New ideas in economics and the social sciences

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Blair Fix

Your browser does not support the audio tag. Download: PDF | EPUB | MP3 | WATCH VIDEO

 Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.

— John Maynard Keynes, 1936 When it comes to rising house prices, nearly everyone has a theory about the cause.

From Commodity to Asset: The Truth Behind  Rising House Prices

Your browser does not support the audio tag. Download: PDF | EPUB | MP3 | WATCH VIDEO [R]esource productivity can — and should — grow fourfold. … Thus we can live twice as well — yet use half as much. —

 Factor Four

, 1997 When it comes to our sustainability problems, striving for greater resource efficiency seems like an obvious solution.

A Tour of the Jevons Paradox: How Energy Efficiency Backfires

My how time flies. As of April 11th, 2024, I’ve been blogging for five years. To celebrate, I thought I’d engage in some obligatory naval gazing. Why blog? I started this blog on a whim. In the spring of 2019, I was one year post PhD and busy publishing pieces of my dissertation. It was about as much fun as licking sandpaper. The problem, I now realize, is that I hate academic writing.

Five Years of Economics from the Top Down

Well, another year of blogging is over. For me, it was a year of research themes. I spent the first half of 2023 debunking interest-rate orthodoxy. Then I spent the second half of the year studying the world’s billionaires. Here were the top 5 posts: Do High Interest Rates Reduce Inflation?

When Stocks Go Up, Who Benefits?

Download:  PDF | EPUB  Economists are not known for their literary imaginations. Flip through any economics textbook and you’ll find a barrage of terms like the ‘Philips curve’ and the ‘Fisher effect’. The jargon is simple enough — empirical relations are usually named after the person who discovered them. But this convention is neither descriptive nor fun.

The Great Gatsby Curve Among America’s Über Rich

DT Cochrane and I look at the network of corporate power behind Canada’s richest families.

Download: PDF | EPUB

 Blair Fix and DT Cochrane

Every billionaire is … a factory for producing policy failures at scale. — Cory Doctorow The planet has a billionaire problem. According to Oxfam, the world’s billionaires have more combined wealth than the bottom 60% of humanity — some 4.6 billion people. Given this obscene situation, calls are growing to rid the world of the billionaire class. But how do we make that happen?

Mapping the Ownership Network of Canada’s Billionaire Families

Download: PDF | EPUB


Have you ever wondered what it takes to become a billionaire? Do you need rare genius? Exceptional acumen? Miraculous foresight? An uncompromising work ethic? On all four counts, the answer is no. It turns out that to become a billionaire, what you really need is the right

 social setting

. You need to live in a society that is suitably rich and appropriately unequal.

Billionaires Are So Predictable

I’m sick of the AI hype and scaremongering. The idea that AI could take over the world is laughable.

Download:  PDF | EPUB  In the last few months, there have been a string of open letters from tech leaders warning that artificial intelligence could lead to a ‘profound change in the history of life on Earth’. According to some insiders, AI poses an extinction risk, on the same level as pandemics and nuclear war. I think this scaremongering is nonsense. It plays into popular science fiction tropes about machines conquering humanity.

No, AI Does Not Pose an Existential Risk to Humanity

How do you tell the story of plutocratic crime? If you’re Cory Doctorow, you write a detective novel about a forensic accountant. It’s a must-read book that sheds light on the often-ignored world of elite finance.

Download:  PDF | EPUB  I still remember when I first encountered Cory Doctorow’s writing. After an internet rabbit hole, I landed on his post ‘Ford patents plutocratic lane-changes’. Man, it made me laugh. Here was a sci-fi writer describing a (real) Ford patent that would monetize the right to change lanes. Is Ford paving the way to a plutocratic hell?

Red Team Blues: Cory Doctorow&#8217;s Anti-Finance Thriller

Are interest rates a neutral policy variable? Or are they a tool for class warfare? It turns out that the evidence speaks for itself. Here are three ways that higher interest rates redistribute income.

Download: PDF | EPUB [I]nterest rates are, first and foremost, a distributional variable that affects the income shares of various social groups. — Louis-Philippe Rochon &amp; Mark Setterfield (2007) When I read about monetary policy, I have a rule of thumb. Every time I see the phrase

 interest rate

, I replace it with the term

 wage rate

. Then I ask myself whether the discussion still makes sense. Often, it does not.

