Real-World Economics Review

from David Ruccio It’s time to get back to blog writing—after a 6-month hiatus during which I taught my final two courses at the University of Notre Dame (A Tale of Two Depressions and Marxian Economic Theory) and prepared for my retirement (which involved, among other things, sorting through, packing up, and moving decades of “stuff”). Now, after 38 years of teaching, I am officially Professor of Economics Emeritus. But, rest assured, I plan to continue this blog and other writing...

from Jason Hickel In a recent Twitter post, Max Roser of Our World In Data claimed that the narrative about rising inequality within countries is incorrect. Inequality has been falling in as many countries as it has been rising, he said, “which should be really embarrassing for many news stories that suggest the opposite with great certainty.” Roser’s tweet referred to an interesting blog post by Joe Hasell, with a graph illustrating the change in the Gini index within countries...

Source: Extreme Carbon Inequality (Oxfam, December 2015)

from Lars Syll As has become abundantly clear during the last couple of years, it is obvious that most mainstream economists seem to think that Modern Monetary Theory is something new that some wild heterodox economic cranks have come up with. That is actually very telling about the total lack of knowledge of their own discipline’s history these modern mainstream guys like Summers, Rogoff and Krugman have. New? Cranks? Reading one of the founders of neoclassical economics, Knut Wicksell,...

from Asad Zaman Previous posts (  MMT Macro Final 1/3 , and  MMT Macro Final 2/3 ) have covered questions 1-4 and 5-8. This post covers the last 4 question of the MMT based  Advanced Macro course I taught last semester at PIDE. The central methodological difference at the heart of my course was the principle of Entanglement: Theories cannot be understood outside their historical context, and history cannot be understood without understanding theories used by human agents to understand and...

from Lars Syll Professors Lucas and Sargent … have a proposal for constructive research that I find hard to talk about sympathetically. They call it equilibrium business cycle theory, and they say very firmly that it is based on two terribly important postulates — optimizing behavior and perpetual market clearing. When you read closely, they seem to regard the postulate of optimizing behavior as self-evident and the postulate of market-clearing behavior as essentially meaningless. I think...

from Ken Zimmerman In 1798, just before the beginning of the industrial revolution in the UK, Robert Malthus published “An Essay on the Principle of Population as it Affects the Future Improvement of Society, with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers.” The thesis for the book was simple. The natural human urge to reproduce increases human population geometrically (1, 2, 4, 16, 32, 64, 128, 256, etc.). However, food supply, at most, can only increase...

from Blair Fix, Jonathan Nitzan and Shimshon Bichler    To reiterate, the base-year problem leads to uncertainty in the calculation of real GDP. But instead of openly reporting this uncertainty, government economists have devised a “fix”. Rather than using a single base year, they “chain” together many adjacent base years. This is a bit like a moving average. They calculate the growth of real GDP between consecutive years, using the first year in each pair as the base, and then “chain”...

There was major economic news this week with the Senate passing a major budget deal that lifts that debt ceiling, and the Fed announcing it will cut interest rates. We rely on the media to tell us what we need to know about how these developments will impact our day to day lives, but the more mainstream outlets tend to give more misinformation than anything else. That’s why we have on our new regular guest, Dean Baker here to help us parse out the facts of what’s happening with...

There was major economic news this week with the Senate passing a major budget deal that lifts that debt ceiling, and the Fed announcing it will cut interest rates. We rely on the media to tell us what we need to know about how these developments will impact our day to day lives, but the more mainstream outlets tend to give more misinformation than anything else. That’s why we have on our new regular guest, Dean Baker here to help us parse out the facts of what’s happening with the economy....