Author Archives: wciecon
An NGDPLP Target vs a higher Inflation Target as insurance against the ZLB
This is not a new point (Scott Sumner has made it before), but it needs repeating. The Zero Lower Bound is something we want to avoid. Here are two ways we can change monetary policy to reduce the risk of hitting the ZLB. Both work, but one comes at the cost of higher average inflation. […]
Artsie non-linearity, economics, and the concrete steppes
When economists say that something is "linear", rather than "non-linear", they normally mean it is a straight line, rather than curved. Y=a+bX is linear; Y=a+bX2 is non-linear. That is NOT what I am going to mean by "linear" in this post. Instead, I am going to use the words "linear" and "non-linear" in the way […]
Three (maybe four) main questions about money
What are the main questions in monetary economics? This post isn't really about the answers to those questions. It's about the questions themselves. This is how I think about dividing up monetary economics into a small number of main questions, and how those questions are related to each other. Others may want to divide it […]
Is the Health Care Cost Curve In Canada Finally Bending?
While public health care spending in Canada has been growing, what has not received a lot of attention is that after adjusting for inflation and population, growth rates of real per capita public health spending in Canada have actually been declining.
Competition between unions
Suppose you were a believer in the benefits of canoes. You want as many Canadians as possible to own a canoe. You would presumably want to encourage competition between different canoe manufacturers, so they would compete on price and quality, so that price would be lower and/or quality would be higher, so that more Canadians […]
“Does monetary policy have (bad) distributional consequences?”
Some questions are bad questions. This is one of them. We can get a clearer and more useful answer if we change the question. We can avoid wasting a lot of time arguing at cross purposes. Here's a better question: "If we used fiscal policy instead of monetary policy to remove a shortage of aggregate […]
Who benefits from the oil sands? Who benefits from saying that only Alberta does?
This didn't pass my sniff test: The economic benefits of oil sands development, while considerable, are unevenly distributed across the country, making interprovincial tensions understandable. While provinces other than Alberta are projected to benefit, modelling by the Canadian Energy Research Institute projects that 94 per cent of the GDP impact of oil sands development will […]
Would eliminating milk quotas be a Pareto improvement?
Today I looked at last week's public finance exam, and got an all-too-familiar sinking feeling: I've asked a question that's almost impossible to answer. Here it is: Currently the production of milk in Canada is restricted through a system of quotas. Eliminating quotas on milk production in Canada is best described as:a. A potential Pareto […]
Abolish the Equity Premium Now!
This post is slightly whimsical. I can't decide myself if I'm being totally serious. My argument is certainly less than watertight. But it's not (to me) obviously wrong either. So I'm just throwing it out there.
Two ‘what ifs’ about Canadian macroeconomic policy during the recession
There's a lot for econobloggers in the US and Europe to get exercised about. They are facing serious problems, and their policy makers have demonstrated an alarming inability to deal with them. It's harder for Canadian econobloggers – okay, for this particular econoblogger – to put together arguments documenting how Canadian policy makers got things […]
Worthwhile Canadian Initiative 
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