Robert Higg has done a marvelous job of describing, in detail, the crucial errors of mainstream (Keynesian) economics. It’s a long paper (at least by Internet standards), so I thought I’d list the errors in short form:
- The Whole Concept of Aggregation
- Ignoring the Meaning of Pricing
- Misunderstanding the Meaning of Interest Rates
- Ignoring the Structure of Capital
- Ignoring Malinvestment
- Ignoring Regime Uncertainty
If you don’t understand these points, you should read the paper. If you do, you’re probably depressed that our political “leaders” are driving us into a ditch.