Author Archives: wciecon
Exogenous policy, endogenous policy……and improving policy
On Saturday I posted my views on why it is difficult to get good estimates of the effects of fiscal and monetary policy. On Sunday Greg Mankiw responded to (less than civil) criticism from Nate Silver. Here is the very short version: Nate Silver criticised Greg Mankiw for looking at the effects of an exogenous […]
Why there’s so little good evidence that fiscal (or monetary) policy works
Will fiscal (or monetary) policy work to prevent a recession? This is perhaps the central question of macroeconomics. We ought to know the answer, and we ought to have overwhelmingly good evidence to support our answer. But we don't. It's still being debated. There's a reason we don't have good evidence.
Debt and Wealth
Does an increase in debt mean a decrease in wealth? There's the accounting question, which should help us keep our heads straight. But there's also an economic question: what is the causal relation between debt and wealth?
A GST fiscal stimulus
There are a number of fiscal stimulus proposals out there, but none of them incorporate my suggestion for using the GST to promote an explicitly short-term stimulus and to ensure that the government's ability to pay for future spending is not permanently compromised. For those of you who have not been paying close attention [Cries […]
Housekeeping note: a search feature has been added. Should anything else be?
After more than three years and more than 400 posts, I'm no longer able to remember who said what where and when, so I've just followed the helpful instructions provided by Typepad and installed a search thingy on the sidebar. Does anyone have any requests about how the blog should be set up? Features to […]
Average Debt and Representative Agents
The representative agent is sometimes a useful conceptual fiction. What's the income of the average Canadian? How many hours does the average Canadian work? It's not just theoretical macroeconomists who ask those questions. But it is a useless fiction when we ask about debt. Or rather, at best it's useless; at worst it's dangerously misleading.
Maybe the Canadian recession will be short and shallow
As Menzie Chinn reports (I've seen other references, but Econbrowser is a sufficient statistic as far as these matters go), there seems to be some sort of consensus forecast to the effect that the US economy will bottom out about sometime around mid-2009, although there is a certain divergence of opinion about just how deep […]
Current Fiscal Policy vs. Future Monetary Policy: Price-level Path Targeting
Paul Krugman presents a simple formal model of a liquidity trap. He shows that monetary policy won't work, but fiscal policy can work, to bring the economy to full-employment. Actually, that's not right. What his model shows is that current monetary policy won't work (because the nominal interest rate is at zero); but future monetary […]
We’re number eleven? Really?
Here is how The Palgrave Econolog ranks the top economics blogs as of this writing: Marginal Revolution Paul Krugman Econbrowser Econlog Portfolio.com: Market Movers Economist's View Megan McArdle Macroblog Brad DeLong Dealbook Worthwhile Canadian Initiative Wow. How did that happen?
Gross National Income and house prices and in Canada and in the US
I've been having difficulty finding ways in which we can directly compare the US housing market débâcle with what's going on in Canada, but I've recently been made aware of two new data sources: The Teranet-National Bank Housing Price Index, which appears to be a Canadian equivalent of the celebrated Case-Shiller index: the methodology makes […]
Worthwhile Canadian Initiative 
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