The Chimera of Macroeconomics

  By providence, we human beings cannot stay on Earth for long or short without consuming utilities of various kinds and that periodically. By nature, on the other hand, our desires for “conveniences” and “luxuries” are unlimited and consequentially keep us hard-wired with self-interest. We are always hungry for utilities as defined in our dictionary; the word saturation to “stagnation” is not in our  dictionary.              One of the boundary conditions of life is that the time ante Eternity is limited to 125 years at the longest. All in all, we shall try to save time in fulfilling our demand for utilities of unlimited kinds. Making, producing or constructing a thing of no use, real or nominal, must be a genuine “waste of time,” one of the Original Sins: “Homo Sapience, thou shalt not be prodigal on thy time in Here.” The Smithean Maxim . Quoting Adam Smith, the Harvard economist Gregory Mankiw says, “Consumpti...

One of the magic words of Cambridge macroeconomics is the “short run.” Somehow, the term sweeps all the periods, short or long, under the rug of “moment” (T 0 in the time dimension). No wonder all “real quantities” are defined with no regard whatsoever to “period.”              Let us come all the way back to the classical framework of “the market.” One of the first things we do is to define and confine the accounting period. Otherwise, we would never be able to name the “quantity traded” or the “equilibrium price.” To be meaningful, we say for instance that the quantity ( q ) of apples traded was 10,000 natural units at the average price ( p ) of half a dolla r, over the past week (T -1 , negative dimension for the purpose of accounting only). Apparently, no period, no quantity, no price, no market!              Now in Cambridge macroeconomics: Is there a way t...