I and others, particularly Paul Krugman, occasionally make reference to "freshwater" vs. "saltwater" economics. Here's a little background to explain the terms and, I hope, shed a little light on current disputes in macroeconomic theory. First, let's go back in time. The stuff that economists study, namely the economy, economic behavior, and markets, really emerged as it's … Continue reading Brief History of Macroeconomics and The Origins of Freshwater vs. Saltwater Economics
The simple version of Keynesian economics suggests that if the economy is suffering from too little economic activity and high unemployment there are some policy options. Specifically Keynes suggests there are three general kinds of policy options: The central bank (The Fed in the case of the U.S.) could lower interest rates and create money … Continue reading Obama’s So-Called Keynesian Stimulus Efforts Aren’t Very
Brad DeLong is as puzzled as I, but is more eloquent in expressing it. In so doing he does my classes a favor in expressing a quick version of the history of addressing macro economic crises. For nearly 200 years economists from John Stuart Mill through Walter Bagehot and John Maynard Keynes and Milton Friedman … Continue reading Why the Austerity Talk?
Today, February 4, 2011, is the 75th anniversary of the publication of John Maynard Keynes's book The General Theory of Employment, Interest, and Money". Like Adam Smith with the Wealth of Nations and Karl Marx with Das Kapital, it's a book that has inspired millions, both as alleged supporters and as supposed opponents, most of … Continue reading 75th Anniversary of a Revolution
From UCLA: UCLA Anderson Forecast: U.S. recovery a long, slow climb; Calif. recovery weaker than nation's (emphases mine): "If the next year is going to bring exceptional growth," [UCLA Anderson Forecast director Edward] Leamer writes, "consumers will need to express their optimism in the way that really counts — buying homes and cars. And that … Continue reading Catch 22 Recovery
Lance Taylor explains Keynesiansim and how it applies to the current crisis on YouTube. h/t Economic Perspectives from Kansas City.
Paul Samuelson is one of the great economists of the 20th century. He was one of the first ones awarded the Nobel Memorial Prize. His textbook on Principles was the standard text for at least 40 years and the model for all others. He speaks in a two-part interview on the current economic crisis, the … Continue reading To learn from history, first listen to those who lived it / made it/ studied it. – Interview w/ Samuelson
Bruce Bartlett sets the history straight. Contrary to today's populist political rhetoric from right-wing, so-called conservative politicians, Keynes, and Keynesian economics is anything BUT socialist. In fact, Keynes sought to save free-market, private-property capitalism from itself. Follow the link for the complete story. Here's an excerpt: Those on the right have been making this same … Continue reading Keynes Was Really A Conservative, Not a Socialist