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Syll’s top 20 books compared to RWER’s top 10 and its poll’s top 40 vote receivers

March 18, 2018 1 comment

In May of 2016 the Real-World Economics Review conducted a poll titled “Top 10 Economics Books of the Last 100 Years”  Voting was open to the journal’s 26,000 subscribers, and over 3,000 of them voted, each having up to ten votes and with 17,270 votes in total cast. The results were published two weeks later and linked on over 2,000 Facebook pages.  It is interesting to compare those results to Lars Syll’s personal list of “Top 20 heterodox economics books” published here earlier today.

Although the RWER subscribers list was not limited to “heterodox” economics books, eight of Syll’s top 20 appear in the RWER subscribers’ Top Ten.

Pasted below are the 40 books in the RWER poll that received the most votes.  Notably, Syll’s list contains only one book published in this millennium and the RWER’s top 20 only three.

The 40 books that received the most votes in the RWER poll for the
Top 10 Economics Books of the Last 100 Years 

  1. John Maynard Keynes, General Theory of Employment, Interest and Money (1936)   1,597
  2. Karl Polanyi, The great transformation (1944)            1,027
  3. Joseph A. Schumpeter, Capitalism, Socialism & Democracy (1942)       927
  4. John Kenneth Galbraith, The Affluent Society (1958)  780
  5. Hyman Minsky, Stabilizing an Unstable Economy (1986)         731
  6. Thomas Piketty, Capital in the Twenty-First Century (2014)       687
  7. Joan Robinson, The Accumulation of Capital (1956)       583
  8. Michal Kalecki, Selected Essays on the Dynamics of the Capitalist Economy (1971)    582
  9. Amartya Sen, Collective Choice and Social Welfare (1970)     580
  10. Piero Sraffa, Production of Commodities by Means of Commodities (1960)       500

Read more…

Top 20 heterodox economics books

March 17, 2018 13 comments

from Lars Syll

  • Karl Marx, Das Kapital (1867)
  • Thorstein Veblen, The Theory of the Leisure Class (1899)
  • Joseph Schumpeter, The Theory of Economic Development (1911)
  • Nikolai Kondratiev, The Major Economic Cycles (1925)
  • Gunnar Myrdal, The Political Element in the Development of Economic Theory (1930)
  • John Maynard Keynes, The General Theory (1936)
  • Karl Polanyi, The Great Transformation (1944)
  • Paul Sweezy, Theory of Capitalist Development (1956)
  • Joan Robinson, Accumulation of Capital (1956)
  • John Kenneth Galbraith, The Affluent Society (1958)
  • Piero Sraffa, Production of Commodities by Means of Commodities (1960)
  • Johan Åkerman, Theory of Industrialism (1961)
  • Axel Leijonhufvud, Keynes and the Classics (1969)
  • Nicholas Georgescu-Roegen, The Entropy Law and the Economic Process (1971)
  • Michal Kalecki, Selected Essays on the Dynamics of the Capitalist Economy (1971)
  • Paul Davidson, Money and the Real World (1972)
  • Hyman Minsky, John Maynard Keynes (1975)
  • Philip Mirowski, More Heat than Light (1989)
  • Tony Lawson, Economics and Reality (1997)
  • Steve Keen, Debunking Economics (2001)

What happens next?

March 17, 2018 3 comments

from Peter Radford

As we tumble from one degrading political spectacle to another it is worth remembering that things that mattered were actually addressed periodically, even if the result was tumult. For reasons not worth mentioning here I am taking good look at English history between 1909 and 1911. In this case the tumult was triggered by a budget which was resisted by landowners and the House of Lords, and ended with a radical reorientation of power that left the House of Lords relatively toothless — although not, unfortunately, eliminated.

That radical budget was introduced by its major proponent, Lloyd George, as follows:

“This is a war Budget. It is for raising money to wage implacable warfare against poverty and squalidness. I cannot help hoping and believing that before this generation has passed away, we shall have advanced a great step towards that good time, when poverty, and the wretchedness and human degradation which always follows in its camp, will be as remote to the people of this country as the wolves which once infested its forests.”

Even from our jaundiced position this is an audacious introduction. Only a few years later Europe was engulfed in catastrophe that led, in large part, to the introduction of meany of the measures within the budget. But Lloyd George and his Liberal colleagues could not have anticipated that.

The constitutional crisis that erupted as a consequence of the budget’s introduction lasted the following two years and involved threats of packing the House of Lords with compliant new members to ensure passage of the law. It involved two different kings — King Edward died in 1910 — plunging the new King George into politics from his first day on the throne. It involved a couple of snap elections, in each case called to bolster the democratic position of the House of Commons and the ruling Liberal party. And it was finally resolved after the House of Lords was cowed into submission and agreed to the passage of the so-called Parliament Act of 1911. This latter act heavily cut back on the House of Lord’s power to interfere in budgetary matters and introduced what we would now recognize as the supremacy of the Commons in fiscal affairs.

