“I wish the Indian Government’s economic advisors were aware of Shimomuran economics”
says Navin Singh
and I wish all macro-economists understood it
I recently copied to an unmet friend called Navin Singh the link about how “Shimomuran Economics Is the Most Significant Advance Ever Made in Economic Understanding and the West Still doesn’t Get It” — see ”https://medium.com/@georgetaitedwards/shimomuran-economics-is-the-most-significant-advance-ever-made-in-economic-understanding-and-the-e540e58bf270 and here is his perceptive reply:
“Thanks George, It is really a pity that such amazing insight is ignored by mainstream economists and for this long. Whenever I see Indian PM taking a whirlwind tour of the world, begging for investment in India with the like of Japan, China and USA, all those who have used investment credit creation with great success, I wish the Indian Government’s economic advisors were aware of Shimomuran economics. Here’s Prof Steve Keen saying something similar to Is+Id= S+D, when he says that Aggregate demand is equal to GDP plus change in debt. He goes on to show mathematically that Expenditure is equal to savings plus change in debt, the debt originating in financial sector as endogenous money creation. So sectoral balances equation is true ex post, but ex ante debt makes up for the surplus between expenditure and savings. And as Prof. Keen points out, this was well understood by, not only Keynes, but Schumpeter and Minsky as well. Keen 2012 UMKC Reconciling MMT and MCT: http://youtu.be/UzxQcTOs4JA"
Also see Professor Steve Keen at http://www.youtube.com/channel/UCM1ubsbE-tG9ru61mc3zX8A
It was the late, great Lord Harold Lever of Manchester who once rebuked me after a meeting with Treasury officials in 1980, when I called these UK Treasury economists stupid, with the words:
“These economists are able and brilliant people,” Lord Lever chided me. “Just because you have a fresh Copernican economics, which places major issues centrally, you are talking as if they were idiots, when you know they are not! Their appearance of stupidity is due to a lack of an adequate understanding of the framework of economics, and has no basis in their lack of intelligence.”
So these economists were just thinking within the wrong framework, as many still do to this day. That comment is still valid for all these economists who support the Washington Consensus. The same and pretty obvious Copernican analogy has apparently recently occurred to Professor Steve Keen.
And thank you Navin for your insightful comments. I hope that one day all macro-economists may understand Shimomuran economics.
© George Tait Edwards 2014
George Tait Edwards has published a book about “Shimomuran Economics and the rise of the Tokyo Consensus ” at http://www.lulu.com/shop/george-tait-edwards/shimomuran-economics/paperback/product-21688864.html and much else elsewhere during the last four decades.