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The author waits anxiously …

August 10th, 2010 14 comments

… for the first book review to come in, and happily, it’s a good one, from Buttonwood, who has long been my favorite columnist/blogger at The Economist.

Get more news as it happens on

http://www.facebook.com/#!/pages/Zombie-Economics-by-John-Quiggin/123348251033799?v=wall&ref=ts

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Back on air

July 17th, 2010 35 comments

The final proofs of Zombie Economics went off to the typesetter this morning, and you’ve all seen this evening’s news. So, I guess it’s time for me to end my hiatus, and make whatever contribution I can to the marvel of democracy. Not to keep anyone in suspense, I’ll be advocating a vote for the Greens.

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Which Road to Serfdom?

April 13th, 2010 125 comments

Both here and at Crooked Timber, libertarianism is getting a bit of a run. So, can anyone find me a copy of Hayek’s prescient 1944 book, The Road to Serfdom, which predicted that the policies of the British Labour Party (policies that were implemented after the 1945 election) would result in relatively poor economic performance, and would eventually be modified or abandoned, a claim vindicated by the triumph of Thatcherism in the 1980s? This book, and its predictive success, seem to play an important role in libertarian thinking.

Despite a diligent search, the only thing I can find is a book of the same title, also written by an FA von Hayek in 1944. This Road to Serfdom predicts that the policies of the British Labour Party, implemented after the 1945 election, would lead to the emergence of a totalitarian state similar to Soviet Russia and Nazi Germany, or at least to a massive reduction in political and personal freedom (as distinct from economic freedom). Obviously this prediction was totally wrong. Democracy survived Labor’s nationalizations, and personal freedom expanded substantially. Even a defensible version of the argument (say, a claim that, Labor’s ultimate program included elements that could not be realised without anti-democratic forms of coercion, and that would have to be dropped if these bad outcomes were to be avoided) could only be regarded as raising a hypothetical, but unrealised, cause for concern.. Presumably, this isn’t the book the libertarians have read, so I assume there must exist another of the same title.

Zombies walking

April 6th, 2010 5 comments

I sent the manuscript of Zombie Economics off to Princeton University Press last night. There’s still plenty of work (figures, index, copyediting, some last-minute changes, galleys) to be done for a planned release at Halloween. But this is the official submission. In writing the preface I checked over the comments I’d received, here and at Crooked Timber. Several thousand in total, from more than a hundred different commenters. Thanks to everyone who took part. It was a huge help and encouragement to me.

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Panic stations

April 1st, 2010 12 comments

My publisher just told me the publication date for my book has been moved forward, and the due date for the manuscript is “…well, now”. Lots needing to be done, and zero time to do it, but I’m sure I’ll manage somehow.

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Bookblogging: The final instalment

March 8th, 2010 12 comments

I’ve finally completed a near-final draft of my book, although some bits, such as the following ‘Reanimation’ section of the chapter on privatisation are still a bit rough.

I’m getting some good comments from readers here, and through more conventional academic channels, which should help me sand down the rough spots a bit. Anyway, thanks to all for the comments I’ve received. It’s made a huge difference to me, and made the production of this book a much less daunting undertaking than laboring alone.

Remember, before pointing out stuff that is missing, that an earlier draft is online here and may be worth reading to see where I’m coming from.

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Bookblogging: the reanimation of trickle down

March 5th, 2010 34 comments

The deadline for the manuscript of Zombie Economics (last complete draft here) is only a few weeks away, and the zombies are popping up faster than I can knock them down. I’m adding a section on reanimated zombies to each chapter. Over the fold is the social mobility defense of trickle down economics, as animated by Thomas Sowell. There’s still time for me to benefit from your comments.

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Invulnerable zombies – the EMH

February 27th, 2010 87 comments

My book is due for publication in the US Fall, so work on my added sections on reanimation is starting to feel like one of those games where you have to kill all the zombies to get to the antidote before you fall victim yourself. Here’s another one – more on the way

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Zombie economics gets a mulligan: or, how Obamacare caused the Global Financial Crisis

February 26th, 2010 28 comments

I’m adding a little section to each of the chapters in my Zombie Economics book called “Reanimation”, about the attempts that are already under way to revive economic ideas killed (at least according to the standard rules of hypothesis refutation) by the global crisis. I wasn’t surprised to find plenty of examples for the efficient markets hypothesis (easy to render immune from any kind of refutation by an appropriate formulation) or for policy ideas that yield big benefits to the rich and powerful, such as privatisation and trickle-down economics. But I was surprised a little while ago to see the crisis described as a transitory blip in the continuing Great Moderation. Still that pales into insignificance compared to this piece by Casey Mulligan of Chicago (h/t commenter Daniel ), in which (I swear this is true!) the crisis is the result of financial markets correctly anticipating the adverse labour market impacts of possible legislation under Obama, such as a health plan that might include means tests.

