Economics

Archive for Economics

Illustrating the Problems With GDP Accounting

In the comments I chimed in, giving an example to demonstrate the dangers of the standard discussion of GDP accounting. (Note that I’m not sure if anyone in the comments was saying something wrong; it was just a springboard for me to pontificate.) Let me embellish the example here: Suppose Country A is composed of […]

Let’s Name the New Planet Krugmanus

Krugman routinely mocks those who rely on austerity for European countries, which (he claims) involves growth through exports. To take a recent example from December 9: European stocks are up today, and I have no idea why. I’m with Felix Salmon — this looks like a disastrous meeting. More austerity, more posing of the crisis, […]

Austrian Business Cycle Theory: Malinvestment, Not Overinvestment

Apropos of the recent flurry–the Austrians are apparently the Charlie Sheen of the blogosphere right now–here is an interesting quotation from Mises: The erroneous belief that the essential feature of the boom is overinvestment and not malinvestment is due to the habit of judging conditions merely according to what is perceptible and tangible. The observer […]

Heads Krugman Wins, Tails Hard Money Loses

I really am swamped with my “day job” for the next month or so, meaning blogging will be sparse. But at this point, I think someone needs to write Portrait of the Artist as a Keynesian Man. In this post, Krugman shows just how many degrees of freedom he has to work with: Some readers […]

The Financial Entangling Alliances Thicken

From CNBC: The world’s major central banks unleashed coordinated action Wednesday to ease the increasing strains on the global financial system, a move that sent stock markets up sharply. The European Central Bank, U.S. Federal Reserve [cnbc explains] , the Bank of England and the central banks of Canada, Japan, and Switzerland are all taking […]

Karl Smith Shouldn’t Start a Mutual Fund

I really like Karl Smith as a person. During our debate–where Karl knew he was entering the lion’s den of Mises fans–one of his slides said he was going to “teach Bob how to dance.” At the time I was so busy analyzing his arguments, I didn’t realize that was a white guy joke. Awesome. […]

Murphy Smackdown: DeLong on Mises

I am going to do a full write-up for Mises.org once I get my day job under control, but those of you who have been following DeLong’s assaults on Mises might be interested in his latest post. For the context, DeLong hasn’t been able to figure out why Mises says printing paper money won’t fix […]

Wolf vs. Krugman: Separating the Economist From the (Bad) Accountant

Not surprisingly, both my allies and critics seem to be missing the point of my previous post on Krugman and (alleged) accounting identities. So some clarification is in order. First, here’s a simple one I made in the comments on the definition of income: If I do a consulting project for a guy and he […]