From Professor Milanovic's personal blog, globalinequality :
In one of his poems, Constantine Cavafy distinguished, in the art of foretelling future events, three groups: men who are able to see what exists now, Gods who alone know the future, and wise men who perceive "what is just about to happen":
Ordinary mortals know what's happening now,
the Gods know what the future holds
because they alone are totally enlightened.
Wise men are aware of future things
just about to happen.
the Gods know what the future holds
because they alone are totally enlightened.
Wise men are aware of future things
just about to happen.
We all aspire to be the wise men and women who can see the immediate future (Cavafy does not believe that even wise men can see the distant future) and the demand for such seers is high when the times are troubled as they are now. Economists are often in particular demand because they claim they can tell the shape of future demand and supply, unemployment and growth. To do that they resort to models that through behavioral equations and identities, show the future evolution of key variables and pretend to predict how long the depression will last and how quick and strong the recovery will be.....MUCH MORE
My argument is that such models are useless under today’s conditions. There are several reasons for that.
All economic models, by definition, take the economy as a self-contained system which is exposed to economic shocks, whether in form of more or less relaxed monetary policy, higher or lower taxes, higher or lower minimum wage etc. They cannot by their very nature take into account extra-economic discrete shocks. Such shocks are simply not predictable. One cannot tell today whether China might invade Hong Kong, or whether Trump might ban all imports from China, or whether the race riots in the US can continue for months, or similar riots break up elsewhere in the world (Latin America, Africa, Indonesia) or even if the US may not end this year with a military government in charge.
All of these social and political shocks that I have listed are due to, or have been exacerbated, by the pandemic.....
Guy can't seem to hold a steady jobBranko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Stone Center on Socio-economic Inequality, senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace
