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https://theconversation.com/orthodox-thinking-wont-cut-it-why-mathias-cormanns-leadership-of-the-oecd-has-economists-worried-191665>
"In June 2007, Jean-Philippe Cotis, the chief economist of the Organisation for
Economic Cooperation and Development, declared that 2008 was going to be a
great year.
The economic situation was “better than what we have experienced in years”, he
wrote, and the central forecast of the OECD, representing the world’s 38
wealthiest countries, “remains indeed quite benign”. He tipped “a soft landing”
in the United States and “sustained growth” in OECD economies, with “strong job
creation and falling unemployment”.
That forecast – relying on the OECD’s “state of the art” economic model –
proved, of course, to be spectacularly wrong. In 2008 the global financial
crisis hit, the worst economic shock since the great depression.
Many critics, including myself, were not surprised. These “dynamic stochastic
general equilibrium” models make assumptions that even died-in-the-wool
mainstream economists can’t stomach. In 2010 the Nobel laureate Robert Solow
told the US Congress they “did not pass the smell test”.
The OECD’s then secretary-general, José Ángel Gurría, took this failure of
conventional economics to heart. In 2012 he established an internal think tank
called New Approaches to Economic Challenges (NAEC) to explore new ways to
analyse and manage the economy. He deliberately set it up outside the OECD’s
economics department so it could be free to consider ideas that mainstream
economics ignored.
NAEC was a breath of fresh air in the normally stale world of economic policy
debate. It heard from all manner of researchers – anthropologists,
neuroscientists, physicists and engineers, as well as mainstream and
non-mainstream economists – who used techniques mainstream economics remained
resistant to, even after its obvious failures.
Those of us who worked with NAEC or spoke at its public seminars enjoyed the
freedom to think and talk outside the mainstream economic box. I spoke at
several seminars, including on climate change and financial crises."
Cheers,
*** Xanni ***
--
mailto:xanni@xanadu.net Andrew Pam
http://xanadu.com.au/ Chief Scientist, Xanadu
https://glasswings.com.au/ Partner, Glass Wings
https://sericyb.com.au/ Manager, Serious Cybernetics
