Author Archives: wciecon
This is why we can’t have nice things
A disconcerting trend is establishing itself in Canadian politics. Political parties are showing essentially no interest in the merits of a policy proposal beyond its potential as an element of some shrewd communications strategy.
Britain’s proposed child benefit taxback is inefficient
Today the BBC reports that child benefit is to be axed for higher-rate taxpayers. Some background: ideally, a person's tax liabilities reflect his or her ability to pay taxes. Most tax systems recognize that having children reduces ability to pay, so provide parents with some kind of tax relief. In the late 1970s, the British […]
Should we teach supply and demand in French?
A simple post, mainly aimed at people like me who teach Intro Economics. For decades I've been puzzling over the problem of how best to explain to first year students exactly what "quantity demanded" and "quantity supplied" mean. Then it suddenly struck me: it must be so much easier in French! (Can anybody who teaches […]
The paradox of thrift vs the paradox of hoarding
Would a sudden fad for antique furniture cause a recession? If, like Paul Krugman, you believe in the paradox of thrift, and if you follow the remorseless logic of your mistaken model, you should answer "yes". I don't believe in the paradox of thrift, and would answer "no". There is no paradox of thrift. There […]
Economy Lab
The email came the day I wrote a post called "Another rant about the Globe and Mail's coverage of economics." It was an offer "that I hope you can't refuse" – to participate in the Globe and Mail's new feature Economy Lab. Another day I might have said no, but I could hardly rant about […]
Why we should stop talking about inventories when teaching macro
Nothing earth-shattering here. This post is about teaching macroeconomics better. But there's just a chance it might help some of you understand macro a little bit better. Whenever we teach the Keynesian Cross (income expenditure) model, and the distinction between National Income Accounting identities and equilibrium conditions, we always talk about inventory accumulation. Planned vs. […]
Is the stimulus program already being phased out?
The federal government won't be bringing its 2011-12 budget down until at least four months from now, but there's already some discussion about just when its fiscal stimulus should be phased out. The government's current line is that the infrastructure program will end on March 31 as planned, with perhaps a certain amount of wiggle […]
Targeting the stickiest price.
Suppose the price of apples is sticky, but the price of everything else adjusts instantly to its equilibrium value. There is then an old, and strong, argument that monetary policy should target the price of apples. The economy performs best when all prices are at equilibrium. If the price of apples won't move (quickly) to […]
Is it getting harder to publish?
Another week, another rejection letter. Am I writing bad papers, or is it getting harder to publish?
The End of Finance? The monetisation of everything.
I know it's wrong, or at least deeply problematic, to adopt a teleological view of history: to say that History has an End, or Purpose, and is inexorably driven by deterministic Iron Laws towards that End, with perhaps an occasional hiccough along the way. But I can't stop myself. What is the End of Finance? […]
Worthwhile Canadian Initiative 
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