Kingston Masters Political Economy 05: Neoclassical Growth theory, RBC & DSGE models
Steve Keen
November 7, 2018
Steve Keen's Debt Watch
Summary:
(This is an incomplete lecture due to a lack of time to prepare it: what I should have spent 2 months preparing I had to do in 2 weeks–while also moving house. Hopefully I’ll find the time to complete it when writing next year’s lectures.) I cover the reasons why the Neoclassical growth model–on which ...
Topics:
Steve Keen considers the following as important:
This could be interesting, too:
Lars Pålsson Syll writes I am I said
Lars Pålsson Syll writes The non-existence of economic laws
Lars Pålsson Syll writes The non-existence of economic laws
Michael Hudson writes Gaza – Civilization will Win over Barbarism
(This is an incomplete lecture due to a lack of time to prepare it: what I should have spent 2 months preparing I had to do in 2 weeks–while also moving house. Hopefully I’ll find the time to complete it when writing next year’s lectures.)
I cover the reasons why the Neoclassical growth model–on which both RBC (Real Business Cycle) and DSGE (Dynamic Stochastic General Equilibrium) models are based–has an unstable equilibrium. Given their Neoclassical fetish for seeing stable equilibrium everywhere, this was not at all the mathematical result they would have wanted.
But as usual they turned failure into a virtue by developing the idea of “jump” variables in dynamic systems, not worrying that this jump relied upon consumers having the combined wisdom of Solomon and Nostradamus. |
|
|
|
2018-11-07