Economic models: worse than Whelan thinks.

Real-World Economics Review Blog

Karl Whelan has an interesting longread on the state of (the teaching of) economics. I agree with many points. But not with everything. It’s worse than he thinks: (1) A large part of economics gives us, intentionally, less insights into the economy, for instance because it ‘abandons’ the idea that people use money (and no, that’s not just a convenient assumption to keep models simple for undergraduates – it is a core aspect of reputed policy models, see below). (2) Much of economics is ideologically framed. A shortread on (1) and (2) below. But first a Whelan quote:

I reckon nobody’s reading at this point, so I’ll just say what I think to keep myself happy.

The world economy is more complicated than any of us can understand and getting more so by the day. There are no magic formulae for understanding it and it takes many years of…

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