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David Landes

Greg Mankiw's Blog - Sep 13

Here is the NY Times obituary of the great Harvard economic historian .

Who predicted the sluggish economy?

Greg Mankiw's Blog - Sep 12

Robert P. Murphy looks back .

A Striking Labor Market Fact

Greg Mankiw's Blog - Sep 6

John Lott points out the following: "So far this year there have been 848,000 new jobs. Of those, 813,000 are part time jobs.... To put it differently, an incredible 96% of the jobs added this year were part-time jobs." Update : Here is the CEA take on this general topic.  And this is from the San Francisco Fed.  I found the following chart of interest.   Part-time employment as a share of total employment for selected groups This shows that part-time work is notably higher than it has been historically ...

Ronald Coase has died

Greg Mankiw's Blog - Sep 3

Here is the news from the University of Chicago .

Marginal Tax Rates under Obamacare

Greg Mankiw's Blog - Sep 3

Back in 2009, I pointed out in a NY Times column that President Obama's healthcare reform would involve substantial increases in implicit marginal tax rates.  I am delighted that Casey Mulligan is now giving the issue some serious attention in two new NBER working papers ( here and here ).  He reports: This paper calculates the ACA’s impact on the average reward to working among nonelderly household heads and spouses. The law increases marginal tax rates by an average of five percentage points (of ...

Don't 'Fight for Fifteen'

Greg Mankiw's Blog - Sep 2

U Chicago's Allen Sanderson opines on the minimum wage . Addendum : And here is an interesting new contribution to the empirical literature on minimum wages .

My Climate Action Plan

Greg Mankiw's Blog - Aug 31

Click here to read my column in Sunday's NY Times .

A Class Act

Greg Mankiw's Blog - Aug 30

A profile of Stanley Fischer .

Good News from the Marketplace

Greg Mankiw's Blog - Aug 30

It is the beginning of a new academic year, and I am pleased to report that my favorite textbooks are still selling well .

Repression in China

Greg Mankiw's Blog - Aug 29

A professor in China brings this story to my attention: A renowned professor has confirmed online rumours that his peers will decide whether he will be expelled from China's most eminent university after he made a series of remarks in favour of free speech and constitutional governance.   Economics professor Xia Yeliang of Peking University was told by his department that his fate would be decided by a faculty vote, he told the South China Morning Post on Monday.   "They told me it's because of all the ...

Macroprudential Regulation

Greg Mankiw's Blog - Aug 27

A wise column from John Cochrane .

Free Bikes and Girls' Education - Update

Greg Mankiw's Blog - Aug 25

Last year, I posted a video about some new research on how giving bicycles to girls in a India increased their educational attainment.  Here is an update. (And here is the paper.)

I am Ray Fair

Greg Mankiw's Blog - Aug 20

Or at least we agree on most things, according to this website , which identifies which economist on the IGM Forum your opinions are most similar to.

An Economist Gets Pregnant

Greg Mankiw's Blog - Aug 17

Emily Oster looks at the evidence .

The One Percent

Greg Mankiw's Blog - Aug 12

The JEP Symposium on The Top One Percent is now available online .

Wisdom from Raghu Rajan

Greg Mankiw's Blog - Aug 10

"For economists who actively engage the public, it is hard to influence hearts and minds by qualifying one’s analysis and hedging one’s prescriptions. Better to assert one’s knowledge unequivocally, especially if past academic honors certify one’s claims of expertise. This is not an entirely bad approach if it results in sharper public debate. "The dark side of such certitude, however, is the way it influences how these economists engage contrary opinions. How do you convince your passionate ...

A Debate over Obamacare

Greg Mankiw's Blog - Aug 9

Casey Mulligan versus David Cutler

A New Job for Raghu Rajan

Greg Mankiw's Blog - Aug 6

He's becoming a central banker .

Obamacare versus the Faculty

Greg Mankiw's Blog - Aug 3

I don't know how widespread this phenomenon is, but I thought I would share an email I received this morning : I have been teaching multiple sections of economics for four years now at several Colleges and Universities in the State of Indiana. I have also been a frequent user of your texts in the classes that I teach. With the implementation of the ACA (Affordable Care Act) these institutions are giving notification to their part-time faulty that their individual teaching schedules will now be limited to ...

Ec 10 Bleg

Greg Mankiw's Blog - Aug 3

As part of our "marketing" effort to get freshmen into ec 10, Harvard's introductory economics course, the ec 10 staff and I are trying to construct a list of famous alums of the course. Here is the list we have put together so far: Steve Ballmer Ben Bernanke Lloyd Blankfein Ryan Fitzpatrick Jeremy Lin Sheryl Sandberg Eduardo Saverin Chuck Schumer Cameron Winklevoss Tyler Winklevoss Mark Zuckerberg If you attended Harvard and have a famous classmate who you are sure took ec 10 (or its predecessor ec 1), ...


Greg Mankiw's Blog - Aug 1

If you are a member of the American Economic Association, you probably received an email this morning about the election of AEA officers. Please vote. It is your patriotic duty, or something like that. Information about the candidates is available here .

Stan and His Students

Greg Mankiw's Blog - Jul 31

When Stan Fischer was a professor at MIT, he was one of the all-time great advisers to those of us in the process of becoming macroeconomists.  At a recent conference, Stan took a picture with some of his former students.  Here is the snapshot.  How many can you recognize?

On Au

Greg Mankiw's Blog - Jul 27

Click here to read my column in Sunday's NY Times . The topic is whether you should invest in gold as part of your portfolio.  After you read the column, you might find the following problem of interest.  It is based on roughly plausible assumptions. Imagine that you start off with a portfolio of 60 percent stocks and 40 percent bonds.  The returns on stocks, bonds, and gold are uncorrelated.  Stocks earn a higher expected return than bonds.  Bonds and gold earn the same lower expected return, but ...

Is Technopessimism Bunk?

Greg Mankiw's Blog - Jul 27

Yes, says Joel Mokyr .

A Tale of Two Political Systems

Greg Mankiw's Blog - Jul 26

Here is a fascinating TED talk about the Chinese political culture.  It takes about 20 minutes. Addendum : And here is a thoughtful commentary on the talk.

Geography and Mobility

Greg Mankiw's Blog - Jul 25

A former student, M. Daniele Paserman, who is now a professor at Boston University, sends me the following email, which I thought was interesting enough to share (with permission, of course): I bumped into your blog post on the Great Gatsby curve, and I was happy to see you raise the point about the arbitrariness of imposing geographic boundaries in measuring intergenerational mobility (why should one lump Connecticut and Mississippi together?) Claudia Olivetti and I raise a similar point in our recent ...

Capital Income Taxation

Greg Mankiw's Blog - Jul 23

Alan Viard offers his perspective on this key debate.

The Changing Distribution of Income

Greg Mankiw's Blog - Jul 19

Click on graphic to enlarge.    Mark Perry points out : "Yes, the middle class has been disappearing, but they haven’t fallen into the lower class, they’ve risen into the upper class."

Observations on the Great Gatsby Curve

Greg Mankiw's Blog - Jul 18

In recent years, some economists have drawn attention to a correlation that has been dubbed the Great Gatsby curve .  In particular, countries that have more inequality in income also have less economic mobility.  (By the way, the curve seems misnamed: Jay Gatsby lived in a time a great inequality and managed to move from being very poor to being very rich.  But never mind that.) My own view is that this correlation is not particularly surprising.  Let me give you an analogy to explain why. Suppose ...

Who will the next Fed chair be?

Greg Mankiw's Blog - Jul 15

Janet Yellen is the odds-on favorite .

The Fed's First 100 Years

Greg Mankiw's Blog - Jul 10

I spent today at the NBER's conference celebrating the 100th anniversary of the Federal Reserve. Among the conferences I have attended over the years, this was among the best. You can find the papers presented here .

Who should the next Fed chair be?

