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Archive for April 25th, 2010

This one is almost too easy. Krugman charges freshwater macroeconomists with epistemic closure. He writes,

Ask a grad student at Princeton or MIT, “How would a new classical macro guy answer this?”, and the student can do it; classes at freshwater departments teach real business cycle theory, and good students can tell you what it says even if their professors have a different view.

But students at freshwater schools — or, alas, many of their professors — can’t return the favor. It’s been painfully obvious since the crisis broke that people at Minnesota, or even many people at Chicago, have no idea what New Keynesian economics is all about. I don’t mean they disagree, or think it’s garbage, they literally have no idea what the concepts are. And that’s why they reinvent 80-year-old fallacies when they try to discuss the subject.

It’s interesting to ask why this sort of cocooning is a feature of the right but not the left. But it’s very real, and has a dire impact on economic as well as political discourse.

Of course, we can just as easily replace salt-water students in this analogy with students of heterodox economics/political economy, and freshwater economics with the whole mainstream. For instance, ask a post-Keynesian or a Marxian to hold court on IS/LM, and they can do it easily. This is not because these economists are heroic; instead, they realize that is essential to build a counter-theory by learning the original theory and its critique.

My course in Marxian political economy began with a reschooling in intermediate micro and macro- we actually learned this stuff better a second time by being forced to think critically about it. However, ask Krugman or his friends at Princeton and MIT about the starting point for Marx’s critique (hint: use-value versus exchange value) or Polanyi’s (hint: embeddedness) and I fear their eyes might glaze over. If the mainstream response to my argument is that the aforementioned critiques are not “serious economics,” well, we no longer have anything to talk about.

P.S. (private message for David Ruccio)- since I’ve dispensed with this one easily enough, hopefully you can take some time to follow up on my post re: Sen/Smith.

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