Whatever happened to the dispute between freshwater economists (that emphasize the importance of free markets) versus saltwater economists (that emphasize market failures). Was that dispute resolved?

It would be utterly absurd to assume this dispute isn’t settled. Such doubt would be equivalent to asserting the “debate” between humorism and modern medicine isn’t settled, or the “debate” between flat eartherism and the established scientific view of planetary formation is still being “debated.” There are no such “debates.” There are simply ideologically brainwashed adherents who are lost in tribal groupthink on one side, with zero empirical evidence to support the vast majority of their suppositions (i.e. freshwater folks)…and those who rely on an ever-evolving body of evidence and real-world observations to shape their worldview on the other side (saltwater folks). The irony, of course, is that freshwater folks really do believe they are promoting a “rational” view. LOL.

Now, to be fair, there are a handful (but only a handful) of instances where individual aspects of freshwater theory has — historically at least — seemed to align with reality. I’m not going to elaborate on specifics because it will only feed the crazies. How does it feed them? Through a joyfully deranged marriage of partial reinforcement and the illusory truth effect.

Suffice it to say that data supporting most freshwater hypotheses are not only sparse, but completely overwhelmed by the avalanche of data that support most (though not all) saltwater hypotheses, and refute freshwater assumptions in the process.
In essence, to assert that there is still a “debate” between freshwater and saltwater perspectives is really just invoking false equivalence — for example, elevating the unicorns and fairy tales of the Chicago School to be (falsely) equivalent to time-proven Keynesian efficacy, only because they are both described as “macroeconomic theory.”

My 2 cents.


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