Policy Research in Macroeconomics

Review of “The Irreconcilable Inconsistencies of Neoclassical Macroeconomics: A False Paradigm” by John Weeks

I’ve just received a copy of John Weeks’ new book, The Irreconcilable Inconsistencies of Neoclassical Economics: A False Paradigm (Routledge).  Especially in the light of the current economic crisis, this book challenges the fundamental premises of mainstream neoclassical economics and appeals to economists to formulate an alternative based on the thinking of Marx and Keynes.  We need to challenge the dominance of neoclassical economics, with its emphasis on speculation, the delusion of easy financial gain, and perpetual, unsustainable growth. My heart goes out to those young people who, spurred on by the financial crisis, embark on a course in economics. Invariably they confront an orthodoxy taught by a profession that failed to predict the crisis, failed to explain it and failed to offer remedies. Indeed the economics profession, with very few notable exceptions has stood aloof, disdaining to offer society, and in particular young people, an understanding of, and a way out of the crisis. Not so John Weeks. This book applies academic rigour to shed light and understanding. It is for anyone with a sceptical mind wanting to understand and make sense of today’s financial mayhem - and keen to challenge the discredited economics that precipitated the crisis of August 2007 – a crisis that is still ongoing.

In collaboration with PRIME, John Weeks has also written a critique of the coalition government’s “deficit disorder” approach to economic recovery.  Entitled “Understanding the Crisis: Clarity on measurement, Clarity on policy,” the paper argues that the government’s prioritizing of debt and deficit reduction remain unfounded.  Rather, as evidence suggests, financial markets have no reason to be alarmed about the state of UK public finances.  The paper advocates a practical, non-ideological policy reversal based on fiscal stimulus, financed through public borrowing and personal income tax increases.

John’s paper can be downloaded free of charge in PRIME’s publication page.

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