How Interest Rates Redistribute Income

There is strong evidence that higher interest rates don’t mitigate inflation. Instead, they might make it worse. I wade through the details here.

Download: PDF | EPUB If you’re just tuning in, I’ve spent the last few months debunking some common misconceptions about inflation:

 Is inflation a uniform increase in prices?

No. Inflation is wildly differential.

 Is inflation driven by an ‘over-heated’ economy?

No. Inflation tends to come with economic stagnation.

Interest Rates and Inflation: Knives Out

Using standard tools of economic analysis, I show that the key to reducing inflation is to raise wages as fast as possible.

Download: PDF | EPUB

 To manage inflation, governments have a simple tool


 at their disposal: raise wages as fast as possible.

— Milton Fryman For the last few months, I’ve been diving into the economics of inflation. In this post, I’m excited to review some forgotten history. Our journey starts with a basic question: what is the key policy tool for managing the rate of inflation?

The Key to Managing Inflation? Higher Wages

I use World Bank data to test Nitzan and Bichler’s ‘stagflation thesis’ — the idea that inflation in the midst of economic stagnation is the norm.

Download:  PDF | EPUB  [I]nflation in the midst of stagnation is not an anomaly. If anything, it is the general rule. — Nitzan and Bichler, 2009  As much of the world grapples with post-Covid price gouging, it seems like a good time to revisit our understanding of inflation.

Is Stagflation the Norm?

A how-to guide for academics who want to have their name on lots of papers.

Download:  PDF | EPUB  Are you an aspiring academic? If so, this manual will reveal the secret to maximizing your scholarly output. Follow my advice, and you too can become an academic hyper-producer. The golden rule: Don’t do research   Newcomers to the academy typically think that the recipe for success is to ‘do high-quality research’. Nothing could be more false.

How To Be an Academic Hyper-Producer

Want to kill the oil industry? Just enforce its obligation to cleanup old wells.

Download:  PDF | EPUB  Environmentalists often argue that if we accounted for the ‘true’ costs of the fossil-fuel business, the industry would go bankrupt. While I understand this sentiment, I think the idea of ‘true’ costs is dubious. Costs exist not because they are ‘true’, but because someone has the power to enforce them. (That’s why Apple can impose a 30% commission on everything in its app store.

How to Make the Oil Industry Go Bust

I’ve started a new section of this blog where I’ll share tips for doing data-driven science.

Exciting news, readers! I’ve started a new section of this blog called Blair’s Science Desk. I’m going to use this section to post tips about doing data-driven science. In creating Science Desk, my goal is to separate two aspects of my writing. On the one hand, I like to write long pieces about original research. On the other hand, I also like to write short notes about doing science.

Check Out My Science Desk

Here’s a recording of a talk that got zoom bombed.

An artist’s enemy is obscurity …  — Cory Doctorow  Like art, the dirty secret of science is that much of it remains painfully obscure. A scientist might spend years collecting and analyzing data, only to have their paper read by a handful of people. Such is the nature of highly specialized work.

Hierarchy, Zoom Bombed

In his recent book, Joseph Henrich argues Western culture exists because the Catholic Church got obsessed with incest. Here’s my in-depth review.

Download: PDF | EPUB The anthropologist Joseph Henrich has written a book called

 The WEIRDest People in the World

. It offers a captivating look at the roots of Western psychology (and capitalism). Here is my in-depth review. * * * Edward O. Wilson, the famed evolutionary biologist and entomologist, argued that the goal of science should be to construct a single ‘consilient’ tree of knowledge.

Weird Consilience: A Review of Joseph Henrich’s ‘The WEIRDest People in the World’

The state of the world from the elite point of view.

A few days ago, I received the attached essay, sent to me in error by a Dr. Tom Riddle. It offers a fascinating glimpse into the elite worldview. (Cover image: Elodie Tihange, altered)

 There is no good and evil. There is only power and those too weak to seek it.

— Lord Voldemort For centuries, philosophers have sought to understand concepts such as ‘equity’, ‘fairness’, and ‘justice’. The result has been widespread confusion.

The Voldemort Index

Do unskilled people actually underestimate their incompetence?

