new issue of Real-World Economics Review

real-world economics review

issue 103
31 March 2023

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How to Make the Oil Industry Go Bust
Blair Fix     2

Technological Change and Strategic Sabotage:
A Capital as Power Analysis of the US Semiconductor Business
Christopher Mouré     26

Do copyrights and paywalls on academic journals violate the US Constitution?
Spencer Graves     56

Mainstream economics – the poverty of fictional storytelling
Lars P. Syll     61

Why do economists persist in using false theories?
Asad Zaman     84

Revisiting the Principles of Economics through Disney
Junaid Jahangir     89

On the Employer-Employee Relationship
David Ellerman     111

Why is yield-curve inversion such a good predictor of recession?
Philip George     122

Book Review: Thomas Picketty, A Brief History of Equality
Junaid Jahangir     128

Book Review: John Komlos, Foundations of Real-World Economics, 3^rd Edition
Alan Freeman     132

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new issue of real-world economic review

real-world economic review

issue no. 101   –   September 2022

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Two conceptions of the nature of money 
Tony Lawson          2

How power shapes our thoughts
Asad Zaman         20

SARS-CoV-2: The Neoliberal Virus
Imad A. Moosa          27

The giant blunder at the heart of General Equilibrium Theory
Philip George          38

A life in development economics and political economy: An interview with Jayati Ghosh
Jayati Ghosh and Jamie Morgan          44

John Komlos and the Seven Dwarfs
Junaid B. Jahangir          65

A three-dimensional production possibility frontier with stress
John Komlos           76

Free trade theory and reality:
How economists have ignored their own evidence for 100 years
Jeff Ferry          83

The choice of currency and policies for an independent Scotland:
A debate through the lenses of different economic paradigms
Alberto Paloni          90

End Matter 107

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Yes, economics has a problem with women

from Julie Nelson

Yes, economics has a problem with women. In the news recently we’ve heard about the study of the Economics Job Market Rumors (EJMR) on-line forum. Student researcher Alice H. Wu found that posts about women were far more likely to contain words about their personal and physical issues (including “hot,” “lesbian,” “cute,” and “raped” ) than posts about men, which tended to focus more on academic and professional topics. As a woman who has been in the profession for over three decades, however, this is hardly news.

Dismissive treat of women, and of issues that impact women more than men, comes not only from the sorts of immature cowards who vent anonymously on EJMR, but even from men who probably don’t think of themselves as sexist. And because going along with professional fashion may be necessary for advancement, women economists also sometimes play along with the dominant view.

Consider a few other cases I’ve noticed during my thirty years in the profession:  

15 most viewed RWER Blog posts in the past year

1. Summary of the Great Transformation by Polanyi, Asad Zaman

2. Piketty’s response to Mankiw et al.: “and some consume academics.”, David Ruccio

3. Germany is bluffing on Greece, Mark Weisbrot

4. Reflections on the “Inside Job”, Peter Radford

5. Emerging vs. developed countries’ GDP growth rates 1986 to 2015,  editor

Financial Times and Wall Street Journal look at parallel currency solution for Greece

Today both the Financial Times and the Wall Street Journal are talking about the increasing possibility of a parallel currency solution for Greece.  Primary sources of this idea are four papers from the Real-World Economics Review:

Trond Andresen and Robert W. Parenteau, “A program proposal for creating a complementary currency in Greece”, real-world economics review, issue no. 71, 29 May 2015, pp. 2-10, http://www.paecon.net/PAEReview/issue71/AndresenParenteau71.pdf

Alan Harvey, “Updated proposal for a complementary currency for Greece (with response to critics)”, real-world economics review, issue no. 71, 29 May 2015, pp. 12-18, http://www.paecon.net/PAEReview/issue71/Harvey71.pdf

Claude Hillinger, “From TREXIT to GREXIT? – Quo vadis hellas?”, real-world economics review, issue no. 70, 20 Feb 2015, pp. 161-163, http://www.paecon.net/PAEReview/issue70/Hillinger70.pdf

Trond Andresen, (2013). Improved Macroeconomic Control with Electronic Money and Modern Monetary Theory, real-world economics review, issue 63, http://www.paecon.net/PAEReview/issue63/whole63.pdf

 

Issue no. 71 of the real-world economics review

Leave comments on issue 71 here.

