||Central Bank Of Barbados
John Quiggin introduces his book “Zombie Economics” by reference to a famous passage by J.M. Keynes that notes that the ideas of economists and political philosophers whether right or wrong are more powerful than is commonly understood. He argued that even hypotheses which have proved themselves wrong and dangerous are very hard to kill and will keep coming back to haunt us; hence the title of the book “Zombie Economics.” The author identified five ideas central to the recent global financial and economic crisis of 2007. These are: the great moderation, the efficient market hypothesis, dynamic stochastic general equilibrium models, trickle-down economics and privatisation. Together these paradigms form a package which Quiggin terms market liberalism. Each chapter of the book which deals specifically with one of the five themes identified above is structured around a description related to the emergence of the idea, its rise to popularity, and then its “death” under the financial crisis. After this the author looks at the reanimation of the paradigm and then considers alternatives to market liberalism.
Book Review - Zombie Economics (Dec 2012).pdf