Greg Mankiw's Blog - Jul 9

A friend points out to me that the monkeys over at Economics Job Market Rumors are voting whether they would prefer Janet Yellen or Larry Summers as the next Fed chair.  Right now, it is close to a tie.

Summers on the Corporate Tax

Greg Mankiw's Blog - Jul 8

On the issue of corporate tax reform, Larry Summers tries to forge a compromise : The United States should eliminate the distinction between repatriated and unrepatriated foreign corporate profits for U.S. companies and tax all foreign income (after allowances for taxes paid to other governments) at a fixed rate well below its current corporate rate, perhaps in the range of 15 percent.


Greg Mankiw's Blog - Jul 4

Over on his blog , Paul Krugman calls attention to the Cengage bankruptcy.  I am not sure why he thinks this event is noteworthy.  He seems to do so because Cengage is the publisher of my favorite textbook . I suppose it is schadenfreude on Paul's part. If you are interested in the topic, I suggest you read this article .  The short story is that this is a Chapter 11 bankruptcy (a reorganization), not a Chapter 7 bankruptcy (a liquidation).  These are very different things. In this case, the equity holders ...

The New CEA Chair

Greg Mankiw's Blog - Jun 29

Click here to read my column in Sunday's NY Times .

Economic History at MIT

Greg Mankiw's Blog - Jun 28

Peter Temin tells the story in a new paper called The Rise and Fall of Economic History at MIT .


Greg Mankiw's Blog - Jun 24

An excerpt from a new poetry collection on economics : An Economist Economists study how society produces and distributes its scarce resources. An economist pretends to know Why things are made and how they flow. He studies men’s biggest woe, He wants it all, what to forego. Like a machine with unseen gears Through greed a solution appears. By making what men hold most dear Profits are earned by serving peers. To boost theirs and the common's gain Become experts in their domains. To make one thing well ...

Focus on Bank Liabilities, Not Bank Assets

Greg Mankiw's Blog - Jun 24

John Cochrane has a great column in today's Wall Street Journal on how to create a better banking system.  He says that we should focus on the nature of bank liabilities (demand deposits, in particular) rather than on the riskiness of bank assets. Back in 1993, in my discussant's comments on an Akerlof-Romer article on the savings and loan crisis, I made a similar argument.  Here is an excerpt of what I then wrote: Traditional banks are peculiar institutions. Traditional banks have depositors who want ...

More on the One Percent

Greg Mankiw's Blog - Jun 23

If you enjoyed reading my forthcoming JEP paper , you might also enjoy It’s the Market: The Broad-Based Rise in the Return to Top Talent by Steven N. Kaplan and Joshua Rauh, which emphasizes complementary themes. An excerpt: We believe that the U.S. evidence on income and wealth shares for the top 1 percent is most consistent with a “superstar”-style explanation rooted in the importance of scale and skill-biased technological change. In particular, we interpret the fact that the top 1 percent is ...

Will summer camp make my kids rich?

Greg Mankiw's Blog - Jun 23

Paul Krugman , commenting on my recent article , thinks it is noteworthy that the rich have increased their spending on child enrichment programs.  To me, that is not a surprise.  The incomes of the rich have risen, and this category of spending, like many others, has a positive income elasticity. I am a parent of three, and as far as I know, Paul does not have any children.  So I have probably spent a lot more on this category than he has.  And I can report that much of it is consumption, not investment. ...

The Left on Just Deserts

Greg Mankiw's Blog - Jun 21

I just got an email from the left-leaning Economic Policy Institute regarding their work on inequality.  I was struck by this passage : Since the 1970s, the United States has become increasingly unequal in terms of income, wages, wealth and opportunity. Today, 1 percent of Americans are taking home nearly 20 percent of the country's total income and own nearly 35 percent of the country's wealth. This means that you (yes, you!) are probably making less money than you deserve to.* Notice the emphasis on what ...

In Defense of Me

Greg Mankiw's Blog - Jun 20

My new paper on the One Percent has generated a fair amount of Internet commentary.  I won't respond to the critics. Time is scarce, and I am busy with other projects. For better or worse, I will leave the paper to speak for itself. (I should note that my paper is part of a forthcoming JEP symposium. I have not seen all the other papers, but from what I have seen, the symposium should offer a good, balanced group of perspectives.) Regarding all that Internet commentary, I did enjoy this defense from Matt ...

Defending the One Percent

Greg Mankiw's Blog - Jun 15

Click here to read my new essay "Defending the One Percent," which is forthcoming in the Journal of Economic Perspectives .

An All-Harvard CEA

Greg Mankiw's Blog - Jun 13

With the news that Betsey Stevenson is joining the CEA, the three-member board will now have two Harvard PhDs and a Harvard professor. Just saying.... Update : A friend points out, "Actually, we have had an all-Harvard CEA for some time since Betsey is replacing Katharine Abraham (a Harvard Ph.D.) and Jason is replacing Alan Krueger (a Harvard Ph.D.)."

The Jason Furman Fan Club

Greg Mankiw's Blog - Jun 10

AEI Chapter . Update : Here the President's announcement of Jason's appointment.

Landsburg versus Krugman

Greg Mankiw's Blog - Jun 8

Paul Krugman says a Heritage Foundation economist is dishonest . Steven Landsburg says, not so fast .

A Commencement Address

Greg Mankiw's Blog - Jun 1

This morning I gave the commencement address at the Chapel Hill-Chauncy Hall School, from which my older son just graduated.  You can read the speech here . Update : A video is posted here .

CEA Chair

Greg Mankiw's Blog - May 28

Rumor has it that my friend and former student Jason Furman will be the next chair of the Council of Economic Advisers.  If true, that is great news.  Jason is smart, knowledgeable, and sensible.  He does not come to the job with as long an academic track record as other recent picks, but he has far more policy-relevant experience and expertise.

Dear Paul

Greg Mankiw's Blog - May 25

My Harvard colleagues Carmen Reinhart and Ken Rogoff have written an open letter to Paul Krugman . ( pdf version ) Addendum : Jim Hamilton and David Warsh weigh in.

Weitzman on Climate Change

Greg Mankiw's Blog - May 23

Wisdom from my Harvard colleague Marty Weitzman .

On Stock Investing

Greg Mankiw's Blog - May 18

Click here to read my column in Sunday's NY Times .

Christy Romer on Japan

Greg Mankiw's Blog - May 14

Last month, I had the pleasure of hearing Christy Romer give a great talk about Japanese monetary policy at the NBER Macro Annual conference.  You can now read it here .

The ZLB in My Favorite Textbook

Greg Mankiw's Blog - May 13

In a recent blog post , Paul Krugman writes: As far as I know, among basic textbooks only Krugman/Wells even talks about the liquidity trap. This is probably a true statement.  It is not that other books don't cover the topic, however.  It is just that Paul Krugman doesn't know it. FYI, here is what the leading introductory text says about the topic: The Zero Lower Bound   As we have just seen, monetary policy works through interest rates. This conclusion raises a question: What if the Fed’s target ...

Stocks are cheap

Greg Mankiw's Blog - May 9

...say two NY Fed economists .   

Fiscal consolidation: At what speed?

Greg Mankiw's Blog - May 5

From Olivier Blanchard and Daniel Leigh.

Preventing the Next Catastrophe

Greg Mankiw's Blog - May 3

Wisdom from David Romer .

Stevenson-Wolfers on Reinhart-Rogoff

Greg Mankiw's Blog - Apr 30

They write : In the end, all the corrections advocated by the critics shift the average GDP growth for very-high-debt nations to 2.2 percent, from a negative 0.1 percent in Reinhart and Rogoff’s original work. The finding remains that economic growth is lower in very-high-debt countries (see chart). It has been disappointing to watch those on the left seize on the embarrassing Excel errors but ignore this bigger picture. Click on graphic to enlarge.  

