The self-destruction of Economics (3)

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This is the third arti­cle in a three-part series on the self-destruc­tion of neo­clas­si­cal eco­nom­ic the­o­ry. See part one here and part two here.

To say that the long self-destruc­tion of the aca­d­e­m­ic eco­nom­ic tra­di­tion was giv­en a final push towards the cliff by the glob­al finan­cial cri­sis paints a pret­ty bleak pic­ture of the future of the dis­mal sci­ence. But I can also see some rays of sun­shine.

The first is to look out­side the Acad­e­my, to for­mal eco­nom­ic bod­ies – to cen­tral banks and Trea­suries in par­tic­u­lar. In the past, these bod­ies uncrit­i­cal­ly repro­duced what­ev­er was the lat­est fad in aca­d­e­m­ic eco­nom­ics (wit­ness the rapid shift from IS-LM and AS-AD mod­els to DSGE mod­els when aca­d­e­m­ic econ­o­mists pro­claimed that the for­mer fell vic­tim to the Lucas Cri­tique).

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About Steve Keen

I am Professor of Economics and Head of Economics, History and Politics at Kingston University London, and a long time critic of conventional economic thought. As well as attacking mainstream thought in Debunking Economics, I am also developing an alternative dynamic approach to economic modelling. The key issue I am tackling here is the prospect for a debt-deflation on the back of the enormous private debts accumulated globally, and our very low rate of inflation.