Come on, guys, somebody take it to the Next Step.
Matt Y comes closer than anyone else to getting to the truth of the problem with Macroeconomics. Following Justin FoxSteven Levitt’s summary, Matt asks the next question:
So why should it be that “in the current regime, if [macro models] are not meticulously constructed from ‘micro foundations,’ they aren’t allowed to be considered”?
There’s a hint in the title of this post.
Edited to fix attribution.
Read more here:
It Looks Like a Great House. Why Does the Basement Always Flood?
Post Tags: bad economics, macroeconomic theory, macroeconomics, problem, rational expectations, the-current, the-title, the-truth, title, truth, why-should
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