Re:Economists don’t understand much about the macroeconomy
by SiempreViernes on Thursday September 19, 2019 @08:28AM
(#21015501)
What all this amounts to is that there is no theoretical understanding of the the social interactions that constitute the economy, only fitted relationships to the actions of aggregating entities like companies.
Re:Economists don’t understand much about the macroeconomy
by nabla9 on Thursday September 19, 2019 @02:04PM
(#21018820)
That would require relatively complete "Theory of human" and also understanding the variety of human behavior. Human are also chancing their behavior. Different generations respond differently to same signal.
But all this does not mean that macroeconomics is useless or that it's not getting results. They are just relatively modest.
Economists started to understand the dynamics of post-war type growing economy and how it behaves better and better. There is gradual shift away from these conditions.
* Wage share in OECD countries peaked late 70's early 80's and has started to decline.
* The return from increased education is slowing. Marginal return from increasing education is smaller.
* Women are now fully in workforce.
* Demographic change in OECD countries when people age. The share of working-age population is in decline. Paying for the care of older people dominates the growth of public spending and requires increases in taxation.
Now macroeconomists are trying to learn the dynamics of new conditions.