This is so far the most informative discussion on the (in)famous fiscal stimulus I've happened onto: a recent, 1 hour long, panel discussion within the Myron Scholes Global Market Forums at the University of Chicago Booth School of Business, having as panelists U. of Chicago professors John Huizinga, Kevin Murphy and Bob Lucas. My favourite is Kevin Murphy (and here I am in total agreement with Steven Levitt, see below for his blogpost and more details), though Huizinga and Lucas have also extremely interesting and pertinent points. Don't miss the questions-answers part in the end either, again particularly for Murphy's answers. Here's the video, and here are the PDF presentations of each of the speakers (to be used while listening to the respective speeches): Huizinga's, Murphy's, Lucas's.
Hat tips to Greg Mankiw and Steven Levitt.
4 comments:
Funny thing:) I have been postponing watching this video for days until I found today the time to watch it and the goddamn stream didn't want to load beyond the first 2 minutes. So I took a break to read my feeds and here I am:) OK, now it seems to be streaming correctly. Bye:)
Yep, smth. not to miss. Especially for Kevin Murphy, of course. See also Luigi Zingales\s question at some point in the question-answers part, indeed quite funny that nobody seems interested to address the problem the other way...
I think Luigi Zingales's point about fear and saving and exporting more is very good. In the same time you corroborate this with the idea the this recesion is like no other, that it's global and just beginning to hit the economy - nobody knowing how hard will it hit - and you get the whole picture of extreme urgency where something needs to be done and fast and form this idea of energic political action needed which leads to fiscal stimulus, because that's what governments do best. You got the irony, of course. And that's why long term - I'd say more efficient - measures are being overlooked in favour of short term measures of doubtful effciency.
The problematic issue here is why the Obama government with such a good team of economic advisers is going this way at full speed. Well I read some ideas of how and why... Anyways, this takes us back to our discussion in November about supporting Obama exactly because he managed to get together a good team of advisers. I was skeptical then about Obama, I've been getting more and more skeptical about his presidency during the last weeks after reading tons of economists views about the fiscal stimulus. I overlook here the foreign policy of the US, of course. I still think - or hope - that he's got enough margin to minimise the damage. Of course this doesn't give any information about what McCain would have done - it is a completely useless question now, I agree - but I think the current situation provides some good lessons for my future political choices.
Yes, that is why I said you should pay attention to Zingales's question. Zingales, Caballero and a few others, really pinned down the problem and addressed it realistically, I think, so I follow what these people write/say as often as I can.
Now to your point of why this is happening> think it like this, they will have had this fiscal stimulus going through anyway, so better you do get some advice on it, rather than everybody just deciding to stay apart (I mean, economists) because this would be nonsense. Part of that fiscal stimulus is not nonsense, obviously, and some people in Obama's team are not just smart, but extremely smart (Summers would be my top example here). The rest depends on what you assume about the world--and if top economists disagree a lot on this, you can imagine how much more disagreement there is elsewhere-- as Murphy has very well shown. In all cases, the good part of this, if any, is that it is a very exciting time for the Economics profession. This is really a real world lab :-).
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