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Minsky: Stability is Destabilizing

The Kickstarter campaign to raise funds to further develop “Minsky“, my dynamic monetary simulation program, has been launched. The immediate objective is to raise $50,000, which will enable the current version of Minsky to be completed. The ultimate goal is to raise $1 million or more to fully develop the concept.

Click here for the Kickstarter campaign. If you have appreciated my work over the last seven years to warn about the economic crisis, to develop an approach to macroeconomics that can understand why it happened, and to develop policies that might help end it, the please show this by making a pledge.

Let your network know about it too. The more people who kick in, the better.

Some key facts about Kickstarter campaigns:

  • They run only for a set number of days: this campaign will end on March 18. If you don’t give by then, you can’t give later. So if you want to help, pledge now.
  • Pledging early is a very good idea. The faster a project reaches its target, generally the more it raises–there is a “bandwagon” effect amongst Kickstarters. Also, a fast-rising project tends to get selected by Kickstarter staff as a “Staff Pick”. That gives it more publicity and raises yet more funds.
  • Pledging is easy. You choose the amount you want to pledge and click. That takes you to an Amazon page where, if you’ve ever bought anything from them beforehand, you already have an account. Confirm the pledge there, and that’s it. If the project gets its target amount of money or more, then at the end of the campaign (some time around March 20) the amount you pledge will be transferred to the Minsky project by Amazon (minus about 10% representing Amazon and Kickstarter’s fees).

I have great hopes for this program. As a teaching tool, I hope it will excite young economists and entice them away from the static, equilibrium-fixated, barter model they are currently taught in Universities around the world. As a research tool, I hope it will develop in the same way that Lorenz’s model of fluid dynamics did, from a “toy” model to the basis of modern weather forecasting. The economics could never be forecast as the weather is, obviously. But explicitly acknowledging the complex, monetary, non-equilibrium nature of the economy has to make for a better economics.

Help me realize those hopes by providing the funding needed to take the program to its full potential. Kickstart Minsky Now!

4 Responses to Kickstarter

  1. john swabey says:

    Is there a relationship between the stock of speculation, hoarding, the 1% and/or even savings, (I would guess the name does not matter much other than speculation on the time horizon to release) and the percent of each dollar in the real economy that is dedicated to debt service.

    The generalization I am chasing is that only improving the amount or quality of hard assets has future benefit and that growing financial assets eventually pull us to a stand still in interest servicing – at least until negative interest rates or worse correct the conditions of the stock.

    I still think stocks and flows is a chicken or egg argument. It can take time for flows to change stocks. Then again in finance the size of the pipe is illusive.

  2. Steve Roth says:

    Hey Steve what happened to this Kickstarter campaign? Don’t find it.

    On the second model, might I suggest that instead of “consumption,” you say “spending”? Semantics, but darned important. The notion of “consumption” by banks, for instance, is problematic in most people’s models/thinking.

    Related to the widespread confusion between “consumption spending” and consumption.

    Quickly, think gross and net consumption and investment, and where consumption of fixed assets (CFA) gets counted.

    Gross consumption would be consumption spending + CFA.

    Just as net investment is gross investment – CFA.

    In this model, spending is just spending. Could be expanded to differentiate between C and I (and to incorporate purchases of financial assets), but not necessary here. It’s all just spending.

    I did similar in my toy model here — all about monetary spending; the real economy is a black box that yields surplus through production spurred by spending:

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