Author Archive

Resources for recovering academic writers

October 18, 2019 4 comments

from Blair Fix

Hello, my name is Blair Fix. I’m a recovering academic writer.

Let me explain. I’m convinced that a major part of grad school is learning to decipher academic prose. Let’s face it — academic writing is usually bad. It’s dense. It’s jargon filled. It’s often monotonous. In short, academic writing begs the reader not to read it.

So a big part of grad school is learning how to read prose that was designed not to be read. This takes great effort and a healthy dose of masochism. If you’ve learned how to read academese, I commend you.

Having learned how to read academic prose, the next step in grad school is to learn how to write this way yourself. Writing like fellow academics signals that you’re ready to join the guild. Your lofty ideas belong in the academic pantheon.

I’ll use myself as an example. During my master’s degree, I did lots of academic signalling. Check out my master’s thesis. It’s a dense fog of verbiage that’s almost unreadable.

So you finish grad school. Congratulations! You’ve learned to read and write like an academic. What’s next?


Take a hard look at your writing. Is it designed to be read? Or is it designed to be cited? If it’s the latter, then you need recovery. You need to unlearn the bad habits you acquired in grad school. Rather than write for the guild, you must learn how to write prose that is intelligible to the non-expert.

As a recovering academic writer, I’ve spent the last few years (re)learning how to write well. Below is a list of resources that have helped me. I hope they aid your recovery as well. Read more…

Some constructive remarks on Wray’s “Alternative paths to MMT”

October 16, 2019 4 comments

from Arturo Hermann

Dear Randall, I appreciate your article “Alternative Paths to Modern Money Theory” and the novel perspective put forth by MMT in respect to the very narrow views of Austrian and neoclassic theories. Starting from this, I would like to make some constructive remarks around the following aspects: 

(I) In the article you stress that (p.6), when there is a “sovereign national currency” (p.5) and flexible exchange rates, “The sovereign currency issuer:

  1.  does not face a ‘budget constraints’ (as conventionally defined). [Later you clarify that “a sovereign government can impose on itself a ‘budget’ and that “this is normal practice and probably a good idea”, but anyway this path seems to be in your view fairly optional.];
  2. cannot ‘run out of money’;
  3. can always meet its obligations by paying in its own currency;
  4. can set the interest rate on any obligations it issues.”

These aspects are true, of course, and lie at basis of most post-Keynesian theories. The central problem is that this picture would apply only in an ideal situation, where public sector, also considered in a supranational dimension as in the case of the Euro*, has a real control over its currency. Read more…

No, productivity does not explain income

October 14, 2019 8 comments

from Blair Fix

Did you hear the joke about the economists who tested their theory by defining it to be true? Oh, I forgot. It’s not a joke. It’s standard practice among mainstream economists. They propose that productivity explains income. And then they ‘test’ this idea by defining productivity in terms of income.

In this post, I’m going to show you this circular logic. Then I’ll show you what productivity differences look like when productivity is measure objectively. They’re far too small to explain income differences.


Marginal productivity theory

The marginal productivity theory of income distribution was born a little over a century ago. Its principle creator, John Bates Clark, was explicit that his theory was about ideology and not science. Clark wanted show that in capitalist societies, everyone got what they produced, and hence all was fair:

It is the purpose of this work to show that the distribution of the income of society is controlled by a natural law, and that this law, if it worked without friction, would give to every agent of production the amount of wealth which that agent creates. (John Bates Clark in The Distribution of Wealth)

Clark was also explicit about why his theory was needed. The stability of the capitalist order was at stake! Here’s Clark again:

Read more…

MMT: eliding foundational principles in the interests of journalistic simplicity

October 13, 2019 19 comments

from Anne Mayhew

I count myself as one of those friendly critics who applaud several of the major MMT contributions to our understanding of the modern American economy. Among these contributions are the emphasis put on

  • the endogeneity of money;
  • the importance of using of a flow-of-funds approach in analysis of the macroeconomy;
  • detailed descriptions of how the FED (Federal Reserve System) actually operates, details usually missing from texts.

