Stephen Marglin Heterodox Economics: Alternatives to Mankiw's Ideology

[IlirMr]

Forget about the ideology. The logical flaws can easily exposed, along with the inaccurate predictions. Just ask two simple questions? What are quality and convenience? When is the one of the superior more valuable than an infinite quantity of the inferior? Alex Gheg's vid is less than 10 minutes and will stump any Prof in class. youtube.com/watch?v=2c4mvGekYZ­Y

[pabloisotom]

Is this about him and his course or about economics?

[jcamargo2005]

So Greg Mankiw was ideological and this is not? First minute and he starts to mention american politics. Ten minutes and he is talking about 'we as a nation' and social problems. Classical Economics is just economics, it is controversial and gets continuously 'revised'. First by Keynes and all his followers and now these clowns, that think they have an 'alternative'. Best thing is, let these ignorants preach to themselves and learn economics for yourself, to actually know how things work.

[nerfmyaccount]

@jcamargo2005 the difference is Marglin/heterodox economists try to acknowledge their ideological bents rather than pretending, as the neoclassicists do, that they don't have any. As his colleague said "we teach one kind of economics at Harvard, good economics." That statement was spoken while the global economy is collapsing, ecological catastrophe is neglected, and governments are failing. If that isn't dripping in ideology then the Pope is an axiomatic theorem producer.

[pqnelson]

@jcamargo2005 It is not true that "Classical economics is just economics". In the 1860s, the "marginal revolution" changed supply and demand from being a rule-of-thumb to an iron law stemming from bogus psychological reasoning. Although this superficially resembled classical economics, it is different and distinct.

There are serious alternatives to this marginalist paradigm. The Santa Fe Institute, for example, is developing a "complexity school" where classical economics emerges nonlinearly!

[moneyisneutral]

I like how they try to kick him off at 20:35. He says he won't take more than 5 mins. He lies.

[moneyisneutral]

Teach-in? HAHAHAHA. What the hell is wrong with these people?

[fling93]

Barbara Bergmann makes a better case for ideology in economics in "The Current State of Economics: Needs Lots of Work" (2005). The high degree of hiring of economists by government creates an incentive for the field to divide itself into two camps, one making proposals Democrats like and the other catering to Republicans. The history of macro thought bears this out: Classical (R), Keynesian (D), Chicago (R), New Keynesian (D), New Classical (R), Institutionalists (D), Austrian (R), etc.

[unassumption]

He really didn't say...much in this at all

[Mydashkey]

Mankiw > Marglin

[MinorEconParameter]

@LogicalFlawDetector - you did actually watch the video? While I can't apologize for Marglin I can ask why you disregard his clear purpose? He is saying more about the sacrosanct nature of mainstream economics than he is about income distribution. He might have picked a poor example, or explained a decent example poorly. But his execution of the same is really beside the point. Is it a worthwhile endeavorer to think critically of (your) professional ideology?

[LogicalFlawDetector]

@MinorEconParameter

And did you actually realize that Marglin comes from a Marxian and Old Keynesian perspective? Marxian and Old Keynesian models are outdated. The Marglin drones are similar to the clowns of the Intelligent Design movement, who yell: "teach the controversy!" To quote Nobel prize-winning economist Robert Lucas:"The attraction of neoclassical economics is not that it is pretty--though it can be--but that, given half a chance, it works." It's the predictive power that matters.

[unassumption]

@LogicalFlawDetector

Marxian 'economists' are an embarrassment. But so are the Austrian school. Both deny science to push an ideology then claim everyone does the same, both have 'institutes' like the discovery institute. I see a lot more Austrians out there than Marxists though so I know who the bigger problem is today. Old Keynes sucks but so does old neoliberal.

[LogicalFlawDetector]

@unassumption

I'm not Austrian. I have many disagreements with their approach. Case in point: Praxeology. Marglin is criticizing neoclassical economics, not Austrian economics. Now, there is nothing wrong in criticizing neoclassical economics. Many have tried and all of them have failed. And what's worse, they have failed to provide alternative models which explain microeconomic phenomenon better than neoclassical economics.

[unassumption]

@LogicalFlawDetector

I don't know much about economics just that Austrians and Marxists both fail. Welfare and stimulus heavy states seem to do better than low tax, low regulation, low spending ones, and distribution seems important. I don't know what model works best but weather keynsian or neoclassical it has to be scientific unlike the ones that seem to have most political influence. Still neoclassic doesn't seem to predict everything, so maybe needs modifying a bit?

[TallFastLoud]

@LogicalFlawDetector which phenomena, whose explanations and how did they fail?

[nerfmyaccount]

@TallFastLoud A small group of people in Chicago got together and made the bold prediction that rich people would get richer. It happened. Ergo, freshwater. Q.E.D.

