Tag Archives: Methodology of Economics

I happen to think the minimum wage in the United States should be raised. I'll go along with the consensus of $15 an hour. I also happen to know that, even under ideal conditions, wages and employment cannot be explained by supply and demand. Some economists, who I no (other) reason to disrespect, seem to think my true statement about labor economics can be discredited by attacking my motivations. So they point out how, under (incoherent) neoclassical theory, higher minimum wages can...

Or, rather, I classify economists into two kinds on each of three dimensions (Table 1). Table 1: Classifications For Economists Emphasis on social reproductionEmphasis on allocating scarce resourcesMoney non-neutralMoney as a veilEconomic issues arise under competitive model, with all agents in possession of all information actually existingEconomic issues to be explained as a result of deviation from an ideal, competitive model I have written about the first dimension before. Classical...

I present four claims about Marx's Capital. I strive for topics more general than, for example, squabbles about the transformation problem. I suggest that some of these claims present a useful focus for reading Marx's book, even if part of your focus is arguing why the claim is wrong. If this were more than a blog post, I would need to cite various Marxists and scholars that inspired me. Thesis I: Capital is organized around a model of a pure, two-class capitalist economy. I think the...

Whether or not the government should intervene in the economy is a false choice. Government and the economy are not too separate and non-intertwined entities. The standard introductory graduate microeconomics textbook now current was written by Mas-Colell, Whinston, and Green. This happens to be from Chapter 15, in the part on the Edgeworth box: "We can now verify a simple but important fact: Any Walrasian equilibrium allocation ... necessarily belongs to the Pareto set... Thus, at any...

Hilary Putnam has long argued that facts and values, or ends and means, cannot be neatly separated. In 1981 he proposed a thought experiment, I assume not to be of contemporary political relevance: What troubled us earlier was that we did not see how to argue that the hypothetical 'perfectly rational Nazi' had irrational ends. Perhaps the problem is this: that we identified too simply the question of the rationality of the Nazi (as someone who has a world view or views) with the...

The Financial Times is having a debate about whether economics has failed. The first interchange is here, with some followups here. (I happen to have two tabs about neoliberalism open at the moment as well.) Mainstream economics is a failure in so many dimensions that its failure cannot be characterized shortly in any comprehensive way. For example, I am not going to discuss funding sources and economics role as a system justification. Even so, you might find this post long and...

Howard Reed argues we should rip up textbooks for mainstream economics and start over. (Some of what he says echoes an argument of mine.) I do not think Diane Coyle addresses Reed's points. Cahal Moran argues the problem is economics, not economists. Beatrice Cherrier has some frankly speculative posts on what limitations economists accepted in emphasizing tractability in developing models. Nathan Robinson does not like the word "neoliberalism", but understands there is a point to using it....

For the purposes of this very simplified and schematic post, I present the CCC as having two sides. Views and achievements of Cambridge (UK) critics: Joan Robinson's argument for models set in historical time, not logical time. Mathematical results in comparing long-run positions: Reswitching. Capital reversing. Empirical results and applications. Rediscovery of the logic of the Classical theory of value and distribution. Arguments about the role that a given quantity of capital plays in...