Math Problems

Assessing this is beyond my math chops to assess, but it is an interesting criticism of the use of math in economic by two math guys. 

Somewhat wonkish, but all verbal explanation. No math, although some familiarity with the context is required. Even without knowing the details, anyone should be able to catch the drift of these relatively short posts without being familiar with the references. 

The claim is that "mistakes were made."

Nassim Nicholas Taleb Blog
Inequality and Skin in the Game

Nassim Nicholas Taleb, scientific adviser at Universa Investments

This was posted in 2011 but it is still relevant.

Rick Bookstaber Blog
A Crack in the Foundation: An error that has wended its way through economics for 77 years

Rick Bookstaber | Research Principal in the Office of Financial Research

Lord Keynes — Vaughn on the Early History of the Austrian School

Karen I. Vaughn’s book Austrian Economics in America: The Migration of a Tradition(Cambridge and New York, 1994) provides an accessible history of the early Austrian school.

I summarise that early history in what follows. Carl Menger (1840–1921) was the founder of the school, and Eugen von Böhm-Bawerk (1851–1914) and Friedrich von Wieser (1851–1926) were the two most important followers of Menger, although they were not Menger’s students, but colleagues.

Social Democracy For The 21St Century: A Post Keynesian Perspective
Vaughn on the Early History of the Austrian School
Lord Keynes

Corey Robin — Nietzsche’s Marginal Children: On Friedrich Hayek

The contributions of Jevons and Menger were multiple, yet each of them took aim at a central postulate of economics shared by everyone from Adam Smith to the socialist left: the notion that labor is a—if not the—source of value. Though adumbrated in the idiom of prices and exchange, the labor theory of value evinced an almost primitive faith in the metaphysical objectivity of the economic sphere—a faith made all the more surprising by the fact that the objectivity of the rest of the social world (politics, religion and morals) had been subject to increasing scrutiny since the Renaissance. Commodities may have come wrapped in the pretty paper of the market, but inside, many believed, were the brute facts of nature: raw materials from the earth and the physical labor that turned those materials into goods. Because those materials were made useful, hence valuable, only by labor, labor was the source of value. That, and the fact that labor could be measured in some way (usually time), lent the world of work a kind of ontological status—and political authority—that had been increasingly denied to the world of courts and kings, lands and lords, parishes and priests. As the rest of the world melted into air, labor was crystallizing as the one true solid....

[Carl] Menger interrupted his abstract reflections on value to make the point that while it may “appear deplorable to a lover of mankind that possession of capital or a piece of land often provides the owner a higher income…than the income received by a laborer,” the “cause of this is not immoral.” It was “simply that the satisfaction of more important human needs depends upon the services of the given amount of capital or piece of land than upon the services of the laborer.” Any attempt to get around that truth, he warned, “would undoubtedly require a complete transformation of our social order.”

The crux of the difference between right and left — all are created equal, or some (the owners) are better than others. The ideal of the left is democracy; the ideal of the right is feudalism.

The Nation
Nietzsche’s Marginal Children: On Friedrich Hayek
Corey Robin

Lord Keynes — Bitcoin is no Great Mystery

Lord Keynes reflects on Bitcoin.

Social Democracy For The 21St Century

Bitcoin is no Great Mystery

Lord Keynes

Lord Keynes — The Origin of Money and Coins in Western Civilisation: The Case of Ancient Greece

Theory of money and historical evidence.

Social Democracy For The 21St Century
The Origin of Money and Coins in Western Civilisation: The Case of Ancient Greece
Lord Keynes

Randy Wray — Back To The Future: Modern Money Conference In 1999

MMT history lesson.

New Economic Perspectives


Back To The Future: Modern Money Conference In 1999
L. Randall Wray | Professor of Economics, UMKC

Lord Keynes — Lachmann and Menger on the Law of Demand

Lachman: Menger uses the ‘law of demand’ as an example for this distinction. According to him the exact law tells us not merely that a rise in demand will lead to a rise in price, but that, under certain conditions, the extent of this price rise is quantitatively exactly determinable (‘dem Masse nach genau bestimmbar’). But he goes on to warn us that these conditions require not only that all participants maximize their satisfaction in the pursuit of which they must be free of all external coercion, but also the absence of error and ignorance. Hence we must not expect to find instances of the exact law in the real world.

Lord Keynes: That Menger could seriously believe and write those words demonstrates that he formulated the law of demand at a level so abstract that it could only be true in that almost imaginary world. It is as if we were to formulate a law that must be necessarily true in the Land of Oz, admit that such a law is not universally true in our world, but nevertheless contend that such a law is always and universally true in Oz, the world of our imagination.

That all this bespeaks a deeply flawed, even deluded, approach to the social sciences goes without saying.

Menger conceded that when related to the empirical real world of experience, the law of demand” arrives at contradictions.” That is quite clearly a continuing problem with the law of demand even in neoclassical economics.

Social Democracy for the 21st Century
Lachmann and Menger on the Law of Demand
Lord Keynes

Lord Keynes — My Posts on the Origin of Money

I have assembled a set of two lists of links and a bibliography below, as follows:

(1) my posts on the origin of money and the debate between David Graeber and Robert P. Murphy;

(2) some external links on the debate between David Graeber and Robert P. Murphy, and

(3) a bibliography on the origin of money.

First, however, I will give a quick summary of Graeber’s view on the origin of money in his recent book (Graeber 2011).

Social Democracy for the 21st Century
My Posts on the Origin of Money
Lord Keynes

Lord Keynes — Rescuing Menger from the Austrians

I have written before of Carl Menger’s Lectures to Crown Prince Rudolf of Austria (trans. Monika Streissler and David F. Good; Aldershot, 1994).

That book shows that the founder of Austrian economics was worlds apart from the modern cult of anarcho-capitalism.

Social Democracy for the 21st Century
Rescuing Menger from the Austrians
Lord Keynes