Robert Skidelsky
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Project Syndicate "Against the Current"

Economic reform needs a dose of reality
Robert Skidelsky
Project Syndicate | Monday, July 13, 2009

 
Mainstream economics subscribes to the theory that markets "clear" continuously. The theory's big idea is that if wages and prices are completely flexible, resources will be fully employed, so that any shock to the system will result in instantaneous adjustment of wages and prices to the new situation.
 
This system-wide responsiveness depends on economic agents having perfect information about the future, which is manifestly absurd. Nevertheless, mainstream economists believe that economic actors possess enough information to lend their theorising a sufficient dose of reality.
 
The aspect of the theory that applies particularly to financial markets is called the "efficient market theory," which should have been blown sky-high by last

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The Lost Continent
Robert Skidelsky
Project Syndicate | Saturday, June 13, 2009

 
LONDON – Home to one-sixth of the world’s people, but contributing only one-fortieth of world GDP, Africa is the most conspicuous victim of the global recession. After a half-decade of 5% growth, the continent’s growth rate is expected to halve in 2009. Some countries, like Angola, are contracting. Elsewhere, the crisis has swept away the benefits of several years of economic reform. Many Africans will fall back into desperate poverty.
 
Development economists wring their hands in despair: Africa defies their best efforts to create a miracle. On the eve of decolonization in 1960, real GDP per head in Sub-Saharan Africa was almost three times higher than in Southeast Asia, and Africans were expected to live two years longer on average. In

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Anatomy of Thatcherism
Robert Skidelsky
Project Syndicate | Wednesday, May 13, 2009

 
London – Thirty years ago this month, Margaret Thatcher came to power. Although precipitated by local conditions, the Thatcher (or more broadly the Thatcher-Reagan) revolution became an instantly recognizable global brand for a set of ideas that inspired policies to free markets from government interference. Three decades later, the world is in a slump, and many people attribute the global crisis to these very ideas.
 
Indeed, even beyond the political left, the Anglo-American model of capitalism is deemed to have failed. It is held culpable for the near financial meltdown. But 30 years of hindsight enable us to judge which elements of the Thatcher revolution should be preserved, and which should be amended in the light of today’s global

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The Treason of the Economists
Robert Skidelsky
Project Syndicate | Monday, April 13, 2009

 
LONDON – All epoch-defining events are the result of conjunctures – the correlation of normally unconnected events that jolt humanity out of a rut. Such conjunctures create what the author Nassim Nicholas Taleb calls “Black Swans” – unpredictable events with a vast impact. A small number of Black Swans, Taleb believes, “explain almost everything in our world.”
 
The prosperity of the first age of globalization before 1914, for example, resulted from a successful constellation of developments: falling transport and communication costs, the technological breakthroughs of the second industrial revolution, the pacific state of international relations, and Great Britain’s successful management of the gold standard. By contrast, in the

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A Warrant of Hypocrisy
Robert Skidelsky
Project Syndicate | Friday, March 13, 2009

 
LONDON – Earlier this month, the International Criminal Court (ICC) upheld the request of the court’s chief prosecutor to issue an arrest warrant for Omar el-Bashir, the President of Sudan, charging him with war crimes and crimes against humanity. Bashir responded by expelling foreign aid agencies looking after the refugee camps in Darfur.
 
This is the first time that a sitting head of state has been indicted for war crimes, with reaction around the world mainly divided between those who hailed the move as a great step for international justice and those who condemned it as colonialism. Both positions are hopelessly buried in intellectual and moral fog.
 
The warrant was no leap forward. From the legal point of view, it makes no

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