The dividing line between bad and good macroeconomics23 September, 2016 at 18:44 | Posted in Economics | 2 Comments
If I am right that in recent decades the equilibrium in post-real macro has discouraged good science … there is some risk that a rear-guard of post-real macroeconomists will continue to defend their notion of methodological purity. At this point it is hard to know whether this group will fracture or dig in for a fight to death. If they dig in, I suspect that it will be in a few departments and that the variation between departments will be larger. Watch to see how this plays out and choose where you go with this in mind.
To learn about a department, visit and ask macroeconomists you meet “honestly, what do you think was the cause of the recessions of 1980 and 1982.” If they say anything other than “Paul Volcker caused them to bring inflation down,” treat this as at least a yellow caution flag. Then ask about cause of the Great Depression. If they start telling you about the anti-market policies of the New Deal, listen politely and scratch this department off your list.