The Real Dow

from Edward Fullbrook

You will find more real stuff here: http://www.showrealhist.com/RD_RJShomes_PSav.html

Will USA living standards ever again be as high as they were in the last century?

from Edward Fullbrook

Median household income in the USA is now 8.4 per cent less than it was at the close of the 20th century.

Source: Sentier Research analysis of Labor Department data.
More info and graphs are available in a  report from Sentier Research.

Economic Thought: Special Issue on Ethics and Economics

Economic Thought - History, Philosophy, and Methodology
An open access, open peer review journal from the World Economics Association
Vol 2, No.1, 2013 – Special Issue on Ethics and Economics

Download issue in full (PDF)

Ontological   Commitments of Ethics and Economics Karey Harrison	Abstract	Download   PDF
Codes of Ethics   for Economists: A Pluralist View Sheila C Dow	Abstract	Download   PDF
No Ethical Issues   in Economics? Stuart Birks	Abstract	Download   PDF
Professional   Economic Ethics: Why Heterodox Economists Should Care George   DeMartino	Abstract	Download   PDF
And the Real   Butchers, Brewers and Bakers? Towards the Integration of Ethics and Economics Riccardo   Baldissone	Abstract	Download   PDF

_________________________________________________________________________________
Volunteers needed to start WEA national chapters. If interested, email nationalchapters@worldeconomicsassociation.org

WEA Young Economists (Facebook Group – 8 days old – 260 members – join today)

WEA online conference: The economics curriculum: towards a radical reformation

The economics curriculum: towards a radical reformation
3d May – 31st May
- a World Economics Association Conference
- with Open Discussion Forum    – http://curriculumconference2013.worldeconomicsassociation.org/

Papers  

The economics curriculum – WEA online conference announcement

World Economics Association online conference:

The economics curriculum: towards a radical reformation

Due to serious illness by Jack Reardon, the leader, this conference has been postponed and the discussion forum will now take place

3d May to 31^st May. 

This postponement gives many of you the opportunity to prepare or finalize papers. We are, in fact rescheduling the deadline for papers and you can upload them when ready and before:

New deadline for papers: 21^st April 2013

http://curriculumconference2013.worldeconomicsassociation.org/

Call for Papers for the Curriculum conference

Alfred Marshall, in the eighth edition of his Principles of Economics, wrote

Score card: 16% vs. 288%

From Edward Fullbrook 

David Ruccio‘s post yesterday on the 34-year (and still continuing) period of radical income redistribution in the United States featured a graph from a new report from the Economic Policy Institute. Below, from the same EPI report, is a table no less shocking than yesterday’s graph. 

WSJ says “there is something profoundly wrong with the mainstream economics profession’s understanding of how modern economies work.”

from Edward Fullbrook

Yesterday’s Wall Street Journal included an article ( A Dire Showing From a Dismal Bunch) that echoes arguments central to this blog and the RWER.  Here are sample passages.

Forecasting is by its nature a hit-and-miss affair; economics is not—despite the apparent dogmatic certainty of some of its practitioners—an exact science. But the track record of the profession in recent years—and last year in particular —is dire. Few economists spotted the boom and most hopelessly underestimated the bust. And it’s not as if the profession’s troubles in 2012 were limited to longer-range forecasts; it was getting it wrong virtually in real time with most forecasters forced to slash their projections every few months as each quarter turned out worse than expected.

What the dismal science’s dismal record suggests is that there is something profoundly wrong with the mainstream economics profession’s understanding of how modern economies work. The models on which its forecasts are built are clearly badly flawed.  

An online journal started in 2000

from Edward Fullbrook

The current issue of Bloomberg Business Week features an article on Ronald Coase’s plans to launch a new journal.  The article ends as follows.

Coase and Wang are still talking to university publishers about supporting Man and the Economy. The University of Chicago Press considered it but found other publications with the same approach, for example the Real-World Economics Review, an online journal started in 2000 by young French economists. They had originally titled it the “post-autistic economics newsletter.” Papers published this summer by the Review include “Rethinking macroeconomics in light of the U.S. financial crisis” and “Neoclassical economics: A trail of economic destruction since the 1970s.” Even if Coase never launches his journal, he’s already helped inspire a generation of economists. One of the quotes on the home page of the Review reads: “Existing economics is a theoretical system which floats in the air and which bears little relation to what happens in the real world.” The source? Ronald Coase.

I was fascinated to learn that in 2000 I was young French economists.

Best economics read of 2012

from Edward Fullbrook

I have a policy of not taking economics books on holiday.  Philosophy yes, literary fiction always, genre fiction sometimes, occasionally books on physics written by physicists, but economics never.  Recently however the rule was broken.  Economists and the Powerful by Norbert Häring and Niall Douglas went with me to Majorca and it was a rewarding and enjoyable mistake.  Like F. Zaman’s RWER paper which I reviewed yesterday, and for similar reasons, it is an important book for understanding the times in which we live.   For both works, the role of power in the economy and the successful efforts of the ultra-powerful and their minions to keep their doings off society’s radar is the central theme.