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Issue no. 71 , 28 May 2015

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Two proposals for creating a parallel currency in Greece                                                   

A program proposal for creating a complementary currency in Greece
Trond Andresen and Robert W. Parenteau          download pdf

Updated proposal for a complementary currency for Greece
Alan Harvey          download pdf

China’s communist-capitalist ecological apocalypse 
Richard Smith          download pdf

Trends in US income inequality 
Pavlina R. Tcherneva          download pdf

The market economy: Theory, ideology and reality 
C. T. Kurien          download pdf

Explaining money creation by commercial banks
Ib Ravn          download pdf

Realist Econometrics? – Nell and Errouaki’s, Rational Econometric Man 
Jamie Morgan          download pdf

Who does the state work for? – Geopolitics and global finance 
Tijo Salverda         download pdf

Leave comments on issue 71 here.

“This may all sound far-fetched, but the idea has been developed in some detail by a Norwegian academic, Trond Andresen”

The conservative UK newspaper The Telegraph has featured an article “How to end boom and bust: make cash illegal” about Trond Andresen’s RWER paper “Improved macroeconomic control with electronic money and modern monetary theory”.  It has already attracted over 3,000 comments.

Most downloaded back-issue RWER papers in March 2015

/PAEReview/issue58/Koo58.pdf
/PAEReview/issue69/Varoufakis69.pdf
/PAEReview/issue46/Baker46.pdf
/PAEReview/issue66/Syll66.pdf
/PAEReview/issue69/Hudson69.pdf
/PAEReview/issue69/Wade69.pdf
/PAEReview/issue56/GuerrienGun56.pdf
/PAEReview/issue69/Knibbe69.pdf
/PAEReview/issue56/Smith56.pdf
/PAEReview/issue52/Kellecioglu52.pdf
/PAEtexts/Chang1.htm
/PAEReview/issue64/Smith64.pdf
/PAEReview/issue60/KaragiannisKondeas60.pdf
/PAEReview/issue66/Huber66.pdf
/PAEReview/issue60/Reinert60.pdf

Issue no. 70 of the real-world economics review

Issue no. 70 of the real-world economics review                   leave comments here

Piketty finally admits marginal productivity theory is wrong

from Lars Syll

In yours truly’s article Piketty and the limits of marginal productivity the author of Capital in the Twenty-First Century is criticized for not being prepared to fully take the consequences of marginal productivity theory — and the alleged close connection between productivity and remuneration postulated in mainstream income distribution theory — over and over again being disconfirmed both by history and, as shown already by Sraffa in the 1920s and in the Cambridge capital controversy in the 1960s, also from a theoretical point of view:

 

Seeking short summaries of major works in economics

from Edward Fullbrook

In 2014 one post on this blog was viewed more than twice as many times as any other post, nearly ten thousand.  It is Asad Zaman’s Summary of the Great Transformation by Polanyi.  Although it was posted back in late 2013, it continues to attract viewers at a rate that every month places it in the ten most viewed posts, and in recent months its download rate has even been growing.

So how do we account for the extraordinary success of Zaman’s post?   Part of the credit is due of course to the quality of Zaman’s writing and to his reputation.  But surely there is more to it than that, and three possibilities have occurred to me.  One, which I reject, is that it is the name Polanyi which attracts so many readers.  Another is that a network of links has been created leading people, most likely students, to Zaman’s post.  But after examining extensive site data I have found no evidence that such links exist.  A third possibility, and the one in which I am inclined to believe, is that it is the idea of a short (blog-post-length) summary of a famous work that attracts the readers and which lends itself to discovery through search engines. I can see how this might especially be appealing to students who education is structured to not only keep them away from all primary sources, but also to deny them direct summaries of important works.

So banking on the third explanation, I am extending a broad invitation.  I would like over the coming year for the RWER Blog to publish a series of short (750 words or less) summaries of famous works in economics.  Initially at least, I am interested in publishing only one such summary per work. So if you are interested in writing one, you should first clear the possibility with me at pae_news@btinternet.com.

If over the coming year we establish a small library of these major work summaries, then there is a good chance that network effects will lead to download rates for individual summaries that exceed that of Zaman’s Polanyi to date.

Reading Piketty in Athens

from Richard Parker

I have been reading Thomas Piketty this past week in Athens, where I came back to assess how Greece is faring half a decade after its economy imploded, initially as a consequence of its own ills and then – in an act of monumental malpractice by Germany, the ECB, and the IMF – the cure imposed.^[1]

Signs of recovery are few.

It is hot here, as Mediterranean summers always are – but as thick as the heat is, an air of solemnity and defeat lies far more thickly over this concrete-gray capital and its now concrete-gray people, for whom what we know as the Great Recession has been their Great Depression, where the GDP has contracted 40% in five years and more than a quarter of its workforce can find no paid employment.

Four years ago, tens of thousands of Greeks would turn up regularly, week after week, at Syntagma Square in the heart of Athens to protest, again and again, the terms of the European-and-IMF-designed austerity regime that was the price Greece was being made to pay for loans meant to keep its government and economy afloat.

