Monthly Archives: July 2015
The Beer IneQuality Index
The conventional Canadian view is that American beer is bad; watery and weak. Yet American breweries produce some of the world's best beers – superb brews coming out of microbreweries across the country. What is striking about the United States is the country's level of inequality – or, to be more precise, the beer quality […]
WTF!? Neo Fisherianism as one social construction of reality
Macroeconomists need to pay more attention to finance sociology. Choke. Languages have multiple equilibria. If we all used the word "cat" to mean dog, then "cat" would mean dog. And if I walked into a pet store and said "I want to buy a cat", the people in the pet store would react differently to […]
The Great Convergence: Federal Transfer Revenue Shares 1980/81 to 2013/14
Well the Council of the Federation began meeting in St. John’s yesterday and given we are on the cusp of a federal election, there will no doubt be a targeting of Ottawa’s role in provincial finances. Naturally, there will be some lamentations about the Prime Minister’s absence – once again – from this annual meeting. […]
Understanding Schmidt and Woodford on Neo-Fisherianism
I think this is roughly what is going on in their model (pdf). I'm not 100% sure I'm right. And I'm not even trying to be 100% right. I'm trying to get the intuition (reverse-engineer) for those bits of their results I find most interesting. Suppose you are really bad at algebra. You can't solve […]
Privately-issued preloaded Drachma cards?
Forget monetary theory for a minute, and think only about the technical/engineering stuff: is Andrew Lainton basically right about this? Can something like this be done quickly and cheaply, without too much danger of counterfeit and fraud? (I don't know, which is why I'm asking.) If you introduce a new money, you want to do […]
Alpha, Beta, ECB independence, and Omega lender of last resort
There is a tension between central bank independence and acting as lender of last resort. We need to recognise that tension. The Bank of Canada prints its dollars on paper plastic. The Bank of Montreal prints its dollars on silicon(?). But both print dollars. BoC dollars and BMO dollars have a fixed exchange rate of […]
Euro MOA+MOE plus Drachma MOE
Suppose your country (call it "Greece") is in recession, because there is an excess demand for money (call it "Euros"). And suppose that the Euro is both Medium of Account (prices are quoted in Euros) and Medium of Exchange (all other goods are bought and sold for Euros). Now suppose your government introduces a new […]
It’s the (absence of) trust, Simon
Simon Wren-Lewis ruins (for me) what would otherwise be a very good sensible keynesian post about Greece ("sensible keynesian" is a school of thought, to which Simon belongs) by leaving out trust. Or, if you want to be techie about it, the "time-consistency problem". If you give me one apple today, and I give you […]
Bad news on GDP vs good news on employment
Here is a macro exam question: Q. You are the New Keynesian governor of an inflation targeting central bank. Two bits of information arrive simultaneously: GDP is lower than you expected; employment is higher than you expected. Relative to what you had otherwise planned to do, how do you respond to the news? Do you […]
Thoughts on the news from Greece
This is just to record my thoughts, so I can look back on this and see what I got right and what I got wrong. Or at least, what I changed my mind about. The Euro was a mistake. I hoped (and still hope) to see the Euro dissolved. But the Euro is now stronger […]
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