Monthly Archives: September 2009
When the going gets weird, the weird turn pro
It is a season in which even the most jaded observers of federal politics can only look on in slack-jawed, googly-eyed wonder. Here is a press release from the NDP web site: Liberals on board with Conservative tax hikes: Despite publicly opposing the Conservatives’ HST plan, Michael Ignatieff is now endorsing it. Ontario Premier Dalton […]
My own memories of the Phelps/Lucas administration
My own memories are similar to Paul Krugman's, but with one important difference. This is the bit I remember differently: "The Lucas view took the economics profession by storm – not because there was any solid evidence for it, but because it was so clever, because it led to nice math, because it let macroeconomists […]
Why did the opposition parties let Stephen Harper outplay them so badly on Employment Insurance?
It appears that we will have some sort of modification to Employment Insurance. The main measure involves an extension of benefits to some EI recipients who may be at risk of exhausting their benefits, and that – and the prospect of an election – appears to be enough for the NDP and the Bloc. For […]
All Microeconomics gets Say’s/Walras’ Law wrong
It's not just John Cochrane; it's not just (modern) Chicago; it's (nearly) all of us. Which economist has not written, said, thought, taught, or learned, the following: "Let there be n goods (including money, if it exists). Max U(X1,X2,..Xn) subject to SUM over n[P(X-E)]=0. Aggregate over all people. Therefore the sum of the n excess […]
Quebec: An oasis of sanity in a desert of GST/HST silliness
The Charest government is floating the idea of increasing the QST – which has been harmonised with the GST since the very beginning – by another percentage point (in addition to the one-point increase announced in last spring's budget) as a way of dealing with the post-recession deficit. This is clearly the right thing to […]
Why does Senator Sharon Carstairs think that the Parliamentary Budget Office shouldn’t make its reports public?
Anyone? Kevin Milligan at Support the OPBO would like to know. So would I. The relevant legislation appears to be silent on the matter.
A “proof” of Say’s Law; and why money is weird
For a whole economy, does planned expenditure on newly-produced goods necessarily equal planned income from the sale of newly-produced goods? That's what I mean by "Say's Law" in this context. Say's Law is wrong, and the fact that it is wrong is really important for macroeconomics. But it's not obvious why Say's Law is wrong. […]
John Cochrane, Paul Krugman, and Say’s Law, again
Via Casey Mulligan and Karl Smith, here is John Cochrane's response to Paul Krugman. It's a very good response. But there is one part where John Cochrane is definitely wrong. It's small, but important. And it's all about Say's Law, and the crucial difference between a monetary exchange and a barter economy.
Is the Bank of Canada bluffing?
From today's interest rate announcement: Persistent strength in the Canadian dollar remains a risk to growth and to the return of inflation to target. In its conduct of monetary policy at low interest rates, the Bank retains considerable flexibility, consistent with the framework outlined in the April MPR. The Bank has been issuing warnings such […]
Long-term unemployment in Canada and the US
The more I look at the US, the more I see unpleasant parallels to Canada's experience of the 1990's – what Pierre Fortin called The Great Canadian Slump. Even after we emerged from the worst of the 1990-91 recession, we still had to deal with a large current account deficit, out-of-control government deficits and significant […]
Worthwhile Canadian Initiative 
Recent Comments