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
Dear Steve: Apparently we are also coming close to an apparent agreement.
It should now be obvious why I object ot the so called ad hoc constraints
of neoclassical theorists -- mainly New Keynesians -- to achieve our
results while still remaining loyal to their long-run ergodic system. And then
insisting that the only way to do economic "science" is using the hard-headed
axioms of classical theory.
     I was pleased today to receive the April 1994 SOUTHERN ECONOMIC JOURNAL,
WHERE ON THE FIRST PAGE OF THE FIRST ARTICLE (P. 805) Bob Clower denigrates
Joe Stiglitz for agreeing that "by introducing ad hoc theoretical gimicks into
standard textbook theory Mankiw and other New Keynesians have 'reincarnated'
Ketynesian economics 'into a body with firm microeconomic muscle'". Right
on Bob!
      My unwillingness to permit nonlinearities to be a proxy for nonergodicity
 is just that brilliant minds like Stiglitz and Mankiw think that they some-
how still can maintain the Arrow-Debrew microfoundations without modification.
Pure self-delusion -- but the kind that helps win Nobel Prizes!

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