Wednesday, June 24, 2015

Midweek Market Monetarist Links and Summaries - 6/24/15

Congratulations to Mark Sadowski, who recently completed his PhD at the University of Delaware. Scott Sumner also includes a graduation picture of Mark with this post.

"...taking into account the monetary policy offset, the fiscal multiplier still appears to be zero, even at the zero lower bound in interest rates." (Mark Sadowski)

David Glasner compares some historical mistakes with more recent mistakes on the part of U.S. government

Scott Sumner highlights Mark's new study Mark Sadowski on fiscal austerity, with and without monetary offset  Two other studies showed similar results - one from Ben Steil and Dinah Walker, and another from Kevin Erdmann
Too many countries lumped together? Okay, guilty as charged. I'm in Jason Smith's doghouse
Fed intentions are not necessarily future policy response. How much do they want Congress to be responsible for? Monetary offset and the time inconsistency problem
Congress and the Fed need a "meeting of the minds", as Congress doesn't appear to be aware of the hard choices at stake We need a commission on stabilization policy
A closer look at several aspects of fiscal options: Fiscal policy isn't about big government

Scott at Econlog:
And yes, market monetarists do work with econometric studies...Russ Roberts vs Simon Wren-Lewis
Presently, no bipartisan support for tax reform The Democrats move left
Central bankers have been a part of the problem...Could a well designed euro have worked?
Abe and Kuroda are not in agreement Japan's 2014 tax increase worked; they should do it again
"In a sense, this entire debate is an artifact of a flawed stabilization policy regime, with unclear lines of authority." The Other Things

When unemployment becomes an excuse to raise rates (Marcus Nunes)
One guess is as good as another!
Even though the evidence is there
So close...

An apt driver's analogy for the macroeconomy: hills, valleys and constraints (David Beckworth)

Speaking of driverless cars, what about "driverless" central banking...(George Selgin)

"The insistence on not making large policy changes creates an environment which is actually very convenient for central bankers who want to hide their mistakes." (Britmouse)

Are ideas "economically special, on the rivalry/non-rivalry dimension"? (Nick Rowe)
Some musings on growth theory:

If this statement were a school assignment, it would be graded "incomplete" (Bonnie Carr)

Housing supply takes a lot of the blame (Kevin Erdmann)
How well has monetary offset held up?
This has been a continuing pattern

Also of interest:

a paper from Brink Lindsey, "Low Hanging Fruit Guarded by Dragons"

Better to create new places of intellectual and economic opportunity for those with limited economic access, than "force" them into places which either don't want or need them:

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