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Zombie ideas rise again

February 4th, 2010 39 comments

A glutton for punishment, I’ve decided the Zombie Economics book manuscript I submitted a month ago (mostly online here) is in urgent need of more zombies. I’ve been struck, even in that short space of time by the extent to which, with undeniable “green shoots” now appearing, the zombie ideas I’ve written about are clawing their way through the softening soil and walking among us again. The most amazing example is that of the Great Moderation – surely you would think no one could believe in this anymore, but they do.

So, I’m planning to add a bit to each chapter, pointing to examples of these ideas being revived. I’d appreciate good examples for the rest: Trickle Down, Micro-based Macro the Efficient Markets Hypothesis and Privatisation (of course, the Queensland government gives an example v close to home).

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Bookblogging: The end

January 18th, 2010 16 comments

Over the fold, the conclusion of my book, with Release Candidate title “Zombie Economics: How Dead Ideas Still Walk Among Us”. I plan a proper post on the whole bookblogging experience, but until then, I’ll thank everyone who’s commented, or just read this exercise with interest and make one (maybe) last request for help. Can anyone recommend a book on Thatcher’s economic reforms that would be a good suggestion for further reading? I’m currently suggesting Anderew Glyn’s Capitalism Unleashed, but I’d like to add something from a centrist or Thatcherite perspective, as long as it’s readable and not too objectionable for words.

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Bookblogging: Privatization (Part 2)

January 15th, 2010 48 comments

I sent off the draft MS of my Zombie Economics book to the publisher last week, but there is still time for improvement. Over the fold is the second, and final part of the privatization chapter.

You can read most of the book (not always the final draft) at my wikidot site.

As always, comments and criticism much appreciated.

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Pulped fiction?

January 7th, 2010 44 comments

Talking of books, it’s been nearly a month since it was announced that Volume 3 of Keith Windschuttle’s fabrications would be released “next week”. Such vaporous promises are typical of KW, but I would have thought that if a book was promised for next week it would have already been printed. Could it be that, with his lead story about Rabbit Proof Fence totally demolished, Keith has decided to pulp the book and try again?

Update Commenter Charlie, who obviously has a stronger stomach than I do, visited the Quadrant website, and found an extract and cover art for the book, with publication details as follows: The Fabrication of Aboriginal History, Volume Three, The Stolen Generations 1881–2008, Macleay Press, $59.95, 656 pages, published in December 2009. But MacLeay Press itself has nothing.

Update While I’m on the topic, the latest outpouring from American Enterprise Institute Fellow Charles Murray as he complains about the number of black and brown faces on the streets of Paris has drawn attention to his past as a youthful cross-burner. In between his KKK wannabe youth and his current channelling of Pauline Hanson, Murray wrote a bunch of books, such as The Bell Curve and Losing Ground, which put a scholarly gloss on the same ugly stuff, and were therefore treated with more respect than they deserve.

Since he has already commented in defence of Windschuttle, I expect Jack Strocchi will have something to say here and I’m going to let him. However, that’s the end. From this post on, any comment from Strocchi touching on the issues of race, ethnicity, religion or immigration, directly or indirectly, will be deleted and repetition will be cause for an immediate and permanent ban. No correspondence will be entered into, and any attempt to dispute the policy in comments (here or elsewhere) will trigger the same ban. Strocchi is, however, welcome to continue commenting on other topics.

Further update The book has now appeared (11/1/09). I guess Windy was just trying to put some time between the Rabbit Proof Fence debacle and the release. Interestingly, he’s still promising Vol 2 and Vol 4.

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Book in beta

January 7th, 2010 7 comments

I just sent a draft manuscript of my Zombie Economics book off to the publisher at Princeton UP. It’s pretty much in beta stage now.The aim is to have it come out in the Fall List.

Thanks heaps for all the praise and criticism. The praise has kept me motivated, and the criticism has been at least as valuable.

I’ve got some more sections of the privatisation chapter and the afterword to post here for comments, and I’m now going to circulate the draft in the older version of the same process. I’m also updating the draft at wikidot (lagging a little on this).

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Bookblogging: Privatisation – Beginnings (updated)

January 2nd, 2010 94 comments

I’m on the final chapter of my long-promised Zombie Economics, dealing with ideas refuted by the Global Financial Crisis. My target this time is privatisation – more precisely, the idea that privatisation will always yield an improvement over public ownership, and, therefore that market liberalism is an advance on the mixed economy that developed in the during the post-1945 long boom.

As always, comments, criticism and suggestions much appreciated.

Updated In response to comments, I’ve added a bit more material on the 1970s and the background to privatisation.

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Would Bacon’s Hamlet be Hamlet?

