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Fifty years after the assassination of Rev. Dr. Martin Luther King Jr., INET looks back at his forgotten economic legacy. In the final years of his life, these provocative positions made King controversial, and they remain as urgent now as they were then.

In the last years of his life, King was boldly forging a radical, multi-racial movement for economic justice

Bill discusses symbolism of the cross and lynching tree with theologian James Cone.

Cross posted from Thursday, February 28, 2008’s broadcast of Democracy Now!

Mainstream economists have ignored private debt to our peril

INET grantee William Lazonick explains why Sen. Tammy Baldwin is proposing to ban stock buybacks.

Economics can be creative, it can be rigorous, it can be relevant.

The renowned linguist, cognitive scientist, and historian on where we stand as an economy, as a country, and as human beings

The renowned economist reflects on the rise of neoclassical economics, the post-2008 surge of interest in non-mainstream, heterodox thought, and how young economists can remain independent in the face of biased evaluation systems

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What 200 Years of Government Interventions in Financial Markets Can Tell Us

The assumptions economists make in their models have implications not only for policymaking and choosing what data we collect, but also for the very definition of work, says Professor Maria Floro of American University. 

Reflections on the Radical Vision of Martin Luther King Jr.’s Last Major Speech

As the U.S. Congress works to undo financial regulation, INET reflects on the lessons of the Bear Stearns bailout

From the Archives: In the wake of the Bear Stearns bailout in 2008, INET Research Director Tom Ferguson and President Rob Johnson say taxpayers rescuing banks are owed their due: “If the public is going to pay for [bailouts]… it should also get paid back for them.”

Ten years ago, the investment bank Bear Stearns collapsed. Its controversial rescue by the Federal Reserve and JP Morgan Chase marked a prelude to the global financial crisis, which would begin in earnest in September 2008. As part of INET’s look back at the financial crisis, we offer this series of reflections on the Bear Stearns bailout, the financialization of debt, and the moral hazard of government bailouts of banks. 

Unregulated, speculative lending markets nearly brought down the global financial system 10 years ago. Now, Western banks are exporting this failed model to the developing world.

Ten years ago when Bear Stearns crashed, the Fed decided to bail out first, ask questions later. It was a mistake that set a bad precedent.

Banks are pushing for deregulation and roll backs of Dodd-Frank’s regular check-ups on their financial health. We should be worried. 

Mariana Mazzucato argues that the idea that entrepreneurship is confined to the private sector is wrong.

Cuba’s entirely state-owned biopharmaceutical industry has been remarkably successful, and can serve as a model for other nations

One of Wall Street’s favorite tools could be deepening the growing chasm between America’s rich and poor, according to INET grantee William Lazonick.

Despite assembling a formidable data set and leveling a bold argument, Thomas Piketty’s Capital in the Twenty-First Century has theoretical and accounting flaws that distort its central findings

Economist Olugbenga Ajilore shows the high cost of the American government’s arming of local police with military weapons, which has exacerbated lethal use of force against black communities

Workers, innovation, and productivity all suffer when corporations spend their new U.S. tax breaks on stock buybacks.

Why women experts are denied the same scholarly authority conferred to men, and what we should do about it

By pushing workers into precarious, part-time work, “Third Way” governments of the past 20 years helped to create the disturbing economic trend that’s vexing orthodox economists

In the face of  laissez-faire capitalism at home and resurgent nationalism across the globe, INET offers an innovative look at the causes of—and solutions for—the problems that ail a fissuring world economy.

The objective of the conference is to exchange perspectives on the risks posed by financial networks, and the role these networks play in the well-functioning of the real economy. 

Ed Pavlić discusses the role of music in communicating suffering and resistance in the African-American experience

Economist Morton Schapiro, president of Northwestern University, and his colleague, literary critic and Slavic studies scholar Saul Morson, argue that—contrary to popular belief—studying the humanities is the key to not getting outsourced.

INET grantee William Lazonick explains how the Trump tax cut is resulting in buybacks on Wall Street and bonuses for CEOs

France, like many Western European countries, has strong campaign finance laws and a vibrant multiparty system. Yet even there, money has had a corrosive effect on democracy, as private donations have an outsized impact on electoral outcomes.

Money in politics is not a strictly American phenomenon. In France, despite strong campaign finance laws, campaign donations have a direct influence on legislative and municipal election results.

Julia Cagé explains the impact of money on French elections

Banks have long had undue influence in society. But with the rapid expansion of a financial sector that transforms all debts and assets into tradable commodities, we are faced with something far worse: financial markets with an only abstract, inflated, and destabilizing relationship with the real economy. To prevent another crisis, finance must be domesticated and turned into a useful servant of society. 

