efficient markets hypothesis

Standard macroeconomic theory did not help foresee the crisis, nor has it helped understand it or craft solutions. This columns argues that both the New Classical and New Keynesian complete markets macroeconomic theories not only did not…

To me, much of the argument about whether or not markets are efficient misses the point. There are conditions, it seems, under which markets seem to do a great job of managing risk, keeping the cost of capital reasonable, and allocating…

MPT is based on a number of assumptions, some of which are more restrictive than others. The question is whether the sum of those assumptions is so far off the mark that it renders the entire theory absolutely useless. Effectively the…

Below is a framework that delineates the ideology and economics of two groups of economic thought that are much talked about in the wake of the Credit Crisis: the Chartalists and the Austrians. These two groups are considered outside of the…

George Soros makes the case for economics as a social science using his theory of reflexivity. Here are some additional thoughts to help understand why markets fail.

Fred Sheehan argues that it is unlikely that Ben Bernanke will raise rates. He says either the market or a successor will do so. He adds that there are several similarities between current trends and those in 1994, a year when many…

By Claus Vistesen The past week has shown the dark side of media coverage and the analysis of current events. It is a test on just how much information you stuff down the public's throat. In the narrowness of my own world, the financial…

By L. Randall Wray The following is a paper given at the ASSA conference in Denver this past week for a panel organized by James Galbraith, titled Pressures on the Paradigm, sponsored by Economists for Peace & Security. The Queen…

This is me thinking out loud (on paper). Comments are appreciated. During crisis we often see economics come toe-to-toe with ideology because government becomes a more openly active player in our lives. This crisis has been no different.…

By Marshall Auerback and Edward Harrison. Marshall's view Ed has asked me to deal specifically with the issue of Ricardian equivalence, the theorem used by anti-government proponents to argue that fiscal deficits are counterproductive and…