Matt Nolan

Quote: 4) Kevin D Hoover – Is the representitive agent model really “micro-foundations”

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Kevin D Hoover:

The claim that representative-agent models provide micro-foundations succeeds only when we steadfastly avoid the fact that reporesentative-agent models are just as aggregative as old-fashioned Keynesian macroeconometric models

Kevin Hoover is a professor at Duke University.  I put down this quote as I believe that the modern day process of macroeconomics is likely to come under scrutiny following recent global events – and Dr Hoover’s writing has convinced me that the representative agent model isn’t really the same as reductionism/micro-foundations.

Microeconomics is beautiful descriptive discipline, macroeconomics needs to either find ways to apply it, or use a different holistic method to explain what it is doing – doing something that is (possibly) half and half might not cut it in the end.

Matt Nolan

Quote 3) Frederic Bastiat: Cause and effects

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Frederic Bastiat:

In the economic sphere an act, a habit, an institution, a law produces not only one effect, but a series of effects. Of these effects, the first alone is immediate; it appears simultaneously with its cause; it is seen. The other effects emerge only subsequently; they are not seen; we are fortunate if we foresee them

ht Kimble.

I have not read any Bastiat – so I have very little to say.

Matt Nolan

Quotes: 2) Lionel Robbins on “historical indication absent theory”

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Lionel Robbins:

In the absence of rational grounds for supposing intimate connection, there would be no sufficient reason for supposing that history “would repeat itself”. For if there is one thing which is shown by history, not less than by elementary logic, it is that historical induction unaided by the analytical judgment, is the worst possible basis of prophecy.

From Chapter 4 of The Nature and Significance of Economic Science.

Matt Nolan

Quotes: 1) John Maynard Keynes on “the master economist”

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John Maynard Keynes:

… the master-economist must possess a rare combination of gifts. He must be mathematician, historian, statesman, philosopher–in some degree.  He must understand symbols and speak in words.  He must contemplate the particular in terms of the general, and touch abstract and concrete in the same flight of thought.  He must study the present in the light of the past for the purposes of the future.  No part of man’s nature or his institutions must lie entirely outside his regard. He must be purposeful and disinterested in a simultaneous mood; as aloof and incorruptible as an artist, yet sometimes as near the earth as a politician.

ht Anti-Dismal, Bluematter, and India’s Development. Note it is also mentioned under the Economist post on Wikipedia.