In this fascinating book, Imad A. Moosa challenges existing preconceptions surrounding normative economics, arguing that what some economists see as undisputed facts of life may be myths caused by dogmatic thinking.
With this in mind, Moosa argues that the alleged puzzles found in the economics and finance literature are not puzzles at all, because they can be explained intuitively, without the need for complex models or the extravaganza of econometrics. Plausible explanations are suggested for puzzles in various areas of economics and finance, such as the home bias puzzle, the PPP puzzle and the presidential puzzle. The author explains why some common beliefs are, in fact, myths, including those of the power of the market, inefficiency of the public sector and the use of low-interest policy to combat the depression caused by the Covid-19 outbreak.
Controversies in Economics and Finance is a thought-provoking and stimulating read that exposes common flaws in economic analysis. It will be of great benefit to academics, graduate students and policy-makers looking to understand the limits of economic analysis.