Have you heard of the ‘Dunning-Kruger effect’? It’s the (apparent) tendency for unskilled people to overestimate their competence. Discovered in 1999 by psychologists Justin Kruger and David Dunning, the effect has since become famous. And you can see why. It’s the kind of idea that is too juicy to

 not

be true. Everyone ‘knows’ that idiots tend to be unaware of their own idiocy.

The Dunning-Kruger Effect is Autocorrelation

Here are the 10 most-read posts of the year.

Well folks, another year has come to a close. Like 2020, I spent most of 2021 hunkered down in front of my computer doing research, trying to forget the craziness of the outside world. The result was over 150,000 words spilled on this blog. Before I get to the top posts of the year, I thought I’d briefly discuss my writing process. Since I started this blog, the trend has been for me to write more long-form content.

A Case Study of Fossil-Fuel Depletion

When it comes to inflation, economists get it wrong. More than anything else, inflation is about income redistribution.

Download: PDF | EPUB

 Inflation is always and everywhere a phenomenon of structural change

. — Jonathan Nitzan, 1992 Milton Friedman has been dead for more than a decade, but his ghost still haunts us. In the 1960s, Friedman declared that inflation is ‘always and everywhere a monetary phenomenon’ — a problem of printing too much money.

The Truth About Inflation

An interview on the ‘Platform’ podcast.

Last week I had the pleasure to chat with Rachel Donald on her podcast ‘Platform’. The show features people who are ‘pissed off with capitalism’. Its goal is to give a platform for under-reported topics that deserve traction and attention. Rachel and I talked about a wide range of topics, but I particularly enjoyed discussing my research on hierarchy and income.

Talking Hierarchy With Rachel Donald

Yes you should read ‘Scale’. No, don’t believe everything it says.

For several years, people have been urging me to read Geoffrey West’s book

 Scale

, claiming that his work overlaps with my own. Having read the book, I largely agree (with some caveats below). Geoffrey West is a physicist who’s become famous for studying ‘scaling’ effects across life on Earth. What is ‘scaling’? It’s best explained through an example. Figure 1 (taken from West’s book) shows how animals’ metabolism varies with body mass.

A Review of Geoffrey West&#8217;s &#8216;Scale&#8217;

Does the deep past live with us, encoded in the structure of our institutions?

One of the challenges of studying the past is that time has a maddening way of erasing evidence. Take the origin of life — the ultimate cold case. Had the first organisms been wise enough to fossilize themselves, we would know exactly how life began. Fortunately, the first organisms

 did

preserve themselves, at least in rough form. That’s because life is itself a kind of time capsule.

Institution Size as a Window into Cultural Evolution

Tim Di Muzio explores the concept of ‘sabotage’ as it applies to capitalist power.

In a series of essays published in 2013 and 2014 on capitaspower.com, political economist Tim Di Muzio explored the concept of ‘sabotage’ as it applies to capitalist power. I recently rediscovered these essays and was so impressed by them that I have reposted them here as a single piece. About the author: Tim Di Muzio is a researcher at the University of Wollongong.

Di Muzio on &#8216;Sabotage&#8217;

My thoughts on the state of corporate power in the US.

I recently had a lively Twitter debate with Jonathan Nitzan, Shimshon Bichler and Cory Doctorow

 1

about the future of big corporations in the United States. The debate was prompted by Doctorow’s piece ‘End of the line for Reaganomics’, which I reposted on capitalaspower.com. Doctorow argues that we may be witnessing a sea change in the way governments treat big corporations.

How Dominant are Big US Corporations?

Some philosophical thoughts on Canada’s recent election.

Yesterday, Canada had an election that was notable for its pointlessness. The Liberal party went into the election with a minority government. And it came out with the same thing. The election was, however, an interesting testament to the pragmatism of the powerful. Like Barack Obama, Canadian Prime Minister Justin Trudeau is gifted at lofty rhetoric. But he’s ultimately a pragmatist, dedicated to holding on to power.

Power Over Principles

Karl Marx declared that all value stems from labor. Was he right?

Download: PDF | EPUB

 … the value of a commodity is determined by the quantity of labour spent on it …

— Karl Marx In the 1860s, Karl Marx declared that all value stemmed from labor. A century-long firestorm ensued. On its own, Marx’s claim seems innocent enough. But what made it incendiary was how he used it. Starting from the idea that labor creates value, Marx built a seductive critique of capitalism.

