If you’re an economic policy analyst, you might get the feeling that the crazy-high uncertainty surrounding policy has abated. You might even feel that more profoundly if your portfolio includes trade policy…
Wisconsin GDP in Q4
BEA has just released state level GDP for 2020Q4. Wisconsin is down slightly more than the US overall (3% vs 2.4%) relative to NBER peak at 2019Q4, and for 2020 overall at approximately the level forecasted in November. Manufacturing had recovered to prior peak, while accommodation and food services were down 27.6% (all percentages calculated as log differences).
On the Word “Eminent”
Reader EConned writes about Judy Shelton:
One can disagree with Shelton’s policy stances, public statements, writings, etc… but there’s no doubt she’s an eminent economist. Debating the substance of her views is great but I certainly don’t see the need to just “hate on her” I. The fashion of this comment (and, honestly, the OP). There are Americans including policy makers of past, present, and future who respect her opinions… for better or for worse.
Now, I know “eminence” is in the eye of the beholder. As an academic economist, I would be tempted to go to “Google Scholar” or the successor to the Social Sciences Citation Index to make my own judgment.
Personally, I don’t know Dr. Shelton, have never met Dr. Shelton, nor corresponded with Dr. Shelton. However, I find her views on government statistics strange, her views on currency manipulation confusing, and her malleability with respect to the conduct of monetary policy troubling.
Wisconsin Employment in February: Trending Sideways
If you’d thought the recovery was in full swing, think again. Wisconsin nonfarm payroll employment has stabilized at a level down 5.6% relative to NBER peak in 2020M02 (in log terms), vs. 6.4% for the nation overall (according to figures released by DWD today).
Thus Confirming Everything I Thought about Both The Independent Institute and Judy Shelton
Popping into my email inbox today, a press release titled:
Renowned Economist and Author Judy L. Shelton Joins the Independent Institute as Senior Fellow
Measuring the Informal Sector
Some methods for estimating the informal sector, and characterizing the cyclical behavior thereof, from Ceyhun Elgin, Ayhan Kose, Franziska Ohnsorge, and Shu Yu (2019).
Proxy Measures for the Cyclical Component of GDP
The output gap is a key concept in macro. Students in my courses have asked about the characteristics of some of the proxies. Here are some representative examples.
Some Strange Things about Inflation Expectations
I was interviewed for a Markeplace piece on some of the strange beliefs people have about how the government measures inflation.
One of the tangental points I mentioned to the reporter (it didn’t make into the article) is household inflation expectations are consistently upwardly biased (by about a percentage point). This is shown in the below graph with ex post inflation (black) against forecasted from Survey of Professional Forecasters (blue) and Michigan (red).
Macroeconomic Competitiveness
Competitiveness is often appealed to in popular discourse, but seldom defined. In macroeconomics, competitiveness is usually interpreted as cost competitiveness. Chinn and Johnston (JPAM, 1994) discuss the topic at length. Here is the OECD’s measure of cost competitiveness since 1999, along with the Fed’s CPI deflated measure of the dollar against a broad basket of currencies.
Some Statistics and Thoughts Regarding Causality
Consider the incidence of hate crimes directed against Asian-Americans/Pacific-Islanders as reported to the FBI.