Lars P. Syll

The ultimate takedown​ of teflon-coated defenders of rational expectations James Heckman, winner of the “Nobel Prize” in economics, was inteviewed by John Cassidy in 2010. What about the rational-expectations hypothesis, the other big theory associated with modern Chicago? How does that stack up now? … It became a kind of tautology that had enormously powerful policy implications, in theory. But the fact is, it didn’t have any empirical content. When Tom...

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Courage on display in Paris [embedded content] Courage is not anything very common, and the value we put on it is a witness to its rarity. Courage is a capability to confront fear. Courage is to do the right thing in spite of danger and fear. To keep on even if opportunities to turn back are given. Like in the great stories. The ones where people have lots of chances of turning back — but don’t. Advertisements...

L’Italia verso nuove elezioni Sergio Mattarella non ha accettato che un avversario dichiarato della permamenza dell’Italia all’eurozona, Paolo Savona, diventasse il prossimo ministro delle finanze. Giuseppe Conte, l’uomo che avrebbe dovuto diventare il prossimo presidente del consiglio, ne ha immediatamente preso atto rinunciando alla possibilità di formare un governo. A questo punto è molto probabile che l’Italia vada incontro a nuove elezioni. Dato che...

Diversity bonuses — the idea [embedded content] If you’d like to learn more on the issue, have a look at James Surowiecki’s The Wisdom of Crowds (Anchor Books, 2005) or Scott Page’s The Diversity Bonus (Princeton University Press, 2017). Advertisements

Behavioural economics — still too devoted to ideas it is supposedly attacking Behavioral economics is still ‘in a relationship’ with orthodox economics and, in a relationship, one makes compromises … We all know how stubborn the other side in this relationship is: standard economics will always ‘rationalize’ behavior wherever it can and will only recognize ‘irrationality’ when there is clear and convincing evidence of it. Understandably, behavioral...

Modern division of labour … Advertisements

The follies and fallacies of Chicago​ economics  [embedded content] Advertisements

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Mainstream economics — peddling fake knowledge Based on the [quantity theory of money equation MV = PQ] holding the money velocity constant, if the money supply (M) increases at a faster rate than real economic output (Q), the price level (P) must increase to make up the difference. According to this view, inflation in the U.S. should have been about 31 percent per year between 2008 and 2013, when the money supply grew at an average pace of 33 percent per...