Click Bait Monetary Economics

25 August 2015

Some economic commentators, in trying to point out the importance of government deficits and debt, go for the overkill. Exhibit: Accounting: bank lending doesn't increase aggr HH net worth. +HH assets, +HH liabs. Gov def spending does. — Steve Roth (@asymptosis) August 23, 2015 Sorry for picking Steve Roth, who is generally a nice person. […]


Economists Can Be So Wrong

14 August 2015

Oh boy! Krugman could not have been more wrong about Macroeconomics than what he said recently in his blog The Conscience Of A Liberal for The New York Times. In a blog post, Competitiveness And Class Warfare, he concludes: International competition is a mostly bogus notion; … In a sense it is not surprising. Paul Krugman has done […]


Federal Government And Regional Balance Of Payments

25 July 2015

The Financial Times has a column titled Europe’s Fiscal Union Envy Is Misguided. The author echoes a recent article in The New York Times (referred here in my blog). According to the FT columnist, in the United States, … The bulk of the risk-sharing happens through credit and capital markets – that is to say, private lending, borrowing and investment returns do […]


Ben Bernanke Embracing Heterodox Ideas

18 July 2015

It’s remarkable how some economists were ahead of the time, while others such as Ben Bernanke seem to just catch up. In a recent post on his blog Ben Bernanke gives out some unorthodox ideas to resolve the Euro Area crisis. Ben Bernanke says: … Germany’s large trade surplus puts all the burden of adjustment on countries […]


Is A Fiscal Union Expensive For Its Rich Members?

10 July 2015

Josh Barro writing for The New York Times claims that a fiscal union for the Euro Area will be an enourmous expense for its rich members. Fiscal union would fix the euro permanently — but at enormous expense to its rich members. So it won't happen. — Josh Barro (@jbarro) July 10, 2015 He cites […]


Thomas Palley On Competing Stories On Inequality, The Financial Crisis And Stagnation

11 June 2015

Thomas Palley has a new paper Inequality, The Financial Crisis And Stagnation: Competing Stories And Why They Matter. Abstract: This paper examines several mainstream explanations of the financial crisis and stagnation and the role they attribute to income inequality. Those explanations are contrasted with a structural Keynesian explanation. The role of income inequality differs substantially, giving rise to […]


Kaldor’s Vision Of The Growth And Development Process According To Thirlwall

25 May 2015

Anthony Thirlwall’s new book Essays on Keynesian and Kaldorian Economics is out. It has a nice chapter (chapter 11) originally written by Thirlwall himself from 1991 titled Kaldor’s Vision Of The Growth And Development Process. The description from introduction (pdf from Palgrave’s website) is a good summary: Essay 11 outlines Kaldor’s vision of the growth and development process […]


On Matters Of Macroeconomics, Even A Beautiful Mind Can Go Astray

25 May 2015

John Nash died on Saturday in New Jersey. Via the blog Econospeak, I came across a 2005 talk titled Ideal Money and Asymptotically Ideal Money by John Nash about money and macroeconomics. pdf here and a news report here. Nash starts his lecture straightaway by dismissing Keynesian economics: The special commodity or medium that we […]


Krugman And Causality

17 May 2015

In a recent post titled Money, Inflation And Models for his NYT blog, Paul Krugman clearly states that “normal equilibrium macro models” say that the direction of causality is from money to prices. Krugman says: Consider the relationship between the monetary base — bank reserves plus currency in circulation — and the price level. Normal equilibrium macro models say […]


Fiscal Conservatism, Weak International Trade Performance And Income Inequality Not Good For The U.S. Economy

15 May 2015

The US economy is only 8.8 percent above the pre-crisis peak. The Levy Institute has a new Strategic Analysis publication titled Fiscal Austerity, Dollar Appreciation, And Maldistribution Will Derail The US Economy in which they identity three main structural characteristics of the economy of the United States that stand in the way of the recovery: (1) […]