Lars P. Syll

Macroeconomics — religion or science? Macroeconomists build theories codified by systems of equations. We use those equations to explain patterns in economic data. Unlike experimental sciences, chemistry and physics for example, macroeconomists cannot easily experiment. That does not mean that we cannot challenge existing theories, but it makes it much harder. Like astronomers waiting for the next supernova to explode; macroeconomists must wait for big...

Big — and not so big — ideas in macroeconomics In Athreya’s world, and that of a large part of the academic macroeconomics profession, macroeconomics does indeed begin with Walras, and the first modern development in the field was the formalization of Walras’ model by the economic theorists Arrow, Debreu and MacKenzie in the 1950s. The big subsequent development is the integration of growth theory into the static ADM framework to generate the modern dynamic...

The ‘tiny little problem’ with Chicago economics Every dollar of increased government spending must correspond to one less dollar of private spending. Jobs created by stimulus spending are offset by jobs lost from the decline in private spending. We can build roads instead of factories, but fiscal stimulus can’t help us to build more of both. This form of “crowding out” is just accounting, and doesn’t rest on any perceptions or behavioral assumptions. John...

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Rumour has it that yours truly is celebrating his 60th birthday visiting​ his favourite town. Regular blogging to be resumed next week.  [embedded content] div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

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When economists become as modest as the physicists In advanced economics the question would be: ‘What besides mathematics should be in an economics lecture?’ In physics the familiar spirit is Archimedes the experimenter. But in economics, as in mathematics itself, it is theorem-proving Euclid who paces the halls … Economics … has become a mathematical game. The science has been drained out of economics, replaced by a Nintendo game of assumption-making …...

Blott en dag (personal) [embedded content] Kämpen, folkbildaren och vännen Hans Mannefred tillägnad. div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

At last — the cause of Christmas has been discovered Every schoolboy knows that cash in the hands of the public regularly shoots up at Christmas, goes down in January and shoots up again around the summer bank holiday. Nobody would suggest (not even Professor Friedman, I believe) that the increase in note circulation in December is the cause of the Christmas buying spree. But there is the question that is more relevant to the Friedman thesis: Could the...