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From:
[log in to unmask] (Robert Leeson)
Date:
Mon Feb 5 09:07:51 2007
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Re Pat Gunning posting about textbook fables and "Onward Christian Soldiers". 

Creation mythology and a Year Zero mentality are not confined to organised religions: we have them in economics too.

Onward Keynesian Soldiers: Pigou et al. were part of the pre-Keynesian darkness and therefore could be relegated to oblivion (however, large parts of Keynesian theory and policy advocacy could equally be called Pigovian.  The 'Klassics' were a Keynesian polemical invention).

Onward Monetarist Soldiers: Phillips' macro was "simple minded" because of a neglect of inflationary expectations (however, Friedman obtained his adaptive inflationary expectations formula from Phillips and in Phillips' model, inflationary expectations are much more devastating to macro stability than in natural rate models).

Onward New Classical Soldiers: rational expectations and the Lucas Critique rendered still more worthless Phillips-style analysis (however, there is a Lucas-style critique in Phillips' work and within mainstream post-war macro there was a sophisticated understanding of expectational feedback).

Robert Leeson   


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