Raghav

@econ_robinson @erhanBLC @mean_field_zane Does anyone in MMT have an argument for how you can avoid currency devaluations (and thereby currency induced inflation) if you follow sustained YCC?

@raghav50k @erhanBLC @mean_field_zane Which MMTer advocates for autarky?

The intellectual dishonesty of MMTers is more infinite than their plans for the inflation rate.

@econ_robinson @erhanBLC @mean_field_zane Plenty - yet to find any solution on how to avoid currency-devaluation induced inflation that would result from widespread YCC….outside of Nathan Tankus’ outright ban on foreigner sales of FX and general autarky

@raghav50k @erhanBLC @mean_field_zane What're you read about MMT and inflation?

@econ_robinson @erhanBLC @mean_field_zane Would that change the fact that fiscal spending is still constrained by inflation, which MMT has no credible ability to respond to, since it has no meaningful model of how currencies would respond to YCC?

@erhanBLC @mean_field_zane Fed and Tsy are important to the US and global economy. Beyond just academic interest, if econs are interested in improving economic outcomes, they should know how things actually work.

@talmonsmith @ArmandDoma It went viral entirely over its $140K = poverty line assertion. That’s the only reason it came on your timeline instead of more thoughtful benefits cliff analysis. Giving it oxygen because it aligns with your priors really diminishes the credibility of NYT econ reporting, frankly

@ArmandDoma the honest issue isn't with the precise numbers. somebody from EPI or the MIT project could've cleaned up his assertions in edits. and if it went viral the same centreright/left folks would've been mad. the real beef is over fears of undue doomerism becoming even more popular

great story from WaPo. "poverty" line nitpicks aside, Mike has started a great debate thats triggered so much of the center-left & center-right officialdom - which has stuck with "no no things are better than ever you masses are too dull & IG Jealous to realize" even after Nov24

@HalSinger @besttrousers @surlygopher @mattyglesias @superwuster @jasonfurman Assuming - based on the evidence you linked to on movie theaters and popcorn - there *is* demand correlation between concessions and admission tickets, why would the stadium owner leave the captured producer surplus from a beer price cap on the table?

For Matt’s thesis (price caps on beer put upward pressure on ticket prices) to work, you must assume (aside from the demand correlation point) that the entity setting beer prices is the same as the one setting ticket prices. Else there is no guarantee that the vendor will choose the jointly profit maximization price for beer. I acknowledge that the stadium owner could establish price floors for all vendors (to prevent competition), and capture the inflated beer prices via a tax, but that might draw the attention of regulators.

I take back "dumb" and replace it with "simplistic, overly stylized, and dated." The three questions you raise actually have more bearing on the policy question, as opposed to the simplistic assumption that a seller in one market can raise prices at will to make up for regulated prices by another seller in an adjacent market.

@varma_ashwin97 @Afinetheorem @binarybits @superwuster The other is that even if these are separate monopolies, access to consumers is gated by the stadium, and so the pricing power would pass thru to the stadium rather than consumers. Given how dynamic stadium pricing tends to be, no reason to assume ticket prices will remain sticky

@Afinetheorem @binarybits @superwuster Reading through, the only contention he makes imo that isn't captured by this quite simple logic is the idea that the ticket selling stadium is not the same business entity as the vendors, while this analysis assumes they are pricing jointly.

This is just dumb and shows a failure to understand buyers. Assuming fans have a fixed total budget is a fallacy. If the stadium could charge more for tickets it would.

@policytensor 200 datapoints seems quite small though - how many independent country-time-period cells have you included here? (I.e: non-overlapping years per country)

With DW is close to 2, I feel more comfortable about my predictive estimate of 2pp faster growth per 1pp of change in world share on average per annum over the previous 2yr period: export success sensu stricto.

The issue is not static; it is dynamic. Specialization/revealed comparative advantage is a formidable predictor of growth rates. Every 1pp gain in high-tech export share predicts 2pp higher RGDP growth*!

@MattBruenig @jaxgriot @samth @aarmlovi Why is desert defined as a unit of utility sacrifice and not as a unit of utility provided to the consumer of your savings?

