Becker and Murphy on the Stimulus Package
Gary Becker and Kevin Murphy write today in The Wall Street Journal about their concerns regarding the stimulus package. There are no two economists in the world who I respect more than Becker and Murphy. Whatever your political bent, when these two write something, you should think hard about their arguments. Read More »
The Great California Prison Experiment
The A.C.L.U. has done it again, but this time on a grand scale.
I published an academic paper back in 1996 that tried to measure the impact that changes in the prison population have on the crime rate. It turns out that this is a hard question. Read More »
Tax Cuts vs. Government Spending
As the Senate and the House look to reconcile competing stimulus plans, the big debate is whether to emphasize government spending or tax cuts. A new paper by the New York Fed’s Gauti Eggertsson argues that the risk of deflation should tilt the balance to government spending. Our current problem is deficient aggregate demand. The Read More »
"Cash for Clunkers" Gets Scrapped
Reuters reports that the “cash for clunkers” program, which I criticized in an earlier blog post, has been removed from the stimulus package. I wish I could say that the reason for abandoning the program was that policymakers had come to understand the likely adverse economic consequences of the program. The real explanation, as usual, Read More »
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