Financial stability requires macroeconomic foundations of macroeconomics

Sergio Rossi
2010 Journal of Philosophical Economics  
Financial stability features prominently among the goals of several post-crisis macroeconomic policies around the world. Being a systemic characteristic, financial stability requires a systemic analysis, which only macroeconomics can offer logically. Yet, the current way of doing macroeconomics is not up to the task, as it is grounded on so-called microfoundations. Considering macroeconomics as the science of aggregating data obtained at microeconomic level can lead indeed to conclusions that
more » ... e either misleading or wrong. This paper points out that the true foundations of macroeconomics are macroeconomic, and that understanding the working of monetary economies of production and exchange requires a conceptual rather than a mathematical treatment of economic issues at a systemic level.
doi:10.46298/jpe.10594 fatcat:uora4geazjccvnzhuokp2yzipa