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The Intolerance of Uneconomic Economics

Over the last couple of days two of the big beasts of the economics blogosphere have offered views on a question of considerable significance for the field of macroeconomics.

On Friday Simon Wren-Lewis discussed whether New Keynesians made a Faustian pact when they decided to engage new classical economists on their own modelling territory. He concludes that New Keynesians were not compelled against their will to adopt modelling devices such as rational expectations and inter-temporal optimisation at the individual level. These modelling techniques were perceived as an improvement on existing practice.

via The intolerance of uneconomic economics.

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