How Markets Fail: The Logic of Economic Calamities by John Cassidy

How Markets Fail: The Logic of Economic Calamities

by John Cassidy

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Business & Finance

New Yorker writer John Cassidy's history-and-analysis of how efficient-markets theory captured economics, blinded regulators to the 2008 crisis, and what a more "reality-based" economics would have to take seriously.

Core ideas
  • Part one is the intellectual history of "utopian economics" — the chain from Adam Smith through Hayek and Friedman to the Chicago School and the rational-expectations revolution — making the case that this set of ideas became methodologically untouchable inside the profession.
  • Part two is the catalog of market failures the utopian frame can't accommodate: externalities, asymmetric information, herd behavior, financial instability — each treated as load-bearing for the 2008 crisis specifically.
  • The constructive program is Keynes, Minsky, and behavioral economics taken seriously as alternatives, not as footnotes to the orthodox model.
Published2009
Pages400
ISBN9780374173203
ReadMar 2024
financial crisis, 2008

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