Re: Some questions

[Doug Henwood <dhenwood@xxxxxxxxx>]

On Thu, 6 Jan 1994, RICHARD P.F. HOLT wrote:

> We know the transition from classical and neoclassical economics brought
> about changes in methodology of economics, but when did we first see the
> bifurcation of economics into microeconomics and macroeconomics? Did this
> occur in response to the Keynesian Revolution?  The reason why I ask this
> is because it doesn't seem until after WWII we have economists like Arrow
> and Debreu and others focusing a lot of attention on the consistent
> relationship between micro and macro. And why was the focus on micro
> as the foundation of macro instead of the other way around?

Might it have something to do with individualism, and an unwillingness to
face aggregation problems? Just assume away all the problems of
organizations ("there's no such thing as society, only individuals and
their families" - Margaret Thatcher) and life is so much simpler.

> Through the influence of friends like Larry Moss and Bruce Caldwell,
> I've been looking more closely at the Austrian school and have been
> very much impressed with the writings of Frank Knight. One of the
> points that the Knight brings home is the subjective nature of economics
> and the nature of error and uncertainty plays in the economy. Should
> Keynesians feel some type of kinship with the Austrians like Knight?

As loopy as the Austrians are, at least they avoid the banalities of
equilibrium theory and have a sense that economics is highly political.

Doug

Doug Henwood [dhenwood@xxxxxxxxx]
Left Business Observer
212-874-4020