tag:blogger.com,1999:blog-8732662769765511163.post5341448411083915150..comments2023-07-31T11:06:29.485+02:00Comments on Transition: Akerlof & Shiller, Animal Spirits: A Misnomer for Their Sound EconomicsD. Mario Nutihttp://www.blogger.com/profile/17319653816487296802noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-8732662769765511163.post-43150952959648358702009-09-09T20:30:30.141+02:002009-09-09T20:30:30.141+02:00Branko, naturally I sympathize with your feelings,...Branko, naturally I sympathize with your feelings, and thanks for your revaluation of my intellectual assets. <br /><br />But, for instance, "Looting: The Economic Underworld of Bankruptcy for Profit", by George Akerlof and Paul Romer (both at Berkeley) is a very fine, original and enjoyable piece of economics and is very highly relevant to the current crisis (you can download it from SSRN, and I guarantee that you will love it). And I am sure you would appreciate Robert Shiller's "Irrational Exhuberance". <br /><br />I feel that much traditional economics is as disreputable and deeply entrenched in academia as Silvio Berlusconi is in government. Against both you need to accept all the support you can get from the opposition, even if you do not agree with the oppositors' arguments as long as their heart is in the right place.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-16287313723857622332009-09-09T14:38:32.136+02:002009-09-09T14:38:32.136+02:00This is a comment bred partly out of ignorance. Of...This is a comment bred partly out of ignorance. Of Akerlof's work, I know only "lemons". Of Schiller, I have never heard. However, what I find annoying is that _after_ the crisis has broken out, these, and perhaps other, authors quickly reach for the books, gathering dust somewhere on the shelves, to which they apparently never paid any attention before, and come out with explanations of the crisis which they expect us to applaud. I would say: yes, gentleman, I love your work but if you are such great guys you should have written this book three years ago, not today. And because Mario, unlike some of these writers, has deep knowledge of several long-neglected areas of economics which have recently become more valuable (Marx, Kalecki, Keynes etc), I thought that he should have made more forcefully this point. I am not pleading for a dogmatic view of economics where we need to read Keynes like latter-day Marx, but I am annoyed by the need of economists (who often know little of history of their own discipline) to reinvent the wheel.Brankonoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-74415192587863445322009-09-09T09:16:37.548+02:002009-09-09T09:16:37.548+02:00On hearing Akerlof's lectures my reaction was ...On hearing Akerlof's lectures my reaction was similar: why doesn't he cite Veblen? Why didn't he read Keynes?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-74762742610109307502009-09-05T18:16:19.641+02:002009-09-05T18:16:19.641+02:00Thank you for the endorsement, Ashok. Maybe I shou...Thank you for the endorsement, Ashok. Maybe I should have used the label "intertemporal inefficiency" instead of "intertemporal allocation". <br /><br />Branko, you are right: I agree almost entirely with A&S's statements about macroeconomic theory and policy, even if for radically different reasons. And I think that those statements are often forgotten and need repeating. Also, I have a great admiration for Akerlof's work, from lemons to looting - not to speak of his stand for the legalisation of mariujana - and for Shiller's Irrational Exuberance and The New Financial Order. Hence my only apparently gratuitous approval. <br /><br />Mining Keynes more? Hardly a stone has been left unturned. He can still inspire, but what might be produced today following his inspiration should not need the support of our conjectures about what he "really" said or meant.D. Mario Nutihttps://www.blogger.com/profile/17319653816487296802noreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-30041347749535464002009-09-05T00:36:38.659+02:002009-09-05T00:36:38.659+02:00Mario's introduction of A&S book is glowin...Mario's introduction of A&S book is glowing. But the more one reads, the less is one impressed by the book. At the end, the review seems to boil down to proclaiming the book useful not because there is anything new or startling in it, but because what A&S write (even if they misname things and are wrong from time to time) has been forgotten. So, it is a useful reminder and antidote to rational expectations and the like. I know of course that reviews tend to focus on what the reviewer finds "wrong:" with the book or article, but here it really seemed to me that there was a rather strong contrast between the beginning and the end.<br /><br />I will not say much about rational vs. irrational because I think that economists tend to call "irrational" everything which they do not understand, that is which does not fall within their very narrow understanding of human motivation and interests. Economists are the ultimate "last men", so a lot is "irrational" to them. But perhaps Matio could have "mined" Keynes more because his animal spirits seem to be _very_ different from A&S's. (Their taxonomy of animal spirits strikes me as tedious and pedantic.)<br /><br />Brankobrankonoreply@blogger.comtag:blogger.com,1999:blog-8732662769765511163.post-79362599268345732362009-09-04T02:33:50.982+02:002009-09-04T02:33:50.982+02:00I must say that in many ways I enjoyed your review...I must say that in many ways I enjoyed your review even more than the book. "A powerful critique, but we are left clutching only a few straws...." Touché!<br />It does feel as if "animal spirits" is the felicitous phrase in desperate search of a theory. Although I'm not convinced that your alternative framework of "intertemporal allocation" is the panacea!<br />Ashokabhttps://www.blogger.com/profile/18263650375765702636noreply@blogger.com