Tuesday, December 22, 2009

On Mattresses, Ideologues, and Cheerleaders

I suppose one ought to be grateful for small mercies; Bryan Caplan has learned how to spell mattress.  Here he is on December 16:
unless employers are unusually likely to put cash under their matresses...
And here again three days later:
the net effect on AD depends on the marginal propensity to stuff income under one's mattress.
Now it would a a major step forward if he were to discover the existence of bills, bonds, equities, mutual funds of various stripes, and rare stamps and coins, all of which can serve as channels for savings, and none of which automatically create a demand for current production in equal measure to the cost of acquiring them. But, as Winterspeak notes, that would be too much to ask:
Glibertarian Bryan Caplan reveals why microeconomics is just useless at analyzing the economy at a macro scale. If you cannot understand that spending equals income at an economy wide level, you'll spout a lot of two sentence nonsense.
I don't think that microeconomics is at fault. The blame lies with a particularly crude and naive textbook version of microeconomics and its uncritical application by ideologues and their cheerleaders.


  1. Speaking of spelling, you have been spelling Tyler *Cowan* where his surname is actually *Cowen*.

  2. Good point! My apologies to Tyler...