Real-World Economics Review

from Dean Baker The idea of industrial policy has taken on almost a mystical quality for many progressives. The idea is that it is somehow new and different from what we had been doing, and if we had been doing industrial policy for the last half-century, everything would be better. This has led to widespread applause on the left for aspects of President Biden’s agenda that can be considered industrial policy, like the CHIPS Act, the Inflation Reduction Act (IRA), and the infrastructure...

from Lars Syll In econometrics one often gets the feeling that many of its practitioners think of it as a kind of automatic inferential machine: input data and out comes causal knowledge. This is like pulling a rabbit from a hat. Great, but as renowned statistician David Freedman had it, first you must put the rabbit in the hat. And this is where assumptions come into the picture. The assumption of imaginary ‘superpopulations’ is one of the many dubious assumptions used in modern...

real-world economics review  Please click here to support this journal and the WEA  Issue no. 10218 December 2022 download whole issue Ecological Economics in Four ParablesHerman Daly          2 The Paradigm in the Iron Mask: Toward an Institutional Ecology of Ecological EconomicsGregory A. Daneke         16  The Towering Problem of Externality-Denying CapitalismDuncan Austin          30  Have We Passed Peak Capitalism?Blair Fix       ...

The EU-commission issued a tweet (below). Another step towards EU statehood. A large one. Since around 1500, access to credit was key for European (later: all) states waging war. The early development of central banks was intertwined with the history of national wars. Look here for the Wikipedia page on the history of the Bank of England -it literally starts with a ‘crushing defeat’ of England by France. Credit was needed to win. Government borrowing had to be enabled by central banks,...

from Lars Syll Post Keynesian authors have offered various classifications of uncertainty … A common distinction is that of epistemological versus ontological uncertainty, with the former depending on the limitations of human reasoning and the latter on the actual nature of social systems … Models of ontological uncertainty tend to hinge on the existence of information that is critical to the decision-making task. Fundamental uncertainty occurs in “situations in which at least some...

from Dean Baker I was having an exchange with an old friend on Mastodon (yes, I’m there now @[email protected]), in which I was arguing that the best way to get alternatives to the current patent system was to have examples of successful drugs developed without relying on patent monopolies. Of course, there are great historical examples, like the development of insulin as a treatment for diabetes or the polio vaccine, but it would be good to have one from the current...

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from Lars Syll Many American undergraduates in Economics interested in doing a Ph.D. are surprised to learn that the first year of an Econ Ph.D. feels much more like entering a Ph.D. in solving mathematical models by hand than it does with learning economics. Typically, there is very little reading or writing involved, but loads and loads of fast algebra is required. Why is it like this? … One reason to use math is that it is easy to use math to trick people. Often, if you make your...