issue no. 64 of real-world economics review
Issue no. 64, 2 July 2013
You can download the whole issue as a pdf document by clicking here
In this issue:
Is it a bubble? download pdf 2
Steve Keen — A bubble so big we can’t even see it download pdf 3
Dean Baker – Are the bubbles back? download pdf 11
Ann Pettifor – The next crisis download pdf 15
Michael Hudson – From the bubble economy to . . . . . download pdf 21
Rethinking economics using complexity theory 23
Dirk Helbing and Alan Kirman download pdf
The fate of Keynesian faith in Joseph’s countercyclical moral 52
Douglas Grote download pdf
A constructive critique of the Levy sectoral financial balance approach 59
Brett Fiebiger download pdf
Capturing causality in economics and the limits of statistical inference 81
Lars Syll download pdf
Money as gold versus money as water 90
Thomas Colignatus download pdf
Constant returns to scale: Can the competitive economy exist 102
M. Shahid Alam download pdf
Reassessing the basis of corporate business performance 110
Robert Locke download pdf
Capitalism and the destruction of life on Earth 125
Richard Smith download pdf
Past contributors, submissions and etc. 152
Leave a comment
—– look inside —– $5.94 / $20.00
—– look inside —– $4.90 / $8.00
—– look inside —– $15.99
—– look inside —– $5.99 / 12.99
—– look inside —– $5.93 / $12.99
—– look inside —– $4.97 / $9.90
—— Ugarteche, Puyana and Madi ——
Gerson Lima / Maria Alejandra Madi
Edward Fullbrook and Jamie Morgan
————— Michael Hudson ————–
Maria Alejandra Madi / Jack Reardon
————- Edward Fullbrook ————-
—————— Steve Keen —————–
————— Richard Smith —————
————– Gustavo Marques————
– Victor Beker and Beniamino Moro –
————– Lars Pålsson Syll ————-
—————– Stuart Birks —————-
Edward Fullbrook and Jamie Morgan
———— Armando Ochangco ———-
Shimshon Bichler / Jonathan Nitzan
————— Mauro Gallegati ————–
————— Herman Daly —————-
————— Asad Zaman —————
—————– C. T. Kurien —————
————— Robert Locke —————-
Real-World Economics Review Blog 
Baker falls into a similar trap as Gavyn Davies of the FT on profits. See:
http://ftalphaville.ft.com/2013/07/01/1551542/playing-profit-with-the-stock-market/
Shahid Alam would find various papers by Bruce Kaufman of interest. Kaufman argues that without transactions cost, as in the theory of perfect competition, capitalist firms would not exist. Rather, everybody would become independent, self-employed artisans.
Great article by Steve Keen (A bubble so big …). The focus of the article is the role of debt in funding stock price appreciation since 1982. However, the graphs also show progressive increase in CPI corrected stock prices from 1950 to 1969 and then a correction (1969-1982) before the dramatic increases leading to the peaks of 2000, 2007 and now the rise of 2013. So what was happening 1950 to 1969 and 1969 to 1982? To what extent was the Long Boom funded by debt?
Outstanding paper by Helbing and Kirman on a new complexity paradigm for economics. This is the kind of thinking that many of us mathematical / scientific critics from outside economics have long called for.
I would add that this work needs to build on the pioneering systems dynamics of the famous limits to growth studies, especially since the world economy is now experiencing the initial phase of these limits (oil and other resource limits, climate events, ecosystem damage, financial crises, civil strife, etc).
Helbing and Kirman’s 11 recommendations are also a massive undertaking, ideally carried out through a new global initiative, with participation and funding from many countries and organizations, with a strong democratic component. Perhaps someone like Soros could be approached to get the ball rolling.
A point to be emphasized is that the economic system they envision (decentralized or weakly coupled, self-organizing toward multiple objectives) actually requires unprecedented central data collections, planning, and regulation of the overall system itself. This is a tall order in a fractious world but also an unprecedented opportunity for a shift toward a culture of global democracy, away from global greed. The debt crisis that will follow the end of growth could become that opportunity, if not a devastating stage of collapse.
A friendly critique to Prof. M. Shahid Alam’s paper:
On Constant Returns to Scale and Marx.
http://aussiemagpie.blogspot.com.au/2013/07/on-constant-returns-to-scale-and-marx.html