Krugman has a review of Keynes: The Return of the Master (h/t Krugman). Krugman continues to bait the fresh water economists but provides a neat summary of the Chicago school’s essential innovation, or, depending upon your perspective, regression to neo-classical economics.
In addition Krugman looks at the evolution of the master’s thought between 1936 and 1937, where Keynes is more concerned with open, uncertain systems. (Maybe Rowan Williams had been reading Skidelsky before making his recent intervention arguing for a reemphasis on Keynsian uncertainty.) Skidelsky argues that the division between closed microeconomic systems and open macroeconomic systems should be formalised with them being studied separately. Krugman demurs, arguing (rightly I think) that mature disciplines ought to know when they are dealing with open and closed systems.
Notre Dame
The University of Notre Dame did near-enough split their economics department along the lines that Skidelsky suggests, creating a ‘hetrodox’ department for ‘economics and policy studies’ and an ‘orthodox’ department for ‘economics and econometrics’. It seems as if the orthodox department wasn’t allowed to recruit graduate students or faculty after the split and is now being closed. It all smells of academic politics, and has been met with a great deal of incredulity in the progressive blogoshpere (e.g., Klein).
Methinks this is all pretty indicative that something is rotten in the state of Denmark.
Tyler Cowan
Tyler Cowan deplores the tone of the debate and has an intelligent and useful post on the warfare in economics, drawing out some reasons for appreciating the work on Real Business Cycles being carried out in the fresh water Chicago school.
Brad de Long
Brad de Long lines up some of the very strident claims luminaries of the Chicago school have been making and skittles them. They do seem to have set themselves up, and poisoned the well, but I can’t help but think that Tyler Cowan has the right idea. Poisoning the well further is hardly going to help.
Will Hutton
On a completely different tack, Will Hutton has wrote a column in Sunday’s observer on a serious and bold initiative by Nicolas Sarkozy to broaden the way we measure GDP so that we start measuring things that demonstrably contribute to happiness and welfare. This kind of thing strikes me as important, and just the kind of thing that the ‘hetrodox’ department at Notre Dame would have been more likely to have taken an interest in than any department attempting to posture as if it belongs in the hard sciences.
This line of thinking really should be taken more seriously.
Economics Roundup
Krugman on Skidelsky
Krugman has a review of Keynes: The Return of the Master (h/t Krugman). Krugman continues to bait the fresh water economists but provides a neat summary of the Chicago school’s essential innovation, or, depending upon your perspective, regression to neo-classical economics.
In addition Krugman looks at the evolution of the master’s thought between 1936 and 1937, where Keynes is more concerned with open, uncertain systems. (Maybe Rowan Williams had been reading Skidelsky before making his recent intervention arguing for a reemphasis on Keynsian uncertainty.) Skidelsky argues that the division between closed microeconomic systems and open macroeconomic systems should be formalised with them being studied separately. Krugman demurs, arguing (rightly I think) that mature disciplines ought to know when they are dealing with open and closed systems.
Notre Dame
The University of Notre Dame did near-enough split their economics department along the lines that Skidelsky suggests, creating a ‘hetrodox’ department for ‘economics and policy studies’ and an ‘orthodox’ department for ‘economics and econometrics’. It seems as if the orthodox department wasn’t allowed to recruit graduate students or faculty after the split and is now being closed. It all smells of academic politics, and has been met with a great deal of incredulity in the progressive blogoshpere (e.g., Klein).
Methinks this is all pretty indicative that something is rotten in the state of Denmark.
Tyler Cowan
Tyler Cowan deplores the tone of the debate and has an intelligent and useful post on the warfare in economics, drawing out some reasons for appreciating the work on Real Business Cycles being carried out in the fresh water Chicago school.
Brad de Long
Brad de Long lines up some of the very strident claims luminaries of the Chicago school have been making and skittles them. They do seem to have set themselves up, and poisoned the well, but I can’t help but think that Tyler Cowan has the right idea. Poisoning the well further is hardly going to help.
Will Hutton
On a completely different tack, Will Hutton has wrote a column in Sunday’s observer on a serious and bold initiative by Nicolas Sarkozy to broaden the way we measure GDP so that we start measuring things that demonstrably contribute to happiness and welfare. This kind of thing strikes me as important, and just the kind of thing that the ‘hetrodox’ department at Notre Dame would have been more likely to have taken an interest in than any department attempting to posture as if it belongs in the hard sciences.
This line of thinking really should be taken more seriously.
Matt Yglesias
Matt Yglesias doubts if banking pay structures had much to do with the crisis and believes we should just get on with taxing the bankers. Yglesias highlights and dismantles a prevailing culture of ‘lazy moralism about debt’ and then seems to forget it again in over-thinking some polling that suggests ordinary folk are quite neo-Hooverite in their opinions.