The confidence fairy vs. the animal spirits — not really a fair fight

posted by
August 4, 2011
Independent Institute
by Robert Higgs  
Posted in Commentary

"The humor columnist for the New York Times, Paul Krugman, has recently taken to defending his vulgar Keynesianism against its critics by accusing them of making arguments that rely on the existence of a 'confidence fairy.' By this mockery, Krugman seeks to dismiss the critics as unscientific blockheads, in contrast to his own supreme status as a Nobel Prize-winning economic scientist. The irony in this dismissal, as others, including my friend Donald Boudreaux, have already pointed out, is that Krugman’s own vulgar Keynesianism relies on a much more ethereal explanatory force for its own account of macroeconomic fluctuations -- namely, the so-called animal spirits." (08/03/11)  


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