by From the abstract: This paper examines several mainstream explanations of the financial crisis and stagnation and the role they attribute to income inequality. Those explanations are contrasted with a structural Keynesian explanation. The role of income inequality differs substantially, giving rise to different policy recommendations. That highlights the critical importance of economic theory. Theory shapes the way we understand the world, thereby shaping how we respond to it. The theoretical narrative we adopt therefore implicitly shapes policy. That observation applies forcefully to the issue of income inequality, the financial crisis a nd stagnation, making it critical we get the story right. Read full paper here.
Topics:
Matias Vernengo considers the following as important: Financial Crisis, inequality, Palley, Secular stagnation
This could be interesting, too:
Matias Vernengo writes Paul Davidson (1930-2024) and Post Keynesian Economics
Matias Vernengo writes The Economist and the American Economy
Robert Skidelsky writes The Roots of Europe’s Immigration Problem – Project Syndicate
Nick Falvo writes Report finds insufficient daytime options for people experiencing homelessness
Read full paper here.This paper examines several mainstream explanations of the financial crisis and stagnation and the role they attribute to income inequality. Those explanations are contrasted with a structural Keynesian explanation. The role of income inequality differs substantially, giving rise to different policy recommendations. That highlights the critical importance of economic theory. Theory shapes the way we understand the world, thereby shaping how we respond to it. The theoretical narrative we adopt therefore implicitly shapes policy. That observation applies forcefully to the issue of income inequality, the financial crisis a nd stagnation, making it critical we get the story right.