Inequality as a cause of the financial crisis and current account imbalances

Thomas Piketty’s Capital in the 21st Century has spurred an intense debate over the macroeconomic causes of income and wealth inequality. Meanwhile, a growing amount of research suggests that inequality itself is an important cause of macroeconomic instability.

In the short interview with Deutsche Welle, Institute grantee Till van Treeck explains how inequality can contribute to macroeconomic instability.

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Eric Weinstein: Economic Thinking In A Fallible World

By Marshall Auerback

The philosopher Karl Popper argued that we cannot know empirical truths with absolute certainty.

According to Popper, even scientific laws can’t be verified beyond a shadow of a doubt. They can only be falsified by testing. One failed test is enough to falsify, but no amount of conforming instances are sufficient to verify. Scientific laws are hypothetical in character and their truth remains subject to testing. Ideologies that claim to be in possession of the ultimate truth are making a false claim; therefore, they can be imposed on society only by force.  Read more

Thoughts On Skidelsky's Rant Against The Current Economics Curriculum

Originally posted on Brad DeLong's Grasping RealityJune 18, 2014

The extremely wise Robert Skidelsky has an excellent rant against Anglo-Saxon economics departments:

Robert Skidesky: Knocking the scientific halo off mainstream economists' teaching and research: "The growing discontent of economics students...

Andy Haldane: Preparing For The Next Financial Crisis

By Marshall Auerback
The days of “the great moderation” are over, if they ever existed in the first place.  

Lifetime Achievement Award for Prof. Sir David Hendry

One of the world's leading economists, INET Oxford's Prof. Sir David Hendry received a unique award from the Economic and Social Research Council (ESRC)

At a ceremony June 6th he was given the Celebrating Impact Lifetime Achievement Award. Sir David is Professor of Economics at the University of Oxford and Director of the Programme in Economic Modelling in the Institute for New Economic Thinking at the Oxford Martin School (INET Oxford).

Simon Head: Innovation And Its Potential To Damage Society

By Marshall Auerback

The benefits of innovation are seldom questioned.  Virtually every single growth initiative formulated by governments around the world to deal with today's challenging economic conditions invariably circles back to the need to promote innovation as a panacea.  

But what if innovation is not an unalloyed good for society?  What if it simply adds to our current dystopian dysfunction?   Read more

David Cay Johnston: The Perils Of Our Growing Inequality

Institute President Rob Johnson interviews David Cay Johnston about his new book, Divided: The Perils of Our Growing Inequality.

Piketty Responds in Detail to FT Criticism

Thomas Piketty has written a detailed response to the critique of his work by the Financial Times. His full response is available here and the first few paragraphs are below.

Full Disclosure: The Institute for New Economic Thinking has extensively supported the World Top Incomes Database on which Piketty’s book Capital in the 21st Century draws extensively. Read more