What's gone wrong with Economics?

09 May 2017 Professor Dennis Leach, University of Warwick


The Queen famously asked, at the LSE, why if it was going to be so big did nobody see it coming; students have widened the charge sheet against academic economics and some have demanded changes to the curriculum they are taught; George Soros has spent $50m on a new Institute with an ambitious reform agenda.
There are two major problems with current mainstream thinking. Keynesian macroeconomics has largely disappeared. What is meant by microeconomic efficiency has changed: instead of the optimum allocation of resources, efficiency refers to information, notably the efficient markets hypothesis.
The unreality of much orthodox economic thinking leads to many problems affecting human welfare such as: the destabilizing Maastricht rules; self defeating austerity imposed on Greece; deflationary UK macroeconomic policy through spending cuts; the UK pension crisis.

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BathTalk May 2017.docx