![Picture](/uploads/8/4/1/7/8417532/6008417.jpg?297)
Professor John Quiggin is a Federation Fellow in Economics and Political Science at the University of Queensland. An excerpt from the review of his book Zombie Economics: How dead ideas still walk among us is reprinted below:
Quiggan examines each of the 6 Zombie ideas:
- the Great Moderation: the idea that the period beginning in 1985 was one of unparallelled macro-economic stability
- the Efficient Markets Hypothesis: the idea that the prices generated by financial markets represent the best possible estimate of the value of any investment
- Dynamic Stochastic General Equilibrium: the idea that macroeconomic analysis should not concern itself with economic aggregates like trade balances or debt levels but should be rigorously derived from micro-economic models of individual behaviour
- Trickle down economics: the idea that policies that benefit the well-off will ultimately help everybody
- Privatisation: the idea that any function now undertaken by government could be done better by private firms
- Austerity: the belief that the best response to a crisis like that of the present is for Governments to balance their own books and wait for the private sector to recover
His style is clear but his intent is serious, with key ideas properly referenced and the book supported by a fourteen page bibliography. It is serious in the way that Keynes wrote seriously: any person with a reasonable awareness of public affairs should be able to understand and learn form it.
On Steve Keen's book, Legge says:
Keen is more technical, and this is necessary since he intends his book to set out arguments that no academic economist can refute, while retaining any claim to logic or consistency. Keen systematically identifies and destroys each of the key foundations of neoclassical economics. He shows that its only possible application is to an economy consisting of one person and one product. Even Robinson Crusoe's environment was richer.
In Chapter 4 Keen destroys the entire foundation of any claim by neoclassical economists to offer policy advice: he shows that 'perfect' competition is no better for society than monopoly, and under most realistic circumstances is worse. Keen demonstrates that the claims for the superiority of perfect competition are based on an elementary mathematical error. When he submitted a paper demonstrating this to a leading economic journal his paper was rejected with the explanation that economics is exempted from the laws of mathematics.
The full article is available in Dissent magazine. Annual Subscriptions are available through their website.
The books reviewed are available in selective book stores and online.
Either book might be a good Christmas gift for Tim Nicholls... assuming he is more interested in Economics than playing tired old political games.