Re: Why economists do not care about high rates of unemployment w

[Paul Davidson <PB108928%UTKVM1.BITNET@xxxxxxxxxxxxxxxxx>]

FROM:  Paul Davidson
"      Economics Department
"      523 Stokely Management Center  (615) 974-4221
But my dear Barkeley, if a desireable equilibrium  can be unstable then
governments intervening "to Push...and KEEP PUSHING" may actually cause
the economic system to be not only continually  unstable but also moving from
one disaster to another (first inflation than stagnation then inflation, etc.)
as the RESULT of government intervention. If that is the case, then as Dave
Colander argues in his multi-equilibrium model in the EEJ (1992), a stable
less than full employment equilibrium might be desireable.
    I think that well-behaved chaos theorists such as Steve Keen and yourself
are presuming that government interference can  avoid unstable
equibilibria or else presuming that the socially desireable equilibrium
in a nonlinear multiequilibrium system must be a stable one. That can not
be the general case.

Have a good day!____Paul Davidson
))))_ fax # (615) 974-1686