LARS P. SYLL

Olivier Blanchard fordert generöser Subventionen statt Kredite

ZEIT ONLINE: Herr Blanchard, Deutschland hat gerade einen umfassenden Lockdown beschlossen, wie viele andere Staaten weltweit. Und der erste Lockdown ist noch nicht lange her. Glauben Sie, dass Unternehmen und Regierungen diesmal besser vorbereitet sind?

Olivier Blanchard: Dieser zweite Lockdown hat ganz neue Dimensionen … Wir müssen die direkt und indirekt betroffenen Unternehmen und Arbeiterinnen und Arbeiter schützen. Europa hat das in der ersten Welle relativ gut gemacht … Es kann aber durchaus sein, dass die Rettung der Wirtschaft dieses Mal sogar noch teurer wird. Da beim ersten Mal die staatliche Unterstützung vielerorts aus einer Mischung aus Subventionen und Krediten bestand, haben sich viele Firmen verschuldet. Passiert das noch einmal, steigt die Verschuldung weiter – mit dem Risiko, dass die Unternehmen die Schulden irgendwann nicht mehr zurückzahlen können. Diesmal sollten die Staaten daher noch großzügiger sein als in der ersten Welle.

ZEIT ONLINE: Noch generöser? Schon jetzt summieren sich weltweit die Rettungsprogramme auf Billionenbeträge.

Blanchard: Aber wir müssen realistisch sein: Die Unternehmen, die sich bereits im Frühjahr verschuldeten, brauchen weitere Unterstützung. Werden das Kredite sein, werden sie diese irgendwann nicht mehr bedienen können. Wir werden viele Bankrotterklärungen von an sich profitablen Unternehmen sehen. Deshalb brauchen wir weniger Kredite und mehr Subventionen.

ZEIT ONLINE: Können die europäischen Volkswirtschaften denn so große Defizite verkraften?

Blanchard: Eindeutig ja! … Haben wir den finanzpolitischen Spielraum dafür? Ja. Das Risiko einer Schuldenkrise besteht, ist aber gering. Diese Wette müssen wir eingehen, weil die Alternative noch schlimmer wäre.

Marlies Uken & Lorenzo Barrio / Die Zeit

Interpreting economic theory

The issue of interpreting economic theory is, in my opinion, the most serious problem now facing economic theorists. The feeling among many of us can be summarized as follows. Economic theory should deal with the real world. It is not a branch of abstract mathematics even though it utilizes mathematical tools. Since it is about the real world, people expect the theory to prove useful in achieving practical goals. But economic theory
has not delivered the goods. Predictions from economic theory are not nearly as accurate as those offered by the natural sciences, and the link between economic theory and practical problems … is tenuous at best. Economic theory lacks a consensus as to its purpose and interpretation. Again and again, we find ourselves asking the question “where does it lead?”

Ariel Rubinstein

Is economics value-free?

I’ve subsequently stayed away from the minimum wage literature for a number of reasons. First, it cost me a lot of friends. People that I had known for many years, for instance, some of the ones I met at my first job at the University of Chicago, became very angry or disappointed. They thought that in publishing our work we were being traitors to the cause of economics as a whole.

David Card

Back in 1992, New Jersey raised the minimum wage by 18 per cent while its neighbour state, Pennsylvania, left its minimum wage unchanged. Unemployment in New Jersey should — according to mainstream economics textbooks — have increased relative to Pennsylvania. However, when economists David Card and Alan Krueger gathered information on fast food restaurants in the two states, it turned out that unemployment had actually decreased in New Jersey relative to that in Pennsylvania. Counter to mainstream demand theory we had an anomalous case of a backward-sloping supply curve.

Lo and behold!

But of course — when facts and theory don’t agree, it’s the facts that have to be wrong …

The inverse relationship between quantity demanded and price is the core proposition in economic science, which embodies the pre-supposition that human choice behavior is sufficiently rational to allow predictions to be made. Just as no physicist would claim that “water runs uphill,” no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teaching of two centuries; we have not yet become a bevy of camp-following whores.

James M. Buchanan in Wall Street Journal (April 25, 1996)

Economics — non-ideological and value-free? I’ll be dipped!

The radical façade of randomistas do not help us fight poverty

Most ‘randomistas’ underestimate the heterogeneity problem. It does not just turn up as an external validity problem when trying to ‘export’ regression results to different times or different target populations. It is also often an internal problem to the millions of regression estimates that are produced every year.

Just as econometrics, randomization promises more than it can deliver, basically because it requires assumptions that in practice are not possible to maintain. And just like econometrics, randomization is basically a deductive method. Given the assumptions, these methods deliver deductive inferences. The problem, of course, is that we will never completely know when the assumptions are right. And although randomization may contribute to controlling for confounding, it does not guarantee it, since genuine randomness presupposes infinite experimentation and we know all real experimentation is finite. And even if randomization may help to establish average causal effects, it says nothing of individual effects unless homogeneity is added to the list of assumptions. Causal evidence generated by randomization procedures may be valid in ‘closed’ models, but what we usually are interested in, is causal evidence in the real-world target system we happen to live in.

‘Ideally controlled experiments’ tell us with certainty what causes what effects — but only given the right ‘closures.’ Making appropriate extrapolations from (ideal, accidental, natural or quasi) experiments to different settings, populations or target systems, is not easy. “It works there” is no evidence for “it will work here”. Causes deduced in an experimental setting still have to show that they come with an export-warrant to the target population/system. The causal background assumptions made have to be justified, and without licenses to export, the value of ‘rigorous’ and ‘precise’ methods — and ‘on-average-knowledge’ — is despairingly small.

Apart from these methodological problems, there is also a rather disturbing kind of scientific naïveté in the randomista approach to combatting poverty. The way randomistas present their whole endeavour smacks of not so little ‘scientism’ where fighting poverty becomes a question of applying ‘objective’ quantitative ‘techniques.’ But that can’t be the right way to fight poverty! Fighting poverty and inequality is basically a question of changing the structure and institutions of our economies and societies.

Reforming economics

The typical economics course starts with the study of how rational agents interact in frictionless markets, producing an outcome that is best for everyone. Only later does it cover those wrinkles and perversities that characterise real economic behaviour, such as anti-competitive practices or unstable financial markets. As students advance, there is a growing bias towards mathematical elegance. When the uglier real world intrudes, it only prompts the question: this is all very well in practice but how does it work in theory? …

Fortunately, the steps needed to bring economics teaching into the real world do not require the invention of anything new or exotic. The curriculum should embrace economic history and pay more attention to unorthodox thinkers such as Joseph Schumpeter, Friedrich Hayek and — yes — even Karl Marx. Faculties need to restore links with other fields such as psychology and anthropology, whose insights can explain phenomena that economics cannot. Economics professors should make the study of imperfect competition — and of how people act in conditions of uncertainty — the starting point of courses, not an afterthought. …

Economics should not be taught as if it were about the discovery of timeless laws. Those who champion the discipline must remember that, at its core, it is about human behaviour, with all the messiness and disorder that this implies.

Financial Times