Criticisms
Since the financial crisis of 2007–2010, considerable conflict has arisen, among both economic theorists and a wider cross-section of the public, regarding the status and future of mainstream economics.
Chartalists, who are generally considered part of the Post-Keynesian school of thought, criticise mainstream theory as failing to describe the actual mechanics of modern fiat monetary economies. Chartalism focuses on a detailed understanding of the way money actually flows through the different sectors of an economy. Specifically, Chartalism focuses on the interaction between central banks, treasury and the private banking system. Chartalism rejects critical mainstream theories such as the loanable funds market, the money multiplier, and the utility of fiscal austerity.
Some economists, in the vein of ecological economics, believe that the neoclassical "holy trinity" of rationality, greed, and equilibrium, is being replaced by the holy trinity of purposeful behavior, enlightened self-interest, and sustainability, considerably broadening the scope of what is mainstream. Ecological economics addresses sustainability issues, such as public goods, natural capital and negative externalities (such as pollution).
Alternative economic schools, such as the Austrian School, also present views that contradict current mainstream economic theory regarding how the modern economy actually works.
Energy related theories of economic concepts also exist within energy economics relating to thermodynamic concepts of economic thinking, such as Energy accounting. Biophysical economics relates to this area.
Read more about this topic: Mainstream Economics
Famous quotes containing the word criticisms:
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—William James (1842–1910)
“I have no concern with any economic criticisms of the communist system; I cannot enquire into whether the abolition of private property is expedient or advantageous. But I am able to recognize that the psychological premises on which the system is based are an untenable illusion. In abolishing private property we deprive the human love of aggression of one of its instruments ... but we have in no way altered the differences in power and influence which are misused by aggressiveness.”
—Sigmund Freud (1856–1939)