Snapshots from the Performance

Greg Mankiw's Blog - Apr 28


The President as Financial Planner

Greg Mankiw's Blog - Apr 28

He and Michelle seem inattentive to their own finances : The Obamas paid $45,046 in mortgage interest in 2012, which appears from the disclosure statement to be at a 5.625% interest rate with Northern Trust. That suggests an outstanding principal balance of about $800,000.  On the other hand, the bulk of their investments are in Treasury notes. Based on the disclosures, I estimate they hold about $3 million in Treasury notes (also held by Northern Trust), yielding 0.71% if averaging a five-year maturity.  ...


Greg Mankiw's Blog - Apr 23

Several people have asked me to comment on the coding error found in one of the Reinhart-Rogoff papers. I have avoided the topic, since I don't think I have a lot to add to the discussion.  But because so many people have asked, here are a few observations: 1. Everybody makes mistakes. I once made an analytic error in one of my published papers and, after it was pointed out to me, subsequently wrote a correction  ( published version ).  Finding and correcting errors is a part of the research process.  ...

A Reading for the Pigou Club

Greg Mankiw's Blog - Apr 23

Europe's Cap-and-Trade Scheme Failing Spectacularly

More Endorsements

Greg Mankiw's Blog - Apr 22

From Megan Amram, Tommy Amaker, and Larry Summers . More to come at this link in the coming days.

Help a Student!

Greg Mankiw's Blog - Apr 17

A student I know (specifically, my older son) is trying to collect some survey data.  Click here if you are willing to participate .  The survey will take about 15 minutes. Update : No more data is needed.  Thanks to the more than 1000 of you who participated.

Beethoven's Fifth

Greg Mankiw's Blog - Apr 15

A performance not to be missed .

Rethinking Macro

Greg Mankiw's Blog - Apr 14

The IMF is holding a conference "Rethinking Macro" on April 16-17.  You can watch a live webcast.  Click here for information .

Congratulations, Raj

Greg Mankiw's Blog - Apr 12

My Harvard colleague Raj Chetty has won the John Bates Clark Medal .

Economics Teaching Conference

Greg Mankiw's Blog - Apr 11

For information about submitting papers or registering, click here .

Solow on Bernanke

Greg Mankiw's Blog - Apr 9

In The New Republic , with thoughtful and thought-provoking commentary on the financial system.

The President's Latest Bad Idea

Greg Mankiw's Blog - Apr 6

Apparently , President Obama's budget is going to include some kind of penalty for people who have accumulated more than $3 million in retirement accounts.  The details are not yet known, but I think we know enough to say that this is a terrible idea. A sizable body of work in public finance suggests that consumption taxes are preferable to income taxes.  Completely replacing our tax system with a better one is, however, hard.  Retirement accounts, such as IRAs and 401k plans, are one way our tax code has ...

Help Me Revise

Greg Mankiw's Blog - Apr 1

My duties as chairman of the Harvard economics department have left me too little time to work on textbook revisions. As a result, I have decided to crowdsource the next edition. Anyone who wants to make a change in the book is free to do so. Like Wikipedia. If you want to learn more about how you can participate in the revision, click here . Yes, this was an April 1 joke.

The Long-run Budget Path

Greg Mankiw's Blog - Mar 30

Click here to read my column in Sunday's NY Times .

Yale Journal of Economics

Greg Mankiw's Blog - Mar 30

Students at Yale have started a new journal, called the Yale Journal of Economics , which aims to publish the best undergraduate papers, not just from Yale, but from any school. Click on the link to read the first issue or to find out how to submit.  The editors hope professors will encourage their students who write noteworthy papers to send them in. Yesterday, I had the pleasure of being the featured speaker at the event where the inaugural issue was released.  Below is a picture of me with the new ...

What is the purpose of insurance?

Greg Mankiw's Blog - Mar 28

A friend points me to this passage : At a White House briefing Tuesday, Health and Human Services Secretary Kathleen Sebelius said some of what passes for health insurance today is so skimpy it can't be compared to the comprehensive coverage available under the law. "Some of these folks have very high catastrophic plans that don't pay for anything unless you get hit by a bus," she said. "They're really mortgage protection, not health insurance." I have the same problem with my other insurance policies.  My ...

Stand-Up Economist is Cancelled

Greg Mankiw's Blog - Mar 25

Due to the recent tragic events in Boston.

Swagel on Scheiber

Greg Mankiw's Blog - Mar 22

Phill Swagel reviews Escape Artists by Noam Scheiber on President Obama's first term . 

The Economist as Advice Columnist

Greg Mankiw's Blog - Mar 19

Ask Emily is slated to be the economist's version of Dear Abby .

The Economist as Civil Libertarian

Greg Mankiw's Blog - Mar 16

Tyler Cowen's new column in the NY Times reminds us that the worldview of economists often extends beyond economic issues.

The Best Job Opportunity Ever

Greg Mankiw's Blog - Mar 15

The Harvard economics department is now recruiting teaching fellows for its popular undergraduate principles course, Ec 10, for the next academic year.   If you are a Boston-area graduate student with a solid background in economics, please consider interviewing for the chance to introduce the next Andrei Shleifer, Ben Bernanke, or Marty Feldstein (all former Ec 10 students) to the power of economic thinking.   If interested, email for more information and to request application ...


Greg Mankiw's Blog - Mar 15

The Economic Report of the President was released today .

Caplan on Card

Greg Mankiw's Blog - Mar 15

In a blog post about the minimum wage , Bryan Caplan makes note of a tension in some of David Card's research.  For those who don't know him, Card is one of the great empirical labor economists of his generation.  In some of his research , joint with Alan Krueger, Card finds that increases in the minimum wage have negligible effects on employment.  In other research , on the Mariel boatlift, Card finds that increases in the supply of unskilled workers have negligible effects on wages and employment of ...

New Rankings

Greg Mankiw's Blog - Mar 12

US News and World Report has released its updated rankings of graduate programs in economics.  Click here to see them .  The top programs are: #1 Harvard #1 MIT #1 Princeton #1 Chicago #5 Stanford #5 UC-Berkeley #7 Northwestern #7 Yale #9 Penn #10 Columbia #11 NYU #11 Minnesota #13 Michigan #13 Wisconsin #15 Caltech #15 UCLA #15 UC-San Diego #18 Cornell #19 Brown #19 Carnegie Mellon #19 Duke


Greg Mankiw's Blog - Mar 11

Jeff Sachs on Paul Krugman Bill Gates on Acemoglu and Robinson Thanks to our friends over at Marginal Revolution for both pointers.

Greg Ip's Little Book

Greg Mankiw's Blog - Mar 7

A terrific, very quick, and nontechnical introduction in economics (more macro than micro) is Greg Ip's Little Book of Economics .  In case you don't know him, Greg writes for The Economist magazine and was previously at the Wall Street Journal .  He now has a new edition  of his book, together with an online guide to suggested readings .

Comic of the Day (Not completely fair, but funny nonetheless)

Greg Mankiw's Blog - Mar 5

Update : A reader suggests an edit of the above Bastiat-inspired comic.

Christy Romer on the Minimum Wage

Greg Mankiw's Blog - Mar 3

In today's NY Times .  I agree with a lot of it.  She concludes with a view that is common among economists: An expansion in the earned income tax credit would be a lot better than an increase in the minimum wage.  I would have added a related fact: Over the years, we have already seen substantial expansions in the EITC.  (See below.) Since we already have the better policy, let's not pursue the worse one. Source .

A Lecture on Income Inequality

Greg Mankiw's Blog - Mar 2

From UC Berkeley economist Emmanuel Saez. It takes about 40 minutes.

Working Before Grad School

Greg Mankiw's Blog - Mar 1

A student emails me a question: I have read all the advice on your blog, and have not found an answer to the following question. With some modifications I think it's a question a few pre-PhDs from Harvard/MIT/etc. have, so I hope I'm not being too selfish in asking. Suppose, for the sake of argument, that I have good reason to believe I'm in the top 1% of academic-economists-to-be in my generation, possibly better. Suppose further that I want to devote my career to important, and mostly policy-relevant, ...

