Summarizing the Generalized-Exchange Theory

Two venues. Building on fundamental heterogeneities that feature information asymmetries and routinized jobs, rational workplace exchange in both the large- and small-establishment venues has been derived from axiomatic preferences and technology. Each demonstrates distinct  decision rules, constraints, and mechanisms of … 
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Culling the Canon

 

It is time to wrap up, for now, the GEM Blog’s forceful argument that the development and dissemination of consensus macroeconomics has been greatly damaged by Ptolemaic intent. To reiterate, research is Ptolemaic if its central objective is the defense … 
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Ptolemaic Woes: Misusing Search Theory

Search theory has long provided an appealing, albeit incomplete, explanation of the natural rate of unemployment. However, when extended to employment/unemployment fluctuations at cyclical amplitudes, an ambitious expansion of the search-model agenda pioneered by Mortensen, Pissarides, and Diamond, the theory … 
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Ptolemaic Woes: Mankiw, Reis, Gali

 

 In the most recent updating of the Handbook of Monetary Economics, Greg Mankiw and Ricardo Reis (2010, p.222) are thoroughly New Keynesian in how they frame the question of why money matters. The framing restricts, and ultimately defeats, an adequate … 
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Ptolemaic Woes: Prescott, Cole, Ohanian

 

An interim message of the on-going series of posts on Ptolemaic woes is bad news. Mainstream macro modeling is trapped in practical irrelevance by the profession’s gatekeeper acceptance of the presumption of market clearing. The troubled nature of consensus market-centric … 
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Ptolemaic Woes: Hall’s Modern Recessions

Some especially unhappy research leads off our series on New Keynesian (NK) theorists, occupying the mainstream in modern macroeconomics, becoming debilitatingly Ptolemaic. The term refers to their emphasis on the defending the consensus general-market-equilibrium model class at the expense of … 
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Advice from a Good Scientist

Toward the end of his extraordinary career, Richard Feynman, the theoretical physicist who solved some of the toughest problems associated with understanding elementary particles, offered some advice on how to do scientific research: “The scientist analyzes something like a detective … 
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