The Battle for the Soul of Macroeconomics, Part 1 (Wonkish)

Do you remember what you were taught in introductory economics? Do you remember how much math you had to chew through in graduate school? Do you want to relive that? Alternatively, you might just have wondered why macroeconomists write and speak like they do, why they use complex math to explain seemingly simple concepts, and why they don't seem to agree on anything?

In this first part, I pick apart the traditional undergraduate story of macroeconomics, and try to explain why Keynes and Friedman maybe weren't as different as everyone would like you to believe. In doing so, I am setting up the big plunge into why on earth macroeconomics has come to rely on a fusion of math and representative agent models to make theories of the world, a story that I will grapple with in part 2 of this show.

 

List of references

Bishop, Matthew (2004) - Essential Economics; the Economist and Profile Books Ltd

Blanchard, Oliver Jean, and Fischer Stanley (1993) - Lectures on macroeconomics; The MIT Press seventh edition

Colander, David (2004) - The strange persistence of the IS-LM model; History of Political Economy Annual Supplement to Volume 36 (2004) 305-322

Colander, David (2006) - Post Walrasian Macroeconomics; Cambridge University Press

Duarte, Pedro Garcia and Lima, Gilberto Tadeu (2012) - Microfoundations reconsidered; Edward Elgar

Friedman, Milton (1957) - A theory of the consumption function; Princeton University Press, sixth edition 1971

Hartcourt G.C. (1977) - The microeconomic foundations of macroeconomics; Macmillan

Hartley, John (1997) - The representative agent in macroeconomics; Routledge

Keynes, John Maynard (1937) - The general theory of employment, interest and money; 2008 edition by BN Publishing

King, J.E. (2012) - The microfoundations delusion; Edward Elgar

Rima Hahne, Ingrid (2001) - Development of economic analysis; Routledge

Romer, David (2006) - Advanced Macroeconomics, McGraw-Hill, third edition

Sloman, John and Wride, Alison (2009) - Economics; 7th edition FT Prentice Hall