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Scott Sumner: December 2014

An Author Archive by Month (15 entries)

I don't believe you (you're a liar)

Revealed Preference
Scott Sumner
In The Big Questions Steven Landsburg examines the problem of belief. He points out that 96% of Americans believe in God, but most go through their lives acting as if they don't believe in God. That raises the question of... MORE

So how's the economy doing this year?

Labor Market
Scott Sumner
Paul Krugman says that the reduction in long-term unemployment has been rather disappointing. This is important, because 2014 was a sort of "natural test" of the hypothesis that the extended unemployment insurance program led to higher unemployment. The program ended... MORE

What an unmitigated disaster for Pikettynomics! PARIS (Reuters) - When President Francois Hollande unveiled a "super-tax" on the rich in 2012, some feared an exodus of business, sporting and artistic talent. One adviser warned it was a Socialist step too... MORE

Choosing the right tools

Economic Methods
Scott Sumner
Here's the always brilliant Steven Landsburg discussing the importance of theoretical tools: I sometimes hear economists defend the unrealism of their models thusly: "Economics is an infant science. Today our models are unrealistic; a decade from now, they'll be a... MORE

Paul Krugman has a new post that explains why he is pessimistic about monetary stimulus at the zero bound. He briefly describes his 1998 paper on the zero bound problem. This paper shows that if base money and bonds are... MORE

Central banks should do their job

Monetary Policy
Scott Sumner
The title of this post sounds like a truism, and yet it's actually highly controversial. In my previous post I pointed out that the ECB was not hitting its 1.9% inflation target, and apparently has no plan for doing so... MORE

The ECB: Is it a hopeless case?

Monetary Policy
Scott Sumner
Remember the joke about the motorist who gets lost, and then asks for directions to Podunk? The farmer replies, "If I was headed to Podunk, I wouldn't start from here." Yes, and if I was targeting inflation at 1.9%, I... MORE

Speaking of torture . . .

Economics of Health Care
Scott Sumner
Here's the New York Times: I TRIED magic mushrooms out of curiosity and in middle age. I'd been on the amateur mycological circuit for a couple of years, but hallucinogenic species were rarely mentioned at the foraging expeditions and conferences... MORE

John Cochrane on modern macro

Macroeconomics
Scott Sumner
When John Cochrane writes on finance I prefer him to be "the grumpy economist." When he writes on macro, I prefer the less grumpy version. His new (non-grumpy) post on macro is outstanding, full of so many important insights that... MORE

War on crime? Or war on the poor?

Economics of Crime
Scott Sumner
Intellectuals on the far left will sometimes argue that the entire criminal justice system is engaged in a vast right wing conspiracy to repress the poor. I'm not quite that paranoid; violent crime is a serious issue, for which we... MORE

Why debates over inflation are pointless

Macroeconomics
Scott Sumner
In a recent post I suggested that one could argue that the entire increase in per capita income over the past 50 years was pure inflation (and hence that real GDP per capita didn't rise at all.) But also that... MORE

What (if anything) can we learn from 1921?

Economic History
Scott Sumner
There has a been a recent flurry of blog posts on the 1921 depression--especially why it was so much less severe than the Great Depression. One unfortunate aspect of the dispute is that it has become linked to a misleading... MORE

Bloggers >>>>>>>>>> Central banks

Monetary Policy
Scott Sumner
Over the past 6 years the blogging world (especially market monetarists) has been highly critical of central banks. Outsiders might have trouble discerning who's right. After all monetary policy is highly complicated. Why should we care about the views of... MORE

Here's Brad DeLong: Two Questions for Scott Sumner: First Question: Why has nominal GDP targeting not already swept the economics community? It really ought to have. Second Question: I believe in nominal GDP targeting--especially if coupled with some version of... MORE

The IMF hits a new low

Monetary Policy
Scott Sumner
The IMF has a reputation (perhaps undeserved) of always getting the policy mix wrong during crises. They also have a reputation for learning from their mistakes---that reputation is definitely undeserved. Here's an example from a recent IMF report: The IMF's... MORE

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