The Annual Peston Lecture 2012

20 March 2012

Time: 6:00pm
Venue: ArtsTwo Lecture Theatre ArtsTwo Building, Mile End Campus

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Policy Implications of Alternative Economic Paradigms: Some Surprises From Endogenous Technological Change
Speaker: Richard G. Lipsey, Emeritus Professor of Economics Simon Fraser University, Vancouver B.C., Canada

Richard G. Lipsey, FRSC, OC, Fellow of the Econometric Society, and Professor Emeritus at Simon Fraser University, has held professorial posts at the London School of Economics and Essex University in England, and
Queen’s University in Kingston, Ontario, as well as visiting professorships at Yale, the University of California at Berkeley, Manchester, and the University of British Columbia. He was Senior Economic Advisor, C.D. Howe Institute (1983-89) and Fellow of the Canadian Institute for Advanced Research (1989-2002). His several textbooks have been translated into more than 15 languages and he has written more than 180 articles and book chapters on theoretical and applied economics and policy. His book Economic Transformations: General Purpose Technologies and Long Term Economic Growth (Richard Lipsey, Kenneth Carlaw and Clifford Bekar) won
the 2006 Schumpeter prize for distinguished writing on evolutionary economics. He was awarded the SSHRC gold
medal for distinguished lifetime achievement in 2005 and in 2011 he received one of the three inaugural fellowships
awarded by the Canadian Economics Society.

Modern economics contains at least three different visions of the economy: Keynesian, New Classical and Evolutionary. Although the New Classical approach dominates macro text books, Keynesian income flow models are found in many first year and some more advanced books and provide the basis of many econometric models. Evolutionary economics builds on the insights of Joseph Schumpeter. These have many different, and sometimes diametrically opposed, policy implications concerning such things as controlling inflation, alleviating unemployment, dealing with business cycles, controlling the financial sector and encouraging the technological change that fuels economic growth. What is the source of these differences? How can we decide which vision to use to guide economic policy?