But you would also find a sizable group of economists who thought the Fed could and should do far more than it was doing. This group, known as doves, tilts liberal, though it includes conservatives as well. If anything, it can probably claim a larger number of big-name economists — J. Bradford DeLong, Paul Krugman (an Op-Ed columnist for The New York Times), Christina D. Romer, Scott Sumner and Mark Thoma, among others — than the camp that believes the Fed has done too much.Seems like he's taking a poll, and then calculating some weighted average to come up with a conclusion, with the weights determined by numbers of blog-readers.
What's happening in monetary policy and macroeconomics.
Sunday, August 28, 2011
This comes from Dissecting the Mind of the Fed, by David Leonhardt, in the Sunday NYT:
Posted by Stephen Williamson at 8:14 AM
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The hawks should start blogging. Right now the position is mostly represented online by Austrians, along with fellow travelers with little understanding of economics.ReplyDelete
I don't think Sumner was a "big name" before he started blogging. Although I would say he is the best econ blogger of recent years. Tyler Cowen has lots of posts, but many aren't economics and about half are just link collections (not that I'm complaining).
That's... pretty absurd. Sumner and Thoma in particular aren't exactly "big name", though they've gotten a solid amount of recognition through their blogs. That's not an attack on them, I like Sumner quite a bit and find his non-monetary blog posts to be fantastic. And it is rather odd how few freshwater people blog. I know of Stephen, Andolfatto, and Casey Mulligan. (And if you're reading this David, blog more damnit)ReplyDelete
This is rather off topic Stephen, but while I was doing a mental run-down of my guess at the monetary opinions of relatively well known economists I thought of John Cochrane. What is your opinion on the fiscal theory of the price level?
"If anything, it can probably claim a larger number of big-name economists — J. Bradford DeLong, Paul Krugman (an Op-Ed columnist for The New York Times), Christina D. Romer, Scott Sumner and Mark Thoma, among others ..."ReplyDelete
What? No Robert B. Reich?
Oh my aching head.
I wasn't going to go on about the rest of the article, but I did not like the hawks/doves characterization. He framed the ideas as if this was just a matter of what point you choose on the Phillips curve. There are "hawks" who like inflation less relative to unemployment than the "doves." I don't think that was at heart of what the dissenters on the FOMC (Kocherlakota and Plosser at least) were objecting to.ReplyDelete
On the "big names," leaving Sumner out of it, if you look at the human capital investment in macroeconomic reasoning and central banking practice, Kocherlakota and Plosser have the big names beaten by a long shot, don't you think?
I wrote about Cochrane's stuff here:
No one seemed to pay it any attention though.
"...Kocherlakota and Plosser have the big names beaten by a long shot, don't you think?"ReplyDelete
Well, Kocherlakota and Plosser are certainly bigger names in macro -- as far as I can see -- than Krugman and DeLong, who made their very significant contributions in trade/geography and history, respectively.
Perhaps I am overlooking something. I must admit that I haven't read every Krugman or DeLong paper, or even anything close.
I agree with your implicit criticism of the article as being simplistic. But that is what newspaper articles are about.
Well, there's simple, and then there's wrong.ReplyDelete
Probably the biggest name in monetary economics could be added to the "big name" list: Michael Woodford. He has come out several times now on the pages of the FT for more monetary stimulus via a price level target. I'd say Woodford has Plosser and Kocherlakota beaten by a long shot.ReplyDelete
What the article really shows, though, is that what makes one an influential economist is no longer limited to just academic journal publishing.
Don't be too dismissive of Krugman. He has an influential paper on liquidity traps and the importance of monetary policy managing expectations.ReplyDelete
This raises an interesting question, which of course is not new. Leonhardt is not quite a lay person, as he has at least an undergraduate education in economics. But how can a lay person sort out the wheat from the chaff in the modern world. So as not to be impolite, I won't name names, but there is much out there in the blogosphere that is widely read, but would not pass muster as sound economics in the academic community.ReplyDelete
In this case, someone mentioned Woodford, whose work is indeed influential - it altered central banking practice - and Woodford has recently been commenting on monetary policy in public:
Why didn't Leonhardt talk to Woodford?
"Don't be too dismissive of Krugman. He has an influential paper on liquidity traps and the importance of monetary policy managing expectations."
That paper is "influential" in Krugman's own mind. From a monetary economist's point of view, it's a homework exercise - nothing new there that Charles Wilson did not tell us about in 1979.
Woodford is incorrect in his FT piece to suggest that QE1 helped markets by providing a buyer for markets that were not functioning.ReplyDelete
The purchase announcements made big impacts on asset prices that were different than the purchased assets, indicating a portfolio balance effect. If the Fed made a surprise announcement of QE3 in the $500 billion + range, you would see markets move again.
I've no wish to carry water for Kocherlakota or Plosser but I must disagree with the anonymous commenter that "Woodford has Plosser and Kocherlakota beaten by a long shot" if that means that Plosser and Kocherlakota are ill equipped to argue with Woodford. I doubt that.
But all three are swimming so far above me in the food chain that they are indistinguishable from the depths I inhabit.
"But all three are swimming so far above me in the food chain that they are indistinguishable from the depths I inhabit."ReplyDelete
If only most of the commenters here, as well as nobodies like Thoma and Sumner, could grasp this fact as well as Chris does.