28 June 2012

Macroeconomics in pictures

via Marginal Revolution:



and the interwebs:



Bottom Line: Bad governance leads to bad outcomes (100% karma effect)

2 comments:

Anonymous said...

Mmmmm... Can you elaborate? Bad governance defined as coordination failure or are we talking of first movers in game theory here? Rosa, your phd classmate

David Zetland said...

Hey Rosa (long time no talkee!) -- I mean governance in terms of micro fundamentals in an economy: spending too much on the top figure and a "false convergence" in the bottom one... There was no coordination failure in the EU, as there were no proper coordination tools (they freed some constraints without fixing the mechanisms to punish bad policies). Can't see a first mover angle...