"Words ought to be a little wild, for they are the assault of thoughts on the unthinking" - JMK
- LK has a good post on the 1937 recession.
- Normally I think its bad form to trash feel-good op-eds by non-experts too much, but I do have some critical thoughts to share about this one by Chuck O'Neal in an Orlando paper (also discussed here). O'Neal writes: "Perhaps someday soon we will hear our president say: "A great American leader once issued a challenge to NASA regarding going to the moon. I am before you today to issue a new challenge for this agency to create as many new technologies and new innovations as is necessary to employ every able-bodied person in this country, to use NASA's collective genius to lift this nation out of its current economic trajectory and place it once again on a course to prosperity". This sort of thing is typical from NASA boosters who often act like NASA is a spin-off producing agency. The appeal of the concept of "spin-offs" is somewhat similar to that of externalities insofar as there is an alleged added payoff, but aside from this veneer of attractiveness it's completely wrong-headed. So we get velcro and memory-foam. Fine. Was there a reason why the private sector couldn't do that? Not that I'm aware of. So there's no good reason to pay an aerospace engineer and rig up a space shuttle to get these things. If they are byproducts to doing something that is worth hiring an engineer and building a space shuttle for, that's great. Enjoy the memory foam you get as a byproduct. But too many NASA people point to spin-offs as a justification for the agency, and it's a really bad one. The thing is, there are plenty of externalities and collective action problems that justify a public role in space. Developing spin-offs usually isn't on that list (and if a particular spin-off technology is worth a public investment, have the NSF fund the thing). Spin-offs should be an afterthought for NASA. If you get one, great.
- Wine blogger Lenn Thomson has a great essay on Virginia wines. I think his list of things holding the state back are all good, although I disagree with his point about Virginia producing too much Chardonnay. His attitude seems to be "if you're only producing good Chardonnay, leave it to the Californians". Certainly as the Virginia wine industry grows they're going to have to satisfy whatever demand is out there and if everybody just wants California Chardonnay the production is going to go down. But at this point that's not the market that Virginia wineries face - a lot of it is for demand for local wines.
- Casey Mulligan apparently thinks if you provide details on a version of Keynesianism that doesn't match his caricatures those are not details, they are "exceptions". If he read my 1920-1921 paper he'd probably say that my argument that fiscal policy wasn't appropriate was an "exception to Keynesianism" rather than a "prediction of Keynesianism". Peter Boettke still doesn't understand why so many people he thinks highly of are unimpressed by Mulligan.
So is Keynesianism some sort of grand unified theory? Because those of us interested in physics don't even have that (it may not even be possible as we currently conceive the notion).
ReplyDeleteFrom what I can tell Keynes fans and advocates are arguing that in this book he wrote in the mid-1930s all the mysteries of macro-economics were revealed and economists in the mainstream of the profession have merely been working out the details. That sounds suspiciously like physics prior to Einstein, Feynman, etc.
No, of course it's not a grand unified theory. I don't think anyone thinks that.
ReplyDeleteI think we're doing what Kuhn would call "puzzle solving" on a lot of the Keynesian paradigm right now, and in that sense only are we "just working out the details", but we're also doing puzzle solving on a few other major mid-century macro people's work. It's obviously not a book that "revealed all the mysteries of macroeconomics". Who says this, Dead Man's Party?
It isn't who says it, it is how it is treated from my experience hanging with economists (limited - the subject isn't exactly thrill a minute stuff). Keynes apparently tried to be some sort of Newton and it isn't surprising that a lot of people responded positively to that.
ReplyDeleteOK well I have no idea what you are refering to then. I've never gotten that impression.
ReplyDeleteHe was certainly an enormous figure and there's nothing inaccurate about making that observation. People have actually compared his innovations to Einstein and the 18th century economists to classical mechanics. Whoever you think is most analagous, Keynes is clearly analagous to these sorts of great advancers of physics. But just like them, of course, he (and like I said - a few others) furnished a dominant paradigm rather than some grand unified theory you're refering to.
So again, though - which economists have you had "experience hanging with" that thought of Keynes in this way?
ReplyDeleteEven when I think of the most rabid post-Keynesians I can't think of any that portray him quite like this.
A GUT would be a dominant paradigm. I would think that would go without saying.
ReplyDeleteDid he actually make any innovations per se? Both advocates and critics state that he mostly reinvigorated a whole bunch of old ideas. Did he do anything like what Newton did with the prism? Did he expand on the work of others like Newton did with Galileo (think here of effort to define the relationship between energy and motion - Ex. Δv = a -> caused by force)?
All GUTs are going to be dominant paradigms, but not all paradigms are GUTs.
ReplyDeletere: "Both advocates and critics state that he mostly reinvigorated a whole bunch of old ideas."
Yes, I think liquidity preference theory of the interest rate was a genuine innovation and he worked with people like Kahn and others. But certainly he didn't make any of this out of whole cloth. He stood on the shoulders of giants, you could say, and that's never been a mark against paradigm-shifters before. Indeed it's a necessity.
re: "Did he do anything like what Newton did with the prism?"
No, my understanding is Keynes didn't do much in optics :)
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ReplyDeleteAha - I thought that might have been you Gary. The attitude was way too similar.
ReplyDeleteI've had the same thought for past pseudonyms. Have you ever used others here, out of curiosity (besides your initial one, of course)?
There are a couple people using this computer that he owns. Sorry.
ReplyDeleteI have used a ton of psuedonyms here.
ReplyDeleteissue a new challenge for this agency to create as many new technologies and new innovations as is necessary to employ every able-bodied person in this country,
ReplyDeleteWhy is employment always the goal? I thought we destroyed this fallacy decades ago