Real-World Economics Review

from Maria Alejandra and WEA Pedagogy Blog Jean-Baptiste Fressoz, professor at the School of Advanced Studies in Social Sciences in Paris, challenges our understanding of the current energy transition process. In his book “The Shock of the Anthropocene: The Earth, History, and Us,” co-authored with Christophe Bonneuil, Fressoz offers a critical history of the Anthropocene, the current geological epoch defined by significant human impact on Earth’s geology and ecosystems. The authors...

from C. P. Chandrasekhar and Jayati Ghosh The latest World Employment and Social Outlook Report (update for September 2024) from the International Labour Organisation highlights some disturbing trends. Importantly, it identifies a significant decline and then stagnation in the share of labour income in GDP, for the world as a whole, in the past few years. This comes as part of a persistent trend of decline in labour income shares, other than spikes in “crisis years” like 2008-10 and...

from Asad Zaman and WEA Pedagogy Blog 1. The Methodenstreit: How Economics Forgot History In the late 19th century, economics experienced a deep philosophical debate over methodology, known as the Methodenstreit, or Battle of Methodologies. Geoffrey Hodgson, in his book How Economics Forgot History, emphasizes the critical nature of this debate. The essential conflict was between those who believed that historical context and specificity are crucial for understanding economic phenomena,...

from Maria Alejandra and WEA Pedagogy Blog Setting the scene Economists and policymakers continue to dominate headlines with the conceptualization of “sustainability,” “sustainable investing,” and “sustainable finance,” along with their various worldwide geographical manifestations. The prevailing scenario, which is characterized by conflict, economic instability, and political disputes, is not favorable to incorporating sustainability into investment decisions. However, pressing...

In Europe (the Euro area, to be precise), both unemployment and inflation are down, according to Eurostat,. Which, again, shows that the Phillips curve, a crucial concept behind neoclassical macroeconomic thinking that assumes a more or less stable negative relation between unemployment and inflation (high unemployment will bring inflation down), is not the place to go when predicting or analysing inflation. Sometimes, this relation is specified as a relation between wage increases and...

from Lars Syll The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 2024 is awarded to Daron Acemoglu, Simon Johnson and James Robinson “for studies of how institutions are formed and affect prosperity.”  Daron Acemoglu and James Robinson’s work, particularly in Why Nations Fail (2012), is widely recognized within new institutional economics for its argument that inclusive political and economic institutions are key determinants of long-run prosperity and...

The end of the post-World War II ´Pax Americana, an almost eighty-year period of peace for European countries allied with the USA, will soon lead the EU to end the prohibition of monetary financing of governments by the European Central Bank (ECB). This might take the shape of the ECB providing credit to an entity purchasing Eurobonds, which will further increases military spending. At this moment, there is based on the Maastricht treaty of 1992 a strict prohibition of monetary financing...

from Dean Baker It is more than a bit bizarre reading pieces that talk about automation or job-killing AI as something new and alien. These are forms of productivity growth. They allow more goods and services to be produced for each hour of human labor. Productivity growth is usually thought of as a good thing. It’s the reason that we don’t have half the U.S. workforce employed in agriculture growing our food. Instead, it is around 1.0 percent of the U.S. workforce, and we grow enough to...

from Peter Radford “Mathematics is the art of the perfect.  Physics is the art of the optimal.  Biology, because of evolution, is the art of the satisfactory”. That’s Sydney Brenner speaking.  He should know a thing or two.  He won a Nobel Prize. It’s a shame, is it not?  Economies are always changing.  Not just in terms of innovation and all the normal things we think of as change, but also in more simple terms: in the people making up an economy change.  They are born and they die.  And...