When Paul Krugman some time ago criticized the new Nobel Prize winner Eugene Fama he did a great job in clarifying the role of accounting identities for economic analysis. He wrote in response to Fama’s claim that higher savings will lead to higher investment: “The immediate thing Fama should have asked himself, …
Paul Krugman is right, Paul Krugman is wrong? At least he is inconsistent on accounting identities
12. November 2013 I