Real-World Economics Review

from Paul Davidson Knight and Keynes have very different concepts of uncertainty. Knight believes that uncertainty is epistemological problem where humans do not have the mental ability to see the future even if it actually knowable currently. Keynes argued the future can not be derived from analyzing the past and current relationships. On page 210 of his book Knight writes that the future “universe may not be knowable ,,,[but] objective phenomenon… is certainly knowable to a degree so...

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from Maria Alejandra Madi Throughout the last decades, the nominal interest rate became the dominant monetary policy instrument. Looking backward, the early 1980s proved to be a transition period in terms of monetary policy. After the monetarist experiences of Thatcher and Reagan, there was a pragmatic shift from the supply of the monetary base to the interest rate as monetary policy instrument. The recognition that the control of the monetary base could not only impose extreme volatility...

from Lars Syll We are not going to get out of the economic doldrums as long as we continue to be obsessed with the unreasoned ideological goal of reducing the so-called deficit. The ‘deficit’ is not an economic sin but an economic necessity […] The administration is trying to bring the Titanic into harbor with a canoe paddle, while Congress is arguing over whether to use an oar or a paddle, and the Perot’s and budget balancers seem eager to lash the helm hard-a-starboard towards the...

My name is Greta Thunberg. I am 16 years old. I come from Sweden. And I speak on behalf of future generations. I know many of you don’t want to listen to us – you say we are just children. But we’re only repeating the message of the united climate science. Many of you appear concerned that we are wasting valuable lesson time, but I assure you we will go back to school the moment you start listening to science and give us a future. Is that really too much to ask? In the year 2030 I will...

United States Source: An Economics Sense United Kingdom Source : UK Office for National Statistics France France and United States VOX-FI

Is it possible to model unemployment in neoclassical ‘DSGE’ macro-economic models ? I’m occupied with a project which compares neoclassical macro concepts with statistical macro concepts. One of the glaring differences between the statistics and the models: we measure unemployment as a matter of routine but DSGE-models do not conceptualize or define, let alone operationalize it. When you model our society as a one person ‘Robinson Crusoë’ ‘society’ you will have somebody who works a...

from Lars Syll The real issue … is not whether it is possible to shift a burden (either in the present or in the future) from some people to other people, but whether it is possible by internal borrowing to shift a real burden from the present generation, in the sense of the present economy as a whole, onto a future generation, in the sense of the future economy as a whole … The latter is impossible because a project that uses up resources needs the resources at the time that it uses them...

from Ken Zimmerman Veblen’s “The Theory of the Leisure Class” is even more relevant for events over the last 100 years. But this and most other Veblen research and writing have been systematically buried. Thorstein Veblen’s working life — from 1890 to 1923 — overlapped with America’s first Gilded Age, so named by Mark Twain, whose novel of that title lampooned the greedy corruption of the country’s most leisurely gentlemen (all men). Now, well into America’s second (bigger and better)...