Working Paper

Why Observation of the Behaviour of Human Actors and How They Combine Within the Economy, is an Important Next Step.

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One might think of the satisfied consensus reigning in macroeconomics before the financial crisis (and still relatively entrenched) as evidence of “Groupthink” in a “Divided State”

I mean by this language that a consensus seems to have developed in a collective mental state characterised by excitement at impressive in-group theories with at the same time an emotional refusal to spoil the achievement by true enquiry into possibly contradictory knowledge of agent reality developing in other fields. In an “integrated state” a truly confident group of theorists would feel secure because they would be able to go out of their way to ensure a reasonable match between evidence of the behaviour of real-world economic agents and the way they interact with models of the behaviour of the aggregate economy in which they participate.