Animal Spirits

Akerlof and Shiller’s new essay on behavioral macroeconomics makes compelling reading. Who else would compare socialism to repressive parenting and Reaganism to permissive parenting?

I’m not professionally qualified to judge the technical merits of George Akerlof and Robert Shiller’s Animal Spirits; Robert Solow, who is, calls it “an important – maybe even a decisive – contribution at a difficult juncture in macroeconomic theory.” In any case, if you don’t believe that a treatise on applied behavioral macroeconomics could make compelling reading, I suggest taking a look.

My favorite metaphor so far: Akerlof and Shiller compare socialist or dirigiste economic policy to a repressive parenting and Reaganite or Thatcherite laisser-faire to permissive parenting, and suggest that entrepreneurs, like teenagers, need to be given both considerable freedom to experiment and appropriate limits.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com