Monday, March 19, 2012
Consigning neo-classical economics to the dustbin
Neo-classical economics has a blind spot when they deny that private debt has any real economic effect. Steve keen succinctly points out this fallicy. Private debt has very real economic effects due to the way money is created. It leads to asset bubbles and crashes thus explaining boom and bust. He concludes by pointing out that UK's aggregate private debt is greater than USA and Australia.