I want to steelman @MattBruenig's viral-dunked "risk" quote. He intended something interesting: Every generation gets the same ex ante risk advice: "put your 401k in S&P500" But morally arbitrary timing of a few years in the same index will enrich or bankrupt your retirement

@AliceFromQueens @PortmanToes Two people who give up the same number of units of consumption deserve the same expected return because their sacrifice helps fulfil an equivalent amount of demand for immediate consumption/investment in society

@PortmanToes the only argument here is about what ppl deserve. no one fails to understand what a market is or a price is

This is the proprietary method I use to select among S&P 500 ETFs. It's a very difficult job and I deserve to be well compensated for all the value I bring society with my ingenious allocations

@MattBruenig @klAhfziadue @AliceFromQueens @BayesianNuance @DeusMozzarella @Duderichy Your argument here is premised on defining TVOM by utils, not units sacrificed. Would you support desert in redistribution being defined in terms of utils not units?

bwahahahahahahahahahahahahahahaha

@MattBruenig @a19grey @jaxgriot @AlexGodofsky What they *do* is fulfil the needs of those who seek to invest/consume now rather than later. As that person’s needs are no more fulfilled by consumption that is foregone as a greater sacrifice, sacrifice isn’t the scale used to judge desert

Bruenig is treated like a serious econ policy commentator in left-of-center circles, but one of his longest-held principles, which inspires much of his positioning on issues, is rejection of the time value of money.

@arpitrage It’s path dependence: each default/credit episode exacerbates conditions for the next. Credit episode -> risk premia rise -> fiscal space is squeezed -> you have political incentives to try unorthodox debt management -> creditors fear getting squeezed -> rinse /repeat

Seems weird we have all these countries in the world but ~only Argentina is a somewhat developed country which struggles with fiscal/monetary/currency issues this badly. I’m a bit aware of the details, but don’t really have a framework for why just them

@ritwik_priya @Akshay_VAK @Blankname1982 @swarajk_ Seems like the need for monetary and fiscal easing is clear, IMO the question is whether cash transfers have the highest fiscal multiplier (esp with the political economy risks of creating new programs that become hard to scale back in the future ala fertiliser subsidies)

So a variety of reasons - some structural e.g. government bodies/ military procuring a larger number of replacement items at historical prices, or some purely technical like path dependence (100-175-200 leads to a different chain weighting of index vs 100-125-200) or simply the evolution of consumption baskets during a period for change, may lead to a deflator that is not representative of the underlying price trend of the private economy. If you are stabilising aggregate demand, you should have a lower variance NGDP series than RGDP series, because nominal spending is your closest thing to 'hard directly measured reality' in national income stats. (This is what Swaraj is saying wrt nominal is real. You can aggregate 100 rs of jeans with 100 rs of eggs into 200rs of consumption. Inferring eggs and jeans from 200 and a price index has more errors) This does not mean it should hit a point estimate or that higher is always better (the Pak/ Turkey or UPA-2 examples). But if you have: 1. multiple successive sub 10% readings for an economy that used to do 12-13% regularly, and should be doing 11-12% given our 'realistic ambitions', and 2. we also know that credit growth, real wage growth, rural consumption etc were weak (before the ladlis took off), and 3. we know that govt has policy space given CAD, FX reserves and Russia oil windfall Then....the Swaraj conclusion follows.

this is what peak performance looks like 🤣

@swarajk_ This is true of all interventions - all to say 0.1 SD impacts for an ECD program aren’t necessarily ground-breaking.

@swarajk_ Implementation isn’t the only thing that changes when things get scaled up - impacts may be transitory and fade a few years down the line, there may be socioeconomic variation that blocks impact channels, you can also have localized GE effects that an RCT can’t measure etc etc

shocking that cash transfers work

@arpitrage @paulnovosad Their version of shock therapy was better implemented because (a) Poland had a private sector thru the 80s, so the shift to a price system wasn’t as much of a shock and (b) they were lucky in that they got to see (and avoid) the worst of shock therapy before they privatised SOEs

@paulnovosad Why do you think this happened to Poland more so than other former Communist areas like East Germany or Ukraine?

Polish growth was more about removal of stupid communist policies than about any special policy. They had the human capital, social institutions, all the right inputs — when 50 years of repression stopped, they could go back to the predicted income level given their inputs.

@pseudoerasmus The demographics are not quite the explanation in till 2008 no? Japanese GDP per working age adult lagged most of the G7 through most of the 90s-00s

@RajaKorman academic.oup.com/qje/article-ab…

@RajaKorman Farhi and Maggiori had a paper on this a few years ago, arguing that safe asset providers may be less willing to roll the dice with Triffin Dilemma sunspots if they did not have a monopoly over convenience yields - leading to safe asset scarcity and forced deleveraging

Why is the stability impact of a multihub regional currency system worse than the stability impact of a single central currency system where real & financial cycles are more likely to diverge? Would Poland be better off invoicing, borrowing and lending in $ than in €?