Contrary to the neoclassical model’s assumptions, shifts in aggregate demand have persistent effects on GDP

The prevailing wisdom that aggregate demand ‘shocks’ determine short-run cyclical fluctuations around a supply-determined equilibrium growth rate and an associated equilibrium unemployment rate (or NAIRU) has been called into question by various streams of literature in the last decades. Specifically, a recently revived literature on hysteresis finds significant persistence in the effects of recessions and negative aggregate demand shocks (Blanchard et al. 2015; Martin et al. 2015).

Over the next year, the Bitcoin price could double, soar tenfold, or collapse by 95% or more, and no economic analysis can help predict where in that range it will lie. Like other cryptocurrencies, Bitcoin serves no useful economic purpose, though in macroeconomic terms, such currencies probably also do little harm.

Nina Banks assesses the legacy of the first African-American economist in the United States

In their op-ed in the Washington Post, INET grantee William Lazonick and Rick Wartzman show how companies are spending their tax savings on investors, not workers.

Learn more about the Commission on Global Economic Transformation

The African Development Bank has laid out a plan for economic prosperity in the continent. But to get there, African countries must first confront jobless growth and underfunded infrastructure projects.

There’s no turning back from humanity’s move to high-density living, says Ed Glaeser. The task of the century will be making cities more liveable.

The corporate titans of yore once offered a sizable wage premium over smaller employers—but not anymore. What happened?

A critical analysis of Piketty’s work

The shocking—but illustrative—example of how an Italian government agency concocted statistics to evaluate scholarship, hid them from the public, and masqueraded them as science. It’s a growing phenomenon

Behind towering figures like Rosa Parks and Martin Luther King, Jr. were the taxi dispatchers, pharmacists, grocers, and other small business owners who were instrumental in making civil rights a reality.

A large literature has detailed the seminal roles played in the Civil Rights Movement by activists, new political organizations, churches, and philanthropies. But black-owned businesses also provided a behind-the-scenes foundation for the movement’s success.

China is now the world’s largest greenhouse-gas emitter, accounting for over 25% of the global total. But the country has also demonstrated a growing understanding that a truly green economy promises to improve quality of life and create enormous opportunities for technological and political leadership.

To get justice, targets must show measurable harm. Economists can help

How did globalization create such discontent in developed and developing countries alike? Nobel laureate and INET grantee Joseph Stiglitz explains in this 150th episode of our “New Economic Thinking” video series.

It wasn’t Comey or the Russians. Trump prevailed because his campaign carefully targeted key states with late infusions of big money from private equity, casinos, and other far right contributors, a remarkable wave of donations from small donors, and substantial infusions from the candidate himself.

The U.S. presidential election of 2016 featured frontal challenges to the political establishments of both parties and perhaps the most shocking election upset in American history.

To get justice, targets must show measurable harm: economists can help.

The renowned feminist economist discusses the importance of heterodoxy, radicalism, and social justice to the discipline

Note: As of March 2019, the Imperfect Knowledge Economics(IKE) Program has been re-launched as the INET Program on Knightian Uncertainty Economics (KUE). Please see the KUE page for updates on this body of work.

Sen. Tammy Baldwin features arguments in questions to SEC nominees, pharmaceutical industry witness

Contrary to conventional wisdom, government stimulus can improve the health of the economy for years after, without inflationary side effects 

Forget the myth of a savings glut causing near-zero interest rates. We have a shortage of aggregate demand, and only public spending and raising wages will change that.

Veiling among Muslim women is modeled as a commitment mechanism that limits temptation to deviate from religious norms of behavior. 

Summers discusses inequality, the GOP tax plan, and our economic future

Servaas Storm’s commentary on the papers presented at the secular stagnation conference.

Inequality isn’t driven by taxes—it’s driven by the power of capital in relation to workers

The past 30 years has witnessed a worldwide decrease in real interest rates. We demonstrate that a large part of the fall in interest rates can be explained by changes in demography, which are as the result of a sudden fall in fertility rates across all of the advanced economies in the early 1970s.

We examine the hypothesis that the slowdown in productivity following the Great Recession was in significant part an endogenous response to the contraction in demand that induced the downturn.

The concern that an economy could experience persistent, and in some sense unusual, weakness goes back to Keynes’s General Theory and led Alvin Hansen to coin the term “secular stagnation.”

This paper shows that aging has positive effect on output growth per capital at positive interest rates, due to capital deepening.

We provide a Keynesian growth theory in which pessimistic expectations can lead to very persistent, or even permanent, slumps characterized by high unemployment and weak growth.

We explore the transmission mechanism of income inequality to output.

I have read the various conference papers and am struck by the fact that many use the (omnipresent New-Keynesian) model of an aggregate loanable funds market to diagnose secular stagnation and investigate possible remedies.

This paper answers fundamental questions that have preoccupied modern economic thought since the 18th century.

Long-term real interest rates across the world are low, having fallen by about 450 basis points (bps) over the past thirty years.

This paper replaces an earlier version of a paper released in 2014 under the title “A Model of Secular Stagnation.”

Distinguished Scholars Including Larry Summers and Adair Turner Present Evidence of the Trend and Policy Solutions