Economists should study financial markets as they actually operate, not as they assume them to operate—observing the way in which information is actu… - Adair Turner, Baron Turner of Ecchinswell

Economic history matters. Students of economics should read Charles MacKay and Charles Kindleberger, and should study the history of the Wall Street Crash as well as the theory and the mathematics required to formalize it.

In the second half of the twentieth century, the idea became increas ingly dominant that attaining a superior growth rate and thus increased prosperity should be the central objective of public policy.

The proposition that markets drive economic efficiency is central to much of economics. Adam Smith illustrated that the “invisible hand” of the market drives efficient allocation of resources in a system of division of labor. Friedrich Hayek illustrated the central importance of the price system as an information processing mechanism more powerful than any centrally planned system could ever be. Kenneth Arrow and Gerard Debreu illustrated that complete and perfect markets deliver a Pareto-efficient equilibrium, in which no one person can be made better off without making someone else worse off. And the development of the efficient- market and rational- expectations hypotheses suggested that financial markets are in fact efficient, and that the conditions required for efficiency and for rational and stable equilibria apply even in contracts between the present and the future, which financial markets provide.