Samuelsonian synthesis depends on strategic micro-macro inconsistency

Evidence

The brand of economics I use in my daily work—the brand that I still consider by far the most reasonable approach out there—was largely established by Paul Samuelson back in 1948, when he published the first edition of his classic textbook. It’s an approach that combines the grand tradition of microeconomics, with its emphasis on how the invisible hand leads to generally desirable outcomes, with Keynesian macroeconomics, which emphasizes the way the economy can develop magneto trouble, requiring policy intervention. … It’s a deeply reasonable approach—but it’s also intellectually unstable. For it requires some strategic inconsistency in how you think about the economy. When you’re doing micro, you assume rational individuals and rapidly clearing markets; when you’re doing macro, frictions and ad hoc behavioral assumptions are essential. So what? Inconsistency in the pursuit of useful guidance is no vice. — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 60

Categorization

• DEFINE: Defines the Samuelsonian synthesis as the postwar orthodoxy combining neoclassical micro with Keynesian macro.
• SEED: Essay angle: the ‘no vice’ defense of inconsistency as the intellectual foundation that made post-2008 economic failure survivable for the profession.
• XREF: connects to: The Samuelsonian synthesis is intellectually unstable because micro and macro rest on inconsistent assumptions — Philip Mirowski, Never Let a Serious Crisis Go to Waste, 61