Coy or Nuanced?
This post from Noahpinion is amusing. He ties himself in knots with the apparent goal of labeling me a hypocrite on the issue of fiscal stimulus.
In fact, if you read my recent writings about fiscal stimulus (in order, here, here, here, here, and here), you will find that I have never asserted that the Obama stimulus was a complete failure in expanding aggregate demand. Instead, I have suggested that there might well have been much better ways to promote recovery. The last article in the list above, soon to be published in the Brookings Papers on Economic Activity, concludes that from a welfare standpoint, "conventional fiscal policy is the demand management tool of last resort." In other words, in that model, conventional fiscal policy is effective, but it is still not the best tool to take off the shelf when facing a collapse in aggregate demand.
Some may think I am being coy. I consider myself nuanced and open-minded. Read the articles at the links above and judge for yourself.
In fact, if you read my recent writings about fiscal stimulus (in order, here, here, here, here, and here), you will find that I have never asserted that the Obama stimulus was a complete failure in expanding aggregate demand. Instead, I have suggested that there might well have been much better ways to promote recovery. The last article in the list above, soon to be published in the Brookings Papers on Economic Activity, concludes that from a welfare standpoint, "conventional fiscal policy is the demand management tool of last resort." In other words, in that model, conventional fiscal policy is effective, but it is still not the best tool to take off the shelf when facing a collapse in aggregate demand.
Some may think I am being coy. I consider myself nuanced and open-minded. Read the articles at the links above and judge for yourself.
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