Paul Krugman: Sticky Wages and the Macro Story
"So when I emphasize nominal wage rigidity, I am defending an analysis of how the economy works, which is not at all the same thing as saying that this rigidity is the problem. On the contrary, for the US (though not for countries like Spain), wage stickiness is if anything good for us right now, helping stave off destructive deflation."The Problem with Microfoundations: Bad Micro
This underlies one of the biggest problems I've noticed about rationalist economics (such as the austrian school). The microfoundations are completely devoid of insights from psychology, neurology, and other appropriate disciplines.
The claim that companies have growing worries about future inflation is demonstrably wrong.?
Brad DeLong: Mark Thoma Worries at the Question: Why Didn't Economists Do a Better Job?
"The continued push from some economists for austerity, interest rate increases, and other policies that satisfy political and ideological goals but work against the recovery, and the failure of economists in charge of monetary policy to ad opt policies consistent with the Fed’s mandate undermine any attempt to fully defend the economics profession"Paul Krugman: Making Ourselves Useless
Arthur Laffer, Anti-Enlightenment Economist
Art Laffer's EPIC FAIL in the WSJ. The numbers he uses are mysterious, and his conclusions are shaky at best (he is guilty of economics fally 101: post-hoc, ergo propter hoc)
another VERY IMPORTANT statement in this article that helps explain the massive deficits we have had since 2008
"Because almost all countries have some sort of social safety net, recessions automatically increase government spending through programs like unemployment insurance, food stamps, Medicaid and others that provide services and benefits to people who lose their jobs in recessions. The worse the recession, the greater the automatic increase in government spending. Thus, the negative correlation between government spending and economic growth that Laffer purports to uncover is easily explained by the existence of automatic stabilizers. The worse the recession, the greater the induced increase in government spending." (emphasis mine)Brad DeLong shows that, for some reason, Laffer's column is devoid of even economics 101.
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