And from these three emphases the central conclusion of MMT is that the availability of space for fiscal expansion is larger than commonly understood. These three emphases are used to construct a forceful rejection of the argument that financial constraints can require austerity in economies with unused non-financial resources. Although much of the analysis has been focused on the U.S. economy, the MMT attack on austerity policies as necessary also has much wider application. This I also applaud.

I am, however, Read more…

Radically misleading calculations

October 11, 2019 4 comments

from Geoff Davies

The point of a theory or model is to provide a useful guide to understanding the world. People like Paul Krugman are fond of claiming simple equilibrium models provide a useful first cut or first approximation to understanding. Others put their faith in more elaborate equilibrium models. But do equilibrium models, simple or elaborate, offer any useful guidance to actual economies, or are they perhaps radically misleading? Is this

a useful guide to this? Read more…

What is MMT?

October 10, 2019 15 comments

from L. Randall Wray

MMT provides an analysis of fiscal and monetary policy that is applicable to national governments with sovereign currencies. We argue that there are four essential requirements that qualify a national currency as sovereign in the sense in which we use the term:

  1. the National government chooses a money of account in which the currency is denominated;
  2. the National government imposes obligations (taxes, fees, fines, tribute, tithes) denominated in the chosen money of account;
  3. the National government issues a currency denominated in the money of account, and accepts that currency in payment of the imposed obligations; and
  4. if the National government issues other obligations against itself, these are also denominated in the chosen money of account, and payable in the national government’s own currency.

There is a fifth, important, consideration, which concerns the exchange rate regime and follows from the fourth requirement above. Strictly speaking, if a country adopts a gold standard or “dollarizes” it does not have what we define as a sovereign currency because it has agreed to exchange its currency for gold or dollars at a fixed exchange rate. Its obligation really is to deliver gold or dollars in payment. On the other hand, Read more…

An ideology called consumerism

October 9, 2019 3 comments

We are guided by an ideology so familiar and pervasive that we do not even recognise it as an ideology. It is called consumerism. It has been crafted with the help of skilful advertisers and marketers, by corporate celebrity culture, and by a media that casts us as the recipients of goods and services rather than the creators of political reality. It is locked in by transport, town planning and energy systems that make good choices all but impossible. It spreads like a stain through political systems, which have been systematically captured by lobbying and campaign finance, until political leaders cease to represent us, and work instead for the pollutocrats who fund them.

In such a system, individual choices are lost in the noise. Attempts to organise boycotts are notoriously difficult, and tend to work only when there is a narrow and immediate aim. The ideology of consumerism is highly effective at shifting blame: witness the current ranting in the billionaire press about the alleged hypocrisy of environmental activists. Everywhere I see rich westerners blaming planetary destruction on the birth rates of much poorer people, or on “the Chinese”. This individuation of responsibility, intrinsic to consumerism, blinds us to the real drivers of destruction.

The power of consumerism is that it renders us powerless. It traps us within a narrow circle of decision-making, in which we mistake insignificant choices between different varieties of destruction for effective change. It is, we must admit, a brilliant con.

It’s the system we need to change, rather than the products of the system. It is as citizens that we must act, rather than as consumers. But how?

George Monbiot in today’s Guardian

Tribalism in Science (and Economics)

October 8, 2019 43 comments

from Blair Fix

If you ask the average person what ‘science’ is, they’ll probably answer something like ‘it’s what we know about the world’. To the lay person, ‘science’ is a body of facts.

To the trained scientist, however, ‘science’ means something different. It’s not a body of knowledge. It’s a method for determining what’s true and what’s not. To determine the way the world works, science appeals to evidence.The ideal of science is beautifully summarized by the motto of the Royal Society: nullius in verba. It means ‘take nobody’s word for it’. In science, there is no authority. There are no gods, no kings, and no masters. Only evidence.

In this post, I reflect on how ‘taking nobody’s word for it’ cuts against some of our deepest instincts as humans. As social animals, we have evolved to trust members of our group. Among these group members, our instinct is to ‘take their word for it’. I call this the ‘tribal instinct’.

Read more…

RWER issue 89: Modern monetary theory and its critics

October 8, 2019 1 comment

Has wealth gone digital?

October 6, 2019 4 comments

from Blair Fix

A revolution is underway around us and it’s called the digital. And it’s changing everything. More than 80% of wealth is now non-material.