Gender and Human Capital Returns

Greg Mankiw's Blog - Feb 23

Here is an interesting fact: Women earn a higher rate of return from a college degree than men.  In particular: After controlling for various demographic factors, the researchers found that female graduates earned more than $6,500 more per year than women with just a high school diploma, and more than $4,500 more than women who dropped out of college. Male graduates, by contrast, earned only about $2,700 more than high school graduates, and about the same amount as male college drop-outs.   The findings ...


Greg Mankiw's Blog - Feb 20

If you are a high school student, or teach economics to high school students, you most definitely will want to click here .

A Profile of Stanley Fischer

Greg Mankiw's Blog - Feb 17

In the Washington Post .  Stan was my PhD dissertation adviser.

Why $9?

Greg Mankiw's Blog - Feb 16

Since the State of the Union address, the minimum wage has heated up again as a political issue.  You can read my previous posts on the topic by clicking here .  (Unfortunately, some of the links in these old posts are now dead.) There is one question I would like to see some reporter ask Alan Krueger, the president's chief economist: How did they decide that $9 per hour is the right level?  Why not $10 or $12 or $15 or $20?  Presumably, the president's economic team must believe that the adverse ...

Econ Summer Camp

Greg Mankiw's Blog - Feb 12

Those with an interest in the history of economic thought might want to consider this summer program .  I have been told that the program is designed primarily for faculty members in economics, other social sciences, and the humanities, though three of the twenty-five slots are reserved for graduate students.

The Growth of the Welfare State

Greg Mankiw's Blog - Feb 12

Source . Click on the graphic to enlarge.

Give Me Your Tired, Your Poor, and Your Economists, Too

Greg Mankiw's Blog - Feb 9

Click here to read my column in Sunday's NY Times .

An economist breaks up with his girlfriend

Greg Mankiw's Blog - Feb 7

...when it is the utility-maximizing thing to do .

Are Google Ads Racially Biased?

Greg Mankiw's Blog - Feb 6

Chapter 19 of my favorite textbook has a case study on research establishing that resumes with names more common in the black community get less response from employers than resumes with names more common in the white community.  Today's Boston Globe has a related article about the results you get when you google a person.

An Econ Conference for Undergrads

Greg Mankiw's Blog - Feb 2

In April at Georgetown .  Click through if you might be interested.

Congratulations to Jim Stock

Greg Mankiw's Blog - Feb 1

President Obama has appointed my Harvard colleague Jim Stock to be a member of the Council of Economic Advisers.

Summer School in Economic Theory

Greg Mankiw's Blog - Feb 1

Grad students in economics can  click here to learn about 2013 Jerusalem Summer School in Economic Theory. It is ten-day program run by my Harvard colleague Eric Maskin.

Revising History

Greg Mankiw's Blog - Jan 30

From Econ Journal Watch : Paul Krugman Denies Having Concurred With an Administration Forecast: A Note by David O. Cushman Abstract In a previous article for Econ Journal Watch, I attributed to Paul Krugman a concurrence with the optimistic economic forecast put forward in early 2009 by the incoming Administration. Krugman reacted by denying that he had concurred with that forecast, pointing to a blog entry of his from January 2009. But Krugman apparently did not read my paper. It concerned not a blog ...

He didn't know the secret handshake

Greg Mankiw's Blog - Jan 29

Some news from across the atlantic: Fake Portuguese economist unmasked And to some lighter news out of Portugal, where a fake economist duped the nation for months. Our correspondent Giles Tremlett reports: Artur Baptista da Silva had become one of the most authoritative voices on Portuguese television, using his experience as an economist and United Nations consultant to explain why so much austerity was bad for the bailed-out country's economy. But now it turns out that the 61-year-old economist who ...

Is the financial sector too large?

Greg Mankiw's Blog - Jan 27

Here are two attempts at addressing this question: Robin Greenwood and David Scharfstein . John Cochrane .

A Reading for the Pigou Club

Greg Mankiw's Blog - Jan 24

From the National Journal .

Allocating Inauguration Tickets

Greg Mankiw's Blog - Jan 20

Here is a good topic for class discussion. Background: The Congress allocates free tickets to the presidential inauguration, often by lottery.  Some winners of the lottery try to sell them for thousands of dollars.  Senator Schumer objects  to the resale. Question 1: When David,  a lottery winner, sells his ticket to Anne, both David and Anne are better off.  Who is worse off? Question 2: Senator Taxcut proposes auctioning off the tickets and rebating the revenue lumpsum to all taxpayers.  Who would be ...

The Gains from Trade

Greg Mankiw's Blog - Jan 17

A story of how a model employee outsourced his own job .

A Comic on GDP Accounting

Greg Mankiw's Blog - Jan 15

A friend recommends this comic as a way to motivate a class discussion of GDP.

Very Quick Reviews

Greg Mankiw's Blog - Jan 14

My older son and I saw Zero Dark Thirty over the weekend.  Great movie.  On par with Argo .  Much better than Lincoln , which seems to be the Oscar favorite. By the way, I have heard that the revival of Pippin I saw and loved is moving to New York after its Boston run is over.  Highly recommended.

A Reading for the Pigou Club

Greg Mankiw's Blog - Jan 9

And also about the Pigou Club, from the NY Times .

How much are your taxes going up?

Greg Mankiw's Blog - Jan 4

The Tax Policy Center has a calculator to answer that question .

ASSA Humor Session

Greg Mankiw's Blog - Jan 3

Many of the world's professional economists are spending the next few days in San Diego for the annual ASSA meeting, where economists network, get some publicity for themselves, and learn what other economists are up to. I am skipping this year's meeting to spend more time with family.  You might think that is lazy of me.  But heck, my marginal tax rate just went up.  A bit of extra laziness is optimal. If I were there, one event I would certainly attend is the annual humor session.  Here is some ...

The Dearth of Bestselling Economists

Greg Mankiw's Blog - Jan 3

Last October, Amazon introduced a new feature: a list of bestselling authors, aggregating across all books an author has written. Here is the list of the top 100 authors. For an economist, perusing the list is a humbling experience. As far as I can tell, not a single member of our profession made the list.  I wonder whether Galbriath might have made it in his day, as he had written a large number of books accessible to general audiences. But these days, not a single one of us has wide enough readership to ...

Tax Progressivity: Update

Greg Mankiw's Blog - Jan 2

Here are the effective federal tax rates (total taxes as a percentage of income) for 2013 under the new tax law, as estimated by the Tax Policy Center , for various income groups: Bottom fifth: 1.9 Second fifth: 9.5 Middle fifth: 15.6 Fourth fifth: 19.0 Top fifth: 28.1 80-90 percentile: 21.5 90-95 percentile: 23.4 95-99 percentile: 26.3 Top 1 percent: 36.9 Top 0.1 percent: 39.6

Anne Pringle

Greg Mankiw's Blog - Jan 1

All ec 10 students know David Johnson, the course's charismatic head teaching fellow.  What they likely do not know is that David's lovely wife, Anne Pringle, is also on the Harvard faculty.  Today's NY Times has an article about Anne and her research .

President rejects his bipartisan commission

Greg Mankiw's Blog - Jan 1

The fiscal deal struck last night makes one thing clear: President Obama must have really hated the recommendations of the bipartisan Bowles-Simpson commission that he appointed. The commission said that we needed to reform entitlement programs to rein in spending and that increased tax revenue should come in the form of base broadening and lower marginal tax rates. The deal appears to offer no entitlement reforms, no tax reform, and higher marginal tax rates. After all the public discussion over the past ...

The Neverending Quest for a More Redistributionist Tax System

Greg Mankiw's Blog - Dec 31

I just listened to President Obama's latest remarks on fiscal policy .  This passage caught my attention: I want to make clear that any agreement we have to deal with these automatic spending cuts that are being threatened for next month, those also have to be balanced, because, remember, my principle always has been let’s do things in a balanced, responsible way. And that means the revenues have to be part of the equation in turning off the sequester and eliminating these automatic spending cuts, as ...

Maybe the Rs and Ds are both wrong

Greg Mankiw's Blog - Dec 29

Click here to read my column in Sunday's NY Times .

