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The monetary policy fallout for developing countries

13 days ago

From C.P. Chandrasekhar and Jayati Ghosh
The monetary policies of the major advanced economies have been obsessively nationalist for more than two decades now, with hardly any genuine international cooperation beyond some coordination among G7 economies. These policies in turn have had all sorts of impacts—often very negative—in the rest of the world, and particularly in the low and middle income countries referred to collectively as emerging and developing economies (EMDEs).
After the Global Financial Crisis, the advanced economies unleashed historically loose monetary policies, with major liquidity expansion and very low or even negative interest rates of their central banks. This enabled and encouraged massive increases in debt both within their own economies and in the rest of the

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new from WEA Books – “Heterodox Economics: Legacy & Prospects”

21 days ago

Kindle edition $5.99   US UK DE FR ES IT NL JP BR CA MX AU IN
paperback $14.99    US UK DE FR ES IT NL PL SE JP CA AU
“The pressing need for alternative approaches in economics that is evident in the wake of the global pandemic, has also signalled an opening of space for the ideas and prescriptions of heterodox economics. This timely volume interrogates the rich diversity of the legacy of the heterodox economics, the institutional context and constraints that determine its influence, while addressing important questions about appropriate and desirable strategies and practices for fostering a vibrant constructive heterodox tradition . . .”
Edited by Lynne Chester & Tae-Hee Jo

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Weekend read – How to be an Academic Hyper-Producer

25 days ago

From Blair Fix 
Are you an aspiring academic? If so, this manual will reveal the secret to maximizing your scholarly output. Follow my advice, and you too can become an academic hyper-producer.

The golden rule: Don’t do research
Newcomers to the academy typically think that the recipe for success is to ‘do high-quality research’. Nothing could be more false. ‘Doing research’ (and writing papers about your ‘results’) is a tedious waste of time. It is no way to be hyper-productive. Savvy academics know that their true goal is to have their name stamped (as author) on stacks of published papers.
Here is a jingle to help you remember the golden rule:

Productive academics neither research nor write,
That is their subordinates’ plight.
To inflate their way up the productivity ramp,

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Weekend read – Can university education in economics contribute to strengthened democracy and peace?

October 21, 2022

From Peter Söderbaum and WEA Commentaries current issue
Introduction
In all societies there is a tension between democracy and dictatorship. In some countries democracy is well institutionalized and the threat of dictatorship is successfully kept at a distance. In other societies, a system close to dictatorship is quite established and democracy is regarded as a threat. Today, we witness a confrontation between Russia, a nation close to dictatorship and Ukraine which appears to move toward strengthened democracy.
In this essay it is assumed that a strengthened democracy is preferable to dictatorship if one aims at a sustainable and peaceful relationship between single nations and regional assemblies of nations. Does the economics taught in universities play a positive role in

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What is money?

October 17, 2022

From Tony Lawson and real-world economics review issue no. 101
What is money?  Two sorts of answer to this question can be found in the modern literature.  One locates money’s nature in the organising structure of human communities, the other in intrinsic properties of particular (money) items (like commodities, debts, precious metals and so on). If accounts of money that draw on social positioning theory are instances of the former, a currently very popular and seemingly increasingly influential version of the latter takes the form of modern money theory (MMT). Notably, however, whilst contributors to social positioning theory have regularly concerned themselves with elaborating explicitly a conception of money’s nature, proponents of MMT rarely address the matter explicitly; mostly

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Neoliberalism as an enabler of the spread of coronavirus

October 14, 2022

From Imad A. Moosa and real-world economics review issue no. 101
The spread of the Coronavirus was aided by unpreparedness, the fact that the private sector cannot deal with a pandemic, neoliberal policy makers who could not care less about ordinary people, and years of dismantling public health systems through privatisation. Since the 1980s, belief in the power of the market has led to a status quo where governments take a back seat, allowing the private sector to steer the economy for the benefit of the oligarchy. As a result, governments have been put in a position where they are not always properly prepared and equipped to deal with crises such as Covid-19. Free markets cannot deal with a crisis of this magnitude. The economy is like the human body: a person who cuts himself

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new issue of real-world economic review

