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:
The decade-long stagflation crisis that began in the early 1970s was a very difficult time. Its economic loss was, in the 20th century, second only to the 1930s Great Depression. Stagflation refers to high product-price inflation occurring simultaneously with high …
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The GEM Project reconstructs macroeconomic theory to be simultaneously micro-coherent and stabilization-relevant. It is a powerful guide to policymaking capable of containing welfare losses that periodically result from the demand propagation of macro shocks. In this post, generalized-exchange analysis identifies …
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This post concludes the GEM Blog’s four-part overview of the public policy on how to prevent future Great Recessions. The consensus quickly emerged in the aftermath of the 2008-09 extreme instability. First, the three pillars of Washington’s curious thinking on …
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This post continues examining the stabilization policy that emerged in the aftermath of the Great Recession. It provides more detail on some of the mistakes made in pursuit of a flawed strategy.
First pillar mistake. Dodd-Frank’s prohibition of injections of public …
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As promised last week, this post provides a thumbnail description of the GEM Project’s explanation of extreme instability. Such instability is defined as contractions in total nominal spending that are too powerful to be reversed by automatic fiscal stabilizers and …
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The greatest damage done by the Ptolemaic intent of mainstream macro theorists is providing support for ill-conceived stabilization policymaking. Exhibit A is the manifestly wrong policy consensus on how to prevent future Great Recessions that emerged after the 2008-09 crisis. …
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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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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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With this post GEM Blog the nears the end, at least for now, of its two-month rant on the centrality of Ptolemaic modeling in modern macro research. To reiterate, Ptolemaic research is defined by its primary objective being the defense …
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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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