I feel I ought to know the answer to this question. But I don't. Suppose that demand this period Y(t) depends on the interest rate this period r(t), and on the expected interest rate next period E[r(t+1)], and on a vector of other stuff X(t). Y(t) = D(r(t), E[r(t+1)], X(t)) where D1 < 0, D2 […]
If I read Stephen Poloz correctly, the Bank of Canada will not normally be doing forward guidance in the future. But it will use forward guidance in an emergency. I do not clearly understand Steve's reasoning (see section 7 of his discussion paper), but I think this is the right decision. "Forward guidance" is a […]
[This is based on an informal talk I gave to Carleton students. There were first year students, and upper year undergraduates, and graduate students, and faculty, in the audience, which made it a little tricky.] Somewhere in Canada there is a person whose height is exactly equal (or almost exactly equal) to the average height […]
Tony Yates is arguing with Willem Buiter about helicopter money. Willem says that helicopter money increases aggregate demand even in a liquidity trap, because helicopter money increases net wealth, because money is irredeemable. Tony says that if money is irredeemable, the existence of an equilibrium in which intrinsically worthless money has positive value becomes problematic. […]
Alex Usher had an interesting post on how universities are basically conflicted between their central authorities and the interests of the assorted disciplines that make up a university. He stresses that the actual point of a university is that it serves to advance knowledge by getting disciplines to work together to tackle problems in a […]
The Bank of Canada calls theirs the "Labour Market Indicator". I now learn from Tim Duy (HT Mark Thoma) that the US Fed has one too, and calls theirs the "Labor Market Conditions Index". I think that LMI and LMCI are roughly the same sort of thing. It's an index number that is supposed to […]
This is a response to this, which is in turn a response to this and this, which was a response to this, which was a comment on this old E-Lab post of mine. This is old, well-covered ground, so I'll be as brief as I may.
Nothing new here. This is just a brief summary of my views:
I have a proposal that would improve aggregate demand management. I call my proposal "money-financed government expenditure on sacrificing goats". I propose that every time the government sacrifices one goat, the Bank of Canada is required by law to increase the base money supply permanently by $1 billion, relative to what it would otherwise have […]
Twenty years ago, men and women had similar attitudes towards children – young women, on average, wanted slightly more children than young men, but the differences were nothing to speak of. Now, on the other hand….
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