macroeconomics Archive

An Enabling Macro Fallacy

The eternal short run of sugar hits, fiscal or monetary, so favoured by our policy-makers, is underpinned by a technocratic belief that we can somehow, if we're smart enough, manage our way out of consequences.


Steve Kates at Catallaxy Files and assorted other Austrian-influenced economists have been banging on about how it can be misleading   to drive policy based on the national accounting identity  Y=C+I+G (and extensions). At its most banal the identity implies that – in theory – total income in an economy equals total expenditure. It’s the […]

Nope, It Still Represents Culture

So now some more serious discussion emerges on Israel’s comparative economic performance after Mitt Romney’s culture comment, and Jordan Weissmann in The Atlantic  highlights four concrete reasons behind Israel’s success: Learning from hyperinflationary disaster: …”crafted a grand bargain that slashed government spending, massively devalued the currency, and severed the tie between wages and prices. It […]

Culture Matters: Why Do We Pretend Otherwise?

Another Romney storm in an American teacup. But it’s one that recurs in the world of social policy and economics. Romney made some remarks about culture and prosperity in Israel, comparing the economic effects of Israeli and Palestinian cultures. It may have been a hand-waving generalisation that you wouldn’t accept from a student, but it […]

Tacocopter Takeaway Drone: Regulation Fail, Theory Fail

 Tyler Cowen, and Ryan Avent at Free Exchange write on how difficult it would be for an entrepreneur to get up the idea of a drone takeaway delivery device: the tacocopter. And it wouldn’t be the technology that would stop it, it would be the regulatory, legal, liability, insurance, brand protection and other social and […]

Honest Talk About Academic Factions

Arnold Kling, who blogs at Econlog, has a series of 3 really interesting posts on the state of macroeconomic debate. Not technical and a conversation we really need to have. Read the first, second and third posts. The posts come from a committed perspective and Kling is upfront about that. But its real value is […]

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