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Reaching out to the Mainstream


I just came across a letter from a mainstream economics journal from 2003 rejecting my paper “Skyscrapers and Business Cycles.” It reads in part that “this journal focuses upon specification and testing of formal macro and monetary models and does not publish papers like yours in which the theorizing and testing is more casual-descriptive than formal-econometric.”

Skyscrapers and Business Cycles” was published in the Spring 2005 issue of the Quarterly Journal of Austrian Economics.

As far as I know “Skyscrapers and Business Cycles” is the only model in print in an academic journal that correctly predicted this global economic crisis. The model generated a signal of economic crisis in July of 2007 and the first signs of trouble emerged in November and December of 2007.

I wonder how all those “formal-econometric” models published between 2003 and 2007 did in predicting the crisis.

Mark Thornton is a Senior Fellow at the Mises Institute and the book review editor of the Quarterly Journal of Austrian Economics. He has authored seven books and is a frequent guest on national radio shows.

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