Category Macro
Goldpunk, strategy space, and Michael Woodford
On the one hand: it's very good news that Michael Woodford has endorsed NGDP level path targeting (pdf). (For non-economists, Michael Woodford is the most influential living academic monetary economist; he's the one who wrote the book that defines how graduate students think about monetary policy.) On the other hand: I'm going to rain on […]
What’s Up with Carney & Flaherty?
Well, I’m still sifting through my thoughts trying to exactly understand what was behind the corporate “dead money” debate last week. After a speech to the Canadian Auto Workers, Bank of Canada Governor Mark Carney drew attention to the rising amounts of cash in the bank accounts of Canadian firms and commented to the effect […]
The very short run
Most macroeconomists make a distinction between the short run (sticky prices) and the long run (flexible prices). I want to talk about the very short run. We mostly ignore the very short run, and I don't think we should. Because the very short run probably isn't really that short. Old Keynesians used to talk about […]
Supertanker and canoe Phillips Curves, and inflation targeting
This post is an attempt to give some intuition for my previous post. There are two differences between a supertanker and a canoe: 1. Position. You can easily pick up a canoe and make it jump a nautical mile north or south of its present position; while a supertanker really wants to stay where it […]
Calvo vs Mankiw/Reis, and IT vs PLPT/NGDPLPT
An economy is humming along very nicely in full long run equilibrium. All real variables are at their natural rates. Actual and expected inflation are both equal to the 2% inflation target. As the years go by, the price level goes: 90, 92, 94, 96, 98, and everybody expects it to continue 100, 102, 104, […]
The Loanable Funds and other theories
This is a long and boring post. (Though some will no doubt find it highly controversial, and a very few might even get over-excited). It might be useful for economics students who want to put the Loanable Funds theory into perspective. They are my main intended audience. And maybe for those who teach them too. […]
Births Revisited: Births, Population and Per Capita Income
Well, after my last post I finally got around to calculating another measure of the birth rate – births per capita. Total births are a useful aggregate but the measure does not adjust for population size. There are other fertility measures out there such as births per woman aged 15 to 44 years but per […]
Whatever happened to Price Level Path Targeting?
Before the recession, Inflation Targeting was the Champ, and Price Level Path Targeting was the Challenger. A strong Challenger. The Champ was the champ, but the Challenger had a lot of support. A lot of people thought he should and eventually would replace the Champ. People argued about who was better overall, but all agreed […]
Can we understand agent-based models?
[Updated. See below.] [I wrote this because we were starting to discuss the question in comments, and I thought it was interesting, so tried to collect my thoughts. No great original insights here. Nor even any conclusions, right or wrong. Read at your own risk. This post is really just a place for people who […]
Wot about the capitalists?
I just read Matt Yglesias "Monetary policy complacency is the conventional wisdom" (HT RA of The Economist) piece in Slate. It's depressing reading. "On one team are the leaders of the Federal Reserve, the European Central Bank, the Bank of Japan, and the Bank of England. Alongside them are the political leaders of the United […]
Worthwhile Canadian Initiative 
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