How the Labor Theory of Value Emerges from Egalitarianism

I discuss the ongoing research into the capital-as-power model of the stock market.

Over the last year, I’ve watched with horror and amusement as health agencies around the world flip-flopped their advice on how to deal with COVID. My horror comes from knowing this flip-flopping breeds mistrust in science. But I am (morbidly) amused because I know that uncertainty is a basic part of real research. For the public, ‘science’ tends to mean authoritative knowledge.

With Great Power Comes Great Fear

Here’s the software and packages that I use the most for my research.

Last week I ran a Twitter survey to see what software my fellow researchers use. It turns out they like R:  As an avid R user myself, this result didn’t surprise me. But it did make me think about my own approach to coding. In this post I’m going to share the tools that I use for my research. To get a sense for my coding habits, I wrote a script to scan all of my code and break it down by language.

My Coding Mix

I quantify the cutthroat nature of the music industry by measuring the half life of hit songs — the time they spend above 50% of their peak popularity.

The music business is a cruel and shallow money trench, a long plastic hallway where thieves and pimps run free, and good men die like dogs.

— Hunter S. Thompson meme

 1

Browse the internet long enough and you’ll eventually run across Hunter S. Thompson’s meme about the music industry. The meme is actually a misquote, but it’s still a fair representation of what the music business is like.

The Half Life of a Spotify Hit

I take a detailed look at the quantitative ritual that orders our social world.

There’s something mysterious about finance. The symbols are arcane. The math is complex. The practitioners are impressively educated. And the stakes are high. All of this gives finance the veneer of higher truth — as if quants are uncovering a reality not accessible to the rest of us. In a sense they are. But the ‘reality’ is not what you think. When you look at stock-market numbers, they do point to a truth about the world.

The Ritual of Capitalization

A rapid-fire post about Nitzan and Bichler’s buy-to-build indicator.

Today I’m trying a different type of post — one that’s not a deep dive, but instead, a rapid-fire summary of an important topic. My inspiration comes from Cory Doctorow, a sci-fi author who runs an old-fashioned links blog that he syndicates across the internet. (At last count, it’s on pluralistic.net, Twitter, Mastodon, and Medium). I read Doctorow’s blog daily, as he writes consistently excellent commentary on political economy.

A Brief History of the Buy-to-Build Indicator

It has been an … interesting month. But I did manage to finish a small project.

Greetings readers. It’s been an interesting month for me, what with Toronto dealing with an explosive 3rd wave of COVID, and me trying to get work done while my 5-year-old daughter does ‘school’ from home. Life has been, shall we say, interesting. Then, two weeks ago my appendix decided it was time to rupture. That put me in the hospital for a few days, and then home in bed for a few more. I’m now almost fully recovered.

RECASP Back Catalogue Now in Full-Text HTML

Economics from the Top Down: Does Hierarchy Unify Economic Theory?

The Forbes 400 and the Pareto wealth distribution

Power, policy, and top income shares

A Hierarchy Model of Income Distribution

The Power Underpinnings, and Some Distributional Consequences, of Trade and Investment Liberalisation in Canada

Some exciting personal news. In July, I will be starting a postdoctoral fellowship at York University. I’ll be studying the hierarchical origins of income inequality. Some of you might be asking — what’s a ‘postdoc’? Well, it’s a position that universities invented in the 1970s to give PhD graduates a job while they waited for professorial positions.

Once More Into the Fire of Academia

I explore the power struggle behind ‘free speech’.

They say that Americans love two things: freedom … and guns. The trouble with guns is obvious. The trouble with freedom is more subtle, and boils down to doublespeak. When a good old boy defends his ‘freedom’, there’s a good chance he has a hidden agenda. He doesn’t want freedom for everyone.

Free Speech For Me, Not You

Have humans always been egalitarian? The evolutionary evidence suggests not.

Man is born free, yet he is everywhere in chains.

— Jean-Jacques Rousseau, 1762 In his epic 18th-century treatise

 Discourse on Inequality

, Jean-Jacques Rousseau argued that inequality is an ill of civilization, created by private property. If you roll back the clock on civilization, he claimed, you should also roll back inequality. Rousseau was probably both right and wrong.

