The Standard Economic Paradigm is Based on Bad Modeling

Mainstream macroeconomics finds itself in a deeply unsatisfactory state, unable to make correct predictions and incapable of providing meaningful longer-term analyses and advice. It clearly needs a major rethink. Regrettably, the dominant response of mainstream macroeconomists so far has been to defend the accepted paradigm: some version of the New Keynesian Dynamic Stochastic General Equilibrium (DSGE) model. People generally laugh...

Meet the “New Koch Brothers” – the Hedge Fund Activists Wrecking America’s Green New Deal

Think the government should do more to deal with climate change? You’re not alone – so do most Americans, according to a 2020 Pew poll. With Biden in the White House and Democrats controlling Congress, plans to get moving on some form of a Green New Deal could finally emerge. The Texas blackout heightened the sense of urgency, and everybody’s talking about upgrading the power grid, renewable energy, and what it will take to...

A Big Fiscal Push is Urgent, The Risk of Overheating Is Small

The $1.9 trillion relief package is on track to pass in March but not without a struggle and with some important details still uncertain. The price tag is big, coming on the heels of the nearly $4 trillion Congress appropriated last year. That’s six times the fiscal relief in the first two years of the Great Recession. Even without the new package, the U.S. federal debt is more than GDP, according to the Congressional Budget Office,...

To Fight Climate Change, Save Energy and Reduce Inequality

We began work on climate change almost 15 years ago, supported since 2012 by INET. Three main themes – historical linkages between increases in energy and labor productivity levels, analysis of economic growth from the standpoint of effective demand to bring employment and distribution into the picture, and comparisons with orthodox narratives – have been at the focus throughout. Publication of our paper in Nature Climate Change...

Google’s Dominance of Online Ads is a Big Deal. Here’s How to Fix It.

Most people know that Google dominates the online search market, but did you know that the company has become the biggest player in the digital ad market? That’s a problem not only for consumers, but potentially for society as a whole, argues former digital advertising executive Dina Srinivasan. Last year, Srinivasan gained attention for her paper “The Antitrust Case Against Facebook,” which explained how the tech giant’s...

Artificial Intelligence Could Mean Large Increases in Prosperity—But Only for a Privileged Few

The past-half century has spurred unprecedented economic growth for many developing countries – brought about by the rapid adoption of technological advancements – and has led to widely shared increases in prosperity, lifting billions out of poverty. But there is no guarantee that this process will continue in future decades. Our new working paper on “Artificial Intelligence, Globalization, and Strategies for Economic...

  • Anton Korinek
  • Joe Stiglitz
7 min read

The Big Squeeze

From time to time, however, some group of investors comes along who truly believe that they do know enough. They know, for example, that certain hedge funds are short one or other dying company—AMC Theatres, GameStop—and that if they collectively use their “free” brokerage accounts to drive up the price they will force the shorts to cover, driving up the price even further, after the shorts have lost intolerable amounts of...

Mass Producing Covid-19 Vaccine

Mass production of COVID-19 vaccines With the identification of the genetic sequence of SARS-CoV-2 in January 2020, a number of research teams around the world embarked on the development of COVID-19 vaccines. Before the year was out, two vaccines had been granted emergency authorization by the U.S. Food and Drug Administration (FDA), and approval of a third is expected this month. Still, an unprecedented challenge is underway: the...

  • William Lazonick
  • Öner Tulum
  • Ken Jacobson
10 min read