A very important paper by Summers and DeLong on fiscal policy in a severely depressed economy. I even knew it was coming - just a crazy week.
This, along with Krugman's prescient 1998 paper on Japan, are going to be two crucial pillars of the "New Old Keynesianism". Let's hope that awful name doesn't stick, but this crisis is going to make a big impact on thinking about the macroeconomy, just like the 1930s and the 1970s did, and this is going to be the narrative that you're going to need to be familiar with.
Sunday, March 25, 2012
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Why, thank you...
ReplyDeleteI do think you probably exaggerate our likely influence. I myself oscillate between (a) thinking that we have merely a special case and (b) thinking that we have a really-important central case; between (a) thinking that what we have is knew and (b) thinking that it is something that everybody has known since Abba Lerner; and between (a) thinking that our arithmetic is so powerful and striking that it must silence all critique and (b) thinking that there is some powerful opposing point that we have somehow overlooked...