The Deep History of Human Inequality

I take a look at kinetic exchange models of income, and what we can learn from their mistakes.

Let’s talk

 econophysics

. If you’re not familiar, ‘econophysics’ is an attempt to understand economic phenomena (like the distribution of income) using the tools of statistical mechanics. The field has been around for a few decades, but has received little attention from mainstream economists. I think this neglect is a shame. As someone trained in both the natural and social sciences, I welcome physicists foray into economics.

Energizing Exchange: Learning from Econophysics&#8217; Mistakes

My talk given to the University of Texas Energy Symposium.

On Tuesday, I gave a talk to the University of Texas Energy Symposium about how societies become more hierarchical as they develop. Thank-you to Carey King for the invitation to speak. King, by the way, is the author of the excellent book

 The Economic Superorganism

(which I recently reviewed). Below is the lecture recording on my end. You can watch the live-stream version here.

Energy and Economic Development: Understanding the Role of Hierarchy

Let’s move all textbooks to the Creative Commons.

Today a rant about

 textbooks

. Every year governments spend billions of dollars on public education, teaching students knowledge that was itself created by publicly funded research. Yet each year, university students must pay anew for this information by purchasing high-priced textbooks. It needn’t be this way. Most university textbooks are written by tenured (or tenure-track) professors.

Why Are Most Textbooks Still Proprietary?

Here’s the manuscript for a new piece in The Mint Magazine about the language of economics.

A few months ago, I went down a rabbit hole analyzing word frequency in economics textbooks. Henry Leveson-Gower, editor of

 The Mint Magazine

, thought the results were interesting and asked me to write up a short piece. The

 Mint

article is now up, and is called ‘Power: don’t mention it’. What follows is my original manuscript. If you’ve ever taken Economics 101, then you’re familiar with its jargon.

Power &#8230; and the Dialect of Economics

Economics from the Top Down is now officially in the Creative Commons.

Exciting news! I have officially put all of the blog posts on

 Economics from the Top Down

in the Creative Commons. At the bottom of each post, you’ll now see the following icon: This Creative Commons licence means that the post is officially ‘free culture’. You can do anything you want with it, as long as you attribute the original work to the author (usually me, Blair Fix) and link back to Economics from the Top Down.

This Blog is Now ‘Free Culture’

I look at the degrowth that might be achieved by eliminating inequality.

Pity the billionaires. High in the towers on Billionaires’ Row, life is hard. The pencil-thin buildings groan as they sway in the wind, keeping penthouse dwellers up at night. Water pipes break, ruining posh décor. And elevators are unreliable, interrupting billionaires’ highly productive lives. So reads Stefanos Chen’s recent piece about the pitfalls of sky-high living.

Radically Progressive Degrowth: Reducing Resource Use by Eliminating Inequality

In case you missed them, here are the Top 5 posts of the last year.

Well readers, 2020 is finally done. In most respects, it was a terrible year. But it turns out that being stuck in the house is good for a few things … one of them being writing. I churned out 50 posts this year and typed about 150,000 words. Here are the top 5 posts by views: What Trait Affects Income the Most? Stocks Are Up. Wages Are Down. What Does it Mean?

Economic Development and the Death of the Free Market

This is the first of two essays written for (and supported by) the Seoul Platform for Initiating Discourses on an Equitable and Resilient Society. These essays investigate the role that hierarchy plays in driving inequality and unsustainability. This piece introduces the facts of hierarchy.

Living the good life in a non-growth world: Investigating the role of hierarchy

A hellish year is over and a vaccine is rolling out. Let’s be thankful for science.

We’ve finally reached the end of 2020, a year that many people are happy to forget. In the history books, 2020 will be known for little besides the Covid pandemic. Fortunately, the end of this disaster is in sight. With multiple vaccines starting to roll out, it looks like 2021 will be a better year. Speaking of vaccines, I’ve been racking my brain to find things to be thankful for this holiday season. It’s not easy.

As 2020 Ends, Let&#8217;s Celebrate Science

Check out the new and improved Capital as Power Forum.