The streets lack protestors now, filled instead by tourists (more than 20 million visitors are expected this year, nearly two tourists for every Greek citizen) but also with drunks, junkies, and beggars out in alarming numbers of their own. Syntagma Square – jammed when I was here in 2011 with the tents and makeshift lean-tos of young protestors – has been scrubbed clean, the grass and flowers replanted, and new marble steps and benches replacing the stonework that had been chipped and broken to provide rocks to hurl at riot police.^[2]

But cross the street from Syntagma Square and walk into the five-star Hotel Grande Bretagne and you suddenly encounter  

issue no. 66 of the real-world economics review

Click here for the contents page of the new issue of RWER 

 

 

We need economic theories fit for the real world

from The Guardian

The Post-Crash Economics Society at Manchester University. Photograph: Jon Super for the Guardian

The Association for Heterodox Economics welcomes student initiatives for fundamental reform of the economics curriculum, as do our post-Keynesian colleagues (Letters, 19 November). Heterodox economists, drawing on a range of theorists, including Keynes, Marx, Minsky and others, have consistently argued for greater pluralism in both economics curricula and economics research evaluation. We recognise the clear benefits of pluralism in economics: it encourages, by exposing them to alternative perspectives, the development of students’ critical thinking and judgment.

Judea Pearl on regression and causation

from Lars Syll

Judea Pearl was kind enough to send yours truly his article (co-authored with Bryant Chen) Regression and causation: a critical examination of six econometrics textbooks a while ago. It has now been published in real-world economics review  issue no. 65.

The article addresses two very important questions in the teaching of modern econometrics and its different textbooks – how is causality treated in general, and more specifically, to what extent they use a distinct causal notation.

real-world economics review – issue no. 65

Issue no. 65, 27 September 2013
http://www.paecon.net/PAEReview/issue65/whole65.pdf  
You can download the whole issue as a pdf document by clicking here     

In this issue: 

Regression and causation: a critical examination of econometrics textbooks          2
Bryant Chen and Judea Pearl          download pdf 

Diagrammatic economics          21
John Pullen          download pdf 

A plea for reorienting philosophical attention from models to applied economics          30
Gustavo Marqués          download pdf 

A Copernican turn in banking union urgently needed          44
Tom Mayer          download pdf 

A monetary and fiscal framework
for macroeconomic stability in the European Monetary Union          51
Thomas Oechsle          download pdf 

The experience of three crises:
the Argentine default, American subprime meltdown and European debt mess          65
Víctor A. Beker          download pdf 

Global output growth: wage-led rather than profit-led?          116
Leon Podkaminer          download pdf  

Striking it richer: the evolution of top incomes in the United States          120
Emmanuel Saez          download pdf 

New Paradigm Economics          129
Edward Fullbrook          download pdf 

Past contributors, submissions and etc.          132

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Wikipedia has the beginning of an article on the RWER, http://en.wikipedia.org/wiki/Real-world_economics_review.  It needs much work.  It would be useful if RWER subscribers contributed to this

10 most viewed posts of the last 90 days

1. The Neoclassical conspiracy against Post Keynesian Economics (1)
2. Doctor X, “pure shit” and the Royal Society’s motto
3. issue no. 64 of real-world economics review
4. Sweden’s 30 years of income redistribution
5. The state of economics: Krugman is wrong
6. 25 graphics showing upward redistribution of income and wealth in USA since 1979
7. IS-LM is bad economics no matter what Krugman says
8. Rethinking Keynes’ non-Euclidian theory of the economy
9. What’s the use of economics?
10. Emerging vs. developed countries’ GDP growth rates 1986 to 2015

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

issue no. 63 of real-world economics review

Issue no. 63,  25  March  2012

You can download the whole issue as a pdf document by clicking  here  

In this issue:

The veil of deception over money           2
Norbert Häring           download pdf

Ultra easy monetary policy and the law of unintended consequences           19
William White            download pdf

Civilizing capitalism           57
Erik Reinert           download pdf

Looking at the right metrics in the right way – Two kinds of models           73
Merijn Knibbe           download pdf

Crisis and methodology: Some heterodox misunderstandings          98
Egmont Kakarot-Handtke          download pdf

Inapplicable operations on ordinal, cardinal, and expected utility          118
Jonathan Barzilai          download pdf

Reduced work hours as a means of slowing climate change         124
David Rosnick          download pdf

Electronic money and Modern Monetary Theory          135
Trond Andresen          download pdf

Productivity, unemployment and the Rule of Eight          142
Alan Taylor Harvey          download pdf

What I would like economic majors to know          147
David Hemenway          download pdf

Past, contributors, submissions and etc.          155

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.