From wrong forecasts by the International Monetary Fund (IMF) and Wall Street, to wrong policies by the Federal Reserve and the Federal Government, wrong economic theory impacts everyone. Last year was a particularly bad one for the profession, as none of the mainstream forecasts on major events, from Brexit to Donald Trump’s election, and the effects of those events on markets and the economy, were correct. In fact, mainstream economics has been consistently getting it wrong since the Great Financial Crisis of 2008.
So why hasn’t the mainstream realized something is profoundly wrong with the models and theories it uses? Why do they marginalize alternative theories and theorists? Why are the people who have been getting it wrong still in charge?
If you worked for companies like General Motors or IBM and are now out of a job because they have outsourced it to Mexico, you can blame wrong economic theory for this.
