Category Nick Rowe
A request for some Bayesian assistance
Calling all Bayesians! I need your help on two questions: first I want you to check something I said; second I want you to check something that Bryan Caplan said. In September 2008, Bryan Caplan issued a challenge (revisited yesterday) for people to say in advance how they would update their prior belief that the […]
Pump-priming and the Keynesian Laffer curve
Update: since what I thought was my most controversial post ever has drawn precisely zero comments, let me re-title it: "A fiscal stimulus can more than pay for itself". The English language is full of dead or dying technological metaphors. How many people have ever primed a pump or kick-started a motorcycle? (I'm old enough […]
The (economic) benefits of civility
I can think of three benefits from people being civil, in arguments about economics (for example).
Why can’t Ann get a credit card? A sample of one.
Ann's not her real name, but she's a real person, and she can't get a credit card. Is this normal, or part of the credit tightening reported on the Bank of Canada's latest Senior Loan Officer Survey? That's not a rhetorical question. I don't know the answer, and wondered if any reader did. Details below […]
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?
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.
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 […]
Canadian Economic Forecasts 2009: Make Yours Now!
John Palmer at EclectEcon has made his own forecasts for 2009 . That's an implicit challenge to this blog, and we must not let it go unanswered. So I am now going to follow him down this foolish road, and invite you all to join me.
Worthwhile Canadian Initiative 
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