Archive
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Article
Is The Weak Axiom of Revealed Preference Falsifiable?
Oct 12, 2012
MWG introduces the theory of consumer behavior by presenting two distinct approaches to modeling consumer behavior, the preference-based approach (based upon unobservable preferences generating a utility function) and the choice-based approach (based upon observable choice behavior), and attempting to establish connections between the two.
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Article
Andy Haldane asks: What have the economists ever done for us?
Oct 9, 2012
What makes a good model?
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News
Are the dollar’s days as a reserve currency numbered?
Oct 8, 2012
a lack of US growth may lead to a fall in the dollar’s popularity, and the result could be a global liquidity shortage.
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Article
Some Considerations on ‘Rationality’
Oct 5, 2012
In this post, I would like to explore the views of preferences and behavior outlined in MWG Ch.1, and specifically the view of rationality developed in this first chapter.
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Video
Breaking the Climate Change Stalemate
Oct 2, 2012
Climate change policy is caught in a stalemate between those who fear the environmental consequences of not doing enough and those who fear the economic consequences of overreacting. But controversy over the extent and sources of climate change need not stand in the way of a positive economic policy response.
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Article
Ring-fencing Explained
Oct 2, 2012
Everyone wants to ring-fence something, but they can’t agree on what: Vickers, Liikanen, Volcker.
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Article
Ring-fencing Explained
Oct 2, 2012
Everyone wants to ring-fence something, but they can’t agree on what:
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Working Paper
Grantee paperFat-Tail Distributions and Business-Cycle Models
Sep 2012
Recent empirical findings suggest that macroeconomic variables are seldom normally distributed.
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Working Paper
Grantee paperThe Pricing Effects of Ambiguous Private Information
Sep 2012
Ambiguous private information leads to informational inefficiency of asset prices in rational expectations equilibrium.
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Working Paper
Grantee paperChartbook of Economic Inequality: 25 Countries 1911-2010
Sep 2012
The purpose of this Chartbook is to present a summary of evidence about changes in economic inequality – primarily income, earnings, and wealth – for 25 countries covering a 100 year period from 1911 to 2010.
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News
Are Eurobonds Necessary?
Sep 29, 2012
A Response to the INET Euro Council Report
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News
INET Council Member Expresses Shock at Financial “Betrayal” in Europ
Sep 28, 2012
Euro Crisis Report
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Article
Situating Microeconomics
Sep 26, 2012
In this initial blog post we wish to situate microeconomics as a field of social enquiry.
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Article
What About the Questions That Economics Can’t Answer?
Sep 24, 2012
Can economics be morally centered? And perhaps more importantly, should it be?
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Article
Welcome to Reading Mas-Colell!
Sep 24, 2012
The blog is intended for any student taking an advanced microeconomics course, any faculty member teaching such material, or indeed anyone interested in microeconomics and its role in the discipline.
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Article
The use of economists' biography, IV.
Sep 23, 2012
Excerpts from a draft introduction of Till Düppe’s and Roy Weintraub’s new book, under revision for Princeton University Press, presently carrying the working title “Finding Equilibrium: Arrow, Debreu, McKenzie and the Transformation of Economic Theory
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News
INET Co-founder William H. Janeway Awarded CBE by Her Majesty the Queen
Sep 23, 2012
INET co-founder William H. Janeway has been granted the honorary award of Commander of the Order of the British Empire (CBE) for services in education and for his support of the University of Cambridge.
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Working Paper
Grantee paperAre Women Really More Risk-Averse than Men?
Sep 2012
While a substantial literature in economics and finance has concluded that women are more risk averse than men, this conclusion merits reconsideration.
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Article
The use of economists' biography, III.
Sep 19, 2012
“The aim would not be to unravel a hidden coherent structure of the philosophical, theoretical, political dimensions of his work, but to give a sense of the contingencies that his work was subject to – both in terms of its origins and its receptions. Don’t make up an Arrow that he himself was not aware of.” -Till to me, email conversation on Kenneth Arrow, summer 2012
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Article
QE3
Sep 18, 2012
Last Thursday, the Fed announced its anticipated third round of balance-sheet expansion, at a fixed rate of about $40B per month “until [substantial] improvement [in unemployment] is achieved in a context of price stability”.