— Charles Foran in Just don’t say his name: the modern left on Karl Marx’s place in politics (41:30)

Both critics and cheerleaders of capitalism claim it has. The critics see non-material wealth as a problem. Digital wealth, they say, is fictitious. It’s lost touch with reality.

The cheerleaders of capitalism see the same thing as a boon. Non-material wealth, they say, will decouple the economy from physical constraints. So the economy can grow forever!

Which side is right?

Neither, in my opinion.

Instead, both sides misunderstand the nature of wealth. Wealth is not becoming non-material. No. Wealth has always been non-material. So the digital revolution isn’t changing the nature of wealth. It’s just laying bare the facts that have always been there.

What is wealth?  Read more…

Understanding statistical distributions

October 4, 2019 Leave a comment

from Asad Zaman

In line with the pedagogical mission of this blog, I will be writing up a sequence of posts which explain the concept of a statistical distribution. As has been pointed out by numerous authors, a fundamental mistake in understanding concepts of uncertainty and probability was made in the early 20th Century, when views of Keynes and Knight were rejected, and ideas of Ramsey, De-Finetti, and other subjectivists were accepted. To set things right, we have start from scratch, and build up the concept of probability on new foundations.  read more

How economists came to ignore the natural world

October 2, 2019 11 comments

She’s right. One of the reasons nations fail to address climate change is the belief that we can have infinite economic growth independent of ecosystem sustainability. Extreme weather events, melting arctic ice, and species extinction expose the lie that growth can forever be prioritized over planetary boundaries.

It wasn’t always this way. The fairytale of infinite growth—which so many today accept as unquestioned fact—is relatively recent. Economists have only begun to model never-ending growth over the last 75 years. Before that, they had ignored the topic for a century. And before that, they had believed in limits. If more people saw the idea of infinite growth as a departure from the history of economics rather than a timeless law of nature, perhaps they’d be readier to reimagine the links between the environment and the economy.

In 1950, the economics profession had surprisingly little to say about growth. That year, the American Economic Association (AEA) asked Moses Abramovitz to write a state-of-the-field essay on economic growth. He quickly discovered a problem: There was no field to review. Read more…

The study of economies needs to be fundamentally reworked.

September 26, 2019 12 comments

from Geoff Davies

The study of economies needs to be fundamentally reworked. The dominant approach has been in a pre-scientific state, akin to medicine before Pasteur. It has not even been in a state comparable to Ptolemaic astronomy, which did make usefully quantified predictions of planetary positions in the sky.

We need to return to fundamental questions. What is the nature of an economy? What is the purpose of an economy? How does an economy relate to the larger society and natural world in which it is embedded? In this book a conception is sketched out that can accommodate not only economic phenomena but the social and natural processes with which they are inextricably entwined.

It is urgently necessary that the currently dominant competitive, free market, neoclassical economic mode be replaced, because it is incompatible with living things at every level: philosophical, theoretical and practical. As a result it is destroying our life support system, and many of us with it. The free-market mode persists in part because of fundamental misconceptions of how unfettered markets work. It is a matter of survival that we better understand this and other possible economic systems, and that we find systems that will nurture human and other life. Fortunately, healthy alternatives are available.

Earth Overshoot Day

September 25, 2019 10 comments

from Barry Gills and Jamie Morgan

We live in a time of Climate Emergency. Nevertheless, our collective actions do not yet approximate a real understanding nor fully appropriate actions. We are not yet acting as if we are facing an urgent and life threatening Emergency. What does ‘Climate Emergency’ actually mean? According to David Attenborough:

It may sound frightening, but the scientific evidence is that if we have not taken dramatic action within the next decade, we could face irreversible damage to the natural world and the collapse of our societies.    (Attenborough, Our Planet)

History is written later, but the future is written now. Perhaps the central message of contemporary climate sciences consists in the realization that the entire planet is deeply interconnected. There are no isolated ecosystems. There are no ecosystems that are safe from the effects of climate change. All life on this planet is profoundly interrelated. What happens in one area of the globe has far reaching, but as yet insufficiently understood, effects upon and consequences for even far distant regions. . . .  Read more…

Can capitalists afford economic growth? An animation

September 24, 2019 2 comments

from Shimshon Bichler and Jonathan Nitzan

Despite the global dominance of capitalism, growth rates continue to trend downward. Mainstream economists blame the slowdown on various ‘distortions’, but as this animation by Elvire Thouvenot shows, the reality is quite different. Capitalists seek not more income per se, but greater power-through-redistribution, which they achieve by strategically stymying growth.

