[PEN-L:3855] Re: stock market & investment

["Alex Izurieta,PhD" <izurieta@xxxxxx>]

Hi Blair,

May I respond in between the lines? Only two comments.
..............
>
> Hall & Taylor have this idea that in the long run the classical model and
> Say's Law are correct...

I cannot adhere with this logic that a succession of disequilibria in
the short run would lead to an equilibrium in the long run. It is in
this perspective that I interpreted Keynes' "in the long run we are all
dead" (sorry if it is not textual, I took it from a Spanish
version..).

In my very intuitive opinion, the statement above, which apparently
Hall and Taylor elaborated more formally,  has very easily passed
unadverted to the logic of many economists due to a blind application of the
'ceteris paribus' methodology. I come from a background in pure
mathematics and have always difficulty in accepting this as a
'generally valid'  method. The most 'aggressive' use of it is when
economists think in the long run, ceteris paribus the short run....;
while in practice, the disequilibria of today just add, in a
not-necessarily related manner, to the disequilibria of yesterday...

I can imagine that a Keynesian could have something to add to my
(probably too heterodox) view. I found that John Weeks (A Critique of
Neoclassical Economics, 1989, MacMillan) elaborates quite acceptably
in this direction.
>
> What are the obvious (to all but me?) criticisms of this model in its own
> terms, i.e., suitable for a low-level intermediate undergraduate macro
> class?

One thing I will always regret of my experience as undergraduate
economist is to have been too often 'forced' to think against the
logic and against the reality (even if that was 'suitable' for the
lecturer, it was not for me...).
>
> Thanks all.

Thank you also; your remarks took me away for a moment of my daily
affairs, and invited me to reflect.
>
> Blair Sandler
> blairs@xxxxxxxxxxx
>
Alex






Alex Izurieta
E-mail: izurieta@xxxxxx
Institute of Social Studies
P.O. Box 29776
2502 LT The Hague
Tel. 31-70-4260480
Fax. 31-70-4260755