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Article
The use of economists' biography, II.
Sep 17, 2012
Excerpts from “Retrospect and Prospect,” the concluding remarks Bob Coats presented at (or maybe wrote after) the History of Economics conference held in 1972 at Bellagio to commemorate and reassess the 1870s “marginal revolution” (full proceedings here).
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News
Cracks in the German Economic Orthodoxy: Is Economic Theory Detached From Reality?
Sep 17, 2012
New economic thinking is creating change in Germany.
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Article
The use of economists' biography, I.
Sep 17, 2012
Robert Solow, “Notes on Coping.” In Szenberg ed. Eminent Economists: their Life Philosophy, 1992, p270
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News
INET’s Rob Johnson on CNBC: “Inequality has been there a long time and growing rapidly”
Sep 16, 2012
Monday marked the one-year anniversary of the start of the Occupy movement, and INET Executive Director Rob Johnson went on CNBC to discuss the significance of the milestone.
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Article
A Quick One (Message to Naomi)
Sep 13, 2012
Yesterday, I had my first introductory economics seminar with my new students.
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Working Paper
Grantee paperWould Women Leaders Have Prevented the Global Financial Crisis? Implications for Teaching about Gender, Behavior, and Economics
Sep 2012
Would having more women in leadership have prevented the financial crisis?
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Working Paper
Grantee paperIs Dismissing the Precautionary Principle the Manly Thing to Do? Gender and the Economics of Climate Change
Sep 2012
Many public debates about climate change now focus on the economic “costs” of taking action.
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News
Europe’s Real Deficit Is Trust
Sep 12, 2012
While Europe faces the specter of overwhelming debt, another deficit lies at the heart of the inability to find a solution: a deficit of trust.
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News
Soros To Germany: Lead or Leave
Sep 9, 2012
INET co-founder George Soros is calling on Germany to lead Europe out of its economic doldrums or get out of monetary union altogether.
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Article
Keynes's 10 Professors... and a Major
Sep 1, 2012
I thought I was on to an inside reference when re-reading the General Theory when Keynes calls Marx, Edgeworth and others simply by name, but refers to “Professor Pigou” in several instances.
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Working Paper
Grantee paperIncome Distribution, Credit and Fiscal Policies in an Agent-Based Keynesian Model
Aug 2012
This work studies the interactions between income distribution and monetary and fiscal policies in terms of ensuing dynamics of macro variables (GDP growth, unemployment, etc.) on the grounds of an agent-based Keynesian model.
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Article
Holiday announcements... History at the ASSA
Aug 21, 2012
Mid August, with the Olympics over, Paralympics and Premiership starting (that’s Soccer for the American readership), it is well and truly the quiet period for most of academia.
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News
Felix Salmon: Curb High-Frequency Trading and End the Stock Market “War Zone”
Aug 13, 2012
When Felix Salmon looks at the global equities market he sees a world of free-for-all electronic warfare that likely would be more recognizable to Isaac Asimov than Milton Friedman.
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News
'Economists at Fault for Recent Crises': An Interview with the Bank of England's Andy Haldane
Aug 7, 2012
In a recent interview, INET Advisory Board member and Executive Director for Financial Stability at the Bank of EnglandAndy Haldane took aim at the economics profession.
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News
Ben Bernanke to Economists: More Philosophy, Please
Aug 6, 2012
This week Bernanke spoke to the International Association for Research in Income and Wealth, and, as Bloomberg Businessweek notes, he was singing a different tune.
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Article
Sleepwalking with Heiner
Aug 3, 2012
A Response to Heiner Flassbeck’s questions about the Institute’s Council on the Euro Crisis
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News
Deleveraging Redfined - Part 2: Martin Wolf on the Least-Bad Alternative
Aug 1, 2012
“You can’t get out of debt by adding more debt.”
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News
Deleveraging Redefined: Martin Wolf Explains “That Sinking Feeling”
Jul 31, 2012
How to explain the current recession facing the US and the world? Does so-called “austerian” logic provide the solution? Or is it doing more harm than good?
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Article
The Coming Crisis in Municipal Bankruptcy
Jul 30, 2012
Where’s the next economic crisis?
