I would suggest another, more fundamental reason economists missed the boat on the bubble. The idea of Progress, in the form of economic growth, is a counter-narrative of the Apocalyptic myth. To have faith in economic growth means that one cannot entertain the likelihood of major disruptions in the narrative of growth-as-progress.
On Mon, Jan 5, 2009 at 1:51 PM, Shane Taylor <[email protected]> wrote: > Ideas? I have a few. Here are my top 10 indictments as to why professional > economists missed the crises until it was too late: > > 1. An inherent upward bias is built into ALL Wall Street research — > including economic research; > > 2. Ideological rigidity prevented creative thinking; > > 3. Non-critical acceptance of official data from BEA, BLS, Commerce led to > only a passing familiarity with reality; > > 4. Institutional rejection of negative analyses remains endemic; > > 5. Traditional (non-behavioral) economic analysis seems to have difficulty > with human irrationality; > > 6. Political Bias; (Right wing during GOP Presidencies; Left Wing during > DEM Presidencies); > > 7. Corporate bias — Stock option compensation — skewed views too > optimistic; > > 8. "Timing" is very different from Analysis; > > 9. Factoring in excessive leverage and liquidity is exceedingly difficult > from a traditional economic perspective (Derivatives especially); > > 10. Herding instinct is powerful; > -- Sandwichman _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
