====================== HES POSTING =================== 
 
[NOTE: Because Robert's posting takes us in a new conversational direction  
only indirectly related to the censorship issue, I have taken the liberty  
to give the message a new subject line. -- RBE] 
 
The passion displayed by Jim Craven [message of 6 November --  
http://www.eh.net/ehnet/Archives/hes/nov-97/0031.html] may, in part,  
explain why the distribution of the post war economics profession was (in  
the 1970s) shifted towards the right tail (previously 2 standard  
deviations from the mean) and not towards the left tail (which became 3 or  
4 standard deviations from the mean). 
 
In 1966, the Keynesian Neoclassical Synthesis suffered two theoretical 
defeats at the hands of the hands of two (equally?) brilliant economists: 
Joan Robinson (and associates) and Milton Friedman.  The defeats were over 
(1) reswitching and (2) adaptive inflationary expectations (which suggested 
that the 'natural' rate of unemployment had a gravitational pull on the 
actual rate).  The first defeat led nowhere, the second defeat all but 
destroyed Old Keynesian economics (for years, at least).   
 
Why?  I suspect that the internal reasons (the external story has been told 
often) are related to the following factors: 
 
1. Friedman was generous and willing to use the language (econometrics, 
ISLM, income expenditure) of his opponents; Robinson was unpleasant to the 
"bastards" who disagreed with her. 
 
2. Friedman was offering a human capital augmenting research strategy by 
applying what Phillip Cagan called "Phillips' Adaptive Expectation Formula" 
to the original Phillips curve (Phillips provided Cagan and Friedman with 
the adaptive expectations formula in 1952).  Robinson was attempting to 
destroy much of the received human capital of the economics profession. 
 
In other words, Friedman (and in his blunt fashion, George Stigler) thought 
about how to provoke and influence their audience; Robinson et al seemed to 
provoke and alienate their audience.       
 
I would be very interested to hear comments from those who lived through the 
Cambridge controversies and the early days of the natural rate 
counter-revolution (and anyone who heard Harry Johnson's 1970 Ely Lecture on 
these themes).  
 
Robert Leeson - Senior Lecturer - Economics Department 
[log in to unmask] 
Murdoch University 
 
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