Chicago economists deny the crisis falsified their core theories

Evidence

The two biggest ideas associated with Chicago economics over the past thirty years are the efficient markets hypothesis and the rational expectations hypothesis. At this stage, what’s left of those two? … John Cochrane: I think everything. Why not? Seriously, now, these are not ideas so superficial that you can reject them just by reading the newspaper. Rational expectations and efficient markets theories are both consistent with big price crashes. If you want to talk about this, we need to talk about specific evidence and how it does or doesn’t match up with specific theories. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 718

Categorization

• XREF: Connects to Mirowski’s broader thesis on the ‘thought collective’ and its unshakeable self-confidence despite empirical refutation. — connects to: Chicago economists led opposition to the New Deal and Keynesian doctrine — Angus Burgin, The Great Persuasion: Reinventing Free…, 88; Economists actively denied the crisis, not merely failed to predict it. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 2180; Chicago economists denied ideological uniformity even while conceding nothing post-crisis — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 494 (+4 more)