Why couldn't the theories predict the current crisis?

Is something seriously wrong with economics? After being cold-shouldered by the model-building, regression-fitting economist fraternity for long, Keynesian and other less orthodox economists are getting a bit of their own back. In an interview to The New York Times, economist James Galbraith, who has steadfastly stayed loyal to the liberal theories of his celebrated father John Kenneth Galbraith, said that the failure to foresee the mortgage crisis was “an enormous blot on the reputation of the profession”. He went on to say: “There are thousands of economists. Most of them teach. And most of them teach a theoretical framework that has been shown to be fundamentally useless.”

Click here for the full story.

Advertisements
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s