Y\’know @RichardJMurphy and his blackboard economics thing?

Y\’know, that way that us neoliberals only ever spout blackboard economics. Purely theoretical stuff that takes no account of the real world beyond the ivory tower?

Just found out the details of where that \”blackboard economics\” (knew it was Coase but here\’s more) came from:

The reason that economists fall into this trap [of sometimes offering poor policy advice] is that they have become enamored of what Coase calls ‘blackboard economics’, an economics wherein economic policy is implemented on a blackboard in a world where the teacher has full information and plays the part of an omniscient government in imposing taxes, subsidies, regulations and programmes of redistribution, all of which serve to enhance societal well-being.  The problem, says Coase, is that the teacher has no counterpart in the real world.  The taxes, subsidies, regulations and redistributions are carried out by disparate and disconnected government agencies, each seeking to serve its own interest.

So, does that better describe neoliberalism or The Courageous State?

9 thoughts on “Y\’know @RichardJMurphy and his blackboard economics thing?”

  1. I do find it tiring when people, such as Mr Murphy, who suggest that markets can only operate when there is perfect knowledge. All possible arrangements would be operate efficiently in a world of perfect knowledge. It is the lack of perfect knowledge, and the transmissions of knowledge and incentives through markets and prices, that makes markets work.

  2. well, the austrian school typically known to be a main source of critique against the blackboard economics with keynes of course being one of the main proponents

  3. Actually, the term “Blackboard Economics” has had a shift in definition since Coase, and is now the accepted term for the sort of theories used by the Austrian school.

    The term accepted for describing the statist school is “Whiteboard Economics,” as in, “The economics you come up with after inhaling fumes from whiteboard markers.”

    I’m surprised you didn’t already know that.

  4. Dennis The Peasant

    “well, the austrian school typically known to be a main source of critique against the blackboard economics with keynes of course being one of the main proponents”

    Huh?

  5. this must be one of the most enigmatic blog comments ever:

    “well, the austrian school typically known to be a main source of critique against the blackboard economics with keynes of course being one of the main proponents”

    Keynes being a propoponent of Austrian economics, blackboard economics or what?

  6. Keynes was a reamarkable intellect and he does not really deserve the disrespect granted on him by the Labour Party and PaulB

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