After a bubble has burst, no one denies that it existed. But before it does, the popular refrain is that though bubbles existed elsewhere in the world, “there’s no bubble here”. So housing bubbles are admitted to have existed in Japan, the USA, Spain and Ireland – because they’ve already burst.
This is a set of 5 lectures that I delivered last week in Quito, Ecuador, at FLACSO–the Latin American Faculty of Social Sciences. In future years I hope to expand this into two complete courses–one on the history and development of economics from a disequilibrium perspective, and the other on dynamic monetary modeling in economics using Minsky, the Open Source system dynamics program that I have developed with the help of a grant from INET.
The Australian Business Deans Council has just released its new ranking of the quality of academic journals in economics. This listing in turn is used to rank the quality of academic research.
Kevin Rudd came to power for the first time on December 3rd 2007, just a few months after the global financial crisis commenced, and some time before its severity was truly appreciated by the political classes of any nation. On September 7, he lost office for the last time.
As regular readers here know, the main reason for developing Minsky was to make it possible to build monetary models of the economy. But it is also a pretty good tool for doing standard system dynamics modeling too, and in these two videos I show a range of famous chaotic oscillators modeled in Minsky:
Readers with long memories will recall Paul Krugman describing interest in the history of economic thought as “Talmudic scholarship” (see figure 1), and dismissing it with an emphatic “I Don’t Care”.
The speed with which a few useful modifications can be done to a a model in Minsky reminds me of the old “don’t try this at home” saying. I’d love to race someone adding the same concepts in a program like Vensim, Stella or even Vissim!
One of the defining features of neoclassical economics is the belief that macroeconomic analysis has to be not merely compatible with, but derivable from, microeconomic analysis. The development of economic theory has been driven far more by this belief than by the desire to make the theory compatible with the observed behaviour of the economy.
One of the advantages of being overseas right now is that it takes less effort to avoid listening to the insipid discourse that passes for political debate during this Australian election. As Kevin Rudd and Tony Abbott compete over who can be more obnoxious to refugees, I find myself pining for the days of sensible and humane policies under Malcolm Fraser. As politicians make themselves the butt of their own unintentional suppository jokes, I pine for someone who could deliver a killer line against his opponent, rather than against himself: Paul Keating.
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