Sunday, April 5, 2015

On the blogs

How To And How Not To Attack Marx's Economics -- Robert Vienneau thoughtful account of various topics on Marxist scholarship. There is also this post by Lord Keynes on the LTV, which he has been discussing more lately. My views are closer to Robert's point of view.

Germany's trade surplus is a problem -- New blogger Ben Bernanke continues with the savings glut theme, and in this case he is right. Germany surpluses hurt the rest of Europe. Germany should spend more and allow the rest of Europe to enjoy less austerity.

The Inbred Bernanke-Summers Debate On Secular Stagnation -- Steve Keen's take on the debate (mine here), which is not on the substance of the debate though (he will post more later). The problem for Steve is that they all are New Keynesians, I think. Not sure if that is a problem. Don't get me wrong pluralism is important, but not sure how an Austrian perspective, for  example, would help clarify matters.

Big data is watching you -- by Lambert Strether, via Yves Smith's Naked Capitalism. I was teaching on efficiency wages last week and told students about how much firms spend on monitoring. I remembered David Gordon's Fat and Mean, that had something to say about that.

Sir John and Maynard Would Have Rejected the IS-LM Framework for Conducting Macroeconomic Analysis -- Mario Seccareccia on the ISLM. Note that Hicks recantation is not particularly good. And regarding Mario's point about investment not being sensitive to the rate of interest (a point made here several times; it's the accelerator!) that does not mean that the IS is vertical. Other spending components might be affected by the rate of interest (e.g. consumption). I would say the problem with modern mainstream macro is that it abandoned (other than for teaching undergrads) the old ISLM. And also, everybody forgets that they not only abandoned the LM for the MP (which Mario notes, and that's just a flat LM), but that they abandoned the multiplier and the IS is based on an intertemporal Ramsey model (that's the problem; the return of Say's Law). On my views on the ISLM go here.

A Stagnating Minimum Wage has Left Low-Wage Workers Facing a Longer Climb to Reach The Middle Class -- EPI's snapshot by David Cooper. Title is self-explanatory. Topic discussed here recently.

PS: I noted that Bernanke, a Republican, is at the Brookings Institution and not at the American Enterprise Institute. I was under the impression, maybe incorrect, that Democrats went to the Brookings, a center-left think tank, and Republicans to the AEI, a center right one. Something has changed if a moderate Republican can make it into the AEI.

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