'Musings on Whether We Consciously Know More or Less than What Is in Our Models…'
Musings on Whether We Consciously Know More or Less than What Is in Our Models…: Larry Summers presents as an example of his contention that we know more than is in our models–that our models are more a filing system, and more a way of efficiently conveying part of what we know, than they are an idea-generating mechanism–Paul Krugman’s Mundell-Fleming lecture, and its contention that floating exchange-rate countries that can borrow in their own currency should not fear capital flight in a utility trap. He points to Olivier Blanchard et al.’s empirical finding that capital outflows do indeed appear to be not expansionary but contractionary ...
[There's quite a bit more in Brad's post.]
Posted by Mark Thoma on Sunday, January 3, 2016 at 05:15 AM in Economics, Macroeconomics, Methodology |
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