There are two points to reflect on in this episode of crisis:  Read more…

Trump’s trade wars threaten US foreign investment

March 17, 2018 4 comments

from Shimshon Bichler and Jonathan Nitzan

There is a lot of buzz about Trump’s recently launched trade wars, but much of this buzz misses the point. The key issue here is not foreign trade, but foreign investment.  Read more…

Keynes and econometrics

March 15, 2018 12 comments

from Lars Syll

29f98bbf-47d2-45c8-840e-2be65f36be25After the 1920s, the theoretical and methodological approach to economics deeply changed … A new generation of American and European economists developed Walras’ and Pareto’s mathematical economics. As a result of this trend, the Econometric Society was founded in 1930 …

In the late 1930s, John Maynard Keynes and other economists objected to this recent “mathematizing” approach … At the core of Keynes’ concern laid the question of methodology.

Maria Alejandra Madi

Keynes’ comprehensive critique of econometrics and the assumptions it is built around — completeness, measurability, indepencence, homogeneity, and linearity — is still valid today.  Read more…

Whose sweet spot?

March 15, 2018 3 comments

from David Ruccio

profit shares

wage shares

Economic journalists, like Neil Irwin, are falling all over themselves celebrating the strength of the current economic recovery.  Read more…

“Let’s pretend that people are like molecules”

March 15, 2018 12 comments

“Social researchers of the 19th century were impressed by the success of this branch of science [thermodynamics], and also by its similarity to economics. A gas is a macroscopic thing, characterized by macroscopic properties — temperature, pressure, volume. But it consists of many microscopic constituents (molecules) whose interactions collectively create the macroscopic state. The study of macroscopic properties arising from microscopic interactions is called statistical mechanics. That really does sound like economics: an economy is a macroscopic thing, characterized by macroscopic properties such as GDP and trade balances, and those macroscopic properties arise from myriad microscopic constituents (people) interacting with each other.”  ergodicity economics


Friedman’s methodology: a stake through the heart of reason

March 15, 2018 5 comments

from Asad Zaman

Romer writes that macro-economists casually dismiss facts, and the profession as a whole has gone backwards over the past few decades, losing precious and hard-won knowledge. He does not consider WHY this happened. What are the methodological flaws that create the possibility of moving backwards, losing knowledge, affirming theories known to be in conflict with facts. How is it that leading economists can confidently assert theories which border on lunacy, and receive Nobel Prizes instead of psychiatric treatment?

This is due to the famous AS-IF methodology of Friedman, which gave economists a license for lunacy.  Friedman came up with this defense of orthodoxy when numerous emprical investigation revealed clearly that firms did not maximize profits, did not know their marginal costs, typically used mark-up pricing, and did other things which did not square with neo-classical theories. Friedman’s argument has been universally condemned by logicians and philosophers as an instance of the logical fallacy of “Affirming the consequent” – the use of modus ponens in reverse. That is, Friedman says, in effect, that theory T implies observable consequence C. We observe C, and therefore we can affirm that T holds. This is obviously fallacious since many different theories, inconsistent with T, may also imply consequence C.  read more 

Steel tariffs and doctors: a teachable moment?

March 14, 2018 25 comments

from Dean Baker

Donald Trump’s tariffs on steel have elicited near universal condemnation. In addition to issuing warnings from retaliation by our trading partners, the media have also been giving us economics lessons on how steel tariffs will mean higher prices for consumers.

If we pay 10 percent more for our steel, then the price of cars and other items that use large amounts of steel can be expected to rise. This will reduce demand for these products and might cause consumers to buy more foreign cars and fewer US made cars, possibly leading to a loss of jobs in the auto industry.

This economics lesson can be useful, but perhaps we can extend this teaching moment to other areas. The basic point economists have been making is that large segments of the population benefit from having access to lower cost imported steel even if it means fewer jobs and lower pay for US steelworkers.

Over the last four decades our trade policy had been quite explicitly designed to put steelworkers and other manufacturing workers in direct competition with low-paid workers in the developing world. Trade deals made it as easy as possible for US corporations to locate factories in Mexico and other developing countries and import their production back into the United States.

