The long run is…

The long run is a misleading guide to current affairs. In the long run we are all dead. -John Maynard Keynes

Economics is sometimes thought to be a science that can predict the future. Certain inputs, certain past trends, they come together to crystallize and make the future known.

Yet, the idea of a long run is silly. In time our lives will change and exist in a new set of conditions. But this is not really the ‘long run’ because the long run implies stability and predictability. In reality, we live in a succession of short-runs where things can change quite a bit.

The long run is the economic equivalent of settling down in life. It assumes that individuals will stop all this nonsense and behave rationally. And perhaps an individual could choose that path. But society is the life of the party, and having too much fun to slip into this “long run.”