Why Neoclassical Economists Didnt See the Great Recession Coming

Mainstream "Neoclassical" Economists famously did not see the Great Recession coming, and when you look at their theories, it's no wonder. Their favourite model prior to the crisis goes by the name of "Dynamic Stochastic General Equilibrium", or DSGE. These models imagined that the entire economy could be modeled as a single individual. Yet neoclassical researchers proved decades ago that even a single market can't be modeled that way. I explain this proof while outlining the fundamental truth that "Neoclassical Economists Don't Understand Neoclassical Economics".
Neoclassical Economics Great Recession Bernanke Financial Crisis Economy Depression Proof by Contradiction SMD Conditions DSGE Modeling Equilibrium Dynamics Complexity Emergent Properties Steve Keen Debt Deflation Great Depression Prof Steve Keen































