Posted: 04 Jan 2015 12:06 AM PST
Posted: 03 Jan 2015 10:33 AM PST
"Rather than point fingers outward, we should look inward":
The Measuring Sticks of Racial Bias, by Sendhil Mullainathan, NY Times: The deaths of African-Americans at the hands of the police in Ferguson, Mo., in Cleveland and on Staten Island have reignited a debate about race. Some argue that these events are isolated and that racism is a thing of the past. Others contend that they are merely the tip of the iceberg, highlighting that skin color still has a huge effect on how people are treated.
Arguments about race are often heated and anecdotal. As a social scientist, I naturally turn to empirical research for answers. As it turns out, an impressive body of research spanning decades addresses just these issues — and leads to some uncomfortable conclusions and makes us look at this debate from a different angle. ...
Posted: 03 Jan 2015 10:02 AM PST
In defence of NGDP targets: Tony Yates had recently written a couple of posts (here, and here, but see also the discussion with Andy Harless on the second) slamming the idea of NGDP targets. (From now on I assume this refers to targeting the level of NGDP.) Now you might think that NGDP targets do not need any support from lukewarm advocates like me, given all the supporters in the econ blogging world. That would be wrong, because - as Tony rightly says - most advocates of NGDP targets tend to argue in a model free way. Both he and I want to stay close to the academic literature, at least as a starting point.
I think Tony is wrong when he says that "the case for levels based targets – including NGDP levels targets – is, both practically and analytically, extremely weak". In making such a claim, Tony should be very worried that one of the supporters of NGDP targets is Michael Woodford, who literally wrote the book on modern monetary theory. ...
After explaining, he concludes with:
Having said all this, it is great that Tony is opening up the discussion on the correct level, so we can get away from what often seems like faith based arguments for NGDP targets. I think the framework that he seems to have in mind is also the correct one: the ultimate policy target would be inflation (and the output gap: I would want a dual mandate), and NGDP would be an intermediate target to achieving welfare maximising paths. So I hope this discussion continues. My one last plea is that arguments make clear whether a NGDP targeting regime is being compared to some form of optimal policy, or policy as currently practiced: as I suggest here these are (unfortunately) different things.
Yates replies here.
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