Thursday, August 18, 2011

Good thoughts from Tyler Cowen

He writes:

"There is nothing in the (very useful) data cited by Mulligan, in his posts on supply and employment, which runs against the Keynesian story. Of course I am a fan of the blogosphere, but sometimes it frightens me when I see it having influence over research interpretations. We’re just a small number of apes sitting at computers, relative to the overall literature. When it comes to Keynesian economics, I don’t always see we apes as reflecting the broader literature very well, yet we are read by a relatively large number of apes. We can expect this problem to get worse, as people learn the “blogosphere versions” of different points of vew."

Nothing Mulligan has been saying runs againts Keynesianism: check.

We are just smart primates and should never forget that: check.

Blogosphere versions of economic theories really distort peoples' perception of the science: check.

The one thing that Cowen didn't get right in my view is what I didn't quote here - he apparently thinks Mulligan is accurately portraying Krugman's view of Keynesianism. This is wrong, of course, and I think Cowen is probably just throwing a bone to his GMU colleagues. I've never heard Krugman say that supply somehow doesn't matter. He's said that changes on the supply side are unlikely to help much right now. This is true. He's said that the main problem right now is demand. This is true. He's never said anything like supply doesn't matter for output and employment, and he's certainly never said that relative differences labor supply of the sort that Mulligan has been pointing to don't express themselves in labor market outcomes (i.e. - higher teen labor supply in the summer results in higher teen employment in the summer, high consumer demand around Christmas results in higher consumption around Christmas, etc.).

1 comment:

  1. For the record, according to Linnaeus (now long dead and buried of course) we're "wise" apes.


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