PSST: Patterns of Sustainable Specialization and Trade

Arnold Kling

George Mason University

January 28, 2013

Capitalism and Society, Vol. 6, Issue 2, Article 2, 2011

This essay offers an alternative way to look at macroeconomics. The current standard approach uses aggregate supply and aggregate demand (AS-AD). I call the alternative approach patterns of sustainable specialization and trade (PSST). The PSST approach combines many old and new strands in economics. It suggests that the economy is a highly complex system that is constantly adapting to new circumstances, especially opportunities created by technological innovation. We can view employment fluctuations as a reflection of the difficulty that markets sometimes have in making the necessary adjustments, so that for a period of time some workers have extremely low marginal revenue product and as a result become unemployed.

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Date posted: January 28, 2013  

Suggested Citation

Kling, Arnold, PSST: Patterns of Sustainable Specialization and Trade (January 28, 2013). Capitalism and Society, Vol. 6, Issue 2, Article 2, 2011. Available at SSRN: http://ssrn.com/abstract=2208029

Contact Information

Arnold Kling (Contact Author)
George Mason University ( email )
4400 University Drive
Fairfax, VA 22030
United States
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