a home
for economists
who believe
macroeconomics
can be both coherent and stabilization policy-relevant
The GEM Project blog appears weekly (Fridays). Interested economists are invited to participate by submitting comments or writing blog entries.
There are a few rules. The subject matter must be related to macroeconomics and macroeconomists, especially in their grand struggle to construct models that are stabilization relevant and internally coherent. Blog entries should be 1,000 words or fewer, and author name and association are required.
These six blogs are the cliff-notes version of the GEM eBook. In bite-sized portions, they capture the essentials of Generalized Exchange Macroeconomics:
Mainstream FGME Analysis
Mainstream friction-augmented general-market-equilibrium theory cannot explain the massive market failure that occurred during the stagflation decade. That episode featured simultaneous high unemployment and a powerful price-wage spiral that broke apart what had been a remarkably stable interindustry wage …
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This and the following three posts use the GEM Project’s generalized-exchange theory to analyze the prolonged stagflation debacle. The analysis is needed. Mainstream theorists have gotten that costly period of market failure wrong for decades. What’s worse, the academy’s economic …
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Generalizing price-mediated exchange from the marketplace to information-challenged workplaces is the most significant extension of the economic reach of the rational modeling of human behavior since the heyday of the marginalists more than a century ago. It interests me that …
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Last week’s post promised embellishment on the inclusion of rational behavior in the short list of crucial characteristics of stabilization-relevant macroeconomics. The GEM Project contends that inattention to rational behavior has greatly damaged mainstream New Keynesian (NK) modeling. Can a …
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Epistemology is defined as the investigation of the origin, nature, methods, and limits of human knowledge. In 2018, Jonathan Rauch wrote about epistemology in the context of current events in National Affairs. “The Constitution of Knowledge” argues that societies of …
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Google’s logo doodle yesterday paid tribute to the late Sir Arthur Lewis, the first economist to be so honored. The accolade bookends the Nobel Prize he won in 1979. Lewis was an influential professor of mine at Princeton. Indeed, my …
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I know Edward Lazear from his time heading the Council of Economic Advisers. We have research interests in common. His academic work has long focused on translating what has been learned by personnel departments into neoclassical economic theory – a …
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A friend argues that I need to try harder to understand the how otherwise reasonable non-economists make sense out of fundamental economic concepts like capitalism, free markets, and business cycles. He recommended a recent book, Having and Being Had by …
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The biggest mistake in the COVID-19 Pandemic is the toleration of budding sociopaths’ refusal, in the face of overwhelming evidence, to wear masks. The biggest handicap, closely tied to the biggest mistake, is Donald Trump as President. The hapless reality-TV …
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Residual rent, particularly when used in explaining income distribution in highly specialized economies, is a great, albeit unappreciated, idea in economic theory. Consider two facts. First, useful macroeconomics require evidence-consistent modeling of factor-income shares. Second, such modeling is inconsistent with …
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