We can take the same approach to trade of highly paid services, specifically the services provided by doctors, our highest paid professionals. Doctors in the United States earn on average more than $250,000 a year. That’s more than twice the average for their counterparts in other wealthy countries.  Read more…

How money is created

March 13, 2018 67 comments

from Lars Syll

Everything we know is not just wrong – it’s backwards. When banks make loans, they create money. This is because money is really just an IOU. The role of the central bank is to preside over a legal order that effectively grants banks the exclusive right to create IOUs of a certain kind, ones that the government will recognise as legal tender by its willingness to accept them in payment of taxes.

There’s really no limit on how much banks could create, provided they can find someone willing to borrow it … For the banking system as a whole, every loan just becomes another deposit. What’s more, insofar as banks do need to acquire funds from the central bank, they can borrow as much as they like; all the latter really does is set the rate of interest, the cost of money, not its quantity …

The real limit on the amount of money in circulation is not how much the central bank is willing to lend, but how much government, firms, and ordinary citizens, are willing to borrow.

David Graeber 

Sounds odd, doesn’t it?

This guy must sure be one of those strange and dangerous heterodox cranks?

Well, maybe you should reconsider …  Read more…

U.S. Average Household Income, 2015

March 12, 2018 3 comments

Source: Emmanuel Saez, UC Berkeley

Utopia and healthcare—1

March 11, 2018 10 comments

from David Ruccio

This is the first in a series of blog posts on the utopian dimensions of healthcare.

I’ve written quite a bit about the U.S. healthcare dystopia over the years—including a seven-part series back in 2016.* But I haven’t yet addressed the utopian dimensions of healthcare reform.

The appearance of the new issue of Jacobin Magazine, titled “The Health of Nations,”  is a good occasion to start that discussion. Adam Gaffney starts with much the same question that provoked my own series of blog posts: “if American health care used to be so much worse, why is it in crisis now?”

In part because, despite such wide-ranging reform, the system’s injustices remain unresolved, pervasive, and deadly.

The figures tell the story. Even without Republican rollbacks, twenty-eight million have no insurance, and, according to the Commonwealth Fund, some forty-one million are underinsured. A substantial portion of the nation—predominantly those of low and middle income and disproportionately people of color—cannot afford to see doctors, pay for medicine, or go to the emergency room.

Families who bought silver plans on the Obamacare marketplace still have $8,292 deductibles, but less than half of American households can cover even a $4,000 deductible. Patients take twice-a-day medications only once, skip doses, or fail to ll their prescriptions to save on co-payments. And of course, people die — tens of thousands of people a year—because they lack coverage.

But the crisis in American health care isn’t simply that the ACA didn’t go far enough: it’s that there’s no ACA 2.0 available to finish the job. Real progress has been made, but the incremental reforms left us with a deeply inhumane system.

The problem, as Gaffney sees it, is that  Read more…

Econometric disillusionment

March 10, 2018 6 comments

from Lars Syll

reality header3

Because I was there when the economics department of my university got an IBM 360, I was very much caught up in the excitement of combining powerful computers with economic research. Unfortunately, I lost interest in econometrics almost as soon as I understood how it was done. My thinking went through four stages:

1. Holy shit! Do you see what you can do with a computer’s help.
2. Learning computer modeling puts you in a small class where only other members of the caste can truly understand you. This opens up huge avenues for fraud:
3. The main reason to learn stats is to prevent someone else from committing fraud against you.
4. More and more people will gain access to the power of statistical analysis. When that happens, the stratification of importance within the profession should be a matter of who asks the best questions.

Disillusionment began to set in. I began to suspect that all the really interesting economic questions were FAR beyond the ability to reduce them to mathematical formulas. Watching computers being applied to other pursuits than academic economic investigations over time only confirmed those suspicions. Read more…

Scientist qua scientist, scientist qua citizen: Part I

March 9, 2018 11 comments

from Malgorzata Dereniowska

That economics is a value-laden science is not a new idea. Most of the prominent economic thinkers were also philosophers, wary of moral and philosophical content of scientific assumptions, models, and theories. That economics needs philosophy, and the separation between these two cannot be maintained any longer, is gaining recognition, and has become a subject of debates in the field of philosophy of economics that brings together (to various extends) philosophers, mainstream, and heterodox economists. For example, Daniel Hausman (1992) discusses that at an analytic level economists do successfully separate the philosophical and ethical content from economic analysis, albeit this separation is possible only at the analytic level. Karl Polanyi (1957), in his discussion on the entanglement of economic activities in the social totality, gives insights from a different perspective how considering the subject of economic study in social vacuum can in fact lead to thinking that scientific practice indeed has disentangled from society.

