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Working Paper No. 663Quality of Match for Statistical Matches Used in the 1995 and 2005 LIMEW Estimates for Great Britain
The quality of match of four statistical matches used in the LIMEW estimates for Great Britain for 1995 and 2005 is described. The first match combines the fifth (1995) wave of the British Household Panel Survey (BHPS) with the 1995–96 Family Resources Survey (FRS). The second match combines the 1995 time-use module of the Office […] -
BlogMore on real interest rates in Europe
Charts in last week’s entry, which contained approximations of real interest rates for various European countries, were unfortunately incorrect. The problem resulted from a silly mathematical error in the formula used to calculate the figures shown in the graphs. Accordingly, the author has recently uploaded a new version of the post, including corrected diagrams. He [...] -
Working Paper No. 662
The Financial Crisis Viewed from the Perspective of the “Social Costs” Theory
This paper examines the causes and consequences of the current global financial crisis. It largely relies on the work of Hyman Minsky, although analyses by John Kenneth Galbraith and Thorstein Veblen of the causes of the 1930s collapse are used to show similarities between the two crises. K.W. Kapp’s “social costs” theory is contrasted with […] -
Blog
Krugman, Galbraith, and others debate MMT
Paul Krugman slugs it out with our colleague Jamie Galbraith and many other “modern monetary theory” partisans at Krugman’s New York Times blog website. Jamie’s most recent retort is at the top of this page of the blog site. Many of the points raised in the discussion there are central to our work here at [...] -
Working Paper No. 661
Minsky’s Money Manager Capitalism and the Global Financial Crisis
The world’s worst economic crisis since the 1930s is now well into its third year. All sorts of explanations have been proffered for the causes of the crisis, from lax regulation and oversight to excessive global liquidity. Unfortunately, these narratives do not take into account the systemic nature of the global crisis. This is why […] -
Blog
How Tight Have ECB Policies Been in Real Terms?
(Click picture to enlarge.) Readers may have seen two charts that are part of a column by David Wessel published last week. For five European countries, they compare actual interest rates with those prescribed by a standard policy rule. Wessel’s charts provide some interesting evidence that European Central Bank monetary policy has been either too [...] -
Blog
Some Interesting Charts and Arguments on the Deficit Issue
Some more thoughts on the federal debt, which I blogged about last week: First, at Barry Ritholtz’s blog, there are some other interesting figures: one portraying the gross federal debt in three different ways and another breaking the gross debt down by holder. Ritholtz’s figures use data from the U.S. Treasury Department. Note that the [...] -
Working Paper No. 660
Financial Markets
This paper provides a brief exposition of financial markets in Post Keynesian economics. Inspired by John Maynard Keynes’s path-breaking insights into the role of liquidity and finance in “monetary production economies,” Post Keynesian economics offers a refreshing alternative to mainstream (mis)conceptions in this area. We highlight the importance of liquidity—as provided by the financial system—to […] -
Working Paper No. 659
Minsky Crisis
Stability is destabilizing. These three words concisely capture the insight that underlies Hyman Minsky’s analysis of the economy’s transformation over the entire postwar period. The basic thesis is that the dynamic forces of a capitalist economy are explosive and must be contained by institutional ceilings and floors. However, to the extent that these constraints achieve […] -
Blog
Data Show Increased Fed Role in Financing Federal Debt
(Click on graph to enlarge.) Some interesting information on the federal government’s balance sheet can be gleaned from the fourth-quarter flow-of-funds report, which was released by the Federal Reserve Board on the 10th of this month. The total amount of all federal liabilities, as reported by the Fed last week, is shown as the sum [...] -
Working Paper No. 658
Keynes after 75 Years
In this paper I first provide an overview of alternative approaches to money, contrasting the orthodox approach, in which money is neutral, at least in the long run; and the Marx-Veblen-Keynes approach, or the monetary theory of production. I then focus in more detail on two main categories: the orthodox approach that views money as […] -
Working Paper No. 657
What Does Norway Get Out Of Its Oil Fund, if Not More Strategic Infrastructure Investment?
For the past generation Norway has supplied Europe and other regions with oil, taking payment in euros or dollars. It then sends nearly all this foreign exchange abroad, sequestering its oil-export receipts—which are in foreign currency—in the “oil fund,” to invest mainly in European and US stocks and bonds. The fund now exceeds $500 billion, […]