Nothing says 1990s like an ‘internet forum’. Nothing says 2000s like a ‘blog’. And nothing says 2010s like ‘social media’. As we contemplate how social media is ruining our society, let’s hearken back to a simpler day. Yes, I’m writing this on a blog. But today I want to talk about internet forums — specifically the Capital as Power Forum, which has recently relaunched.

The Capital as Power Forum Lives Again!

A post in which I ask for money the radical political-economist way.

A few weeks ago I got an email from Wikipedia with the subject ‘

 This is a little awkward

’. I knew from the header that they were going to ask for money. But I was happy to oblige. Wikipedia is one of the triumphs of the internet — a vast repository of knowledge that’s free for everyone. I use Wikipedia daily. So I was happy to support their work.

The Business of &#8216;Free&#8217;

The US election got me thinking about the power of ideology.

I rarely write about partisan politics on this blog. Today, though, I’ll make an exception. As the spectre of a second Trump term remains possible, here are some thoughts on the US election. Avoiding democracy   A second Trump term is possible largely because the US electoral system is designed to avoid democracy. To be fair to the US, though, many of the world’s democracies have similar features.

Ideological Tunnel Vision

In this guest post, economist Christophe Petit pays tribute to his friend and mentor David Graeber.

As many of you know, the anthropologist David Graeber died recently at the age of 59. Many of us are still coming to grips with this loss. Graeber was a rare individual — both a tireless activist and a superb scholar. In this guest post, teacher and a financial analyst Christophe Petit pays tribute to Graeber, his friend and mentor.

A Tribute to David Graeber

Frederick Soddy looms large in the field of ecological economics. Here’s a short dive into his ideas.

In the field of ecological economics, Frederick Soddy looms large. Born in 1877, Soddy became a chemist and eventually won a Nobel prize for work on radioactive decay. Then he turned his attention to

 economics

. Between 1921 and 1934, Soddy wrote four books that looked at how money relates to the physical economy. For his ground-breaking work, Soddy was rewarded with deafening silence.

Frederick Soddy&#8217;s Debt Dynamics

IQ tests have always bothered me. They claim to measure ‘general intelligence’. I think this is bullshit.

Donald Trump took an IQ test … you’ll never guess what he scored! Apologies. That was my attempt at clickbait.

 1

Now that I’ve hooked you, let’s talk about the elephant in the room. No, not Donald Trump. Let’s talk about

 IQ

. For as long as I can remember I’ve been skeptical of measures of ‘intelligence’. The whole procedure rubbed me the wrong way.

Why &#8216;General Intelligence&#8217; Doesn&#8217;t Exist

Exciting news!

 Capital as Power

— the seminal text written by Jonathan Nitzan and Shimshon Bichler — is now available for free as both an epub and online book. Full disclosure: the typesetter was yours truly. What’s

 Capital as Power

? And why did I make a free ebook version? Read on to find out. You must unlearn what you have learned

 1

I don’t talk much on this blog about my personal journey.

Free Capital as Power Ebook

People tend to become more individualistic at the same time that hierarchy grows. What explains this paradox?

In the early 1970s, Geert Hofstede discovered something interesting. While analyzing a work-attitude survey that had been given to thousands of IBM employees around the world, Hofstede found that responses clustered by country. In some countries, for instance, employees tended to prefer an autocratic style of leadership. But in other countries, employees preferred a democratic approach.

The Paradox of Individualism and Hierarchy

In a new video, Jonathan Nitzan demolishes the neoclassical theory of prices. Here’s a summary and some consequences.

Prices are caused by supply and demand, right? So say neoclassical economists. If you’ve bought their fairy tale, I recommend you watch the video below. In it, Jonathan Nitzan demolishes the neoclassical theory of prices. It’s a master lesson in how to deconstruct a theory. Here’s the 100-word summary.

Supply and Demand Deconstructed

Here are 10 tips for making charts that pop.

They say that a picture is worth a thousand words. In science, the corollary is that a good chart is worth a whole article. Okay, that’s probably an exaggeration … but only slightly. Millions of words are spilled each day communicating science. Yet people have finite time to read. The consequence is that most people skim articles, looking for things that interest them. What’s going to catch their eye as they skim?

10 Tips for Making Beautiful Charts

The neoclassical theory of economic growth is an example of Murphy’s law: everything that could go wrong did go wrong.