December 22nd, 2009 36 comments

In the course of an interesting piece by Richard Dorment in the NY Review of Books on the authenticity or otherwise of works by Andy Warhol, I came across a striking passage

The single most important thing you can say about a work of art is that it is real, that the artist to whom it is attributed made it. Until you are certain that a work of art is authentic, it is impossible to say much else that is meaningful about it.

Is this a reasonable claim about art in general? How important is authentic attribution in, say, literature or music?
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Bookblogging: The failure of trickle down

December 17th, 2009 124 comments

Another section of my book-in-progress, looking at the failure of the trickle-down hypothesis. Comments and criticism welcome as always.

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An odd numbering scheme

December 17th, 2009 21 comments

Keith Windschuttle has been in the news again lately, making claims of inaccuracy against the film ‘Rabbit Proof Fence’ which were then roundly refuted by the filmmakers, pointing to documentary evidence apparently undiscovered by the ace historian. When even the Oz describes Windy as having been ‘dispatched to the fence’ he clearly has a problem. Having claimed that the girls in the film were removed from their families because they were having sex with white men, he now says his case is unaffected by the discovery that they were actually removed because they were promised as brides for black men. WIndschuttle describes this as “standing by” his statements, a locution I also heard recently from the Queensland government after the economists statement demolishing their case for asset sales. Apparently it means “while I have no credible response to make, I’m not going to retract, let alone change my mind”.

What’s really interesting to me is that all this publicity is in aid of the forthcoming Volume 3 of Windschuttle’s Fabrication of Australian History which caused such a stir when Volume 1 was released in 2002. Three volumes in nearly a decade looks like slow, but steady work, the kind of history Windschuttle supports.

That is, of course, except for the minor detail that there is no Volume 2. Originally Volume 2, due in 2003, was supposed to be the big one, which would refute Henry Reynolds claims about violence on the Queensland frontier, while volume 3, promised for 2004, was going to be about WA. Although promises kept being made, Vol 2 never came out, and in 2008, the “stolen generations” book was announce as Volume 2. It seemed that the Queensland and WA projects had been abandoned.

The new numbering scheme, eccentric as it is, at least implies a promise of a Volume 2 in which Windschuttle will finally put up or be morally obliged to shut up (not that he will of course).

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Bookblogging: Implications of trickle down

December 13th, 2009 104 comments

Another section of my book-in-progress, this time on the implications of trickle-down. I’m getting lots out of the comments, even if I don’t respond to everything, so please keep them coming.

One thing that would be really useful to me is references to publications (probably popular, rather than journal articles) by prominent academic economists that clearly espouse some of the implications of trickle-down discussed here. More than most of the ideas I’m criticising, trickle-down economics tends to be a background assumption rather than something which comes out into the open, and I want to avoid the suggestion that I’m attacking a straw zombie here.
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Bookblogging: Trickle down Part 1

December 11th, 2009 14 comments

I’m pushing hard now to finalise a draft of my book-in-progress,

It’s currently titled Zombie Economics:Undead Ideas that Threaten the World Economy. The title is pretty much locked in, but the subtitle is still open for change if anyone has any suggestions. You can read the first few chapters (not quite an up-to-date draft) at wikidot.

The chapter I’m working on now is Trickle-Down Economics, which seems a fairly soft target after the challenge of presenting a critique of the “micro foundations” approach to macroeconomics. But, there are still plenty of difficulties starting with the point that, of course, no-one espouses Trickle-Down Economics under that name. On the other hand, while the view that pro-rich policies will benefit everyone in the long run is widely held, I don’t know of a good general term that describes it.

Anyway here’s the opening section. As always, comments and criticism much appreciated.

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Bookblogging: What next for macroeconomics ?

November 20th, 2009 86 comments

It’s been slow going, but I’ve finally finished the draft chapter of my book-in-progress that looks forward to a new research program for macroeconomics, an absurdly ambitious task, but one that needs to be tackled. Of course, what I’ve written isn’t fundamentally new – it’s a distillation of points that Old Keynesians, post-Keynesians and some behavioral economists have been putting forward for a while. But I hope I’ve got some positive contribution to make. More than ever, comments are much appreciated.

Update In response to comments, mostly at Crooked Timber, I’ve fairly substantially revised the section on “avoiding stagflation”. While I don’t back away from the points I made previously, I took for granted some things that I’d mentioned in other places in the book. The result made for a fairly unbalanced treatment with an excessive focus on the role of labor militancy. I’ve now tried to put this into proper context. I don’t expect that will satisfy everybody, but this is closer to what I meant to say all along.End update
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Bookblogging: The failure of micro-based macro

November 5th, 2009 9 comments

Work on my book-in-progress has been slowed by other commitments, such as work on Queensland privatisation (hopefully this will get me in the right frame of mind for the privatisation chapter), but I’m still moving forward. Here’s a section on the GFC and the failure of the micro-foundations approach to macroeconomics. As always, comments much appreciated

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A snippet on representative agents

October 23rd, 2009 13 comments

In response to some comments, I’ve written a little bit about the representative agent assumption in Dynamic Stochastic General Equilibrium Models. I argue that, given the underlying DSGE assumptions, you won’t get very much extra by including heterogeneous agents.

