I was not alone. Apparently Tim Harford of FT.com was also confused and disappointed while learning the modern macro models and theories. I however figured it was a bunch of nonsense. The assumptions made by modern macro models, particularly the Rational Expectations stuff of New Classical and New Keynesian theory are the problem. By making … Continue reading Macro: an awful mess today
P.J. O’Rourke’s explanation of the difference between the two: microeconomics concerns things that economists are specifically wrong about, while macroeconomics concerns things that they are wrong about generally via FT.com / Weekend columnists / Tim Harford - Are those who sweat the big stuff in meltdown?.