September 22, 2022

Real-world economic review

issue no. 101   –   September 2022download whole issue

Two conceptions of the nature of money Tony Lawson          2
How power shapes our thoughtsAsad Zaman         20
SARS-CoV-2: The Neoliberal VirusImad A. Moosa          27
The giant blunder at the heart of General Equilibrium TheoryPhilip George          38
A life in development economics and political economy: An interview with Jayati GhoshJayati Ghosh and Jamie Morgan          44
John Komlos and the Seven DwarfsJunaid B. Jahangir          65
A three-dimensional production possibility frontier with stressJohn Komlos           76
Free trade theory and reality:
How economists have ignored their own evidence for 100 yearsJeff Ferry          83
The choice of currency and policies for an independent

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WEA Commentaries 

September 6, 2022

WEA CommentariesVolume 12, Issue 2
download the whole issue
Can university education in economics contribute to strengthened democracy and peace? Peter Söderbaum
The Irish anomaly. Rethinking the concept and operationalization of ‘Gross Fixed Capital Formation’ Merijn Knibbe
Benefits of fathers caring for children remain underestimatedin several European contexts Mitja Stefancic
The WEA Textbook Commentaries Project
What’s Capitalism got to do with it? David F Ruccio
Please click here to support the World Economics Association

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Markets are only a sub-set of economic life

August 15, 2022

From Ken Zimmerman  (originally a comment)
Economic life is the activities through which people produce, circulate and consume things, the ways that people and societies secure their subsistence or provision themselves. Activities by which communities sustain themselves. ‘[T]hings’ is, however, an expansive term. It includes material objects, but also the immaterial: labor, services, knowledge and myth, poems, religion, names and charms, and so on. In different times and places, different ones of these will be important resources in society, and when they are important they come within the purview of economic anthropologists. That is, where some economists have identified economic life in terms of the sorts of mental calculus that people use and the decisions that they make (for

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A coherent alternative has to be proposed

August 10, 2022

From Nikolaos Karagiannis and Issue 94 RWER
The practical use of the term “neoliberal” exploded in the 1990s, when it became closely associated with two developments. One of these was financial deregulation, which would culminate in the 2008 financial crash and in the still-lingering euro debacle. The second was economic hyper-globalization, which accelerated thanks to free flows of finance and to new, more ambitious types of trade agreements. Financialization and hyper-globalization have become the most overt manifestations of neoliberalism in today’s world.[1]
That neoliberalism is a highly biased concept does not mean that it is irrelevant or unreal. Who can deny that the world has experienced a decisive shift towards markets from the 1980s on? Or that centre-left politicians –

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The reinjection of empirical ideas

August 1, 2022

“As a mathematical discipline travels far from its empirical source, or still more, if it is a second and third generation only indirectly inspired from ideas coming from ‘reality’, it is beset with very grave dangers. It becomes more and more purely aestheticizing, more and more purely l’art pour l’art. This need not be bad, if the field is surrounded by correlated subjects, which still have closer empirical connections, or if the discipline is under the influence of men with an exceptionally well-developed taste.
But there is a grave danger that the subject will develop along the line of least resistance, that the stream, so far from its source, will separate into a multitude of insignificant branches, and that the discipline will become a disorganized mass of details and

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Book Review by Jayati Ghosh : The journey to greater equality

July 26, 2022

From Jayati Ghosh

Economic inequalities have increased substantially across the world in the past three decades and have deepened during the COVID-19 pandemic. Thomas Piketty and his colleagues at the World Inequality Lab at the Paris School of Economics (PSE), France, have been at the forefront of tracking these changes, providing extremely useful analyses based on careful aggregation of national data on income and wealth inequality from a multitude of sources. They have shown that globally, inequality is now as entrenched as it was during the first part of the 20th century.
Despite this sobering assessment, A Brief History of Equality by Piketty, who is Professor at the École des Hautes Études en Sciences Sociales and the PSE, is, in many ways, an optimistic account of long-term

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What is really going on?

