Real-World Economics Review

from Lars Syll A critique yours truly sometimes encounters is that as long as I cannot come up with some own alternative to the failing mainstream theory, I shouldn’t expect people to pay attention. This is however to misunderstand the role of philosophy and methodology of economics! As John Locke wrote in An Essay Concerning Human Understanding: The Commonwealth of Learning is not at this time without Master-Builders, whose mighty Designs, in advancing the Sciences, will leave lasting...

from Mark Weisbrot Here are eight predictions for the coming year, in accordance with a hallowed tradition that I have previously not honored. If some of the supporting facts below seem unfamiliar, it could be because they have not received the attention they deserve. But they are real, and links to sources are provided. First, some good news about the US economy: Inflation will likely continue to fall until it becomes obvious that it is no longer a serious concern. Inflation (as measured...

from Lars Syll • Mind the assumptions — assess uncertainty and sensitivity. • Mind the hubris — complexity can be the enemy of relevance. • Mind the framing — match purpose and context. • Mind the consequences — quantification may backfire. • Mind the unknowns — acknowledge ignorance. Andrea Saltelli, John Kay, Deborah Mayo, Philip B. Stark, et al. Five principles I think modern times “the model is the message” economists would benefit much from pondering. And especially when it comes to...

from Peter Radford Is it just me? Or is the realm of punditry in a state of confusion? There seems to be an emerging consensus that something big is happening.  It’s just that we don’t quite know what.  The problem is that the template we are all applying is frayed if not shattered.  Consequently we are searching for the safety of explanations but finding that our questions do not elicit comfortable answers.  This is not a place we like to inhabit.  What are we to do? Let’s speculate....

from Asad Zaman and the WEA Pedagogy Blog Why does “Sovereign Default” become a hot topic with annoying regularity in Pakistan? The fundamental problem is the huge imbalance between our exports and imports. In 2021, our exports were USD 30 Billion, while our imports were around USD 62 Billion. In general, since 1960 onwards, our imports have averaged about 18%, while exports have been around 12% of the GNP. After reaching a high of 16.9% in 1996, the export ratio has been declining...

from Lars Syll Economics students today are complaining more and more about the way economics is taught. The lack of fundamental diversity — not just path-dependent elaborations of the mainstream canon — and narrowing of the curriculum, dissatisfy econ students all over the world. The frustrating lack of real-world relevance has led many of them to demand the discipline to start developing a more open and pluralistic theoretical and methodological attitude. Dani Rodrik — among economics...