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Article
The ECB Can Save the Euro – But It Has To Change Its Business Model
Jul 29, 2012
Paul De Grauwe raises very important questions on the institutional structure of Europe and how it must be modified to fortify the euro zone.
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Article
Paul de Grauwe: The ECB Can Save the Euro – But It Has To Change Its Business Model
Jul 29, 2012
In what sense are central banks really independent? From whom are they independent? For whom in society do they deliver?
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Article
The ECB Can Save the Euro – But It Has To Change Its Business Model
Jul 29, 2012
How must the European institutional structure be modified to fortify the euro zone?
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Article
The fix was in
Jul 28, 2012
In Friday’s FT, former Morgan Stanley trader Douglas Keenan traces banks’ LIBOR manipulations back to 1991, when he observed, from the futures desk, LIBOR fixings come in at levels different from where he new the market to be.
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Article
Leakage as historiographic genre @ HES 2012
Jul 26, 2012
If the meetings of European historians of economics are urbane and cosmopolitan, the meetings of American historians are, by contrast, frank and toilful.
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Article
Inclusive wealth and the history of GDP
Jul 16, 2012
The International Human Dimensions Programme on Global Environmental Change (IHDP) recently published the Inclusive Wealth Report 2012, in which the authors propose a measure of wealth based on the stock of capital present in a country, as opposed to the flow measure of GDP.
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News
How to save the financial system from itself?
Jul 16, 2012
what role central bankers should play to bring the needed change>
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Article
Math or Society: Did Economists Forget Who They’re Supposed to Serve?
Jul 11, 2012
Has the servant’s servant become the master’s master?
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Article
Interdisciplinarity and education @H2S workshop
Jul 10, 2012
A few weeks ago, I attended the H2S 4th workshop on “Cross disciplinary ventures in postwar American Social Sciences,” (research program outline here).
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News
Leading European Economists Support Banking Union
Jul 9, 2012
In support of a European Banking Union, Done Properly: A Manifesto by Economists in Germany, Austria and Switzerland
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Article
Economists Coming of Age
Jul 7, 2012
Last weekend, I was in Tübingen - very close to my home town: the same smell, the same surreal Swabian idyll that makes you think of Hölderlin and Hesse rather than DSGE.
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Article
The less you know, the better?
Jul 7, 2012
A few days ago, I began researching on the history of a subfield of economics which was born in the sixties, then thrived and institutionalized itself in the early seventies.
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Article
The Visible Hand Writing History
Jul 7, 2012
[We are inaugurating something new in this blog: a jointly written post!]
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News
Is the Economy Sustainable?
Jul 4, 2012
How will climate change influence economic sustainability?
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Article
How to lie with statistics: An economist's guide
Jul 2, 2012
How representation of data can contribute to, or dispel the false certainty of statistical and econometric technique.
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Article
Economics and computation in the postwar period: managing scarcity
Jul 1, 2012
“We choose this stochastic structure for computational reasons. This reduces the dimension of the variables. With (such and such) alternative, the computational burden would have dramatically increased.”
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News
An Economic Manifesto
Jul 1, 2012
Are we doomed to repeat the past? Even when we know better? Or do we not know better even when we should?
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Working Paper
Grantee paperMethod to simultaneously determine stock, flow, and parameter values in large stock flow consistent models
Jun 2012
Stock flow consistent macroeconomic models suffer from the lack of a coherent estimation method due to the complicated nature of the modeling process.
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Working Paper
Grantee paperMacroeconomic Policy in DSGE and Agent-Based Models
Jun 2012
The Great Recession seems to be a natural experiment for macroeconomics showing the inadequacy of the predominant theoretical framework — the New Neoclassical Synthesis — grounded on the DSGE model.
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Working Paper
Grantee paperThe Financialization of the US Corporation: What Has Been Lost, and How It Can Be Regained
Jun 2012
Background paper for a presentation to the Seattle University School of Law Berle IV Symposiun, “The Future of Financial/Securities Markets,” London June 14-15, 2012.
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Working Paper
Grantee paperThe Making of America’s Imbalances
Jun 2012
This paper tracks the development of sectoral saving and borrowing in the US economy over the past 50 years.
