- Matt Yglesias talks about modern macroeconomics in terms of Kuhn's take on the Copernican Revolution. I don't think I endorse this interpretation. For one thing I think of New Keynesianism as the version of Keynesianism we got as a result of the Lucas Critique, whereas here Yglesias is juxtaposing the two. Is there an incomensurability between the two? No, I really don't think so. He also just seems to analogize the two as "New Keynesianism is messy" and "Epicycles were messy", and I'm not sure that's the best way to draw parallels either. "Messiness" is largely dependent on the complexity of the subject of study and exactly what you're choosing to model in that subject. The question is - are we working at what Kuhn called "normal science" or not? I think there's a ton wrong with this interpretation, but it's interesting.
- A better Matt Yglesias criticizes Kocherlakota: "if at first you fail, then fail, fail again". I've criticized this mindset recently, to Bob Murphy's chagrin. People act as if the fact that we're not in utopia right now means that what we tried briefly three years ago is absolutely the wrong answer. If you want to say it never was the right answer, that's one thing. You can argue that point on its merits. But don't look around and say "we tried stimulus once, we're still in a bad position, stimulus must not work". As Gene Callahan once noted, it's like saying that because death from pneumonia occurs when people fail to respond to antibiotics, the key to not dying from pneumonia is to stop taking antibiotics (instead of... maybe... more aggressive treatment).
- Abstract thought, recipe following, and chemistry in some highly evolved (but not quite as highly evolved as us) primates. Humans are truly amazing creatures.
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As Gene Callahan once noted, it's like saying that because death from pneumonia occurs when people fail to respond to antibiotics, the key to not dying from pneumonia is to stop taking antibiotics (instead of... maybe... more aggressive treatment).
ReplyDeleteThe facts can be interpreted any number of ways, They never "speak for themselves." What people should be arguing over is theory, not empirical correlations.
The stimulus didn't revive the economy. Is that because the stimulus was counter-productive, or because the economy was worse than we thought? Both sides are argued as nauseum as if appealing to graphs or figures is going to determine anything.
The solution has to come from arguments over theory. Why should the stimulus have worked? Why should it have not worked? What's the logic behind fiscal and monetary action, and how can we incorporate that into our schools of thought?
It comes down to arguing over ceteris paribus conditions. Aggressive fiscal and monetary stimulus should, ceteris paribus, revive aggregate demand and enable full employment some say. Others argue the opposite ceteris paribus.
We as economists need to start looking at methodology and epistemology a lot more than we have been. The ceteris paribus conditions are crucial.
Well said. I'm not quite sure if epistemology is the solution, but aside from that last paragraph I'm in full agreement.
ReplyDeleteRe: "epicycles are messy"
ReplyDeleteI don't see how anyone having read Kuhn's book can say this. Clearly, the equants were where things got messy.
The problem with Kuhn is this: there is a lot of baggage with his most famous work that just isn't in there (something which he fought a rearguard action against the last decade or so of his life). So when I see a few paragraph blog post that mentions Kuhn I just ignore it. I realize that as a rule of thumb it has its faults, but it works well enough for me.
ReplyDeleteThere is something be said about the value of quiting.