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Naked Keynesianism

Microfinance, Financial Inclusion,and the Rhetoric of Reaction

This paper was published by Latin American Policy last year, co-authored by my ex-student Carlos Schönerwald Silva. From the abstract: Several political and academic circles have considered microfinance to be an important tool to promote economic development and the reduction of poverty. It became a worldwide phenomenon, and the practice disseminated in many developing countries such as Brazil. Even as many authors sing the praises of microfinance—in particular the success in developing...

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Has this happened before?

So I have discussed this before. The idea that the Great Depression bears a resemblance to the Great Recession, in that in both cases income inequality increased in the previous period, and went hand in hand with debt accumulation. I cited the Barba and Pivetti paper for the more recent event, and the work by my student Ahmad Borazan on the previous case (see also this post). Now I've been reading Matthew Drennan's book on Income Inequality, and he shows the following figure. In the same...

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Heterodox, Trespasser, Malthusian and other economist labels

I discussed long ago what it means to be heterodox in economics. Bob Kuttner, who I once saw giving a talk at the New School (in the 1990s), a very sharp journalist that knows quite a bit about economics, sings the praises of Dani Rodrik as an heterodox economist. I discussed Rodrik before, in particular his notion that there is only one economics (neoclassical, of course as in the title of his book One Economics, Many Recipes). And he is not subtle about it either. As I noted back then, in...

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On the blogs

Introduction to Economics and Global Capitalism Syllabus -- Mike Isaacson's syllabus, with no textbook. Good choice The U.S. Tax Code Actually Doesn’t “Soak the Rich” -- Nick Buffi at the CEPR blog. I sort of discussed that here Three reasons we’re not yet at full employment -- Jared Bernstein. He's right

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On the AS/AD model and the micro/macro relation

I promised to discuss Nick Rowe's claim that one must start with Aggregate Demand and Supply (AS/AD) to explain macroeconomics. Nick's argument is that the AS/AD model is useful to analyze monetary economies, and he quite correctly points out that money must be part of the discussion from the start. In his words: And if you don't start with money, monetary exchange, and AD and AS, you are doing macro wrong. Because the only thing that makes macro different from micro general equilibrium...

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On the blogs

Why Did Latin American Import Substitution Industrialisation Run into Serious Problems by 1970s/1980s? -- Lord Keynes provides a summary of Erik Reinert views. If he is accurate, I have a lot of problems with Reinert's views, btw (perhaps more on that in a post) Scarce workers? -- In which David Ruccio says workers are abundant and that's why wages have been growing slowly. I think pay goes beyond scarcity/abundance, but he is not wrong on the state of the labor market Post Keynesian...

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Higher education and social mobility

The New York Times had a while ago a whole piece on Chetty, Saez and co-authors about the lack of capital mobility in the US. No surprises really. Turns out that universities can increase social mobility. The problem is that universities don't do enough. Bucknell actually has considerably more students from the 1% than from the bottom fifth. One way to increase social mobility would be to expand the scholarships to low income students. Somehow I doubt that the guy from Trump University...

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Beware of Trump’s appointees

No, not to the SCOTUS position. I'll leave that for more qualified analysts. I'm just saying that it seems that Trump will appoint more hawkish appointees for the two vacancies on the Fed’s Board of Governors, which are part of the FOMC, that decided monetary policy (the other 5 are the Governor of the NY Fed, and governors of the rotating member banks). It seems that Trump wants higher interest rates, even if that contradicts his rhetoric about the dollar being appreciated and hurting...

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