Add these criticisms together and there is a clear case for reinvention, especially in macroeconomics.
The great failures of the subject tend to come in macroeconomics, the study of the entire economy in aggregate.
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In macroeconomics, aggregate demand is the total demand for final goods and services in the economy at a given time and price level.
Ms Krueger's background is in trade more than in macroeconomics.
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It dates back to Keynes, one of the few economists whose reputation has been burnished by the crisis. (Another is Hyman Minsky, whose main insight was that stability leads to too much debt, and then to collapse.) Most work in macroeconomics in the past 30 years has been useless at best and harmful at worst, said Mr Krugman.
But Ornstein, a career political scientist (whatever that is), is out of his depth in discussing macroeconomics.
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Against a background like this, a little waywardness in the world of macroeconomics seems entirely forgivable.
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There are many European politicians who prefer their own version of macroeconomics to the one taught in textbooks.
Put your hands together, therefore, for a country which has undertaken three original and far-sighted reforms to bring credibility to its monetary policy, stability to its public finances and prudence to its government accounts, and has thus transformed itself from one of the great disasters of modern macroeconomics into an object lesson in the conduct of economic policy.
Cochrane is the author of a bible of finance called Asset Pricing but in recent times has been piercing the pieties of macroeconomics.
Macroeconomics, which Keynes invented, is redundant in an economy that does not use credit.
More problematic is his approach to macroeconomics (a term, incidentally, that was barely in use in 1948, and did not appear in the first edition of the book).
The principle failing of macroeconomics is the intrusion it invites and the certainty it instills in the planners.
My knowledge of macroeconomics is limited to what I learned during Econ 101 at NYU and the lessons that were covered in the material I was required to read in order to complete the demanding CFA program.
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