Sunday , August 1 2021
Home / Real-World Economics Review

Real-World Economics Review

The drug companies are killing people

from Dean Baker I get to say this about the drug companies, now that President Biden has said that Facebook is killing people because it was allowing people to use its system to spread lies about the vaccines. There is actually a better case against the drug companies. After all, they are using their government-granted patent monopolies, and their control over technical information about the production of vaccines, to limit the supply of vaccines available to the world. As a result, most...

Read More »

Weekend Read – Econometrics — science based on unwarranted assumptions

from Lars Syll There is first of all the central question of methodology — the logic of applying the method of multiple correlation to unanalysed economic material, which we know to be non-homogeneous through time. If we are dealing with the action of numerically measurable, independent forces, adequately analysed so that we were dealing with independent atomic factors and between them completely comprehensive, acting with fluctuating relative strength on material constant and homogeneous...

Read More »

The concept of homeostasis

from Ken Zimmerman  (originally a comment) On the one side were those who believed that the existing economic system is in the long run self-adjusting, though with creaks and groans and jerks, and interrupted by time-lags, outside interference and mistakes … These economists did not, of course, believe that the system is automatic or immediately self-adjusting, but they did maintain that it has an inherent tendency towards self-adjustment, if it is not interfered with, and if the action...

Read More »

The failure to start from real, concrete questions and issues in the real world

from Gerald Holtham  (originally a comment) The biggest problem, it seems to me, is not the tools that economists use but the failure to start from real, concrete questions and issues in the real world. Someone builds a model of a real situation. It may be useful or not but if it is ingenious it gets published. People then play tunes on the model; they seek to “generalise” it in various ways. We embark on a process of theoretical development for its own sake, increasingly divorced from...

Read More »

Is emerging Asia in retreat?

from C. P Chandrasekhar and Jayati Ghosh International observers still view Asia and particularly East Asia as the most dynamic economic region in the world, a perception that has been even more entrenched over the period of the pandemic. Certainly, if aggregate GDP growth rates in real terms (as shown in Figure 1) are anything to go by, there is no doubt that the region of East Asia has been growing faster than the world as a whole, and has even managed to maintain positive growth in the...

Read More »

Deductivism — the original sin in mainstream economics

from Lars Syll Mathematics, especially through the work of David Hilbert, became increasingly conceived as a practice concerned with formulating systems comprising sets of axioms and their deductive consequences, with these systems in effect taking on a life of their own … The emergence of the axiomatic method removed at a stroke various hitherto insurmountable constraints facing those who would mathematise the discipline of economics … In particular it was no longer regarded as...

Read More »

Weekend Read – Hockey Stick or Growth Illusion?

from Asad Zaman Most economists are committed to Friedman’s methodology which advocates a nominalist philosophy of science. Theories do not aim to discover hidden real structures which explain the observations. Instead, they aim to “save the appearances”: provide a good match to the observations. Although a small minority of voices has advocated a realist methodology – Bhaskar Roy, Peter Manicas, Tony Lawson, and some others – the vast majority remains unconvinced. One important reason...

Read More »

Paul Krugman’s gadget version of Keynesianism

from Lars Syll Paul Krugman has often been criticized by people like yours truly for getting things pretty wrong on  the economics of  John Maynard Keynes. When Krugman has responded to the critique, by himself rather gratuitously portrayed as about “What Keynes Really Meant,” the overall conclusion is — “Krugman Doesn’t Care.” Responding to a post up here on this blog, Krugman writes: Surely we don’t want to do economics via textual analysis of the masters. The questions one should ask...

Read More »

‘Bidenomics’: Evolution or Revolution?

Does President Biden’s economic agenda represent a new progressive era in the U.S.? Goldman Sachs Research’s Allison Nathan discusses how big of a shift in U.S. economic policy Bidenomics truly represents and the implications for the economy with David Brady, professor at the Stanford Graduate School of Business; Jason Furman, professor at the Harvard Kennedy School; and Dean Baker, co-founder of the Center for Economic Policy Research. For more episodes of “Exchanges at...

Read More »

Job growth under Biden and Trump

from Dean Baker Yes, it is that time of month again. As I always say, this sort of comparison is silly, since there are so many factors determining job growth that have nothing to do with the person in the White House. But, we all know that Trump and the Republicans would be touting this to the sky if the shoe were on the other foot. So, here’s the latest, the economy has created more than 3 million jobs in the first five months of the Biden administration. It lost almost 2.9 million...

Read More »