Updated 10/31/2016 Mathematical economists are attracted to equilibrium solutions like moths to a flame. One reason is because mathematicians like the aesthetic beauty of finding a unique solution to a mathematical puzzle. An equilibrium is a solution where everything is…
Blog Archives
Do Monetarists Understand Their Own Models?
I have learned a lot from Nick Rowe. For example, he wrote a great post where he pointed out a place where many Keynesians don’t understand their own models. But the following section suggests that Nick doesn’t completely understand his…
The Streetlight Fallacy
The Streetlight Fallacy is a kind of informal fallacy in which people over-emphasize readily-available information even though it is clearly wrong instead of looking for the right information. It is a version of the availability heuristic, except that in the…
Posted in Medianism, Philosophy and ethics
The Fed is of the banks, by the banks and for the banks.
Brad Delong recently remarked that it is “good to know” that the Fed doesn’t have a double mandate (1. fight inflation, 2. fight unemployment), but rather a triple mandate (3. keep the financial system strong and stable). The idea the the…
How The Fed Has Exacerbated Inequality
One of the confusing concepts in public economics is how the government prints money and where it goes. The Treasury is responsible for literally running the presses that print the cash, but the Fed is in charge of deciding how…
Phantom Money Measures and Predictions of Phantom Inflation
UPDATE: Today I came across this old post that I started a year ago and never quite finished. I’ll finally post it now, but I’ll try to put it in at the date when I originally wrote it. Suppose everyone…
News Flash: Americans Are Mostly Below AVERAGE Income…
…And Tyler Cowen Predicts That Even Fewer Will Be Above AVERAGE In The Future Garrison Keillor jokes that in the mythological town of Lake Woebegone, all the students are above average. This is humorous because it is mathematically impossible for…
Posted in Medianism
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