Category Fiscal policy
“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 […]
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 […]
Identity Economics
Here are two macroeconomic identities: 1. Y=C+I+G+NX 2. MV=PY Both are true by definition.
The federal deficit is shrinking quickly
During the recession and recovery, I got into the habit of writing graph-laden posts every time there was an important data release. I've gotten out of that habit, but I still keep track. One of the things I track is the federal Department of Finance's Fiscal Monitor, which is a brief monthly summary of federal […]
Fiscal policy, ideology, and framing
TiC Take a standard New Keynesian macro model. Assume it sometimes gets stuck in a ZLB liquidity trap, where monetary policy can't work. There is a very simple solution: use fiscal policy. Government spending should be cut whenever the economy is not in a liquidity trap. That is the clear policy implication of New Keynesian […]
Provincial Finances: An Estimate of “Tax Prices”
My previous post dealt with differences in provincial health spending and how on a per capita basis some provinces were substantially above the provincial average while others were not. One of the factors behind any government spending at the provincial level is own source revenue capacity so in light of some of the comments asking […]
Living in a demand-side world
I know what it's like to live in a demand-side world, because I used to live in one. Let me tell you about it. Maybe it's like the world you live in.
Live, on tape delay, it’s the federal budget
I'm about to leave for Ottawa to take part in this conference (program here). My original plan was to arrive early and spend the day touring Ottawa, but then the government decided that March 29 would also be budget day. So I'll be spending the day instead at the budget lockup with the Globe and Mail team. […]
Ontario’s 2012 Budget: Bending the Spending Curve
Well the Ontario budget is out and despite all the talk of 30 percent across-the-board budget cutting in the wake of the Drummond Report, it forecasts more a deceleration of spending growth rather than steep cuts.
Who is More Fiscally Sustainable: Ottawa or Queen’s Park?
Both the Federal and Ontario budgets are nearly upon us and the key watchword for both is going to be the sustainability of the public finances.
Worthwhile Canadian Initiative 
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