American Economic Policy, as told by Martin Feldstein at Harvard University: Lecture 2, Where are we? How did we get here? What next?

~ MilesCorak ~ 1 Comment

Martin Feldstein American Economic Policy Harvard January 27 Lecture 2 Graphing Housing Prices

What caused the Great Recession, and could it happen again? These are the questions that motivate Martin Feldstein in the second lecture of his course “American Economic Policy” given to undergraduates at Harvard.

The good professor suggests that the housing sector is where we should look for an answer, and that we should appreciate that public policy played a role in both causing the recession, and in helping the American economy recover from it. But also important policy changes putting this sector on a more stable footing were reversed for political reasons, and this raises the risk that it could all go terribly wrong again.

Where are we? How did we get here? What next?

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American Economic Policy, as told by Martin Feldstein at Harvard University: Lecture 1, Introduction to Economics 1420

~ MilesCorak ~ 5 Comments

Martin Feldstein Harvard University“This is a remarkable year for studying economic policy in the United States.”

That is how Martin Feldstein began his course “American Economic Policy” for undergraduates at Harvard University. I’ve gone in cognito and hope all the 20 year olds will not notice me—well not really.

It is just one of several courses I’ll audit this spring semester, and besides it was not too hard to hide in the overflowing room, standing room only at least for this first day of class.

Feldstein is a player in US economic policy. The biography on his website says:

From 1982 through 1984, Martin Feldstein was Chairman of the Council of Economic Advisers and President Reagan’s chief economic adviser. He served as President of the American Economic Association in 2004. In 2006, President Bush appointed him to be a member of the President’s Foreign Intelligence Advisory Board. In 2009, President Obama appointed him to be a member of the President’s Economic Recovery Advisory Board.

Since I am slated to teach a similar course at the University of Ottawa next year after my academic leave is over, it makes sense to see how the Harvard professor handles the big macro-economic issues of our time. So every Monday, Wednesday, and Friday morning it is back to undergraduate economics for me, and I’ll post my edited class notes if you want to follow along, learn some macro-economic theory, and develop an appreciation of the economic challenges facing the United States (and presumably other rich countries).

During the first class Professor Feldstein posed the big questions and issues the course will tackle, as well as laying out some of the administrative  ground work.

Economic theory and practical lessons for measuring equal opportunities

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High Level Expert Group Workshop on Inequality of Opportunity January 2015 Paris OECD
High-Level Expert Group, January 2015, Paris

I’ve written a working paper based upon a presentation I made in January 2015 to a workshop on “Inequality of Opportunity” held by the High-Level Expert Group on the Measurement of Economic Performance and Social Progress. The OECD, which was one of the organizations co-hosting the workshop, is currently reviewing the paper for publication.

You can download the current draft here, and I’d invite any comments before it is finalized and officially released.

You can view the workshop agenda and all the presentations here. The broader program of the Expert Group, which includes the development of “distributional National Accounts”—national accounting that recognizes inequality and the distribution of income—can be found at this link.

What follows for quick reference is the introduction of my paper. If you have a chance to read the whole thing and have some thoughts to make it better, feel free to include your suggestions in the comment section at the end of this post, or email them to me.

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Inequality: a fact, an interpretation, and a policy recommendation

~ MilesCorak ~ 4 Comments

Tackling inequality and poverty aren’t mutually exclusive; rather, efforts devoted to fighting the former contribute to solving the latter.

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The OECD Centre for Opportunity & Equality will address some important questions

~ MilesCorak ~ 4 Comments

OECD Centre for Opportunity & Equality Launch Agenda

The OECD is continuing to expand its highly regarded work on inequality by launching a new research centre. The announcement will be formally made in Paris on Monday with a series of panel discussions, featuring economists, policy makers and government officials from a number of countries. I’m pleased to be a participant, but I’m looking for advice on how to answer to some questions that may be asked. I’d love to hear your ideas, so send them along.

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Are Canadian progressives showing Americans the way?

~ MilesCorak ~ 7 Comments

Reflecting on the recent outcome of the Canadian election, in which the Liberal Party of Canada cast itself as a progressive left of center party and reversed its fortunes in a major way to win a strong majority government, Larry Summers wrote in the Washington Post that “More infrastructure investment is not just good economics. It is good politics. Let us hope that American presidential candidates get the word!”

Anyone who has heard Mr. Summers speak over the course of at least the last five years will be familiar with his message, that he can’t imagine a better time—with historically low interest rates, lower wages, and higher unemployment—to be investing in the country’s infrastructure. Just when would be a better time to revamp Kennedy airport, and the nation’s roads, bridges, and dams, than now?

Paul Krugman echoes the same sentiment in a New York Times column entitled, somewhat inappropriately, “Keynes Comes to Canada.”

Good economics it is, and not simply for pump-priming reasons in the old Keynesian way. If there is a rock solid case to be made for productivity improving public investments, it should be made regardless of the state of the macro-economy.

But as the obvious frustration in the tone of Mr. Summers’ voice suggests, the fact that his advice does not lead to policy, suggests good economics doesn’t always line up with good politics. And there are a number of peculiarities in both personalities of political leaders, and the structure of politics, suggesting the Canadian example does not automatically translate to the American setting.

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