Tag Archives: Economics

Guest post by Jeff Mosenkis of Innovations for Poverty Action. A Red Cross pamphlet from WWI slogan (at the bottom): “Millions for Relief, but Not One Cent for Administration” In a surprise ruling a few hours ago the Kenyan Supreme Court voided the outcome of the recent election, calling for a new one within 60 days. The Nairobi stock market dropped 10 percent right away, triggering a brief halt in trading. Follow Ken Opalo for the latest (and just in general). Here’s one way to cut through...

Guest post by Jeff Mosenkis of Innovations for Poverty Action. A Red Cross pamphlet from WWI slogan (at the bottom): “Millions for Relief, but Not One Cent for Administration” In a surprise ruling a few hours ago the Kenyan Supreme Court voided the outcome of the recent election, calling for a new one within 60 days. The Nairobi stock market dropped 10 percent right away, triggering a brief halt in trading. Follow Ken Opalo for the latest (and just in general). Here’s one way to cut through...

Guest post by Jeff Mosenkis of Innovations for Poverty Action. A Red Cross pamphlet from WWI slogan (at the bottom): “Millions for Relief, but Not One Cent for Administration” In a surprise ruling a few hours ago the Kenyan Supreme Court voided the outcome of the recent election, calling for a new one within 60 days. The Nairobi stock market dropped 10 percent right away, triggering a brief halt in trading. Follow Ken Opalo for the latest (and just in general). Here’s one way to cut...

Economics — nothing but an ideological paranoia  [embedded content] Economists have a tendency to get enthralled by their theories and models ​and forget that behind the figures and abstractions there is a real world with real people. Real people that have to pay dearly for fundamentally flawed doctrines and recommendations. Let’s make sure the consequences will rest on the conscience of those economists. div{float:left;margin-right:10px;}...

The eminently quotable Robert Solow says it all: To get right down to it, I suspect that the attempt to construct economics as an axiomatically based hard science is doomed to fail. There are many partially overlapping reasons for believing this … A modern economy is a very complicated system. Since we cannot conduct controlled on its smaller parts, or even observe them in isolation, the classical hard- science devices for discriminating between competing hypotheses are closed...

Does competition really eliminate bad bosses? But what of the argument that competition eventually eliminates bad bosses? True, it does sometimes; the relatively egalitarian John Lewis Partnership has done better than department stores such as House of Fraser or Debenhams, for example. But market forces are weak (and perhaps getting weaker). One reason for this is simply state intervention; without this, almost all shareholder-owned banks with their...

Revealed preference theory — much fuss about ‘not very much’ We must learn WHY the argument for revealed preference, which deceived Samuelson, is wrong. As per standard positivist ideas, preferences are internal to the heart and unobservable; hence they cannot be used in scientific theories. So Samuelson came up with the idea of using the observable Choices – unobservable preferences are revealed by observable choices … Yet the basic argument is wrong; one...

On the limits of game theory  [embedded content] Back in 1991, when yours truly earned his first PhD​ with a dissertation on decision making and rationality in social choice theory and game theory, I concluded that “repeatedly it seems as though mathematical tractability and elegance — rather than realism and relevance — have been the most applied guidelines for the behavioural assumptions being made. On a political and social level, ​it is doubtful if the...

Abba Lerner and functional finance According to Abba Lerner, the purpose of public debt is “to achieve a rate of interest which results in the most desirable level of investment.” He also maintained that an application of Functional Finance will have a tendency to balance the budget in the long run: Finally, there is no reason for assuming that, as a result of the continued application of Functional Finance to maintain full employment, the government must...

The balanced budget mythology I think there is an element of truth in the view that the superstition that the budget must be balanced at all times [is necessary]. Once it is debunked, [it] takes away one of the bulwarks that every society must have against expenditure out of control. There must be discipline in the allocation of resources or you will have anarchistic chaos and inefficiency. And one of the functions of old fashioned religion was to scare...