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Working Paper
Grantee paperPrincipled Policymaking in an Uncertain World
Jun 2012
Revised text of a presentation at the Conference on Microfoundations for Modern Macroeconomics, Columbia University, November 2010. I would like to thank Amar Bhidé, Roman Frydman, and Andy Haldane for helpful comments, and the Institute for New Economic Thinking for research support.
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Working Paper
Grantee paperWhat’s Wrong with Economic Models?
Jun 2012
John Kay’s thought-provoking essay The Map is Not the Territory: An Essay on the State of Economics argues that economists have been led astray by excessive reliance on formal models derived from assumptions that bear too little similarity to the world we live in.
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Article
Hogarth and Soyer on the Hollow Men
Jun 30, 2012
A poem seems to be an almost perfect metaphor for the modern corporate world.
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Article
Economics at Chicago, 1939-1955: the scope of our ignorance
Jun 26, 2012
The University of Chicago is well-known for as the place where a famous group of economists, including Milton Friedman, Georges Stigler, Gary Becker, among others, developed a method for analyzing economic facts based on Marshallian price theory, a vision of the evolution of macroeconomic aggregates called monetarism, and an approach to individual liberties and the role of the state known as (neo)liberalism.
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News
BRIC Buddies – China and Brazil Agree to Currency Swap
Jun 26, 2012
In a show of good faith between two rising economic powers, China and Brazil have agreed to a bilateral currency swap.
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News
German Orthodoxy Starting to See the Need for New Economic Thinking
Jun 25, 2012
While German economic policy makers continue to cling to neoclassical economic approaches, an increasing number of prominent economic figures are starting to accept the failure of orthodox theories to address the current crisis and are expressing the need to rethink fundamental economic concepts.
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News
Higher education…or hired education?
Jun 24, 2012
What is the purpose of America’s universities today?
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Article
Division of labour was common knowledge by the 1770s
Jun 23, 2012
I always think of Adam Smith when I hear the term ‘division of labour’ - but I’m being cured of this by reading a bit more about Britains late 18th century in Jenny Uglow’s The Lunar Men.
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News
Which nation is the greatest threat to Europe?
Jun 20, 2012
One country poses an existential threat to Europe – and it is not Greece, Italy or Spain.
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News
World Bank President Zoellick: In Euro Crisis “Time Is of the Essence”
Jun 18, 2012
World Bank President Robert Zoellick is growing frustrated with the lack of urgency on the part of Europe’s leaders in responding to the financial crisis in the euro zone.
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Article
Lethal Embrace? A Thought Experiment
Jun 18, 2012
At the heart of the Eurocrisis lies a vicious circle where once there was a virtuous one.
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News
Looking Forward By Looking Back: Axel Leijonhufvud Interviews Friedrich Hayek
Jun 18, 2012
Leijonhufvud has questioned the flawed fundamentals of economics. And he has explored the spread of contagion in undermining the web of contracts that are the basis for capitalism.
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Article
After the election, what’s next for Greece?
Jun 17, 2012
After the recent election brought a center-right coalition to power, what’s next in the Greek crisis? Are we finally in the clear? Not so fast, Greek economist Yanis Varoufakis says. Varoufakis explains the real outcome we can except after Greek voters’ “contradictory verdict,” where 55% voted for anti-bailout parties yet a pro-bailout government resulted due to the nature of Greece’s electoral system.
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News
Confidence Game: Simon Johnson on the Conflicted NY Fed
Jun 14, 2012
Have you ever heard the old adage about the danger of allowing foxes to guard the henhouse? Apparently the New York Fed hasn’t.
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News
Living in Sinn
Jun 13, 2012
Germany should not pay for the bankruptcy of Europe, at least according Hans-Werner Sinn, head of the Ifo Institute for Economic Research at the University of Munich.
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News
Too Big to Bail? Spain is Repeating Ireland’s Mistakes
Jun 13, 2012
“Spain is now heading down the same path that bankrupted Ireland,” INET grantee Stephen Kinsella of the University of Limerick and Mark Blyth of Brown University warn on the Harvard Business Review’s blog.
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News
Too Big to Bail? Spain is Repeating Ireland’s Mistakes
Jun 13, 2012
“Spain is now heading down the same path that bankrupted Ireland,” INET grantee Stephen Kinsella of the University of Limerick and Mark Blyth of Brown University warn on the Harvard Business Review’s blog.
