September 15, 2016

Soapbox economics

Comment on Lars Syll on ‘But not as wrong as Paul Krugman …’

Blog-Reference and Blog-Reference on Sep 16

Lars Syll correctly summarizes: “Dani Rodrik — just like Paul Krugman — does often take a ‘radical’ stance on different policy issues. But when it comes to core theoretical and methodological issues, he — just like Paul Krugman — is a self-proclaimed and proud die-hard mainstream neoclassical economist.”

The curious thing about economics is that there is a total DISCONNECT between an economic policy proposal and the underlying theory. Just as there has been a total disconnect between poultry entrails and the utterances of the haruspex which guided ancient Roman policy. In other words, economic policy guidance has NO sound scientific foundation at all. This holds for Neoclassicals, Keynesians, Marxians, and Austrians in equal measure. All these approaches are provably inconsistent.#1

Economics consists of political and theoretical economics and both are disconnected. Political economics is scientifically worthless for more than 200 years. There is nothing to choose between Rodrik, Krugman, or King.

As Lars Syll says: “People who really want to develop alternatives ... have to look elsewhere.”#2

Egmont Kakarot-Handtke

#1 Keynesianism: The triumph of blathering over thinking.
#2 For details of the big picture see cross-references Paradigm Shift.

Related 'Krugman is not an economist' and 'Economics: The Battle of Frogs and Mice is over' and 'From Orthodoxy to Heterodoxy to Sysdoxy'