Tag Archives: Uncategorized

from Robert Locke As an historian, I am somewhat appalled at the inability of economists, including those on this blog to get the history of their own discipline straight.  The obsession has been with neoclassical economic’s attempt to turn economics into a physico-mathematical discipline as Walras phrased it, and the economists usually discuss this attempt within the historical context of their discipline pre-1945, with references, to  Walras, Marshall, Keynes, and others. It  became...

It’s been over a week now since I challenged the authors of 5 business-friendly economic reports to a friendly wager over the future trajectory of employment in provinces that are raising their minimum wage to $15 per hour.  The challenge was issued in my Globe and Mail column of October 3. I was responding to the several business groups and business-funded think tanks that had issued several reports predicting job losses from the higher minimum wage, in the run-up to the coming vote in the...

from Mark Weisbrot The International Monetary Fund (IMF) released its biannual “World Economic Outlook” (WEO) today, presenting a 300-page overview of the world economy and where it might be going. The Fund is one of the most powerful and influential financial institutions in the world. Despite the fact that this flagship publication, and the Fund’s hundreds of PhD economists, missed the two biggest asset bubbles in US and world history (the stock market bubble in the late 1990s and the...

from Lars Syll To-day, in many parts of the world, it is the serious embarrassment of the banks which is the cause of our gravest concern … [The banks] stand between the real borrower and the real lender. They have given their guarantee to the real lender; and this guarantee is only good if the money value of the asset belonging to the real borrower is worth the money which has been advanced on it. It is for this reason that a decline in money values so severe as that which we are now...

from Dean Baker Since the dawn of time men have married into prominent families as a way to improve their career prospects, but as Jared Kushner can attest, the returns to marrying well have never been greater. We may see further proof of this proposition if Donald Trump selects Kevin Warsh to replace Janet Yellen as chair of the Federal Reserve Board. Like Kushner, Warsh’s secret to success seems to rest largely on the family he married into. Warsh’s father-in-law is the billionaire...

from David Ruccio Lots of folks have been asking me about the significance of the so-called Nobel Prize in economics that was awarded yesterday to Richard Thaler. They’re interested because they’ve read or heard about the large catalog of exceptions to the usual neoclassical rule of rational decision-making that has been compiled by Thaler and other behavioral economists. One of my favorites is the “ultimatum game,” in which a player proposes an allocation of an endowment (say $5) and the...

I read this as weakening demand and employers unwilling to pay up to hire, and maybe even posting openings to replace existing workers at lower wages: Highlights Job openings held steady at a very abundant 6.082 million in August while hirings remained far behind, at 5.430 million. In an early indication of full employment, the gap between openings and hiring first opened up about 2-1/2 years ago signaling that employers are either not willing to offer high enough pay to...

from Asad Zaman At the heart of modern economic theory is the micro-economic model of homo economicus, who is cold, calculating and callous. This picture of humans as heartless rational robots is what leads to “Poisoning the Well: How Economic Theory damages our moral imagination” (Julie Nelson). I have provided a thorough critique of neoclassical utility theory in my paper:  The Empirical Evidence Against Neoclassical Utility Theory: A Review of the Literature,” International Journal of...

from Maria Alejandra Madi The concept of nudge became popular after the publication of the 2008 book Nudge: Improving decisions about health, wealth, and happiness, written by Cass Sunstein and the most recent Nobel Laureate, Richard Thaler.  According to the authors, nudge refers to “any aspect of the choice architecture that alters people’s behavior in a predictable way without forbidding any options or significantly changing their economic incentives. To count as a mere nudge, the...