5min chapter

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#303 – Steve Keen: Marxism, Capitalism, and Economics

Lex Fridman Podcast

CHAPTER

What Is Money Illusion?

Economists learn literally in the first few weeks at university that money is irrelevant. So they represent people's tastes using what they call indifference curves. And say, lots of bananas and very few coconuts can give you the same utility as lots of coconuts and very few bananas. They think anybody who worries about money suffers from money illusion. You are therefore ignorant of the deep insights of economics if you think money actually matters. The post-Cansian school has been inhibited by learning their mathematics from neoclassical economists. That's what we should be analyzing: non-equilibrium violence and creativity of capitalism.

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