Author Archives: Steve Keen

Below is the video of my talk at INET’s Berlin 2012 con­fer­ence. The oth­er videos for the con­fer­ence are avail­able from INET’s web­site: Day 1; Day 2; Day 3.

Bear­ing in mind that I did­n’t see all pre­sen­ta­tions,  my favourite talks (in deliv­ery order) were those by: George Soros; Gerd Gigeren­z­er; Axel Lei­jon­hufvud; Michael Hud­son; Yanis Varo­ufakis; Dirk Beze­mer; and Moritz Schu­lar­ick.

 INET will pub­lish this paper on their web­site in due course. Click here for the Pow­er­point file;
Click here for the data: Debt­watch mem­bers; (CfE­SI mem­bers link to come in Syd­ney morn­ing)

Lau­ren Lyster and Demetri Kofi­nas at Rus­sia Today’s Cap­i­tal Account did their usu­al bril­liant job in this inter­view with me about the Krug­man brawl, and I’ve been some­what remiss in not post­ing it here ear­li­er. I’ve giv­en enough links on this top­ic in ear­li­er posts not to both­er now, so look to those if you want to fol­low the debate in more detail.

Sor­ry, that was a belat­ed April Fool’s joke. He has­n’t, of course—though there has been an apol­o­gy of sorts from Nick Rowe, which is duly not­ed and accept­ed.

The best Krug­man could man­age is the fol­low­ing update to his orig­i­nal dia­tribe “Oh My, Steve Keen Edi­tion”:

Update update: Ah, so Keen did­n’t mean DSGE — a term that refers only to New Key­ne­sian mod­els — when he said DSGE; he meant New Clas­si­cal, which he some­how regards as the under­ly­ing prin­ci­ples for mod­els that aren’t New Clas­si­cal at all. OK. Any­way, enough of that. I’m all for lis­ten­ing to heretics when they offer insights I can use, but I’m not find­ing that at all in this con­ver­sa­tion, just word games and con­tin­u­al insis­tence that the mem­bers of the sect have insights denied to us less­er mor­tals. Time to move on.

Q: What do John May­nard Keynes and Steve Keen have in com­mon?

A: They’ve both been mis­read by Paul Krug­man.

In just a cou­ple of days I’ve gone from the priv­i­lege of being acknowl­edged by Krug­man to being mis­read by him, in a way that would have any stu­dent failed in a mul­ti­ple choice exam. In a pas­sage where I specif­i­cal­ly referred to DSGE models–which includes both “New Clas­si­cals” and “New Key­ne­sians” he inter­pret­ed me as refer­ring to New Key­ne­sian mod­els only.

And I said “under­ly­ing prin­ci­ples to the DSGE mod­els”, which should have been enough of a clue that I was refer­ring specif­i­cal­ly to New Clas­si­cal mod­els, not New Key­ne­sian ones.

I’m rather lucky with the cal­i­bre of my blog mem­bers, and that’s been in evi­dence in the dis­cus­sion over Krug­man here in the last few days. One com­ment by Andrew Lain­ton sim­ply has to be shared more wide­ly:

Wel­come to Lon­don Steve

I hope peo­ple have spot­ted that Krug­man isnt sim­ply propos­ing a loan­able funds approach to banks, where loans are based on the inflow and out­flow of sav­ings by say­ing that banks ‘must buy assets with funds they have on hand’ he is going back to a mid 19th cen­tu­ry wages fund the­o­ry. Krug­mans world isn’t even Ptole­ma­ic, the world does­n’t even turn and time does­n’t exist.

Jet­lag has me up and at the key­board at 5.54am here in Lon­don, 43 min­utes before sun­rise, which today is at 6.37am.

Only it’s not “sun­rise”, is it? As we all know, it’s real­ly “Earth Axi­al Rotate” at the point in its 24 hour axi­al rota­tion when the Sun—around which the Earth rotates once each year—becomes vis­i­ble from Lon­don.

Click here for this post in PDF

Paul Krug­man has just com­ment­ed (twice) on my most recent blog about my paper for INET. In one sense, I’m delight­ed. The Neo­clas­si­cal Estab­lish­ment (yes Paul, you’re part of the Estab­lish­ment) has ignored non-Neo­clas­si­cal researchers like me for decades, so it’s good to see engage­ment rather than wil­ful (or more prob­a­bly blind) igno­rance of alter­na­tive approach­es.

Click here for this post in PDF

Fig­ure 1: Krug­man’s first piece

There is a bizarre asym­me­try in eco­nom­ics: crit­ics of Neo­clas­si­cal eco­nom­ics like myself read Neo­clas­si­cal lit­er­a­ture avid­ly, no because we agree with it—far from it—but because we feel oblig­ed to under­stand why they hold to their coun­ter­fac­tu­al views on the econ­o­my.

Lars Schall is a free­lance finan­cial jour­nal­ist in the indus­tri­al heart­land of Ger­many, the Ruhr Area, who focus­es on oil, pre­cious met­als and the mon­e­tary sys­tem. Lars inter­viewed me sev­er­al weeks ago for his pod­cast; click here for the MP3 file, or lis­ten to the link below.

Steve Keen’s Debt­watch Pod­cast

Lars’s overview of the inter­view is avail­able here.

My paper “Insta­bil­i­ty in Finan­cial Mar­kets: Sources and Reme­dies” for the INET con­fer­ence “Par­a­digm Lost: Rethink­ing Eco­nom­ics and Pol­i­tics”, to be held in Berlin on April 12–14, is now avail­able via the INET web­site.

If you’d like to down­load it, you can get it either from my INET page, or from a link on the con­fer­ence pro­gram. For copy­right rea­sons I can’t repro­duce it here, but I can pro­vide a quick syn­op­sis and some excerpts, so here goes.

One of the many great ironies of Amer­i­can cul­ture is that a soci­ety which lauds cap­i­tal­ism is also home to the fan­ta­sy of the self­less Super­Hero: enti­ties rang­ing from an ordi­nary but wealthy human (Bat­man) to an extra­or­di­nary but poor Extra-Ter­res­tri­al (Super­man), who spend their days sav­ing us mere mor­tals, for no obvi­ous rec­om­pense.

Well bol­locks to all that! Meet “Super Cor­po­rate Heroes”—super­heroes who are more in line with the actu­al Amer­i­can Way. These super­heroes are employed by a For­tune 500 com­pa­ny, charge for their services—“if you wan­na get res­cued, you got­ta pay insurance”—and live lifestyles rang­ing from opu­lent to the top billers, to just above the bread­line for the only slight­ly super amongst them.