Theater Recommendation

Greg Mankiw's Blog - Dec 28

For those in the Boston area: Yesterday, my family and I enjoyed one of our Christmas presents from Santa and went to the new production of the musical Pippin at the American Repertory Theater in Cambridge. I recall seeing the original Broadway production in the 1970s when I was in high school and liking the play then. I went to see it yesterday with a bit of trepidation, wondering whether my sensibilities had changed too much over the past four decades for me to still enjoy it. But the play did not ...

Glaeser on Disability

Greg Mankiw's Blog - Dec 27

Ed considers what might be behind this fact: Thirty years ago, there was a 40-to-1 ratio between the total labor force and those workers receiving Social Security disability payments. Today that ratio is less than 18-to-1.

A Reading for Christmas

Greg Mankiw's Blog - Dec 24

My favorite Christmas-themed economics article is this one by Steve Landsburg . From 2004, but truly timeless.

A Krugman Puzzler

Greg Mankiw's Blog - Dec 24

I often disagree with Paul Krugman, but I usually understand him.  Lately, however, I have been puzzled about his view of the bond market.  In a recent post , he takes President Obama to task for believing that the failure to deal with our long-term fiscal imbalance might cause a spike in interest rates: America can’t run out of cash (except politically, if Congress refuses to raise the debt ceiling); it basically can’t experience an interest rate spike unless people see an increased chance of economic ...

Russ Roberts talks with John Taylor

Greg Mankiw's Blog - Dec 23

Previous installments are here .

Asness on Buffett

Greg Mankiw's Blog - Dec 17

Warren may be a great investor, but he really doesn't cut it as a policy wonk .

Feldstein on the Fiscal Cliff

Greg Mankiw's Blog - Dec 14

Marty offers his recommendation .

Interpreting the Fed

Greg Mankiw's Blog - Dec 13

My friend and sometime coauthor Larry Ball sends me his quick analysis of the Federal Reserve's recent announcement: I think the FOMC announcement is big news: for the first time, the Fed clearly says it will be more dovish in the future than the pre-crisis Taylor Rule (TR) dicates. In my estimation, the pre-crisis TR is something like the following for the real interest rate r: r = 2.0 - (1.5)(u-u*) + (0.5)(pi-2.0). Let’s say u* is still 5.0. Then if u=6.5 and pi=2.5, the TR says r = 0, which ...

Option C

Greg Mankiw's Blog - Dec 12

In the negotiations over the fiscal cliff, many people think the House Republicans are in a tough spot.  The logic is that they have little leverage, because they face only two choices: A. Concede to most of the president's demands. B. Take the economy over the cliff, and get blamed for it. As a result, the logic goes, they will end up doing A, because B is so much worse. Keith Hennessey points out that there is also option C: Extend the tax cuts, except at the top, for one year. Apparently (and I was not ...

The Poverty Trap in France

Greg Mankiw's Blog - Dec 11

From Forbes : Let’s take an unemployed mother living alone with two children between six and 10 years old. In 2010, there were 284,445 French families in this situation that were on welfare. This mother will be given the “Active Solidarity Income.” Since she has two children, the amount will be $1,100. If she is renting an apartment with a $650 rent, she will be given the “Housing Customized Aid,” amounting to $620. Then she will receive “Family Allowances,” which amounts to another $160. ...

Make Your Own Deficit-Reduction Plan

Greg Mankiw's Blog - Dec 11

The Wall Street Journal's interactive graphic lets you choose from a menu of options .

She's German. He's Greek. It's Christmas.

Greg Mankiw's Blog - Dec 10

Click here for the previous installment.

Fiscal Cliff Fact of the Day

Greg Mankiw's Blog - Dec 9

As reported in the NY Times : Even if Republicans were to agree to Mr. Obama’s core demand — that the top marginal income rates return to the Clinton-era levels of 36 percent and 39.6 percent after Dec. 31, rather than stay at the Bush-era rates of 33 percent and 35 percent — the additional revenue would be only about a quarter of the $1.6 trillion that Mr. Obama wants to collect over 10 years.

Deck the Halls

Greg Mankiw's Blog - Dec 6

Not quite fair to Keynesianism, but fun nonetheless:

An Unfortunate Broken Promise

Greg Mankiw's Blog - Dec 5

Back in 2008, when President Obama was running for his first term, he promised to be a post-partisan leader.  While a Democrat, he said he would accept good ideas when they came from Republicans.  At the time, I believed him, at least to some degree.  And I wrote about it in this NY Times column . Sadly, I was wrong.  The short version of the story is this: As a candidate, President Obama campaigned on a platform of raising taxes on the rich.  Yet he and his economic advisers also said they wanted to raise ...

A Reading for the Pigou Club

Greg Mankiw's Blog - Dec 3

From The New Yorker .  One disappointing quotation: "We would never propose a carbon tax, and have no intention of proposing one," [White House spokesman Jay] Carney told reporters.

Some Advice on Tax Planning

Greg Mankiw's Blog - Dec 3

I don't normally give advice on personal finances, but in light of the fiscal situation we are facing, I will pass along one tidbit.   Consider converting some of your retirement savings into a Roth IRA . Over the past few years, I have converted all that I can, which is about half of my retirement savings.  To make the best of a Roth conversion, you need liquid assets outside of retirement accounts to pay the resulting tax liability.  But if you can do this, you will shelter more of your savings from ...

Why the President is Not So Keen on Just Limiting Deductions

Greg Mankiw's Blog - Dec 1

From the White House blog .  Bottom line: If you apply a $25,000 deduction cap only to households with income above $250K, phase in the cap gradually as income rises above $250K, and exclude charitible giving from the cap, you increase revenue by only $450 billion over ten years.

The Gray Lady's Misleading Headline

Greg Mankiw's Blog - Nov 30

Over my coffee this morning, I read the following headline on the front page of The   New York Times : "Complaints Aside, Most Face Lower Tax Burden Than in the Reagan ’80s."  Below it was a graphic comparing average tax rates for various income groups in 1980 and 2010. The problem is that Reagan did not become president until January 1981, and his tax policy was not fully implemented until a couple of years later (and arguably not until his second term, when we got very significant tax reform).  So the ...

Quick Movie Reviews

Greg Mankiw's Blog - Nov 29

Over the last week, I saw two of the movies that critics have been raving about: Lincoln and Argo .  Lincoln was okay but a bit disappointing compared to expectations.  It is too hagiographic for my taste.  Argo was great.

The Coming Tax Hikes

Greg Mankiw's Blog - Nov 28

Donald Marron of the Urban-Brookings Tax Policy Center explains the tax increases that are part of the upcoming fiscal cliff.

Dividing Household Chores

Greg Mankiw's Blog - Nov 28

Advice from economist Emily Oster .  A good reading to assign when teaching the theory of comparative advantage.

Michael Sandel and His Critics

Greg Mankiw's Blog - Nov 27

My Harvard colleague Michael Sandel has been getting a lot of attention lately with his book What Money Can't Buy: The Moral Limits of Markets. To get a flavor of the debate, read A short essay by Michael Sandel . A review of his book by economic historian Deirdre McCloskey . A commentary from erstwhile ec 10 sectionleader Jodi Beggs . A review by Chicago's Raghu Rajan .

A Master of Tax Avoidance

Greg Mankiw's Blog - Nov 26

Warren Buffett has an op-ed in today's NY Times on one of his most popular themes: The rich should pay more in taxes.  At first blush, his position seems noble: A rich guy says that people like him should pay more to support the commonweal.  But on closer examination, one realizes that Mr Buffett never mentions doing anything to eliminate the tax-avoidance strategies that he uses most aggressively.  In particular: 1. His company Berkshire Hathaway never pays a dividend but instead retains all earnings.  So ...

Solow on Hayek and Friedman

Greg Mankiw's Blog - Nov 26

From The New Republic .

