Richard Werner

All of economics - hypothetico-axiomatic deductive equilibrium economics that is - agrees that lower interest rates stimulate growth and higher rates slow growth. This claim has been made so frequently in the past half century and beyond that one likes to assume that it refers to a well-established empirical fact. However, there is no empirical evidence. This paper presents the first thorough empirical study on this question. The claim is found to be untrue. There are major consequences for economics, research methodology and ecological economics.