July 21, 2022

Yanis Varoufakis
. . . what is really going on? My answer: A half-century long power play, led by corporations, Wall Street, governments and central banks, has gone badly wrong. As a result, the West’s authorities now face an impossible choice: Push conglomerates and even states into cascading bankruptcies, or allow inflation to go unchecked.
For 50 years, the US economy has sustained the net exports of Europe, Japan, South Korea, then China and other emerging economies, while the lion’s share of those foreigners’ profits rushed to Wall Street in search of higher returns. On the back of this tsunami of capital heading for America, the financiers were building pyramids of private money, such as options and derivatives, to fund the corporations building up a global labyrinth of ports,

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Economics is always ‘political economics’

July 11, 2022

From Peter Söderbaum
Mainstream neoclassical economics is attacked by many and from different angles or vantage points. Neither the defendants nor the critics can claim value-neutrality. “Values are always with us” (Myrdal 1978) and economics is always ‘political economics’. The neoclassical attempt to construct a ‘pure’ economics has failed. Neoclassical theory may still survive as a theory that is specific in scientific and ideological terms and useful for some purposes. But this survival has to be accompanied by the admission that neoclassical theory is built on assumptions that are specific in terms of ethics and ideology and that alternatives to these assumptions exist. The future of neoclassical theory is therefore not only a matter of its usefulness to solve economic problems in

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The magnitude of the required reductions

July 10, 2022

From Ted Trainer
It is not commonly understood how large the reductions would have to be to enable a society that is globally sustainable and just. The World Wildlife Foundation’s Footprint measure (2018) estimates the average Australian per capita use of productive land at 6–8 ha. Thus, if the 9–10 billion people expected to be on earth by 2050 were to live as Australians do now, up to 80 billion ha of productive land would be needed. But there are only about 12 billion ha of productive land on the planet. If one third of it is set aside for nature then each Australian would be living in a way that would require about 10 times as much productive land as all people could ever have. Some other measures taking into account factors such as materials consumption (Wiedmann et al., 2015)

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Weekend read – Danger signals from the crypto casino

July 9, 2022

From C. P. Chandrasekhar
The meltdown in May 2022 in the cryptocurrency world, in which the values of digital coins plunged and rendered some near-worthless, is a wake-up call. It once again shows that cryptocurrencies are nothing but a bunch of insubstantial, digital ‘bits’ created by speculators as ‘coins’ for speculation. Over the years since 2009, when the first bitcoin was minted, privately generated cryptocurrencies have failed to live up to the claim that they offer an alternative to government-backed and regulated fiat currencies. They are hardly used as media of exchange in routine economic transactions. They mainly serve as virtual instruments on which speculators, with money to lose and the time and inclination to gamble, place costly bets. And consequently their ‘value’

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COVID and the broken global order

July 6, 2022

From C. P. Chandrasekhar
When the COVID pandemic affected every one of the world’s nations, the way forward seemed obvious, even if difficult to traverse. Given the rapid spread of the disease and its severity that overwhelmed long neglected health systems, and the cost to lives and livelihoods that shutdowns of economic and social activity implied, quick access to drugs and vaccines to manage the pandemic were crucial. Fortunately, government support for biotech research, in general, and research on new generation vaccines, in particular, had advanced science to some degree. Many developed country governments and some developing country governments were willing to outlay large sums to accelerate further research on and pre-order potential production of any promising drugs and

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real-world economics review issue no. 100

July 4, 2022

Real-world economics review
issue no. 100
download whole issue
Introduction to RWER issue 100          3
Real Science Is Pluralist           issue no. 5 – 2001Edward Fullbrook         5
Is There Anything Worth Keeping in Standard Microeconomics?          issue no. 12 – 2002Bernard Guerrien          11
How Reality Ate Itself: Orthodoxy, Economy & Trust          issue no. 18 – 2003Jamie Morgan          14
What is Neoclassical Economics?         issue no. 6 – 2006Christian Arnsperger and Yanis Varoufakis          20
A financial crisis on top of the ecological crisis: Ending the monopoly of neoclassical economics         issue no. 49 – 2009Peter Söderbaum          30
U.S. “quantitative easing” is fracturing the Global Economy          issue no. 55 – 2010Michael Hudson          41

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University departments of economics are degraded to political propaganda centres.

