A discussion of “A Skeptic’s Guide to Modern Monetary Theory” A sexy new economic theory appeared in the last few years promising us that government debt really is nothing to worry about. Modern Monetary Theory (MMT) says a nation that spends, taxes and borrows in a fiat currency they control…
Category: Macroeconomics
Macroeconomics
Consumer Reaction to the Pandemic Shutdown Shock
A Discussion “Initial Impacts of the Pandemic on Consumer Behavior” Here is an early look at the impact on consumers’ income, spending and savings behavior from the dreadful economic shock of the coronavirus pandemic and shutdown. As an economist, I never would have said it was possible to shut down…
Macroeconomics
Why Countries Rich with Resources can be so Poor and How to Prevent It
A Discussion of “Does Information Break the Political Resource Curse? Experimental Evidence from Mozambique” It seems logical that a country with no resources would be poor, so it seems puzzling when a country rich in resources is poor. However, Armand, Coutts, et al. (2020) note the Resource Curse, defined as…
Macroeconomics
More Robots Mean More Riots?
A Discussion of “Rage Against the Machines: Labor-Saving Technology and Unrest in Industrializing England” “Machines are going to take all the jobs,” is a sentiment I hear and read often. As an economist, I know this is not true. There will be disruption. Some jobs will be lost. Some jobs…
Macroeconomics
Do Economists Go Too Far Arguing for Free Trade?
A Discussion of “Deconstructing the Argument for Free Trade” “If all the economists were laid end to end, they still would not reach a conclusion.” “What happens when you get 10 economists in a room? You get 11 opinions.” Or the old story of President Truman wishing for a one-armed…
Macroeconomics
Can Emerging Market Economies Prevent Importing a Financial Crisis?
A Discussion of “When Do Capital Inflow Surges End in Tears?” Post World War II the “Powers that Be” set about building an economically interdependent global world order, governed by institutions like the IMF, the WTO and the World Bank, with the intention of preventing future global wars. If a war…
Macroeconomics
Who is Winning the Trade War?
A Discussion of “Who’s Paying for the US Tariffs? A Longer-Term Perspective” The Trump tariffs on China will lead to inflation, job losses and the end of the world as we know it! OK, a bit much, but sometimes reading the news feels more like click bait. As an economist,…