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News
FTD and Global Climate Forum to Host Event at Berlin’s Mercator Project Center
Jun 13, 2012
What is the role of Germany in Europe?
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Article
History of Economics Journals in SSCI - a correction
Jun 13, 2012
In a recent post I wrote: “I am sure it will not take long before Journal of the History of Economic Thought (Cambridge Uni. Press) makes that list [Thompson Reuters, Social Science Citation Index].”
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News
Looking Out For Unknown Unknowns
Jun 12, 2012
Chicago School founder Frank H. Knight had some prescient observations in the early 20th century.
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News
The Vicious Cycle of Economic Inequality
Jun 11, 2012
The refrain for some time now has been that the economy will decide the upcoming U.S. election. But Joe Stiglitz offers some much needed focus to this discussion.
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News
Nobel laureate Elinor Ostrom Passes Away at 78
Jun 11, 2012
Today the world lost one of its leading economic lights, as Nobel laureate Elinor Ostrom passed away at the age of 78.
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Article
Between science and history
Jun 11, 2012
Last Friday, philosophers from the University of Leiden hosted the symposium ‘Between Science and History,’ in an attempt to figure out what the differences are between practicing scientists’ use of history and historians use of history.
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News
FT Alphaville asks: Is the Renminbi overvalued?
Jun 10, 2012
“A chronic trend of this sort would indicate that the yuan was now overvalued versus the dollar,”
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Article
Swexit - When will Switzerland exit the euro?
Jun 6, 2012
Since September 2011, the Swiss National Bank has held a floor of 1.20 francs per euro.
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News
The Big Bet in Europe
Jun 4, 2012
It’s crunch time in Europe.
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News
Joe Stiglitz on the 1%'s Problem and the Price of Inequality
Jun 3, 2012
Inequality isn’t just a problem for the 99%.
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Article
Three questions to Ivan Moscati: Historicizing Choice Theory
May 31, 2012
Ivan Moscati is one of the most exciting voices in the historiography of decision theory.
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Article
Let Us Praise Famous Men, or why we must praise them...
May 30, 2012
Steven Shapin is visiting the UK. For those unfamiliar with the history and sociology of science, he is one of the giants of the field.
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News
A challenge to dollar domination?
May 26, 2012
FT Alphaville uses a Lord of the Rings metaphor to describe the state of global currencies.
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News
Stephen Kinsella: A “nutter in a balloon” gives you perspective
May 24, 2012
Stephen Kinsella has some advice for economists: “Sometimes, all you need is a nutter in a balloon to change your perspective. And perspective is everything.”
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News
Sen Warns of Europe’s Well-Meaning Mistakes
May 23, 2012
If proof were needed of the maxim that the road to hell is paved with good intentions, the economic crisis in Europe provides it
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Article
Contextualizing one and other @ ESHET 2012
May 21, 2012
My attempt at a double riddle. “I find familiar faces only in unfamiliar places. Who am I? And whom are the faces?” The answer to the first is, I am an academic, to the second, my conference buddies.
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Article
Maynard's Revenge: A Review
May 21, 2012
Below is a revised version of a talk I gave at the New School University, at a conference to launch Lance Taylor’s latest book. The date of the event was April 28, 2011, more than a year ago, and the delay in revision was entirely my fault—overcommitment and pressing deadlines on many fronts. Sorry about that.
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Article
Maynard's Revenge: A Review
May 21, 2012
The Collapse of Free Market Macroeconomics
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News
China’s RMB Exodus
May 21, 2012
Will China correct this imbalance by allowing the RMB to appreciate? Or will it dump dollars onto forex markets?
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News
INET Goes to Paris
May 21, 2012
INET Executive Director Robert Johnson delivered a keynote address at the OECD Forum in Paristoday.
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News
What are economists for, anyway?
May 20, 2012
Who does the economist serve: powerful interests or society?
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News
Economics Is Not Math
May 20, 2012
Mathematician Michael Edesess has a dose of reality for economists.
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News
Calls for Financial Architecture Fix
May 20, 2012
What’s wrong with our economic recovery?