The failure of macroeconomics as a science

My target is again Simon Wren-Lewis. My stress and discomfort is entirely my fault, for reading his interesting Mainly Macro blog and struggling with the logic on the one hand and the quagmire of bad English, and loose sentence structure, on the other. He writes:

"Does this core model influence the way some academics think about policy? I have written how mainstream macroeconomics neglected before the financial crisis the importance that shifting credit conditions had on consumption, and speculated that this neglect owed something to the insistence on microfoundations. That links the methodology macroeconomists use, or more accurately their belief that other methodologies are unworthy, to policy failures (or at least inadequacy) associated with that crisis and its aftermath." -- https://mainlymacro.blogspot.co.uk/2016/10/ricardian-equivalence-benchmark-models.html

[1]  The 'core model' mentioned is presumably the one referred to in the previous paragraph as the 'benchmark model'; but not defined there. 

[2]  Was the 'core model' neglected, or did it do the neglecting? (Can a 'core model' neglect? Or does he mean that the practitioners of the core model did the neglecting?) 

[3]  I would suggest a few commas. ("I have written how, before the crisis, mainstream macroeconomists neglected the importance that shifting cc. had on consumption; and I speculated that this neglect...")

[3]  SW-L uses the word 'that' too often, too loosely, and to baldly. It can function as several different parts of speech, and even as a restrictive pronoun it can refer to any number of nouns, previously used (or implied).  So:  "That [neglect][insistence] links the methodology used by macroeconomists{a} to policy failures{b} associated with that crisis and its aftermath." (For clarity I have omitted clauses {a} and {b}.)  

[4]  You will notice that I object to the 'noun' 'noun' combination in the above sentence. ("methodology macroeconomists used"). It is easily avoided, as I show. 

[5]  Towards the end of the paragraph SW-L realizes that he does not mean what he has just written; but instead of scrubbing it and rewriting, he merely adds on a correction. And then another correction!

[6]  My conclusion is that the failure of macroeconomics as a science arises because of both the limited nature of the models used, and the contempt shown by one 'school' towards competing 'schools'. Add to that the fog of jargon and poor writing.

That and Which (2)

That and Which (2)

In English grammar, 'which' describes while 'that' defines. In some cases it is impossible to decide which of these two pronouns is correct. In the following, however, it is quite clear that John Maynard Keynes is wrong.

"Since we are here concerned in determining what sum will be spent on consumption when employment is at a given level, we should, strictly speaking, consider the function which [that] relates the former quantity (C) to the latter (N)." ( "The General Theory of Employment, Interest and Money", chapter 8, [1])

 I conclude that JMK has a tendency to confuse these two relative pronouns. In which case we can not trust him when he writes ( my emphasis): 

"....; whereas they do not resist reductions of real wages, which are associated with increases in aggregate employment and leave relative money-wages unchanged, unless the reduction proceeds so far as to threaten a reduction of the real wage below the marginal disutility of the existing volume of employment." -- (in JTEIM chapter 2)

"Which" would be correct if all reductions of real wages are of the sort described, but are they? 

References:

1.  John Maynard Keynes (1936), "The General Theory of Employment, Interest and Money"

This and That and Which

That and Which

Returning to that very difficult sentence in the essay by Mainly Macro titled “Fiscal rules and MMT”, I pick this time on problems concerning pronouns.   (Original text in Times New Roman; My comments in Arial narrow; My re-write in Helvetica.)

    "Most mainstream macroeconomists understand that assignment does not work at the Zero Lower Bound (ZLB), but a few disagree. To those that follow MMT fiscal rules that target the deficit are wrong because they think fiscal policy should do the job monetary policy is supposed to do in the consensus assignment, even outside the ZLB."

I find the first 'that' ambiguous in a worrying but rather trivial way. Does he mean "Most economists understand that this assignment...." ?  (One can 'find that something is the case', or 'find that book (as opposed to this book) to be ........'.) But there is here no question of using 'which'.

However, in the second sentence there are two 'thats', which present different problems. I was taught to avoid repetition, which seems a rather stupidly mechanical grammatical rule. However, we could very easily write "To those who follow modern monetary theory....", thus avoiding the repetition without damaging the sentence; indeed, improving it. The second 'that' ––  "fiscal rules that target the deficit" –––  should that 'that' be 'which'?  No! 'That' defines, 'which' describes. 

He also has a missing comma:- "To those who follow modern monetary theory, fiscal rules that...".

(However, I still do not know what on earth he is trying to say.) 

Mainly Macro on “Fiscal rules and MMT”

I found a very difficult sentence in a piece by Mainly Macro on “Fiscal rules and MMT”. 

(Original text in Times New Roman; My comments in Arial narrow; My attempt at the text in Helvetica bold.)

    What I call the ‘consensus assignment’ in modern macroeconomics is that monetary policy keeps output stable at a level that leaves inflation at target over the medium term, and fiscal policy stabilises the ratio of government debt to GDP.

    Most mainstream macroeconomists understand that assignment does not work at the Zero Lower Bound (ZLB), but a few disagree. To those that follow MMT fiscal rules that target the deficit are wrong because they think fiscal policy should do the job monetary policy is supposed to do in the consensus assignment, even outside the ZLB.

There are altogether too many acronyms, too many ‘that’s, serving as adjectives and as pronouns of various nouns, and too little punctuation. In the second paragraph, I do not know if he is saying “understand x” or “understand that y” (where x=“that assignment” and y=“assignment”). And is he talking about ‘those who follow fiscal rules’, or those who follow MM theory” ?   I would have to write several versions to cover all options. In the last sentence, the pronouns drift around in a disconcerting way. (“…because they think..” ; who thinks? The ‘fiscal rules’ or the ‘followers of the MM theory’.

    There is consensus among modern macroeconomists that it is the role of monetary policy to keep inflation at its target level (with output stable), while it is the role of fiscal policy to stabilise the ratio of government debt to GDP. (I.e. the printing presses are not normally used to pay off government debt; but why not.) 

    It is widely understood by the mainstream (with a few dissenters) that this division of roles does not work when interest rates hit zero. According to modern monetary theory, it is a mistake to expect fiscal policy to do the job conventionally assigned to monetary policy. 

(Those who follow MM Theory regard as wrong the use of fiscal policy to do the job of monetary policy. Even outside the ZLB. Or perhaps they think the opposite. I am totally lost. )