The Passing Of Peter Flaschel And The Bielefeld School Of Macroeconomics
German economist Peter Flaschel died yesterday at age 78. I am not sure precisely of what, although it was not Covid-19. He had been in declining health for some years, with a heart problem at least. Roberto Veneziani, from whom I learned the news, said that Peter “sounded tired” when he spoke with him a few days ago. Ironically he spoke with him to tell him I had accepted for publication in the Review of Behavioral Economics a paper they co-authored with two other economists on the economics of the pandemic. I knew and liked Peter a lot, although I had not seen him for a full decade, last when I spoke at Bielefeld University where he was located. Indeed, his death I think means the end of what I had labeled “the Bielefeld School of Macroeconomics,” although this did not catch on all that much. But I know that Peter, who may have been the central figure of this group, appreciated my labeling it as such and trying to bring some attention to them.
Indeed, I think they deserved more attention, which they got very little of in the US. Various of them published quite a few books over the years, where their approach got laid out most fully. But their articles did not show up in US journals, and to some extent, I think they may have partly brought this obscurity on themselves. In particular, while some like me saw them as having affinities with Post Keynesian economics, they themselves disdained the PKs for not being sufficiently mathematical. And, with a few exceptions, most of the Post Keynesians in their various sub-varieties and camps, seem to have ignored the Bielefelders, to the extent they were even aware of them. Some of this may have also had to do with nations as well, with PKs mostly in US, UK, and Italy, although also in Australia, while the Bielefelders were heavily in Germany, with outposts in Japan, although some people at the New School in the US, and also in Australia.
So who else besides Peter was part of this group? One was Reiner Franke, who was with Peter at Bielefeld for a long time, but then moved to Bremen. Another was Willi Semmler, who long split his time between Bielefeld and the New School, not quite sure what his status is with all that. But he was the main US link. Then there was Toichiro Asada at Chuo University in Tokyo and the late Carl Chiarella of the University of Technology in Sydney, Australia. I knew/know all of these. Carl in particular, whose Ph.D. was in Applied Math and served for a while as co-editor of the highly mathematical Journal of Economic Dynamics and Control was one who was especially critical of what he considered the low mathematical content of much of Post Keynesian economics. Peter himself had an undergrad degree in math, and also shared this view. Just to note the Bielefeld connection, both Asada and Chiarella spent a lot of time visiting at Bielefeld and working with Peter on joint projects as well as with some of these others.
So what is the Bielefeld approach, and why do I respect it a lot? Well, it combined Marx, Schumpeter, Keynes, Metzler, and Goodwin to generate fairly complicated models that combined both long-run growth dynamics with short-run cyclical fluctuation dynamics. Their models easily produced various complex dynamics, including such things as chaotic dynamics, which I have long been interested in. They never went along with rational expectations or any of that stuff. I always thought their models were both realistic and intellectually sophisticated. But as noted, they did not publish articles in some journals that might have gotten them more attention, especially the Post Keynesian ones that I think might have taken them. And books, well, it is easy to ignore books, no matter how good they are. So I think their very appealing approach in my view just did not get the attention it deserved
And now it probably will not any further, as probably its key and central figure still at Bielefeld is no longer with us. As it was in recent years he had become involved with some younger economists, especially Veneziani, who is at Queens College in London. Some of their work with various coauthors has in fact moved back more to a directly Marxist approach, with this very much the case for Peter’s last book out in 2018 with Roberto and some others from Elgar, Value, Competition, and Exploitation: The Marxian Legacy Revisited. Anyway, I shall miss him, a good man and a fine economist.