Insider critics accused mainstream macro of being self-referential and disconnected from economic reality

Evidence

Lest the reader get the impression that this was the only retort to the accusation that economists had failed in predicting the crisis, they should be apprized that there was also a counterreformation movement. … Most mainstream macroeconomic theoretical innovations since the 1970s (associated with such names as Robert E. Lucas Jr., Edward Prescott, Thomas Sargent, Robert Barro, etc., and the New Keynesian theorizing of Michael Woodford and many others) have turned out to be self-referential, inward-looking distractions at best. Research tended to be motivated by internal logic, intellectual sunk capital and aesthetic puzzles of established research programmes rather than by a powerful desire to understand how the economy works … the manifest failure of the EMH in many key asset markets was obvious to virtually all those whose cognitive abilities had not been warped by a modern Anglo-American Ph.D. education. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 702

Categorization

• XREF: Internal critique of the economics profession echoes voices in the post-2008 ‘thought collective’ debate, connecting to Buiter’s own later Bank of England tenure. — connects to: Mainstream economists defended theory by scapegoating Greenspan-style market fundamentalism — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 700

Broader Connections

• Mainstream economists defended theory by scapegoating Greenspan-style market fundamentalism #complicates (0.75) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 700