Economist's View

Are those who sweat the big stuff in meltdown?, by Tim Harford, Commentary, Financial Times:

...I am struck by the soul-searching that has gripped the [macroeconomics] profession in the face of the economic crisis....

Paul Krugman ... thinks macroeconomics is in a dark age, in the sense that rather than discovering new insights, we are actually going backwards and forgetting what we used to know. Mark Thoma ... opines: “I think that the current crisis has dealt a bigger blow to macroeconomic theory and modelling than many of us realise.”

We shall see. While many commentators have reached for Keynes – or some caricature of Keynes – as a solution to this crisis, this is not because he is the fount of all knowledge, but because he was asking good questions about problems that now seem relevant again.