Blogging on macro readings

A lot of bad things have been said about economics lately.  It can be argued — with plenty of evidence to support the argument — that a large portion of economic theory as it exists is an ideological rationalization of the interest of capital, a rationalization that disguises itself behind the veil of mathematical modeling.  As of late, Paul Krugman has argued that economists have been led astray by their mistaking mathematical beauty for truth.

I’m not going to disagree with this.  But, where I come from, you don’t make such a sweeping generalization about a body of ideas as complex as modern economic theory without a prior, critical digestion — both logical and factual — of the material.  Since in any case, due to my work, I need to read and re-read textbooks and articles on economic theory, I plan to — time and other obligations permitting — use this blog to publish my raw thoughts on stuff I read.

I’m going to start with a few chapters from Maurice Obstfeld and Kenneth Rogoff’s (1998) Foundations of International Macroeconomics, Cambridge: MIT Press.  This textbook continues to be used in second-year macroeconomics courses at  many doctoral programs.  From me, readers should expect something rather choppy and idiosyncratic.  Nothing systematic.

Neither should readers expect any judgment about the overall value or validity of the material in this book.  If at all, that judgment will follow my grappling with most of its chapters.

I can only engage with the material I read by reference to my own personal, intellectual trajectory.  Thus, a lot of my musings will result from — as David Harvey puts it — “rubbing” my understanding of Karl Marx’s theoretical work, which I hold in high regard, with the material I read.

Some logistics: I will need to type some math here.  For that,  I will use LaTeX.  Readers wishing to follow the math will have to use some online compiler to convert my script into something viewable.

Here’s a “Hello World!” script that people may use to test their ability to compile LaTeX files online.  Highlight it, copy it, and paste it inside of the white box of the online compiler (click on the English flag to view the page in English).  (In script that contains equations, the blank lines in between must be removed.)  After compiling it, scroll down, and request to view the output as a pdf file.

\documentclass[12pt]{article}

\usepackage{fullpage}

\textheight=9.0in

\setlength{\tabcolsep}{0in}

\begin{document} Hello World!

\end{document}

Again, on my plan

About a year ago, I sketched a plan to get the banks back into health.  Its principle was simple:  Instead of handing out massive amounts of cash to the banks with tons of toxic assets clogging their balance sheets, in the hope that that they restart lending, hand the money directly to the so-called “subprime” borrowers so that they continue to service their mortgages.   At the time, it sounded utopian, even silly — because the political clout to push for it, let alone to force its implementation was non-existent.  Even now, the political force that is required to place this plan in the agenda is still in its embryonic stages, but I believe it is gradually building up.

In this post (in my otherwise neglected blog), I just want to report that — aside from Joseph Stiglitz — there’s another reputed economist just coming around to my approach: Steve Keen.   The neat thing is that, unlike me, who only enunciated a principle and sketched the idea, Keen has taken the trouble to model and calibrate carefully the effects of the alternative plan.

And, in regards to the build up of the political force referred above, I will refer you to Arianna Huffington’s review of Michael Moore’s new movie, Capitalism: A Love Story.

[Image borrowed from The Black Commentator: http://www.blackcommentator.com.]