It seems sensible for most professions but in economics it’s nothing short of a revolution: The 17,000-strong American Economics Association has adopted a stringent new code for disclosures meant to prevent or at least highlight possible conflicts of interest.
Ask not what your monetary policy can do for you, but what you can do for your monetary policy. That’s the jist of a 1968 paper by Milton Friedman, the poster-child for monetarist economics, entitled “The Role of Monetary Policy,” whose key questions remain hotly debated more than four decades on. Friedman’s answer is simple (some might argue too simple), and all too familiar to those who read the speeches of present-day Federal Reserve hawks – focus on the only thing monetary policy can truly control, which in Frideman’s view is price stability.
from Ian Bremmer:
By Ian Bremmer
The views expressed are his own.
One of the biggest changes we’ve seen in the world since the 2008 financial crisis can be summed up in one sentence: Security is no longer the primary driver of geopolitical developments; economics is. Think about this in terms of the United States and its shifting place as the superpower of the world. Since World War II, the U.S.’s highly developed Department of Defense has ensured the security of the country and indeed, much of the free world. The private sector was, well, the private sector. In a free market economy, companies manage their own affairs, perhaps with government regulation, but not with government direction. More than sixty years on, perhaps that’s why our military is the most technologically advanced in the world while our domestic economy fails to create enough jobs and opportunities for the U.S. population.
This blog may actually be worth the web page it is electronically printed on. A paper from the Center for Economic and Policy Research (not Dean Baker’s shop but the other CEPR, in London) discussed here at VoxEU by University of Bologna economist Paolo Manasse, finds that, at least for American economic thinkers, blogging yields high returns — even from an economists’ strictly utilitarian, efficiency-maximizing perspective.
When the Federal Reserve announced back in August that it expected to keep interest rates at very low levels until at least mid-2013, three top policymakers voted against the decision — and a number of non-voting officials grumbled as well. St. Louis Fed President James Bullard is one prominent critic of the policy, arguing in a speech last month it ties the central bank down unnecessarily and potentially threatens its credibility if conditions require a course correction:
The Federal Reserve’s long-quiet doves are becoming increasingly louder about championing more aggressive forms of monetary easing, including possibly setting employment and inflation targets and/or engaging in another round of bond purchases. Most prominent among these have been Charles Evans, the Chicago Fed president who openly favors more transparent policy guidance and Eric Rosengren, who told CNBC on Wednesday a third round of monetary easing could be in store:
Poor people have shorter life spans and more health problems than the wealthy. Surprising? For growth-obsessed economists, yes actually. A new study from The Organization for Economic Cooperation and Development represents a worthy attempt to move economics away from its traditional tendency to equate growth with well being. Its rankings suggest factors other than the rate of gross domestic product expansion are important in determining quality of life.
Europe on the brink. United States risks double-dip recession. Financial turmoil threatens world economy. Not the sort of headlines you would associate with a Nobel-prize-winning contribution to the progress of humanity. To their credit, recipients Christopher Sims of Princeton and Thomas Sargent of New York University did develop methods and models that are wisely used by economists around the world, including central banks. But it’s unclear what practical applications their findings have for the world’s current economic predicament.