Thursday, November 4, 2010

Three Links on 1920-21

I just wanted to note these quickly:

- Jonathan Catalan has a thougthful post on Austrian methodology and my 1920-21 paper, with a lively comment section. I think he's obviously right that I'm taking a positivist approach to economic science. Whether Austrians want to play that game with me is clearly up to them. Jonathan makes a case that Austrians should think carefully about this. Either way, the point may be moot when it comes to 1920-21. My basic argument is that while we can say a lot of interesting things about it and I think we should study it more closely, it ultimately is not a case that can arbitrate between Keynesianism and the Austrian school. As far as I can tell so far (and of course I'm just at the beginning of my study of the episode), it's consistent with both stories.

- This blog, called "Social Democracy for the 21st Century: A Post Keynesian Perspective" (Post-Keynesian as in Galbraith/MMT, not "after Keynesian") has a very thorough post up on the 1920-21 downturn and also mentions my paper at the end. I haven't been able to fully digest this post yet, but it does a lot of good bibliographical leg-work. The blog itself is Post-Keynesian, so it's going to be a little left of me - and it also seems to engage the Austrian school a lot (and more harshly than I do). I'm going to start following it, so if anything interesting comes up I'll share it here.

- Prometheus 6 does not mention my paper, but does have a post up on the Harding election, the 1920-21 depression, and the lead up to the Great Depression. It's interesting - he takes an approach that is skeptical of corporate interests and laissez-faire capitalism, but it also attributes the Great Depression to boom-time shenanigans by the Fed after 1920-21. I don't think that idea is entirely crazy - certainly the crash was a result of loose monetary policy, and the crash was a contributor to the depressionary demand shock. I guess I just found it interesting because usually more left-of-center perspective blame the Fed for their response to the Depression rather than the run-up to the Depression. Either way - I don't know exactly where this guy is coming from politically/philosophically, but I thought it was worth resharing.

These are some exciting discussions that are going on. We are really cutting into the just-so stories that guys like Woods and Murphy promote about 1920-21. That's fantastic!

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