I’ve written a lot on this blog about the absurdity of marginal productivity theory. But I haven’t said much about the other pillar of mainstream economics: neoclassical growth theory. Today I’ll break that silence. Neoclassical growth theory is a textbook example of Murphy’s law. Everything that could go wrong with the theory

 did

go wrong.

Economic Growth Theory &#8230; Bah Humbug!

I’ve always been baffled why ‘modern monetary theory’ is called a

 theory

. I don’t mean this in a disparaging way. As far as theories of money go, I think modern monetary theory (MMT for short) is the correct one. But having a correct theory of money is a bit like having a correct theory of traffic lights. Traffic lights (like money) are a social convention.

Why Isn&#8217;t Modern Monetary Theory Common Knowledge?

I dissect how neoclassical economics treats (neglects) natural resources, and discuss ways to fix it.

If it is very easy to substitute other factors for natural resources, then there is in principle no “problem”. The world can, in effect, get along without natural resources.

— Robert Solow, 1974 In the distant future, aliens come to Earth. They find a planet devoid of life. Looking closer, the aliens see that life on Earth

 was

once abundant, but was wiped out by a mass extinction.

Can the World Get Along Without Natural Resources?

I recount the difficult lives of a few revolutionary scientists. And I discuss some career tips for doing revolutionary science in a hostile world.

In this two-part post, I’ve been reflecting on the challenges of doing revolutionary science. (See Part 1 here.) I’ve argued that revolutionary science — the practice of questioning the core principles of an accepted theory — is difficult for a simple reason. To do it, you must fight the instinct to

 conform

. Conformity is the glue that holds human groups together. It’s what underpins the rule of law and the norms of trade.

The Challenges of Doing Revolutionary Science (Part 2)

I show how hierarchy grows with economic development — something that neoclassical economics says shouldn’t happen.

I’ve finally had the time, over the last few weeks, to formalize some of the ideas that I’ve been developing on this blog. This is the result — a new paper that studies how hierarchy grows with economic development. You can download the pdf here.

 The 100-word summary

. Neoclassical economists claim that the free market is the optimal form of social organization.

I’ve gotten rid of ads on Economics from the Top Down

Greetings readers. For some time now, I’ve been uncomfortable with the fact that WordPress (who hosts this site) inserts ads into the content. It’s annoying. But more importantly, it goes against much of what this blog stands for. My goal in this blog is to do

 science

— to dispassionately look at the evidence. Having ads cheapens (or at least distracts from) this goal. So for some time, I’ve been thinking about getting rid of ads.

No More Ads

I discuss biophysical constraints on our ability to cope with the current pandemic.

Back in January, physicist  Brian Stewart asked me to give a talk to his “Radical Sustainability” class at Wesleyan University. The talk was to be in early April, and Brian offered to fly me  to Connecticut for the occasion. Luckily I decided at the time to give the lecture virtually. So when the coronavirus forced us all to stay home, nothing much changed. On that note, here’s a video of the talk.

Biophysical Economics and the Coronavirus Pandemic

Sometimes scientists fall victim to a base human instinct — the need to conform. When they do, we need revolutionary scientists to put science back on track.

Science is miraculously improbable. To work, it must fight against a deep human instinct — our desire to

 conform

. As social animals, humans are built to do as others do. Why? Presumably because it’s advantageous. In our evolutionary past, conformist groups beat out non-conformist groups. And so here we sit, a conformist species.

The Challenges of Doing Revolutionary Science (Part 1)

Exciting news, friends! I’ve joined Patreon! What’s Patreon, you ask? Patreon is a crowdfunding site that gives  creators a way to earn money. Here’s how it works. If you think my research is worth supporting, you can become a ‘patron’ of Economics from the Top Down. As a patron, you’ll donate a small amount monthly.

I&#8217;ve Joined Patreon

Income in the US military follows the power ethos — to each according to their social influence.

In How Hierarchy Can Mediate the Returns to Education I examined the pay structure of the US military. I found that hierarchical rank is (by far) the strongest determinant of military pay. Here I want to show you that there is a regularity to military pay. In the US military, income is proportional to the number of subordinates one controls.

Economics from the Top Down

A Tour of the Jevons Paradox: How Energy Efficiency Backfires

Is Bitcoin More Energy Intensive Than Mainstream Finance?