Author Archives: John Taylor
Higher Investment Best Way to Reduce Unemployment, Recent Experience Shows
Some economists argue that the efforts now underway to reduce government spending as a share of GDP will have adverse effects on unemployment. This is not what the data show. Consider this chart which shows the pattern of government purchases … Continue reading
Posted in Fiscal Policy and Reforms
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Higher Investment Best Way to Reduce Unemployment, Recent Experience Shows
Some economists argue that the efforts now underway to reduce government spending as a share of GDP will have adverse effects on unemployment. This is not what the data show. Consider this chart which shows the pattern of government purchases … Continue reading
Posted in Fiscal Policy and Reforms
Comments Off on Higher Investment Best Way to Reduce Unemployment, Recent Experience Shows
Historical Evidence on the Benefits of Rules-Based Economic Policies
Each year since 1948 the American Economic Association and the American Finance Association hold a joint luncheon with an invited speaker. Over the years the luncheon has grown to a very large affair usually held in the big hotel ballrooms. … Continue reading
Posted in Teaching Economics
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New Revealing Study of FOMC References to the Fed’s Mandate
Dan Thornton of the Federal Reserve Bank of St. Louis just completed a very revealing paper called What Does the Change in the FOMC’s Statement of Objectives Mean? in which he traces FOMC references to the Fed’s mandate over many … Continue reading
Posted in Monetary Policy
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A Very Good Year for Economics Videos, Especially Cartoons
Short video clips are a good way to get students interested in economics and help them understand the basics. I especially like the Golden Balls video for teaching game theory and Milton Friedman’s classic telling of the pencil story for … Continue reading
Posted in Teaching Economics
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Models Used for Policy Should Reflect Recent Experience, But Do They?
Data from the Department of Commerce show that short-term stimulus funds did not go to increase federal purchases, or state and local purchases, or even consumption purchases by much over the past few years. Thus the packages did not materially … Continue reading
Posted in Stimulus Impact
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Impacts of Proposed Changes in the Fed’s Mandate
A few weeks ago Paul Ryan and I wrote an article proposing changes in the Federal Reserve Act. One change would require the Fed to focus on “the single goal of long-run price stability within a clear framework of overall … Continue reading
Posted in Monetary Policy
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Putting New Fed Policy in the Economics Textbooks
Every Friday the economists at JP Morgan issue a useful compendium of facts and analysis called Global Data Watch. I’ve been reading GDW for many years, and I recall the days when it was only available in the paper edition. … Continue reading
Posted in Teaching Economics
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Futures Market Forecast of a Federal Funds Rate Increase Likely to be Appropriate
According to the federal funds futures market, the Fed will begin raising rates sometime next year—with the federal funds rate reaching about ½ percent by December 2011. In fact, rising rates next year has been the implicit forecast of the … Continue reading
Posted in Monetary Policy
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Stimulus Math: Many Multiples of Nothing is Still Nothing
In an article in tomorrow’s Wall Street Journal, John Cogan and I review our research showing why the 2009 stimulus package did little to stimulate the economy, despite its large size. The reserch continues our earlier work showing why the … Continue reading
Posted in Stimulus Impact
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Economics One 