Häring and Douglas detail how the real-world contexts out of which economic doctrines came to be created, in other words, all that stuff that should be in a History of Economic Thought course, but probably never is.  Their concept of power vis-a-vis economics includes the Pentagon.  The book abounds with fascinating historical detail.  Here is an example. 

Adam Smith, F. Zaman’s RWER paper and the 99% Movement

Social movements unsupported by strong intellectual storylines rarely prove successful.  For example, despite the everyday obviousness of their subjection, a century of brave women struggling for liberation never got beyond step one, the vote, until Beauvoir’s The Second Sex and its subsequent popularizations made both the injustice and the possibility of victory intellectually comprehensible.

The 99% Movement has emerged out of the street-level fallout from the stark reversal of the primary societal trends that for generations characterised the US, Canada and other countries: the now rapid and accelerating movement of wealth, income, opportunity and power away from the middle classes and into the hands of the wealthiest 1%, especially the 0.1%.  It is as if when no one was looking the socio-economics hourglass has been turned upside down.  And why was no one looking?  Because there was no theory or social narrative through which to view it.  It is not just science that needs theories to be able to see empirical reality.[1]  They are just as crucial, if not more so to societies.  That is why, for example, Thomas Paine was so important to the success of the American Revolution.  If there is no story that explains what is and how it came to be and moreover one that offers a possible victorious ending (“I have a dream.”), movements die a slow death under the weight of their grievances and the cost of their tactics.

Without the Beauvoirs major social movements become marooned at the tactical level.  Festering soon follows. The 99% Movement has not yet begun to fester, but it will if it does not begin now to integrate its gritty street-level narrative with a strategic intellectual one.  Until a few weeks ago no such possibility existed.  But now it does thanks to L. Frederick Zaman’s paper in the current issue of the Real-World Economic Review.

Nash dynamics of the wealthy, powerful, and privileged:
America’s two-player, Darwin metaeconomy
http://www.paecon.net/PAEReview/issue61/LFZaman61.pdf

Zaman’s primary inspiration, contrary to what his paper’s title suggests and also to what almost anyone might guess, is Adam Smith.  

Public Debt or Private Debt? – Part 2

In 24 hours a number of people have contributed data and graphs related to the request in Part 1.  These are pasted below, including the two remarkable graphs sent by Beaker in Australia and which he made  from data obtained by clicking through on the link sent by kkalev.

But I am still drawn to the simplicity of the two kinds of debt graph that Steve Keen is using in various public forums to illustrate the situation in his country.  It would be useful if such a single-country graph existed for many countries for anyone to use in public discussions.

First, here are two graphs from Beaker.  Click on them to enlarge. 

Average Rankings for the 8 Income and Leisure Indicators

Decline of the USA (Al Jazeera’s review)

For days of holiday and vacation taken per year the USA ranks 23rd out of 23

Decline of the USA     (Al Jazeera’s review)  

For average hours worked per person annually in employment the USA ranks 22nd out of 30

Decline of the USA     (Al Jazeera’s review)   

For current account balance as a percentage of GDP the USA ranks 25th out of 30

Decline of the USA     (Al Jazeera’s review)  

For ratio of female to male income the USA ranks 12th out of 30

Decline of the USA      (Al Jazeera’s review)  

Economists This Week: What is neoclassical economics? Glasner, Krugman, Vernengo, Knibbe and Pilkington

David Glasner  http://uneasymoney.com/2012/08/27/hayek-was-a-neoclassical-yes-neoclassical-economist/

Keynes’s work was not neoclassical economics, and it has been an ongoing project ever since Keynes published the General Theory to determine whether, and to what extent, Keynes’s theory could be reconciled with neoclassical economic theory. Here is how Hayek summed up his essay.

It seems to me that signs can already be discerned of a revival of interest in the kind of theory that reached its first high point a generation ago – at the end of the period during which Menger’s influence had mainly been felt. His ideas had by then, of course, ceased to be the property of a distinct Austrian School but had become merged in a common body of theory which was taught in most parts of the world. But though there is no longer a distinct Austrian School, I believe there is still a distinct Austrian tradition form which we may hope for many further contributions to the future development of economic theory. The fertility of its approach is by no means exhausted and there are still a number of tasks to which it can profitably be applied.

So we are all (or almost all) neoclassical economists, and none more so than Hayek, 

For income equality the USA ranks 28th out of 29

Decline of the USA     (Al Jazeera’s review)    

For share of income received by richest 10% the USA ranks 26th out of 28

Decline of the USA     (Al Jazeera’s review)    

For share of income received by poorest 20% the USA ranks 27th out of 28

Decline of the USA    (Al Jazeera’s review)