Neoclassical economics had no framework for deflationary crises

Evidence

Furthermore, neoclassical policy was entirely focused on avoiding one problem, inflation, and providing one outcome, stable prices. It seemed to have very little to say about a world in which deflation was now the worry, and price stabilization meant raising, not lowering, inflation expectations. — Mark Blyth, Austerity, 158

Categorization

• QUESTION: A useful inversion: the anti-inflation toolkit was structurally incapable of handling disinflation — a mechanism worth tracing further across the austerity literature.
• XREF: connects to: The financial system failed to foresee crisis because its risk theory denied catastrophes — Mark Blyth, Austerity: The History of a Dangerous…, 100; Crisis metaphors dominating public discourse had no basis in economic theory — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 465; Economists had no consensus explanation for the 2008 financial crisis — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 448 (+7 more)

Broader Connections

• Orthodox economics models structurally excluded the possibility of major crises #corroborates (0.92) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 491
• Neoclassical models cannot diagnose man-made crises, only exogenous shocks. #expands (0.85) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 763
• Crisis metaphors dominating public discourse had no basis in economic theory #expands (0.78) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 465
• Economists had no consensus explanation for the 2008 financial crisis #corroborates (0.75) — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 448