Tuesday, June 30, 2009

 

"The neoclassical-Keynesian synthesis was like a house built in the 1940s..."

Prof. Mankiw has a good history of modern macro thought, "The Macroeconomist as Scientist and Engineer,". From the May 2006 working paper:
The neoclassical-Keynesian synthesis was like a house built in the 1940s: The new classicals looked at its outdated systems and concluded it was a tear down, while the new Keynesians admired the old-world craftsmanship and embraced it as an opportunity for a major rehab...., The division of economists between new classicals and new Keynesians is not, fundamentally, between the political right and the political left. To a greater extent, it is a split between pure scientists and economic engineers.
 

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