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Scott Sumner: June 2014

An Author Archive by Month (12 entries)

When is nominal GDP targeting optimal?

Macroeconomics
Scott Sumner
Commenter Felipe sent me to an interesting Jeffrey Frankel post on NGDP targeting: There are good reasons to think that NGDP targeting is better suited to emerging and developing economies than to industrialized countries. These economies are more frequently subject... MORE

Piketty on "merit"

Wealth distribution
Scott Sumner
One thing I noticed while reading Thomas Piketty's new book was the topics that were not covered; progressive consumption taxes, Singapore (or indeed any of the 4 Asian "tiger economies"), and the link (if any) between ethnicity and great wealth.... MORE

Unpersuaded

Income Distribution
Scott Sumner
I recently completed reading Thomas Piketty's new book entitled Capital in the Twenty-First Century. Piketty explains why the distribution of capital is becoming increasingly unequal, why we need higher tax rates on upper income individuals, and also a wealth tax... MORE

Up until 2008 I had a sort of "Whig view" of Fed history. They made many mistakes, but learned enough from those mistakes to gradually improve. Now I'm not so sure. Here are 6 policy regimes, all excessively procyclical: 1.... MORE

People on the left like Paul Krugman sometimes suggest that 1934-80 was a sort of golden age of stable banking---after the New Deal regulatory reforms and before the deregulation of the 1980s. I'm not convinced that regulation has much to... MORE

Fiscally inefficient monetary policy

Macroeconomics
Scott Sumner
Here is Noah Smith: Abe is the most effective national leader in the world right now. I never thought I'd say this, but he's an example that the rest of the world should be following. This time around, Abe didn't... MORE

Never reason from an interest rate change

Monetary Policy
Scott Sumner
I occasionally point out that the European Central Bank raised interest rates several times in 2011, triggering a double dip recession. At other times I argue that interest rates are not a reliable indicator of the stance of monetary policy.... MORE

Let's think about (left) liberalism over the last 50 years. By the 1960s, income had become relatively equally distributed. Liberal economists grew increasingly skeptical of labor unions. When the UAW demanded higher wages, the money seem to come out of... MORE

Obama is to the right of Texas on pot legalization

Economics of Crime
Scott Sumner
Here is just one example of the Obama administration's reefer madness: Robert Duncan, who managed marijuana-growing for a collective of Northern California medical marijuana dispensaries, surrendered to federal prison Monday, where he will serve a two-year sentence. Speaking to... MORE

The First Fundamental Law of Capitalism

Income Distribution
Scott Sumner
Suppose that I made the following claim: The formula M*V = P*Y is a pure accounting identity. It can be applied to all societies in all periods of history, by definition. Though tautological, it should nevertheless be regarded as the... MORE

Private affluence, public squalor, high taxes

Public Choice Theory
Scott Sumner
Every time I visit New York I think about John Kenneth Galbraith's famous remark about American private affluence and public squalor. There is impressive new residential construction. Townhouses in areas like Brooklyn are being fixed up. But the subway system... MORE

Piketty on Kuznets

Income Distribution
Scott Sumner
I've started reading Thomas Piketty's now-famous Capital in the Twenty-First Century. Over at MoneyIllusion.com I have some observations on the opening chapter (which is all I have read so far.) Here I'd like to focus on one section of the... MORE

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