Today economists of both mainstream (e.g., Jean Tirole) and heterodox approaches more readily admit: economics is a moral and philosophical science. Yet the meaning and scope of the normative components of economics, the epistemic consequences of the social embeddedness of science, and the social consequences of economics are raising so far inconclusive debates. These issues constitute two-tiered dimensions of scientific rationality: external and internal ones. While the criteria of internal rationality (which constitute the standard approach to scientific rationality) refer to disciplinary epistemology and methodology, the criteria of external rationality involve the axiological, ethical, and societal elements of the process of knowledge production and the social consequences of science.  read more

WEA Commentaries – new issue

March 8, 2018 Leave a comment
WEA Commentaries
Formerly the World Economics Association Newsletter
Volume 8, Issue No. 1  Download the issue as a PDF

In this issue

How to Inspire and Motivate Students
Asad Zaman
Redefining Governance in Cooperative Banks
Mitja Stefancic, Silvio Goglio, and Ivana Catturani
The Biophysical Basis of Production and the Public Economy
June Sekera
Tesla, Amazon, Bitcoin, Efficient Markets and FTT
Dean Baker
Keynes and Econometrics
Maria Alejandra Madi
Corrupted Economic Research—two illustrations
Norbert Häring, Edward Fullbrook

Female and male participation and employment


According to the accepted narrative after about 1950 female participation rates started to rise thanks to inventions like the washing machine and kept rising forever after. Reality is more confusing. According to a recent book by Julia Sophie Wörsdorfer, washing machines were, contrary to the ideas of Ha-Joon Chang, not that important. Neither cross sectional data nor time series analysis yields a strong correlation between ownership of a washing machine and high female labour force participation. But there is a strong link between the rise of the washing machine and a rise of public and personal cleanliness standards – more kinds of clothes were washed more often than before in less time. The Japanese data also contradict the washing machine thesis. It explains neither the post 1960 decline of the female Japanese participation rate nor the recent increase in Japan or, for that matter, Turkey.  Clearly, the female participation rate is to quite an extent a cultural phenomenon, though it is no doubt also influenced by education, fertility decisions and urbanization. The idea that the washing machine enabled women to emulate men is, however, wrong. They made and make their own choices, often more family oriented than those of men. Which is not necessarily a bad thing.  Read more…

What austerity preachers do not get

March 7, 2018 11 comments

from Lars Syll

We are not going to get out of the economic doldrums as long as we continue to be obsessed with the unreasoned ideological goal of reducing the so-called deficit. The “deficit” is not an economic sin but an economic necessity …

idle all around us.



The administration is trying to bring the Titanic into harbor with a canoe paddle, while Congress is arguing over whether to use an oar or a paddle, and the Perot’s and budget balancers seem eager to lash the helm hard-a-starboard towards the iceberg. Some of the argument seems to be over which foot is the better one to shoot ourselves in. We have the resources in terms of idle manpower and idle plants to do so much, while the preachers of austerity, most of whom are in little danger of themselves suffering any serious consequences, keep telling us to tighten our belts and refrain from using the resources that lay der Hamilton once wrote “A national debt, if it be not excessive, would be for us a national treasure.” William Jennings Bryan used to declaim, “You shall not crucify mankind upon a cross of gold.” Today’s cross is not made of gold, but is concocted of a web of obfuscatory financial rectitude from which human values have been expunged.

William Vickrey

“If poor people knew how rich rich people are, there would be riots in the streets”

from David Ruccio


Chris Rock may be right. Still, Americans are well aware that economic inequality in their country is obscene, even though they often underestimate the growing gap between the poor and the rich.  Read more…

U.S. real weekly wages, 1979-2016

March 5, 2018 5 comments

Wren-Lewis and the dangerous MMT

March 4, 2018 26 comments

from  Lars Syll

Professor Simon Wren-Lewis recently wrote: “The dangers of pluralism in economics: the case of MMT” …

mmtWren-Lewis argues that MMT concepts can be explained using mainstream terminology. Since I tend to use fairly standard terminology, I cannot disagree with that argument. However, I would phrase it differently. Mainstream discussion of fiscal policy is almost invariably clouded with theoretical junk (“fiscal sustainability”, “budget constraints”, “intergenerational transfer”, “bond vigilantes”) that it takes considerable effort to strip the junk out to get the correct description, which almost always ends up being the MMT description. The MMT jihad against various phrasings and framing terms reflects the need to think clearly about fiscal policy …

Modern Monetary Theory is evolving outside the journals that are locked down by the mainstream, and is focussed on real economic issues. Meanwhile, the mainstream is using dubious mathematics to painfully re-derive results that have been part of the post-Keynesian tradition for decades. You do not need a degree in the history of the philosophy of science to guess what the outcome is going to be. What we are seeing is the inevitable blowback of the attempt to stifle debate; since criticism cannot work through academic channels, it is instead funneled through non-academic ones.

Brian Romanchuk