“fairy-tales of eternal economic growth”

September 23, 2019 8 comments

Going digital: the forces shaping the future of business and labour – call for papers for a new WEA Conference is open!

September 23, 2019 1 comment

from Malgorzata Dereniowska

Call for Papers

The advent of digital economy creates new challenges for businesses, workers, and policymakers. Moreover, business prospects for artificial intelligence and machine learning are evolving quickly. These technologies have transforming implications for all industries, businesses of all sizes, and societies. The digitalisation of economic activities calls for a deep reflection on the forces that will shape the future of the global economy.

Aims of the Conference

The objective of this conference, led by Prof. Maria Alejandra Madi and Dr. Małgorzata Dereniowska, is to discuss recent contributions to the understanding of digital economy and its consequences for business trends and labour challenges. The conference also focuses on bridging the gap between different economic theoretical approaches and the practical applications of artificial intelligence and machine learning. Related topics include law, ethics, safety, and governance.

Topics include (but are not limited to): read more . . . 

Willian Nordhaus can’t keep his “Nobel Prize” because he doesn’t have one.

September 21, 2019 5 comments

Willian Nordhaus can’t keep his “Nobel Prize” because he doesn’t have one. Alfred Nobel never set up a prize for economics because he recognised that it is not a science – not even a “dismal science” – and that most of the research has little to do with the real world, being founded on ideas which are palpably untrue.

What Nordhaus has is a Swedish Banker’s prize for promoting neo-liberal ideas about money for the benefit of the world’s super rich. They call it the “Nobel Prize” despite Nobel’s wishes and the efforts of his family to have the title removed.

This economics prize is routinely dished out to people who promote right-wing ideas in an attempt to give them added respectability. They have been, to the world’s great loss, horribly successful on this endeavour. It is no surprise that Nordhous’s ideas are as bad as they are, firstly because classical economics is not capable of dealing with the sorts of problem climate change poses to the world; and secondly because the purpose of the award is to give the bankers/financiers/capitalists/plutocrats (add more to taste) cover for what they intended to do anyway.

I am sure Steve Keen is aware of all of this but it is sad to see someone of his stature accepting the basis of this fake “Nobel Prize”. We need more political-economic thinkers like Professor Keen to both expose the fake ideas of people like Nordhaus and also to promote real ideas about money and economics with a base in the real world and a concience about the consequences of our current path.

Ken Patterson

Economics’ billiard-ball model

September 16, 2019 2 comments

“The social extension of atomistic methods . . . is not, of course, really a scientific project at all, though it uses scientific language.  It is a distortion that tends to discredit the whole idea of science by exploiting it to draw dubious political and moral conclusions.  This distortion itself has become obvious over the very notion of an atom – the idea of an impenetrable, essentially separate unit as the ultimate form of matter.  We know that today’s physicists no longer use this billiard-ball model.  They now conceive of particles in terms of their powers and their interaction with other particles, not as inert separate objects.  The seventeenth-century idea of a world constructed out of ultimately disconnected units has proved to be simply mistake.  Instead, physicists now see many levels of complexity; many different patterns of connection.

At an obvious level it follows that we ought no longer to be impressed by social atomism, or by behaviourism, in the way that we once were.  We can see now that it cannot have been scientific to impose on social affairs a pattern which turns out to have been so inadequate for physics.  But the moral goes much deeper.  It is one that would still hold even if physics had not changed.  That moral is that, quite generally, social and psychological problems cannot be solved by imposing on them irrelevant patterns imported from the physical sciences, merely because they are seductively simple.”

Mary Midgley, p.7-8, Science and Poetry

WEA Commentaries is looking for a co-editor

September 11, 2019 Comments off

WEA Commentaries

Co-editor required

Are you an early- or mid-career economist?

Do you have, or wish to develop, links with pluralist economists from around the world?

Are you self-motivated, capable of showing initiative, and interested in a wide range of perspectives?

If so, we would like to hear from you. Please email