More on New Keynesian Macro Silliness

An on-going task of the GEM Blog is to monitor the American Economic Journal: Macroeconomics (AEJ:M), flagging the more egregious use of neoclassical general-market-equilibrium modeling to explain actual behavior in modern, highly specialized economies. The exercise is always discouraging, but … 
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The Criticality of Chronic Wage Rent

 

I have become increasingly interested in how macroeconomists think, or more accurately don’t think, about wage rent. The GEM Project features the most consequential variant of that phenomenon, which it names “pure wage rent”. PWR does not require formal collective … 
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Helping Great Economists: Joan Robinson

Joan Robinson is the most surprising theorist never to be awarded a Nobel Prize in Economics. She made fundamental contributions to understanding the limits of mainstream competitive market-centric theory, perhaps helping to explain why an economics establishment deeply committed to … 
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Helping a Great Economist: Arthur Burns

It is a tenet of the GEM Project that professional greatness is not limited to making important contributions to economic theory. Economist policymakers whose experience and skill, especially in crisis, have substantially enhanced our collective well-being are included in the … 
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A Macro Annus Mirabilis?

The GEM Project’s generalization of rational exchange from the marketplace to workplaces restricted by costly, asymmetric workplace information is exceptionally consequential. That core theory simultaneously microfounds three separate models that, taken together, fundamentally reorganize textbook macro theory:

Labor pricing that is … 
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Helping Great Economists: Piero Sraffa

I am fascinated by the capacity of the GEM Project to rescue powerful theories from the New Keynesian (NK) dustbin. Generalizing rational exchange from the marketplace to workplaces restricted by costly, asymmetric information is apparently a very good idea. A … 
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