Does Akerlof and Shiller's Animal Spirits Provide a Helpful New Approach for Macroeconomics?

The Journal of Socio Economics, Vol. 39, No. 2, pp. 150-154, 2010

Posted: 16 Nov 2010

Date Written: November 15, 2010

Abstract

Animal Spirits (2009) is a timely and widely appreciated work focusing on the need to incorporate behavioral factors in macroeconomic analysis that draws on a famous reference of John Maynard Keynes. Nonetheless, it has a number of limitations. Those in several chapters are noted. Most important, however, the book does not break down "animal spirits" into its components, and distinguish sufficiently between (1) cognitive, (2) emotional, (3) cultural, and (4) visceral factors, or (5) those emanating from neuroeconomics. There is not enough reference to the advances of behavioral microeconomics and there is no explanation why so little progress has been made in behavioral macroeconomics despite approximately fifteen years of efforts.

Keywords: Animal Spirits, Behavioral Economics, Financial and Economic Crisis

JEL Classification: E0, E2, G0, Z0

Suggested Citation

Schwartz, Hugh H., Does Akerlof and Shiller's Animal Spirits Provide a Helpful New Approach for Macroeconomics? (November 15, 2010). The Journal of Socio Economics, Vol. 39, No. 2, pp. 150-154, 2010. Available at SSRN: https://ssrn.com/abstract=1709504

Hugh H. Schwartz (Contact Author)

Independent ( email )

5902 MOUNT EAGLE DR
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ALEXANDRIA, VA 22303-2519
United States

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