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from Dean Baker Several people on my Twitter feed touted the drop in the stock market last month as evidence of the failure of Donald Trump’s economic policy. I responded by pointing out that he was reducing wealth inequality. I was being only half facetious. I have always been less concerned about wealth than income both because I think wealth is less well-defined and because income is the more important determinant of living standards. In the case of the stock market plunge, the vast...

from Lars Syll In a comment on one of yours truly’s posts last week, Jorge Buzaglo wrote this truly interesting comment: Nobel prize winner Richard Feynman on the use of mathematics: “Mathematicians, or people who have very mathematical minds, are often led astray when “studying” economics because they lose sight of the economics. They say: ‘Look, these equations … are all there is to economics; it is admitted by the economists that there is nothing which is not contained in the...

from Lars Syll In his well-written and interesting article The Trouble with Macroeconomics, Paul Romer goes to a ​frontal attack on the theories that have put macroeconomics on a path of ‘intellectual regress’ for three decades now: Macroeconomists got comfortable with the idea that fluctuations in macroeconomic aggregates are caused by imaginary shocks, instead of actions that people take, after Kydland and Prescott (1982) launched the real business cycle (RBC) model … In response to...

from C. P. Chandrasekhar and Jayati Ghosh Figure 1: India has very unequal wealth distribution Source: Credit Suisse Global Wealth Report, 2018. India is often mistakenly seen as a country with relatively low economic inequality. In fact, there were always very significant economic inequalities in India, which intersected with social and locational inequalities in complex ways. More significantly, the country’s inequalities widened after the internal and external economic liberalization...

from David Ruccio Those aren’t my words. The quotation that forms the title of this post is from a recent Federal Reserve Bank of St. Louisblog post. And they’re important to keep in mind in light of the news coverage (e.g., by the New York Times) of last week’s Labor Department report on hiring and unemployment. Yes, 250 thousand jobs were added in the U.S. economy last month and average earnings did rise by 0.2 percent and are up 3.1 percent over the past year.  But. . . The rate of...

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from Lars Syll The belief in the power and necessity of formalizing economic theory mathematically has thus obliterated the distinction between cognitively perceiving and understanding concepts from different domains and mapping them into each other. Whether the age-old problem of the equality between supply and demand should be mathematically formalized as a system of inequalities or equalities is not something that should be decided by mathematical knowledge or convenience. Surely it...

from Shimshon Bichler and Jonathan Nitzan The LA Times called the bluff: William D. Nordhaus won the Nobel prize in economics for a climate model that minimized the cost of rising global temperatures and undermined the need for urgent action. ‘The economics Nobel went to a guy who enabled climate change denial and delay’: It has been a scary month in climate science. Hurricane Michael and a frightening report from the U.N. Intergovernmental Panel on Climate Change underlined the potential...