June 8, 2022

From Peter Soderbaum
Climate change is perhaps the most threatening aspect of the ecological crisis but not the only one. Reduced biological diversity, reduced water availability and deteriorating water quality in some regions exemplify other relevant dimensions. On the financial side, the ‘market mechanism’ has been unable to come up to expectations.
How can these problems be understood? Many factors have certainly contributed but in my judgment neoclassical economics as disciplinary paradigm and neo-liberalism as ideology are among the most important. If actors in society have failed, this can largely be attributed to the mental maps they have used for guidance and these mental maps are largely connected with dominant ideas about economics (as conceptual framework and ideology) and

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Contextual economics

May 30, 2022

From Neva Goodwin
Starting in the early 1990s I have worked with a number of great colleagues to develop a full alternative that we call contextual economics. The name comes from our conviction that an economic system can only be understood when it is seen to operate within a social/psychological context that includes values, ethics, norms, motivations, culture, politics, institutions, and history; and a biophysical context that includes the natural world as well as the built environment.
The starting point for our contextual economics textbooks is an inquiry into goals: What are the appropriate goals for an economy? And, relatedly: What are the appropriate goals for the discipline of economics? Contextual economics emphasizes that most traditionally understood economic goals –

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The useful economist and economic research

May 29, 2022

From James Galbraith
The useful economist
The common characteristic of almost all of this work, excepting a few who preoccupied themselves with logical skirmishes with the neoclassical orthodoxy – e.g., the Cambridge-Cambridge controversies over the theory of capital (Robinson, 1956; Sraffa, 1960; Harcourt, 1972), or in microeconomics (Keen, 2011) – is that the protagonists were concerned, in the first place, with the practical questions of policy facing their governments or the international community of which they were a part. Whether reformist or revolutionary, their economics was (and still is) the elucidation of problems and the means of dealing with them. The purpose of economic reasoning is to inform and buttress political and social choices. It is not merely to create a

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Hazel Henderson obituaries

May 27, 2022

Washington PostGreen EconomyThe Telegraph
Hazel Henderson attacked economics as “politics in disguise” and demanded economists take account of quality of life.   And for two decades she offered moral support for this blog and the Real-World Economic Review.

“The paradigm of sustainability, with its notions of limitations and carrying capacities confronts dominant paradigms of progress which do not recognize limits to unchecked growth.”

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Great and rising inequality

May 23, 2022

From Jamie Morgan
An interest in great inequality and rising inequality have become prominent features of our times. According to Oxfam in 2019 the 26 richest people on the planet had equivalent wealth to the 3.8 billion who comprise the lower 50% of the world population. The previous year it required the top 43 to create this equivalence. The 2020 Oxfam report adds a series of statistical claims: the world’s richest 1% have more than twice the wealth of 6.9 billion of the world’s population, the 22 richest men have more wealth than all the women in Africa (and the estimated value of the unpaid work of women in the world is $10.8 trillion); a report from the Institute for Policy Studies, meanwhile, highlights that US billionaire’s tax obligations as a %  of wealth reduced by 79%

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Ethical criteria which hold the sustainability of life at their core

May 22, 2022

From Fernando García-Quero and Fernando López Castellano
Overconfidence in the magical thinking of technification, economic growth, the free market, and neoliberal globalization has led many to forget that the state is the main policy architect and actor when facing a crisis. Successful responses to Covid-19 have shown, once again, the central role of states in organizing political measures that foster and maintain the welfare of their populations, through actions to guarantee quarantine, social distancing, mobility restrictions, as well as extraordinary support to manage losses related to the economic downturn.
The role adopted by the states and politics in countries’ performances when tackling COVID-19 is very different from the perspectives that dominate the current agenda of

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The Collapse of the India’s creative Industries

May 21, 2022

From Jayati Ghosh
There is no doubt that creative industries, along with care activities, are going to emerge as some of the most significant economic sectors of the future. Broadly speaking, the creative industries consist of advertising, architecture, arts and crafts, design, fashion, film, video, photography, music, performing arts, publishing, research & development, software, computer games, electronic publishing, and TV/radio.
A 2019 report from by UNCTAD (Creative Economy Outlook 2019, Geneva: UNCTAD) notes how these activities are valuable in both cultural and commercial terms. Obviously, they improve human and social well-being, and as expressions of the human imagination, bring joy, meaning and fulfilment to lives. In their finest forms, they can spread important social and

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In economics value-neutrality is an illusion

May 18, 2022

From Peter Söderbaum
I am a professor emeritus with many years of experience of the functioning of university departments of economics and other social science disciplines, such as business management. As has already been made clear I consider the close-to-monopoly position of neoclassical theory at university departments of economics as a major problem in relation to aspirations of sustainable development. The two “facts” that (a) values are necessarily involved in research and education and (b) those employed at university departments of economics live in democratic societies – means that economics (in democratic societies) cannot be reduced to a centre of propaganda for those values that are built into the neoclassical paradigm. A degree of pluralism in education and research

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