Economics

Archive for Economics

Failed I Have

I have been warning you guys for a long time now that Scott Sumner was the real guy to watch. Now Christina Romer writes in the NYT–the NYT for crying out loud!–that Ben Bernanke needs to get his Volcker on: Today, inflation is still low, but unemployment is stuck at a painfully high level. And, […]

A Video Trying to Make Nominal GDP Targeting the New Normal

This is pretty good, and has the endorsement of lots of market monetarists (see the comments here). If I were going to make a video to introduce a newcomer to Scott Sumner’s ideas, it would look something like this.

How Are Sujatha Reddy and Scott Sumner Alike?

Well, neither has been in my living room. But beyond that, they both have far more expertise in their respective fields than I do, and yet I confidently claim that they are being very misleading when they “debunk” conventional wisdom. I’ve already complained about how Scott says that inflation poses no problem at all (or […]

Should Central Banks Worry About Asset Bubbles?

A long long time ago, from an ISP far far away, the indefatigable von Pepe was beating me over the head about my reckless CPI “calls,” telling me that loose monetary policy would show up all over the place. He sent me all kinds of academic papers. Well I finally took the time to write […]

People Draw Different Lessons From History

Paul Krugman talking about the Europeans’ amazing reluctance to print as much money as he thinks they should: The point here is that we have a couple of centuries’ experience with central banking, and that experience clearly shows that the lender of last resort function is crucial. The Federal Reserve basically was created after America […]

When the Facts Change, I Silently Curse–What Do You Do, Sir?

Dangit, I realized there is yet another complication to the income vs. consumption tax saga. I don’t know about you guys, but this debate is like the first season of 24. In the beginning I thought it was incredibly interesting, I was hooked, I couldn’t get enough. But after 20 hours of it, there were […]

Yet More Clarity (Confusion?) on Mainstream Tax Analysis

OK this is almost out of my system, but people keep asking good questions in the comments. “May I have another, sir?” Chris asked: Bob, Doesn’t a consumption tax also hit you when you earn interest, dividends, and capital gains? After all one doesn’t earn interest to roll it over for perpetuity — it’s eventually […]

Yet Another Quick Note on Tax Theory

OK in the comments on previous posts it is clear that a lot of readers didn’t get the point I was making originally, that there is a legitimate sense in which an income tax hurts individuals more than a comparable consumption tax. So let me take another stab at it. (It should go without saying […]