[nerfmyaccount]

@LogicalFlawDetector neoclassical critiques fail, claim neoclassicists.

[peetasmith1]

@LogicalFlawDetector - Neoclassical economics has failed to predict many issues and has many fundamental flaws such as its inability to deal with debt and rentier issues. Just massacring the straw men of ill-informed Marxists and Austrians does not really lend any credibility to you argument. I like the work of neoKeynesian like Steve Keen and modern Georgists who have a lot to inform neoclassicals like your good self and had the ability to predict the crash with excellent mathematical models.

[LogicalFlawDetector]

@peetasmith1

Neoclassical economics is microeconomics. The class Marglin is critiquing, EC 10, is a microeconomics class. New Keynesian economics is macroeconomics. Bubbles, crashes, business cycles--which you erroneously claim the New Keynesians predicted accurately--are also part of macroeconomics which have nothing to do with this video. You need to learn what you are talking about. Both schools suck at macro. Neoclassical dominates and is the best when it comes to micro. 

[peetasmith1]

@LogicalFlawDetector Neoclassical economics is not just microeconomics. Mankiw is a macro economist and used the neoclassical synthesis as the basis of his work, critiqued here. Neoclassical economics is not confined to microeconomics and is used by all levels of Government to advise on macro economic policy. It has singularly failed, we need better economic models . You assertion this is just about microeconomics is a 'straw men' and a fundamental logic flaw on your part.

[peetasmith1]

@LogicalFlawDetector I claimed one neo-keynsian predicted the crash - Proff Steve Keen, as well as a number of modern Georgists all using debt based models. You really are a master of Straw Men when it comes to debate Mr Logic Flaw.

[LogicalFlawDetector]

Marglin is operating under the premise that income inequality is a bad thing. I think a valid exercise, then, he should consider is the following: Between the current income distribution and a distribution in which everyone earned equal incomes, there is an optimal distribution respect to which the current distribution is inefficient (implied). What is the optimal distribution and how is it determined?

[unassumption]

@LogicalFlawDetector

Have you heard Richard Wilkinson's points about inequality having negative effects in itself? I don't agree with him 100% but it has some points. Concentrating wealth can also lead to cheating. But it's the extrinsic problem that more up the top (unless it leads to growth) means less for the rest (having something to share > how it's shard but the 2nd part can't be ignored) and since it doesn't seem needed to be THIS unequal we should move 2 more equal.

[unassumption]

@LogicalFlawDetector

I don't know the optimum distribution but I sure as hell know it's not this, and the direction we should take to get there.

[LogicalFlawDetector]

Marglin is an embarrassment. Harvard should fire him. He has no clue about what caused income inequality: increases in productivity for jobs of college educated people during the period 1980-2007. In fact, the wage gap between high school graduates and college and graduate school graduates has been increasing. MacArthur fellow Kevin Murphy of Chicago demonstrates this in his research.

[tippingpts]

@LogicalFlawDetector

The wage gap may be increasing when you compare someone who's had more or less 4 years of university training against someone who can barely remember how to do algebra. But if you look at real median income of college educated people on a time series line, we're all back to where we were in 2000. It took us a decade to get to nowhere.

[tippingpts]

@tippingpts

And he's not talking about income inequality between high school grads and college grads. He's talking about the average income versus the one percent of people who work in places like Wall Street and own most of the wealth in the country. You need to learn to listen, before you speak.

[LogicalFlawDetector]

And who are those 1% Wall Street executives--non-college graduates? Mankiw's point about the returns to education being extremely high among college graduates, who *disproportionately make up the top 1%*, has been vindicated. Productivity increases, triggered by technological progress, vastly increased the incomes of college graduates and graduate school graduates relative to the incomes of just high school graduates, who dominate the 99%. This includes MBAs in Wall Street.

[unassumption]

@LogicalFlawDetector

The majority of the top 1% are in management or finance, they have education but aren't in new high-tech jobs. The education seems more a way of distributing the workload, than something you need to do the jobs. Especially since half of our education isn't relevant to work.

[LogicalFlawDetector]

@tippingpts

You are assuming--like Paul Krugman did and whose point you are merely emulating like a drone--that returns to human capital are deterministic when they are actually *stochastic*. Simply looking at real income on a time series line is a simplistic test of increasing returns to human capital.

[unassumption]

@LogicalFlawDetector

watch Archon Fung's lecture "Why Has Inequality Grown in America? What Should We Do?" in this series for a rebuttal of this point. It explains the distribution within the bottom 90% but above that when you see what kind of jobs people have (while they're all educated) it's not new kinds of education it's stuff like law and management which has always existed, the tech explanation breaks down at the top end of the scale.