Daniel Davies wrote: > worth noting (and apologies if someone already has), that Krugman has > recently more or less admitted that about half of US universities did > actually semi-officially censor the *Keynesians*, making it rather more > credible that smaller and weaker tendencies got even worse treatment: > > http://krugman.blogs.nytimes.com/2009/03/01/equilibrium-decadence-wonkish/
here's the relevant PK quote: > And the latter group, the equilibrium macro side [following Robert Lucas], > was so convinced of the logical correctness of its position that schools > dominated by that view stopped teaching demand-side economics. (Schools > dominated by new Keynesians, on the other hand, did teach real business cycle > theory.) I haven’t been able to dig up the quote, but somewhere along the > line Ed Prescott declared that his students wondered who Keynes was, because > he was never mentioned in their courses. > And those trained according to this dogma were and are utterly ignorant of > what Keynes, or modern Keynesians, have to say. They know that Keynesianism > is stupid nonsense, because that’s what they remember having been told. But > they don’t actually know why they’re supposed to believe that; the serious > debates the profession had in the 70s about the microfoundations of inflation > and unemployment theory are lost in the mist. > And as a result we have the spectacle of well-known economists offering what > they think are profound arguments, but are actually long-refuted fallacies. > Most important is the “Treasury view” that government spending can’t affect > demand. But there’s also the astonishing belief that Ricardian equivalence > means that consumer spending automatically falls to offset even a temporary > increase in government spending, which seem to be part of that Poole quote. > (New Keynesian models in which consumers fully anticipate future taxes still > leave room for fiscal policy — but they don’t know that.) > And the sad thing is that all of this matters. Our ability as a nation to > respond to the current economic crisis is being seriously hampered by the > gratuitous ignorance of many of our economists.< My experience is that PK is right: the "Chicago schoolers" (and the Austries?)[*] are more sectarian than the Keynesians after they take over a department. They are less willing to present or respect the "other side." But why were they allowed to get away with this? It fit the neoliberal spirit of the age along with the pressure from business lobbyists and the like. Further, the first 30 years or so of revived Calvin Coolidge Capitalism _worked_! Look at GDP rise year after year! Look how small and short the 2001 recession was! We've enjoyed the "Great Moderation" or the "Goldilocks Economy"! (Of course, they had blinders on when it came to non-GDP issues.) -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. [*] I'm told that these two schools don't get along, unless they're fighting them damn lib'rals and the damned guv'mint. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
