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Old April 27 2013, 03:06 PM   #315
Re: Roddenberry's Worst Ideas

stj wrote: View Post
I am not invested with the authority to deem that some academic economists are engaged in true research while other are merely propagandizing. Some academically trained economists, including the gentlemen you mention, do indeed explain away the business cycle. (As you point out, it is mostly by claiming it is inevitable but self-curing.)

Lord Keynes is all very well, but Friedrich Hayek is certainly highly esteemed. Order of the Companion of Honour, I think, plus a Nobel Laureate. His disciple, Margaret Thatcher, was just awrdeded a lavish state funeral for her success in championing his ideas. And there was nearly universal condemnation in official media of anyone so vile as to disapprobate her Hayekian triumphs. Government is the problem, and capitalism is the cure!

I can understand why you want to think of only what you can accept as honest attempts at science as constituting the profession of economics. But in the world as it is, isn't that really just wishful thinking?
It is not some. I linked to a paper by Mike Woodford who is THE monetary economist and its underlying methodology is the basic methodology of mainstream macro research. No mainstream macroeconomist gives a shit about Hayek.

I am not a big fan of mainstream macro by the way as there are plenty of methodological problems. But the basic setup of these models does create underemployment equilibria (via price rigidities) and is not ideologically biased in any way. I don't wanna get more technical and as I said, I don't like the way in which the business cycle is modelled there. As Stiglitz said long ago, there is no financial sector in mainstream macro models so they naturally provide no insights for a financial crisis.

So yeah, I frankly admit that I am more into heterodox stuff but mainstream economics isn't per se leaning to the right. For every Hayek there is a Stiglitz. Paul Krugman and Richard Koo are the two guys who provide the best insights at the moment as they learned the lesson from Japan and both are classical economists. OK, admittedly Koo seems to be a bit Postkeynesian but you get my point, you can be a classical economist and still be progressive and care about the truth.
And while there is, as in all other sectors of life, too much corporate influence upon the dismal science and while theory is complicated empirics isn't. We just conducted a large experiment with nasty employment effects in the real world. Of course there are some corrupted assholes who deny the validation of Keynesian theory (or rather the the rough implications of ALL Keynesian schools of thought, Old Keynesian, Neokeynesian and Postkeynesian) but when there are liars we call them liars and don't give up on an entire social science.
The illegal we do immediately; the unconstitutional takes a little longer. - former US Secretary of State and unconvicted war criminal Henry Kissinger
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