Monthly Archives: November 2009
More reasons to support the PBO
Today's National Post has an op-ed written by a couple of Fraser Institute types entitled "Scrap the Parliamentary Budget Office". It's a remarkable piece of rhetoric. Although its stated purpose is to make the case for eliminating the PBO, it ends up demonstrating once again why an effective PBO is so desperately needed.
Accounting and Economics; and Money
To paraphrase Churchill, accountants and economists are divided by a common language. We seem to be using the same words to talk about the same things, but we don't understand what the other is saying. This is my attempt to provide an economist's perspective on the relation between accounting and economics. What I say here […]
“Presentation of the Liberal position on climate change and the environment”
It's not often that the internal Laval e-mail listserve grabs my attention. I guess I have to go, if only to satisfy my curiosity about the following points: Is this a real policy proposal, or a recital of Conservative failures? Cap-and-trade, or a carbon tax? How much material can he cover in 45 minutes? Will […]
Yes, the federal government has a structural deficit. But let’s keep it in perspective, shall we?
Don Martin loses it in today's National Post: Clock tallies IOU to next generation: Stephen Harper will join Jean Chretien as only the second prime minister in history to enroll Canada in the half-trillion-dollar national debt club. This is silly. Nominal debt figures from 1995 – when the federal debt first went above $500b – […]
Promising to keep nominal interest rates low for too long
I was lucky enough to be invited to a Bank of Canada conference on Thursday and Friday. The topic was "New Frontiers in Monetary Policy Design". One recurring theme in particular has stuck in my mind: that a credible promise to keep interest rates low for too long can help an economy escape a liquidity […]
Deflationary death-spirals and the social construction of monetary policy
I present a simple macro model and use it as a vehicle to explore the idea that it matters how monetary policy is framed. One framing leads to a deflationary spiral, which an alternate framing can avoid or escape. The model is an otherwise bog-standard New Keynesian/Neo-Wicksellian model, but with a minor modification in the […]
Why academic economists aren’t (announced) Bayesians
Bryan Caplan asks the question of why more academic economists don't use Bayesian methods. It's a question academic Bayesian economists ask ourselves pretty often. One part of the answer is that many already are informal Bayesians. For example, the whole DSGE literature would be uninteresting (or even more uninteresting, depending on how you feel about […]
On the federal government’s structural deficit
The Department of Finance publishes monthly data for expenditures, revenues and the deficit. These numbers don't necessarily correspond to the annual numbers (for example, various items are sometimes booked to a fiscal year after it's over), but it gives us a good idea of where the government's finances are going. The monthly numbers are pretty […]
What’s the optimum net worth of a charitable organisation/university?
Last night I was chatting with someone who works for a think-tank. I work for Carleton University. We both work for charities. Like households, firms, and governments, charities have income and expenses, and a net worth. Consumer choice theory tells us, at least in principle, how much people should save, and what the optimum net […]
An updated history of the federal government surplus deficit
In an upcoming post, I'm going to try to thrash out some of the details about the origins of the federal budget deficit, with an idea to figuring out how to make it go whence it came. But first, I'm going to set out some historical background, now that the data from the 2008-9 fiscal […]
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