Why did no one see it coming?

WEA Pedagogy Blog

In the wake of the Global Financial Crisis (GFC 2007), the Queen of England asked academics at the London School of Economics why no one saw it coming. TcrisisGFChe US Congress constituted a committee to investigate the failure of economic theory to predict the crisis.  Unfortunately, economists remain unable to answer this critical question. Some say that crises are like earthquakes, impossible to forecast. Others take refuge behind technical aspects of complex mathematical models. With monotonous regularity, more than 200 monetary crises have occurred globally, ever since financial liberalization started in the 1980’s. the methodology currently in use in economics systematically blinds economists to the root causes of these crises. Many leading economists have called for radical changes to bring economic theory into closer contact with reality.

Many who had hoped that the  GFC would serve as a wake-up call for the profession have been extremely disappointed by subsequent developments…

View original post 843 more words

Author: Makere

A transplanted New Zealand Scots/Maori academic/grandmother/random singer and sometime activist, my life is shaped by a deep conviction of the necessity for active critical engagement in the multi-faceted global and local crises of being and survival of species that confront us in the 21st century, the urgency of re-visioning the meaning of thriving together, and the contribution of Indigenous knowledge systems to a truly sustainable and just global society.