Tuesday, August 25, 2020

A new real-world economics text book — John Komlos

This textbook demonstrates how misleading it can be to apply oversimplified models of perfect competition to the real world. The math works well on college blackboards but not so well on the Main Streets of America. This volume explores the realities of oligopolies, the real impact of the minimum wage, the double-edged sword of free trade, and other ways in which powerful institutions cause distortions in the mainstream models. Bringing together the work of key scholars, such as Kahneman, Minsky, and Schumpeter, this book demonstrates how we should take into account the inefficiencies that arise due to asymmetric information, mental biases, unequal distribution of wealth and power, and the manipulation of demand. This textbook offers students a valuable introductory text with insights into the workings of real markets not just imaginary ones formulated by blackboard economists.

Getting to an understanding of MMT is going to require undoing the nonsense. This looks like a step in that direction.

And, of course, asymmetry in markets underlies extraction of economic rent by those who control the balance of market power in capitalist economies.

Real-World Economics Review Blog
A new real-world economics text book
John Komlos |  former Chair of Economic History at the University of Munich

See also

Peter Thiel argues that success in entrepreneurship hangs on being able to create market power and rise above commodity markets in which there is more market symmetry.

In this sense, "free market" means that owners of capital are free to create asymmetric market power without government interfering. The basis of neoliberalism is government not only not interfering with market asymmetry but cooperating to create it, e.g., by creating artificial scarcity through law and regulation.

Progress in Political Economy (PPE)
Peter Thiel’s Zero to One explains why ‘big tech’ dominates
Seb Wrangles

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