tag:blogger.com,1999:blog-6245381193993153721.post6057552630652415477..comments2024-03-28T17:08:15.784-07:00Comments on Social Democracy for the 21st Century: A Realist Alternative to the Modern Left: Kaldor on the Irrelevance of Equilibrium EconomicsLord Keyneshttp://www.blogger.com/profile/06556863604205200159noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-6245381193993153721.post-35195337815778997342013-05-18T11:56:52.072-07:002013-05-18T11:56:52.072-07:00The idea of intrinsic value is. But the idea of ho...The idea of intrinsic value is. But the idea of how people assign values to things is not. Luis Augustohttps://www.blogger.com/profile/17574787433969840143noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-71436191411217192572013-05-16T06:42:53.722-07:002013-05-16T06:42:53.722-07:00"Kaldor argued that where modern economics we..."Kaldor argued that where modern economics went wrong – both in Classical political economy and neoclassical economics – was a fixation with the theory of value, or a deeply mistaken theory of prices, in which the question of how value and price are determined for factor inputs and products takes central stage (Kaldor 1972: 1241). The major flaw in this enterprise has been the assumption of constant returns to scale (Kaldor 1972: 1241)."<br /><br />I'd like to see a quote on this, but if you're correct then I think that Kaldor was wrong. The problem with value theory was value theory itself -- as Joan Robinson showed so graciously in both her "Economic Philosophy" and, to a lesser extent, in her "Essay on Marxian Economics".<br /><br />The entire idea of value is completely metaphysical and absurd. Economists, neoclassical and otherwise, search out a theory of value because then they can know what is Good for people. It's a search for a timeless moral truth. This is not only anti-rational, this, I believe, is a strongly authoritarian quest and has all sorts of real-world manifestations. It also accounts for the self-assuredness of marginalists in the face of enormous theoretical and empirical evidence that their theories are false.<br /><br />Apart from that Kaldor's remarks are typically insightful, they just don't take the problem by the root. Only Robinson managed to do that.<br /><br />I'm not sure if I've pointed to it before, but I highly recommend the paper linked to in the following post. It deals with Kaldor's underlying methodology and its relationship to Debreau and the General Equilibrium theorists (my summary and comments might be worth a look too):<br /><br />http://www.nakedcapitalism.com/2012/08/philip-pilkington-divine-mathematics-neoclassical-economics-as-spiritual-meditation.htmlPhilip Pilkingtonhttp://www.nakedcapitalism.comnoreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-35264060166285399922013-05-16T03:06:02.393-07:002013-05-16T03:06:02.393-07:00great job, master!great job, master!I.https://www.blogger.com/profile/00315764352082282661noreply@blogger.comtag:blogger.com,1999:blog-6245381193993153721.post-71179306732403201542013-05-15T22:26:21.652-07:002013-05-15T22:26:21.652-07:00The underlying problem with metallic money is that...The underlying problem with metallic money is that the relationship between demand for physical currency supply and currency demand is not organically related. Stirling Newberryhttps://www.blogger.com/profile/08626207362076099371noreply@blogger.com