Slugging It Out, Inside Obama’s Mind

Greg Mankiw's Blog - Nov 24

Click here to read my column in Sunday's NY Times .

Response to Diamond and Saez

Greg Mankiw's Blog - Nov 21

In a widely discussed recent paper , Peter Diamond and Emmanuel Saez have suggested that the top tax rate should be very high--about 73 percent.   Tax Notes has a new commentary on their conclusion .

The U.S. has a flat tax (in effect)

Greg Mankiw's Blog - Nov 18

The Congressional Budget Office has a new study of effective federal marginal tax rates for low and moderate income workers (those below 450 percent of the poverty line).  The study looks at the effects of income taxes, payroll taxes, and SNAP (the program formerly known as Food Stamps).  The bottom line is that the average household now faces an effective marginal tax rate of 30 percent.  In 2014, after various temporary tax provisions have expired and the newly passed health insurance subsidies go into ...

Should we repeal anti-gouging laws?

Greg Mankiw's Blog - Nov 12

A great topic for class debate.  Some readings: John Carney says yes . (Also, look here .) Mark Thoma raises concerns about fairness . (Also, look here .) Carney replies to Thoma .

An Interview with Eugene Fama

Greg Mankiw's Blog - Nov 11 Bob Litterman .  (A great piece to assign undergrads when teaching about financial markets and institutions.)

How To Raise Tax Revenue From The Rich Without Increasing Tax Rates

Greg Mankiw's Blog - Nov 10

According to the Tax Policy Center, if we cap itemized deductions at $50,000 and keep tax rates as they are today, we would raise $749 billion in tax revenue over ten years.  Moreover, according to the TPC's  distribution table , 96.2 percent of the extra revenue would come from the top quintile, with 79.9 percent from the top one percent. This may be the germ of a possible deal between President Obama and Speaker Boehner: The speaker agrees to this tax hike if the president agrees to some fundamental ...

No Exit

Greg Mankiw's Blog - Nov 7

With the President reelected and the House and Senate largely unchanged in composition, the first thought that came to my mind was the classic Sartre play No Exit , with President Obama, Speaker Boehner, and Majority Leader Reid playing the three characters.


Greg Mankiw's Blog - Nov 6

Today is the day. If you are a reader of this blog, it is a good bet that you are better informed than average on the key economic issues of the day. So get to the polls. BTW, for two of my three children, this is the first presidential election in which they can vote.

The State of Neuroeconomics

Greg Mankiw's Blog - Oct 31

An assessment of a new, promising field .  (HT to MR).

Tax Expenditure Fact of the Day

Greg Mankiw's Blog - Oct 28

The NY Times reports : [T]he people who tend to derive the greatest dollar benefit from the mortgage interest deduction are households earning $100,000 to $500,000 a year.   “About two-thirds of the total benefit go to that group in the 80th through the 99th income percentiles,” Mr. Rosenberg said.   For those households, by the center’s calculations, the tax benefit of the deduction amounts to about 1.5 percent of after-tax income. By way of comparison, the value to households earning $40,000 to ...

Al Smith Dinner Talks

Greg Mankiw's Blog - Oct 27


The Effects of Government Debt on Growth

Greg Mankiw's Blog - Oct 26

An analysis from Stanford's Michael Boskin .

Harvard Conservatives

Greg Mankiw's Blog - Oct 24

No, it is not an oxymoron, but a new blog .

Blinder and Mankiw Webcast

Greg Mankiw's Blog - Oct 22

Alan Blinder and I will be speaking at the 8th Annual Gulf Coast Economics Association Teaching Conference on November 8th and 9th, 2012.  Even if you can't make it to the conference in Orlando, Florida, you can watch us via a free webcast.  For more information, click here .

John Taylor versus Paul Krugman

Greg Mankiw's Blog - Oct 19

Taylor: Simple Proof (of weak recovery) Krugman criticism: Financial Crisis Denialism Taylor response: Weak Recovery Denial

College Still Pays

Greg Mankiw's Blog - Oct 18

A nice, accessible analysis of the economics of higher ed from Michael Greenstone and Adam Looney .

People Respond to Incentives

Greg Mankiw's Blog - Oct 17

Even in France : France's new 75 percent income tax on the rich may not be popular with millionaires. But it's being cheered by another group: Paris real-estate buyers. Real estate agents say that the number of multi-million-dollar real-estate listings in Paris has jumped more than 25 percent over last year -- due in part to the threat of the new income tax....[B]rokers say the 75 percent tax on the wealthiest French citizens has contributed to the decision by many of the them to sell their homes in ...

Optimal Tax Policy

Greg Mankiw's Blog - Oct 16

A group of top economists was asked  what they thought about this statement: "Taxing capital income at a permanently lower rate than labor income would result in higher average long-term prosperity, relative to an alternative that generated the same amount of tax revenue by permanently taxing capital and labor income at equal rates instead." There was not unanimity, but about three times as many economists agreed than disagreed.

Roth and Shapley

Greg Mankiw's Blog - Oct 15

Congratulations to Al Roth and Lloyd Shapley for winning the Nobel Prize today!  It is well deserved. FYI to teachers of introductory economics:  I use Al's article on Repugnance as a Constraint on Markets as an ancillary reading in ec 10.

The Value of Consensus Building

Greg Mankiw's Blog - Oct 15

As seen by Larry Summers : "If there is no consensus on the causes or solutions to serious problems, it is unreasonable to ask a political system to implement forceful actions in a sustained way. Unfortunately, this is to an important extent the case with respect to current economic difficulties, especially in the industrial world."

Paul Ryan's Early Aspirations

Greg Mankiw's Blog - Oct 11

"As a young man, Ryan held numerous amusing summer jobs, including a stint as an Oscar Mayer salesman in which he drove a Wienermobile. He envisioned eventually going to the University of Chicago for an advanced degree in economics and becoming an economist/academic, but he says he 'kept getting lured into politics.'" Source .

An Interview with John List

Greg Mankiw's Blog - Oct 9

A nice discussion of his research using field experiments .

The Two Labor Market Surveys

Greg Mankiw's Blog - Oct 6

If you go to the recent release from the BLS , you can find these two sentences a few paragraphs apart: Total employment rose by 873,000 in September. Total nonfarm payroll employment increased by 114,000 in September. To a layman, this may seem confusing.  The first statement suggests a robust labor market, the second a more lackluster one.  What is going on? The issue is that there are two surveys.  The first estimate of employment comes from the survey of households; the second is from the survey of ...

Swagel on Bair

Greg Mankiw's Blog - Oct 1

University of Maryland economist Phill Swagel reviews the new book by the former FDIC head .

Actual Economists, Virtual Realities

Greg Mankiw's Blog - Sep 30

The economics of video games .

The Price of Fiscal Uncertainty

Greg Mankiw's Blog - Sep 28

I have been reading Bob Woodward's new book, The Price of Politics .  It is a detailed recounting of the back-and-forth negotiations among President Obama's White House, the Republican leaders in the House of Representatives, and the major players in the Senate regarding the debt ceiling and long-term fiscal outlook.  The book is primarily an objective narrative, rather than a foaming-at-the-mouth polemic (unlike the over-the-top book The Amateur , which I read over the summer).  Nonetheless, the ...

Surprise Fact of the Day

Greg Mankiw's Blog - Sep 27

"Economics undergraduates have been found to be the most promiscuous students on campus." Source .

Pigou Club Alert

Greg Mankiw's Blog - Sep 27

Click here to vote for a carbon tax .

The Taxation of Capital Income

Greg Mankiw's Blog - Sep 26

Many economists believe capital income should be taxed at a lower rate than labor income, perhaps even at a zero rate.  Matthew Yglesias explains why .

Economics Teaching Conference

Greg Mankiw's Blog - Sep 25

You can still register for the economics teaching conference on November 8 and 9 in Orlando, Florida.  Early bird registration is open until October 10.  Click here for more information . FYI, I am among the keynote speakers .

Mankiw vs. DeLong and Krugman on the CEA’s Real GDP Forecasts in Early 2009: What Might a Time Series Econometrician Have Said?