But, I intend to say in the “Where next” section, it seems likely that heterogeneous and boundedly rational individuals, interacting in imperfect and incomplete markets will generate ‘emergent’ macro outcomes that are not obvious from the micro foundations. Of course, this is going to be a prospectus for a theory, not the theory itself.

In the meantime, comments on my snippet would be much appreciated.

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Bookblogging: Implications of micro-based macro

October 21st, 2009 19 comments

Another section from my book-in-progress. The book-so-far can be viewed here.

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What went wrong with New Keynesian macro ?

October 13th, 2009 17 comments

More bookblogging! It’s all economics here at CT these days, but normal programming will doubtless resume soon.

Most of what I’ve written in the book so far has been pretty easy. I’ve never believed the Efficient Markets Hypothesis or New Classical Macro and it’s easy enough to point out how the occurrence of a massive financial crisis leading to a prolonged macroeconomic crisis discredits them both.

I’m coming now to one of the most challenging section of my book, where I look at why the New Keynesian program (with which I have a lot of sympathy) and ask why New Keynesians (most obviously Ben Bernanke) didn’t, for the most part, see the crisis coming or offer much in response that would have been new to Keynes himself. Within the broad Keynesian camp, the people who foresaw some sort of crisis were the old-fashioned types, most notably Nouriel Roubini (and much less notably, me) who were concerned about trade imbalances, inadequate savings, and hypertrophic growth of the financial sector. Even this group didn’t foresee the way the crisis would actually develop, but that, I think is asking too much – every crisis is different.

My answer, broadly speaking is that the New Keynesians had plenty of useful insights but that the conventions of micro-based macroeconomics prevented them from forming the basis of a progressive research program.

Comments will be appreciated even more than usual. I really want to get this right, or as close as possible
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Bookblogging Micro-based macro

October 12th, 2009 4 comments

Over the fold, yet more from my book-in-progress, Zombie Economics: Undead ideas that threaten the world economy. This is from the Beginnings section of the Chapter on Micro-based Macro, and covers the breakdown of the Phillips curve and the rise of New Classical and Rational Expectations macro. This (along with the bits to come on DGSE models) is probably the section on which my own background is weakest, so feel free to point out my errors.

I’ve now posted drafts of the first three chapters (+Intro) at my wikidot site, so you can get some context. In particular, before commenting on omissions, take a quick look to see that the point hasn’t been covered elsewhere.

Micro-based macro is here

I’ve got a lot out of comments and discussion so far, and I hope some of this is reflected in what you are reading.

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Bookblogging: Micro-based macro

October 8th, 2009 14 comments

Another installment of my slowly-emerging book on Zombie Economics: Undead ideas that threaten the world economy. This is from the Beginnings section of the Chapter on Micro-based Macro. I’ve now posted drafts of the first three chapters (+Intro) at my wikidot site, so you can get some context. In particular, before commenting on omissions, take a quick look to see that the point hasn’t been covered elsewhere.

Micro-based macro is here

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Bookblogging & bookwiki

October 5th, 2009 2 comments

I’ve been moving slowly on the book for the last few weeks, but I have taken one positive step to encourage further discussion. In response to suggestions from readers, I’ve started a wiki site imaginatively named Zombiecon where my plan is to post draft chapters. The Efficient Markets Hypothesis is already up. In part, the idea is to provide a reference to avoid some of the problems that arise from blogging a section at a time. But, if someone wants to create one or more talk pages on the site itself, that would be great. I’m not really sure joint editing in the mode of Wikipedia, but if you have suggested minor changes, go ahead and make them – I may revert or partially adopt them. ????? ???? ? ????????? ????????

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More bookblogging

September 20th, 2009 156 comments

I’m starting now on what will I think be the hardest and most controversial chapter of my book – the argument that the search for a macroeconomic theory founded on (roughly) neoclassical micro, which has been the main direction of macro research for 40 years or so, was a wrong turning, forcing us to retrace our steps and look for another route. As always, comments and criticisms accepted with gratitude.

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Bookblogging: a snippet

September 9th, 2009 46 comments

A little bit I plan to include in the chapter on the Great Moderation, linking on to a critique of post-70s macroeconomics. As always, comments and criticism gratefully (and, mostly, I hope, gracefully) accepted

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