Tag Archives: Economics

Noah Smith’s unicorn defence​ of economics Unlike the old neoclassical theories, game theory concerns strategic interaction between different people. It can encompass things like wage bargaining, fraud and lots of other things that neoclassical equilibrium glosses over or leaves out.  And in game theory, free markets full of rational actors can easily, even regularly, lead to inefficient outcomes that require government intervention. Noah Smith/Bloomberg...

How to be a great economist The master-economist must possess a rare combination of gifts …​ He must be mathematician, historian, statesman, philosopher—in some degree. He must understand symbols and speak in words. He must contemplate the particular, in terms of the general, and touch abstract and concrete in the same flight of thought. He must study the present in the light of the past for the purposes of the future. No part of man’s nature or his...

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I think the two most important microfoundation led innovations in macro have been intertemporal consumption and rational expectations. I have already talked about the former in an earlier post … [s]o let me focus on rational expectations …  [T]he adoption of rational expectations was not the result of some previous empirical failure. Instead it represented, as Lucas said, a consistency axiom … I think macroeconomics today is much better than it was 40 years ago as a result of...

Forgive me, I forgot a title and can’t seem to take back my error…anyway, here’s some reading about the dangers of bad math as it pertains to housing affordability…the upside is that consequences for low-wage workers are less dire than a recent analysis suggests.

[unable to retrieve full-text content]Not to alarm you, but here’s a headline that’s been popping up a bunch:: Forgive me, I forgot a title and can’t seem to take back my error…anyway, here’s some reading about the dangers of bad math as it pertains to housing affordability…the upside is that consequences for low-wage workers are less dire than a recent analysis suggests.

Globalization — a win-lose situation ZEIT ONLINE: Einigen Menschen würde es ohne Globalisierung also besser gehen? Holger Görg: Ja. Das ist das große Problem der Globalisierung. ZEIT ONLINE: Was kann man dagegen tun? Görg: Da sind die Staaten gefordert. Es muss ein soziales Sicherungsnetz geben, das die Menschen auffängt und ihnen ein Einkommen garantiert, wenn sie ihren Job verlieren. So wie in Deutschland und den meisten entwickelten Ländern. Aber das ist...

Contrast explanations in economics For all scholars seriously interested in questions on what makes up a good scientific explanation, Alan Garfinkel’s Forms of Explanation (Yale University Press 1990) is a must-read. A lot of recent work done within different realist schools in theory of science — e.g. Roy Bhaskar, Andrew Collier, Richard W Miller and Tony Lawson — issue not so little from questions and problems posed by Garfinkel. Especially his advocacy...

The Permanent Income Hypothesis Milton Friedman’s Permanent Income Hypothesis (PIH) says that people’s consumption is not affected by short-term fluctuations in incomes since people only spend more money when they think that their lifetime incomes change. Believing Friedman is right, mainstream economists have for decades argued that Keynesian fiscal policies, therefore, are ineffectual. As shown over and over again for the last three decades, empirical...

[unable to retrieve full-text content]What I’ve Been Doing On My Non-Summer Vacation…: some personal news…also about economists fancier than myself don’t worry :)