Greg Mankiw's Blog - Sep 22

This post takes its title from  a new article at Econ Journal Watch .  Here is the abstract: In early 2009, the incoming Obama administration’s Council of Economic Advisers predicted real GDP would rebound strongly from recession levels. In a blog post, Greg Mankiw expressed skepticism. In their blogs, Brad DeLong and Paul Krugman sighed. Of course there would be strong growth, they maintained, because the recovery of employment would mandate it via Okun’s Law. Mankiw challenged Krugman to a bet on the ...

Nobel Predictions

Greg Mankiw's Blog - Sep 19

From Thomson Reuters .

A Break from Economics

Greg Mankiw's Blog - Sep 15

My younger son and I attended a great concert last night by Florence + The Machine. If you aren't familiar with their music, here is a sample:

The Trading Game

Greg Mankiw's Blog - Sep 13

Duke economist Marc F. Bellemare has a cool in-class experiment to demonstrate the gains from trade.

A Reading for the Pigou Club

Greg Mankiw's Blog - Sep 12

Here .  A tidbit: According to economists crunching the numbers, this makes mileage standards somewhere between 2.4 and 13 times more expensive than a gasoline tax as a tool to reduce our use of fuel. Indeed, by some calculations, raising fuel-economy standards is more costly than climate change itself.

Help Wanted

Greg Mankiw's Blog - Sep 11

I am looking to hire a Harvard student to work with me as I revise my principles textbook (along with several other less time-consuming tasks). The part-time job requires strong writing/editing skills, the ability to proofread carefully, some facility with data, and an interest in pedagogy. Work would start soon, and it would continue throughout the academic year. If you are interested, please drop off a brief letter, resume, and transcript with my assistant Lauren LaRosa in Littauer 236.

Harvey Rosen on the Romney Tax Plan

Greg Mankiw's Blog - Sep 7

You can read what the Princeton public finance expert says at this link .  Here is the bottom line: I analyze the Romney proposal taking into account the additional income that might be generated by economic growth. The main conclusion is that under plausible assumptions, a proposal along the lines suggested by Governor Romney can both be revenue neutral and keep the net tax burden on high-income individuals about the same. That is, an increase in the tax burden on lower and middle income individuals is ...

The Case for Big Banks

Greg Mankiw's Blog - Sep 6

From University of Maryland economist Phill Swagel .

Ranking Universities

Greg Mankiw's Blog - Sep 5

Last month, the Center for World-Class Universities at Shanghai Jiao Tong University released the 10th edition of its annual global university ranking.  Click here to see the economics ranking .

An Article without a Single Wasted Word

Greg Mankiw's Blog - Sep 4

Here is a paper I wish I had written,...I mean, not written.

A Reply from Martin Feldstein

Greg Mankiw's Blog - Sep 2

I am happy to lend this space to my Harvard colleague Martin Feldstein. -- Greg   Feasibility of the Romney Tax Plan – Reply to Comments Martin Feldstein This note is a reply to those who commented on my August 28 WSJ article (available here ) about the Romney Tax Plan. The Romney income tax plan includes a 20% cut in all individual tax rates, eliminating the AMT, and eliminating the taxes on interest, dividends and capital gains for those with incomes under $100,000.   The resulting revenue loss is ...

Live from Stockholm

Greg Mankiw's Blog - Aug 31

Next week you can listen in on a Nobel symposium on growth and development and another conference on climate change.  For more information, click here .

Feldstein on the Romney Tax Plan

Greg Mankiw's Blog - Aug 29

Marty runs some numbers . Updates : The TPC responds to Marty , and Marty responds to his critics .

A Tax Level Cheat Sheet

Greg Mankiw's Blog - Aug 29

A nice summary from Keith Hennessey : Over the past 50 years federal taxes have averaged 18% of GDP. Governor Romney proposes taxes “ between 18 and 19 percent ” of GDP. The House-passed (“ Ryan ”) budget proposes long-term taxes of 19 % of GDP. President Obama’ s budget proposes long-term taxes at 20 % of GDP. The Bowles-Simpson plan proposes long-term taxes at 21 % of GDP.

More Competition

Greg Mankiw's Blog - Aug 24

Glenn Hubbard and Tim Kane have started a blog .

What is the best way to reduce the government's budget deficit?

Greg Mankiw's Blog - Aug 24

New research by  Alberto Alesina, Carlo Favero, and Francesco Giavazzi suggests an answer: This paper studies whether fiscal corrections cause large output losses. We find that it matters crucially how the fiscal correction occurs. Adjustments based upon spending cuts are much less costly in terms of output losses than tax-based ones. Spending-based adjustments have been associated with mild and short-lived recessions, in many cases with no recession at all. Tax-based adjustments have been associated with ...

I am number 88

Greg Mankiw's Blog - Aug 24

...on the Amazon list of bestselling books .  I believe it is the first time one of my texts has made it into the top 100.

The Economist Platform

Greg Mankiw's Blog - Aug 17

NPR has a list of policies that economists across the political spectrum love.  It has some overlap with my list from few years back.

Romney Economics

Greg Mankiw's Blog - Aug 13

Here are several things to read on the topic: A white paper from economists advising Mitt Romney . An attack from Paul Krugman (natch) . A response from John Taylor . Addendum : Here is a list of economists who support Romney.

My Annual Field Trip

Greg Mankiw's Blog - Aug 11

Every year around this time, I take a trip to do an extensive study of economy of Nantucket.  As you might imagine, this activity requires large quantities of hard work and concentration sun screen. One implication is that I won't be blogging much until classes start up in September.  And if you are a reporter trying to get a quote for a story, sorry, but you are out of luck.

Academic Comic of the Day

Greg Mankiw's Blog - Aug 7

Click on graphic to enlarge.

The Potential Gains from Tax Reform

Greg Mankiw's Blog - Aug 6

Economist John Diamond offers some simulations from a computable general equilibrium model .

I talk with NPR

Greg Mankiw's Blog - Aug 6

You can listen here .

David Brooks on the Joys of Middle Age

Greg Mankiw's Blog - Aug 3

The most common question I have been asked lately is, "Why the hell did you agree to become department chairman?"  It is a bullet I have been dodging for some years, but I finally capitulated when the dean asked me this time. Why, at the age of 54, did I change my mind? David Brooks's wonderful column today offers as good an answer as any I have come up with. Then in your 50s and 60s, you will become a sociologist, understanding that relationships are more powerful than individuals. The higher up a person ...

The President's Rosy Scenario

Greg Mankiw's Blog - Jul 31

I have been looking through the Obama administration's midsession review , which was released a few days ago.  I found the comparison between the adminstration's economic forecast and the Blue Chip consensus of private forecasters noteworthy.  (See the table called "Table 3. Comparison of Economic Assumptions.")  Here is the projected growth of real GDP, fourth quarter to fourth quarter, of Team Obama in red , and private forecasters in blue . 2012 2.6 2.0 2013 2.6 2.5 2014 4.0 3.1 2015 4.2 3.0 2016 3.9 ...

Where is economics going?

Greg Mankiw's Blog - Jul 27

Eight young stars take a shot at the answer .

What I've been reading

Greg Mankiw's Blog - Jul 26

I am down here on Long Beach Island, NJ, visiting my mom with my younger son.  It has given me a chance to catch up on some reading, and I have a recommendation to pass along: Unintended Consequences by Edward Conard.  The subtitle ( Why everything you've been told about the economy is wrong ) is unnecessarily contentious and not really an accurate description.  But the book, written by a former Bain partner, gives a good overview of the forces behind the financial crisis.  It is far smarter and more ...

What I've been watching

Greg Mankiw's Blog - Jul 18

I am a latecomer to this, but a friend suggested to me that I would enjoy the TV show Breaking Bad , and boy was he right. It has occupied me almost every evening for the past month, as I have caught up to the current season five. The show tells the story of a particularly destructive mid-life crisis, as a mild-mannered high school teacher slowly descends into the underworld of drug manufacturing. It is not the best TV drama of all time (I would probably vote for The Wire ), but it is close. It is ...

