Saturday, May 16, 2009

John Quiggin

John Quiggin has an impressive list of refuted, obsolete, debunked or highly troubled economic doctrines. All of these are, of course, still in use, because economists are loath to give up anything, even if it's got low marginal utility relative to newer approaches.

If a theory fights with a fact, the theory always wins.

Here's the list so far:
  1. The Efficient Markets Hypothesis, the weak form of which may survive.
  2. The Case for Privatization, in which government tries to drown itself in a bathtub
  3. The Great Moderation. Business cycles are so yesterday
  4. Individual Retirement Accounts. How's that 401k working out for you?
  5. Trickle Down Economics. The rich are looking out for you
  6. Central Bank Independence. When money just won't do it
  7. New Keynesian Macroeconomics. People aren't rational


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