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Is Economics Ready for a New Model?

Harvard Business Review

In the sense that financial markets and the economy in general are far more fragile than most mainstream economists contemplated before 2008, there was a bit of unlearning done in the 1990s and early 2000s. The 1987 stock market crash was a scare. So were the currency and debt crises of 1997 and 1998, and the stock market collapse of 2000-2002. Disruptive innovation Economy Finance

Longrunonomics vs. Shortrunonomics

Harvard Business Review

Shiller had already circulated his devastating demonstration that asset prices were much too volatile to be explained by fundamentals, and the 1987 market crash had provided an object lesson in panic. Real business cycle theory continued to prosper, developing an increasing stranglehold over the professional journals. Behavioral finance stayed on the margins. It doesn't offer much hope, though, for clear guidelines to macroeconomic decisionmaking.