Harry Reid's Wardrobe

Greg Mankiw's Blog - Jul 17

Having learned that the U.S. olympic uniforms were manufactured in China, Senator Harry Reid said , "I think they should take all of the uniforms put them in a big pile and burn them and start all over again." Will some enterprising reporter please ask Senator Reid for the opportunity to inspect the senator's closet and check the labels of his clothing to make sure they are all American-made?   I look forward to seeing Mr. Reid's bonfire. In the alternative, I would be happy to send the senator of copy of ...

The Progressivity of Taxes and Transfers

Greg Mankiw's Blog - Jul 14

To update one of the tables for the next edition of my favorite textbook, I have been looking at the  new CBO report  on the distribution of income and taxes.  I found the following calculations, based on the numbers in the CBO's Table 7, illuminating. Because transfer payments are, in effect, the opposite of taxes, it makes sense to look not just at taxes paid, but at taxes paid minus transfers received.  For 2009, the most recent year available, here are taxes less transfers as a percentage of market ...

Anti-poverty programs raise effective marginal tax rates

Greg Mankiw's Blog - Jul 13

Eugene Steuerle calculates the effective marginal tax rates from the system of taxes and transfers : we calculate the effective average marginal tax rate if this household increases its income from $10,000 to $40,000. That is, how much of the additional $30,000 of earnings is lost to government through direct taxes or loss of benefits? The average marginal tax rate in the first bar of Table 3, 29 percent , is based simply on federal and state direct taxes, including Social Security and the EITC. The rate ...

A Tribute to Anna Schwartz

Greg Mankiw's Blog - Jul 11

Here are some words from David Romer, spoken at the beginning of the NBER Summer Institute, Monetary Economics program: Before we begin, we have a sad milestone to note. Anna Schwartz, who was a towering figure not just in the Monetary Economics program of the NBER, but in the field of monetary economics, died last month. The usual way to mourn someone’s passing is with a moment of silence. I think everyone who knew Anna even a little realizes that that would be absolutely the wrong way to remember her. ...

Is the Fed too timid?

Greg Mankiw's Blog - Jul 10

Yes, say Betsey Stevenson and Justin Wolfers .

A Reading for the Pigou Club

Greg Mankiw's Blog - Jul 5

From Yoram Bauman and Shi-Ling Hsu.

Pigou Club news

Greg Mankiw's Blog - Jul 3

From my inbox: I thought you might be amused to see this. At Metrovino, a restaurant in Portland, Oregon where I run the bar, we needed a name for a drink we serve that's a slight variation on the Pegu Club (a classic gin cocktail). "Pigou Club" was the first thing to come to mind. I doubt many guests know what the name alludes to but it makes me happy and the drink has become one of our bestsellers. A photo of the menu is attached.  The recipe and background are here . Also, by the way, Australia has ...


Greg Mankiw's Blog - Jul 2

The folk over at the Council on Foreign Relations say that Paul Krugman's analysis of Iceland lacks a certain..., let's say, robustness .

Chief Justice Roberts disses economists

Greg Mankiw's Blog - Jun 29

From his recent opinion on the health care law, page 24: To an economist, perhaps, there is no difference between activity and inactivity; both have measurable economic effects on commerce. But the distinction between doing something and doing nothing would not have been lost on the Framers, who were "practical statesmen," not metaphysical philosophers.

SCOTUS on the Health Care Mandate

Greg Mankiw's Blog - Jun 28

Well, the Supreme Court said today that the health care mandate is ok.  I am no constitutional scholar, but from what I can tell from the news reports, the Court's logic is similar to mine in this old blog post .

Should Germany exit the euro?

Greg Mankiw's Blog - Jun 27

Yes, say Ken Griffin and Anil Kashyap .

Niall Ferguson on the Generational Compact

Greg Mankiw's Blog - Jun 23

The Harvard historian says it is badly frayed .

Anna Schwartz has passed away

Greg Mankiw's Blog - Jun 22

Here is the NY Times obituary of the great monetary economist .

I inspire a contest

Greg Mankiw's Blog - Jun 18

The folks over at New Economic Perspectives are sponsoring a contest "offering t-shirts to the top three readers who identify passages that contain the worst predictive and policy follies in Mankiw’s textbook ." That is very helpful.  Thanks!  I am always trying to find mistakes, omissions, and ambiguities in the book so I can improve the next edition.  I look forward to seeing what they come up with.

Elinor Ostrom has passed away

Greg Mankiw's Blog - Jun 18

Here is the Nobel prize winner's  NY Times obituary .

Data > Ideology

Greg Mankiw's Blog - Jun 14

Emi Nakamura, Jon Steinsson and Nicolas Vincent stand up for data collection .

On my to-read pile

Greg Mankiw's Blog - Jun 10

A new book by economist Ariel Rubinstein .  You can read it for free by clicking here .  (And in case you are wondering, the second link is legit, not pirated.) Addendum : Here is a review of the book.

Barro on the Slow Recovery

Greg Mankiw's Blog - Jun 5

Robert says incentives are the key : Consider the expansion of social-safety-net programs, including food stamps, unemployment insurance, Medicaid (prospectively) and housing and mortgage programs. In a study published last month by the National Bureau of Economic Research, University of Chicago economist Casey Mulligan observed that, because these programs were means-tested (falling or ending as income rises), expanding them raised the effective marginal tax rate on labor income. Specifically, Mr. ...

Summers on Quantitative Easing

Greg Mankiw's Blog - Jun 5

Larry is skeptical : There is also an oddity in this renewed emphasis on quantitative easing. The essential aim of such policies is to shorten the debt held by the public or issued by the consolidated public sector comprising both the government and central bank. Any rational chief financial officer in the private sector would see this as a moment to extend debt maturities and lock in low rates – exactly the opposite of what central banks are doing. In the U.S. Treasury, for example, discussions of ...

Macro 8e is now available!

Greg Mankiw's Blog - Jun 2

Click here to learn more .

A Bond Market Meme, Revisited

Greg Mankiw's Blog - May 30

About a year ago, I pointed out a fashionable trend : Some pundits were saying that long-term interest rates couldn't go much lower.  Since then, the yield on a 10-year Treasury bond has fallen from 3.18 to 1.65 percent. The lesson: Don't try to time the market.  My own asset allocation remains 60 percent stocks, 40 percent bonds, with wide diversification in each category.

More Competition

Greg Mankiw's Blog - May 29

University of Michigan economist Miles Kimball is now blogging .  Incidentally, many years ago, Miles was my very first PhD dissertation advisee.

Feldstein on the Euro

Greg Mankiw's Blog - May 29

Marty says it will remain a source of trouble .

What the Market Will Bear

Greg Mankiw's Blog - May 27

Rock star Jack White understands how to set prices to clear markets .

From Harvard Commencement

Greg Mankiw's Blog - May 26

A friend sends along this snapshot from an Occupy protest at Harvard's commencement this week.  For the record: I fully support sunshine.

Government as Venture Capitalist

Greg Mankiw's Blog - May 25

Larry Summers once said that goverment is a "crappy venture capitalist."  He was right .

Harvard students on Occupy Harvard

Greg Mankiw's Blog - May 25

The Crimson reports : For a Statistics 104 final project, a group of students asked 1,035 undergraduates to gauge their impression of Occupy on a scale of one to ten, with ten being most positive. They found that the average ranking of Occupy Harvard was 2.84 out of 10.

You are using the wrong textbook when...

Greg Mankiw's Blog - May 24

The NY Times reports : An economics book used in some high schools holds that the Antichrist — a world ruler predicted in the New Testament — will one day control what is bought and sold.

Economics Educators Conference

Greg Mankiw's Blog - May 23

In November, I will be speaking at the annual conference of the Gulf Coast Economics Association, which this year is being held in Orlando, Florida.  If you are interested in attending, registration is now open .