Posts Tagged ‘economics’

I recently stumbled upon a great collection of resources by The Institute for New Economic Thinking.

From INET’s “About” page:

The Institute for New Economic Thinking (INET) was created to broaden and accelerate the development of new economic thinking that can lead to solutions for the great challenges of the 21st century.

The havoc wrought by our recent global financial crisis has vividly demonstrated the deficiencies in our outdated current economic theories, and shown the need for new economic thinking – right now.

INET is supporting this fundamental shift in economic thinking through research funding, community building, and spreading the word about the need for change. We already are a global community of thousands of new economic thinkers, ranging from Nobel Prize winning economists to teachers and students who have emerged out from the shadows of prevailing economic thought, attracted by the promise of a free and open economic discourse.

Having graduated from business school in 2007, just before the monetary/financial/economic crisis really kicked into high gear, I’ve grown increasingly interested in how the economics profession (among other culpable professions/schools of thought) could fail so miserably at seeing what was coming and how it would impact our societies.  Granted, I only studied economics & finance in the context of a general business administration education, but I realized that economic theory was the intellectual bedrock upon which many important theories taught in business school rested.  If the intellectual foundation of economics resembled a castle made of sand, then I figured that, as Jimi Hendrix sang, it would “fall into the sea, eventually.”  Whether or not mainstream economic thinking has fallen into the sea, is open to debate.  But I would argue that organizations like INET, the New Economics Foundation, and others, are a clear indication that there is a growing appetite for a major re-thinking of economics.

Although I just found out about INET, I must say that I’m impressed with the quality of content & thinkers profiled on its website.  I still have more to explore about INET, but the fact that I found recorded interviews and talks by thinkers like Thomas Homer-Dixon, Satyajit Das, and William Rees, makes me confident that there is a wealth of relevant, and leading-edge thought going on in this community.

On that note, I wanted to embed a video of a talk given by one of the major intellectual influences of this blog – Thomas Homer-Dixon.  The talk, given at the 2011 Bretton Woods Conference called Crisis & Renewal: International Political Economy at the Crossroads (link), discusses Homer-Dixon’s recent thinking on complexity theory as it pertains to economics & public policy.

More on Thomas Homer-Dixon:

More on the Institute for New Economic Thinking:

More on other organizations & schools of thinking related to heterodox economics:

  • Institute for Integrated Economic Research (link)
  • New Economics Foundation (link)

Below, I’ve embedded a talk given by Tomas Sedlacek at the RSA in London.  Sedlacek is a young, Czech economist/historian/philosopher who has written and spoken about the problems of economics in both it’s current & historical context.

Something that is noticeable in Sedlacek’s economic thinking is the moral philosophy aspect.  Most economists often speak with a lot of “shoulds”, but very few have any real background in the history or moral philosophy behind economics.  In this regard, Sedlacek is a refreshing break from a lot of the economic thinkers who focus too narrowly, or don’t incorporate historical thinking.

In any case, it’s worth checking out.

A few take-aways from Sedlacek’s talk:

  • Economics is now a religion – we ask it today, the same questions that we asked Gods in earlier days.
  • Compares the dicey relationship of monetary policy & fiscal policy to JRR Tolkien’s Ring in Lord of the Rings.  A force that is too powerful to be allowed to exist.
  • How interest is analogous to alcohol.  Interest & alcohol are similar in that that they allow us to make energy time-travel from the future to the present for the purposes of current consumption (and leverage).
  • Talks about the wisdom of Aristotle, the Islamic tradition & the Pharaohs with respect to interest rates & business cycles.

Additional Resources:

Does Economics Trump Ethics? Does it Pay to Be Good? (link)

Thomas Sedlacek’s site

Embedded below is a great video by David Korowicz of the Foundation for the Economics of Sustainability (FEASTA).

As with many of the resources I share on this blog, the following video explores the pressing concerns of today from the perspective of complex-adaptive systems theory.

Complexity is one of those things that most people “get” (at least intuitively) but about which very few people think systematically.  Instead of trying to comprehend, cope with & adapt to complexity, many people’s response to it is just simply to ignore it or to minimize it.  But, the law of requisite variety says that “if a system is to be stable the number of states of its control mechanism must be greater than or equal to the number of states in the system being controlled (wiki link).” So, for us to properly understand and control our responses to complexity, our mental control systems must be broad enough to be able to handle the massive range of inputs.  In a world of hyper-specialization with subject matter experts, pundits & guru’s, very few of us have a perspective that is transdisciplinary enough to actually understand what’s really going on in the world.

People like David Korowicz of FEASTA, Stoneleigh of The Automatic Earth, Nate Hagens of TheOilDrum & The Institute for Integrated Economic Research, Buzz Holling – the father of resilience theory, or the noted trans-disciplinary thinker Thomas Homer-Dixon – these guys & gals are among a select group of individuals with enough understanding of enough different fields of study to actually have something useful to say about how the future might unfold.  Although the subject matter experts have their purpose, I am of the opinion that in the current environment, anyone who fails to understand complexity and the role that energy plays in sustaining it is not worth listening to for very long.

We live in a complex world.  To deny or ignore this is to severely limits one’s ability to understand and consequently, to make wise decisions.  So, I try to focus on the trans-disciplinary thinkers who make complex-adaptive systems an explicit part of their perspective.

Korowicz is one such thinker.

Additional Resources: