Zombie Economics: How Dead Ideas Still Walk Among Us

Zombie Economics: How Dead Ideas Still Walk Among Us

Book rating: 04 Hardback Princeton University Press

By (author) John Quiggin

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  • Publisher: Princeton University Press
  • Format: Hardback | 248 pages
  • Dimensions: 152mm x 229mm x 25mm | 514g
  • Publication date: 1 November 2010
  • Publication City/Country: New Jersey
  • ISBN 10: 0691145822
  • ISBN 13: 9780691145822
  • Illustrations note: 4 line illus.
  • Sales rank: 37,239

Product description

In the graveyard of economic ideology, dead ideas still stalk the land. The recent financial crisis laid bare many of the assumptions behind market liberalism - the theory that market-based solutions are always best, regardless of the problem. For decades, their advocates dominated mainstream economics, and their influence created a system where an unthinking faith in markets led many to view speculative investments as fundamentally safe. The crisis seemed to have killed off these ideas, but they still live on in the minds of many - members of the public, commentators, politicians, economists, and even those charged with cleaning up the mess. In "Zombie Economics", John Quiggin explains how these dead ideas still walk among us - and why we must find a way to kill them once and for all if we are to avoid an even bigger financial crisis in the future. "Zombie Economics" takes the reader through the origins, consequences, and implosion of a system of ideas whose time has come and gone. These beliefs - that deregulation had conquered the financial cycle, that markets were always the best judge of value, that policies designed to benefit the rich made everyone better off - brought us to the brink of disaster once before, and their persistent hold on many threatens to do so again. Because these ideas will never die unless there is an alternative, "Zombie Economics" also looks ahead at what could replace market liberalism, arguing that a simple return to traditional Keynesian economics and the politics of the welfare state will not be enough - either to kill dead ideas, or prevent future crises.

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Author information

John Quiggin is professor of economics at the University of Queensland in Australia.

Customer reviews

By Kieron Smith 26 Oct 2010 4

For once a title that uses the idea of 'zombies' to good effect, a good mix of explanation of economic ideology and critical theory.

Review quote

Co-Winner of the 2012 Gold Medal Book Award in Economics, Axiom Business One of Bloomberg News's (bloomberg.com/news) Top Thirty Business Books of the Year for 2010 One of Financial Times (FT.com)'s Books of the Year in Nonfiction Round-Up in the Science & Environment list for 2010 One of Naked Capitalism blog's , "Must Read" Economics Books, Yves Smith for 2011 "This book is certainly a good read for anyone eager to know why it is urgent that economists come up with a socially useful body of thought or suggestions."--Shanghai Daily "Entertaining and thought-provoking... [W]orks as a good summary for non-specialists of how the economics debate has developed."--Philip Coggan, Economist "Quiggin is a writer of great verve who marshals some powerful evidence."--Financial Times (FT Critics Pick 2010) "Lucid, lively and loaded with hard data, passionate, provocative and ... persuasive... [Zombie Economics] should be required reading, even for those who aren't Keynesians or Krugmaniacs."--Glenn C. Altschuler, Barron's "Apparently some economists have a sense of humor, dismal though it may be. Quiggin uses the 2008 global financial crisis as the focal point for examining five core macroeconomic and financial theories that have been--to use zombie terminology--killed by our current predicament... Economics students and interested lay readers will find this valuable."--Library Journal "Erroneous economic ideas resemble the living dead, writes John Quiggin in his smart new book Zombie Economics. They are dangerous yet impossible to kill. Even after a financial crisis buries them, they survive in our minds and can rise unbidden from the necropolis of ideology."--James Pressley, Bloomberg News "The financial crisis has disproved many cherished tenets of 'market liberalism', such as the 'Efficient Markets Hypothesis', yet these zombie ideas still shamble through newspapers and journals. Enter economist Quiggin, calmly wielding dual shotguns to blast them relentlessly in the face... As Quiggin explains with elegance, lucidity and deadpan humour, the undead ideas here are interconnected: killing one causes it to knock over another in a sort of zombie-dominoes effect."--Guardian "Zombie Economics is ... a highly readable and sobering assessment of the role played by discredited economic ideas in the global financial and economic meltdown of 2008-09. Quiggin delves deeply into the origins and development of all the star culprits so loved by the economic right in recent decades: from the efficient markets hypothesis to privatization and Real Business Cycle Theory. None has stood up to the stern test posed by real markets and economies in crisis. Yet most live on, still featured in many curriculums and advocated by those academics who have staked their careers on them."--Globe & Mail "It's hard to resist a book called Zombie Economics, and University of Queensland professor John Quiggin makes his tale as compelling as his title... It's the rare read that's both thoughtful and fun."--Biz Ed "[A]n excellent new book."--Jessica Irvine, Sydney Morning Herald "I haven't done justice to Quiggin's book, so if you're interested in a readable exposition of the exploits of academic economists over the past 35 years I recommend it highly. It's the story of how economists forgot much of what they knew. Please, guys, don't do that again."--Ross Gittins, Sydney Morning Herald "As well as exposing how these flawed ideas brought on the global crisis and how they live on, Quiggin offers his view on a new way forward in economic theory. It's time to bury the zombie."--Fiona Capp, The Age "From the so-called 'great moderation' concept to the implications of the efficient markets hypothesis, Quiggin does an excellent job summarizing each zombie idea and explaining why it is discredited in a simple (but not simplistic) manner."--Choice "[Cogent] and readable ..."--The Nation "Cleverly titled, with a wonderful and very un-academic cartoon cover and written without excessive jargon, Zombie Economics provides an elegant critical introduction and analysis of some of the key ideas of modern economic thought."--Satyajit Das, Naked Capitalism blog "Put a bullet through the decaying brain of walking-dead economics by reading Quiggin."--Seth Sandronsky, SN&R "Peppered with humorous quotations, theory and history, Quiggin has assembled a compelling read about the misguided intellectual economic assumptions of the last forty years and also gives possible solutions to our current financial dilemma."--Ted Stamas, Bullfax.com "I encourage my colleagues in sociology, psychology, and management to read this book and leverage it to lead to a more integrated social science and, perhaps, a more socially aware economic science."--Brent Goldfarb, Administrative Science Quarterly

Flap copy

"Killing vampires and werewolves is easy enough. But how does one slay economic zombies--ideas that should have died long ago but still shamble forward? Armed with nothing but the truth, John Quiggin sets about dispatching these dead ideas once and for all in this engaging book. "Zombie Economics" should be required reading for those who would dare reanimate the economic theories that brought us to the edge of ruin."--Brad DeLong, University of California, Berkeley"Tempted to tangle with your libertarian uncle or your "Wall Street Journal" bromide-spouting coworkers? If so, this book will arm you to rebut the clever phrasemaking and slippery reasoning that has allowed dead constructs like 'trickle down economics' to soldier onward. Quiggin's clear, elegant dissection of wrongheaded notions will appeal to both lay readers and academic economists."--Yves Smith, author of "ECONned: How Unenlightened Self-Interest Undermined Democracy and Corrupted Capitalism"""Zombie Economics" provides a unique and comprehensive discussion of the ideas that failed during the recent financial crisis. But the book contributes much more. Its discussion of how macroeconomics developed, and the ideology that has grown up around it, is every bit as important and interesting."--Mark Thoma, University of Oregon"This is a terrific book. Quiggin is an engaging writer, and the combination of quotations, history, theory, and hard evidence makes the book quite a page-turner."--Andrew Leigh, Australian National University

Table of contents

Preface vii Introduction 1 Chapter 1: The Great Moderation 5 Birth: Calm after the Storms 8 Life: The Great Risk Shift 13 Death: The Dissenters and Their Vindication 19 Reanimation: A Global Crisis or a Transitory Blip? 30 After the Zombies: Rethinking the Experience of the Twentieth Century 31 Further Reading 34 Chapter 2: The Efficient Markets Hypothesis 35 Birth: From Casino to Calculating Machine 36 Life: Black-Scholes, Bankers, and Bubbles 39 Death: The Crisis of 2008 50 Reanimation: Chicago Revives the Dead 64 After the Zombies: The State and the Market 66 Further Reading 77 Chapter 3: Dynamic Stochastic General Equili brium 79 Birth: From the Phillips Curve to the NAIRU, and Beyond 83 Life: Rationality and the Representative Agent 106 Death: How Did Economists Get It So Wrong? 110 Reanimation: How Obama Caused the Global Financial Crisis 121 After the Zombies: Toward a Realistic Macroeconomics 123 Further Reading 133 Chapter 4: Trickle -down Economics 136 Birth: From Supply-side Economics to Dynamic Scoring 138 Life: Excuses for Inequality 146 Death: The Rich Get Richer and the Poor Go Nowhere 152 Reanimation: Mobility without Movement 167 After the Zombies: Economics, Inequality, and Equity 168 Further Reading 172 Chapter 5: Privati zation 174 Birth: We Are All Market Liberals Now 178 Life: A Policy in Search of a Rationale 182 Death: Puzzles and Failures 187 Reanimation: Dead for Good? 199 After the Zombies: The Mixed Economy 200 Further Reading 204 Conclusion: Economics for the Twenty -first Century 206 Rethinking the Experience of the Twentieth Century 206 A New Approach to Risk and Uncertainty 207 What Is Needed in Economics 210 References 213 Index 229