This is J. Bradford DeLong's Typepad Profile.
Join Typepad and start following J. Bradford DeLong's activity
Join Now!
Already a member? Sign In
J. Bradford DeLong
Berkeley, CA
J. Bradford DeLong is an economist teaching at the University of California at Berkeley.
Interests: history, economic history, information age, political economy, grand strategy, international relations, material culture., information technology, economics
Recent Activity
****: [Department of "Huh!?": This Is All Cosma Shalizi's Fault Department...]( When something comes across my RSS feed stating that it is: >2500 words of statisticians quarreling with econometricians about arcane points of statistical theory... how am I supposed to resist getting sucked in? And so not that many minutes later I find myself reading: >**Chris Sims**: Time series econometricians long ago got over the idea that frequency domain estimation, which makes only smoothness assumptions on spectral densities, is any more general than time-domain estimation with finite parametrization. In fact, the preferred way to estimate a spectral density is usually to fit an AR or ARMA model… But surely if you are, to pick an example out of thin air, interested in estimating how much of a time series is made up of its permanent or near-permanent persistent components, you should estimate that directly—not use short-run autocorrelations to fit a _low-order_ ARMA process and then infer the permanent and near-permanent persistent components from the low-order ARMA representation. In what sense can 'fit[ting] an AR or ARMA model' be the 'preferred' way to conduct such an esimation? Low-order ARMA models are bad guides to the (very limited) information present about the... Continue reading
**Should-Read: Simon Wren-Lewis**: [The lesson monetary policy needs to learn]( "The main problem with monetary policy... >...In 2009, when central banks would have liked to stimulate further but felt that interest rates were at their lower bound, they should have issued a statement that went something like this: >>We have lost our main instrument for controlling the economy. There are other instruments we could use, but their impact is largely unknown, so they are completely unreliable. There is a much superior way of stimulating the economy in this situation, and that is fiscal policy, but of course it remains the government’s prerogative whether it wishes to use that instrument. Until we think the economy has recovered sufficiently to raise interest rates, the economy is no longer under our control. >I am not suggesting QE did not have a significant positive.... But its use allowed governments to imagine that ending the recession was not their responsibility, and that what I call the Consensus Assignment was still working. It was not: QE was one of the most unreliable policy instruments imaginable. >The criticism that this would involve the central bank exceeding its remit and telling politicians what to do is misplaced. Members... Continue reading
**Should-Read: Darrick Hamilton**: [Post-racial rhetoric, racial health disparities, and health disparity consequences of stigma, stress, and racism]( "High achieving black Americans... still exhibit large health disparities... >...We discuss how the post-racial, politics of personal responsibility and “neoliberal paternalism” troupes discourage a public responsibility for the conditions of the poor and black Americans, and, instead, encourage punitive measures to “manage…surplus populations” of the poor and black Americans. We introduce an alternative frame and integrate it with John Henryism as a link to better understand the paradox above... Continue reading
**Must-Read**: The extremely thoughtful Martin Sandbu writes: **Martin Sandbu**: [Bolder rethinking needed on macroeconomic policy]( "**Top economists need to dig deeper after policy failures of past decade**... >...Peterson Institute conference on “Rethinking Macroeconomic Policy”... I recommend everyone to take a look — but with a disappointment spoiler up front. For while some of the world’s most brilliant economists took part, which alone makes it worth a view, the promised “rethinking” was often more incremental (even marginal) than radical. The opening paper and presentation by Olivier Blanchard and Larry Summers is a tour de force in terms of stating where the debate stands today in a range of key policy areas. They were followed by former Federal Reserve chair Ben Bernanke, who headlined the panel on monetary policy.... >Western economies are far from where central bankers thought they would have been by now, still either below capacity or not convincingly at full capacity. Worse yet, they do not understand why. In this context, one might have hoped for some deep soul-searching in a conference of this calibre. In terms of concrete “deliverables”, there were few new proposals for how to do monetary policy differently. The main contribution was Bernanke’s discussion of... Continue reading
**Comment of the Day: A in CA**: [Monday DeLong Smackdown Watch: Still Looking for a High Quality DeLong Smackdown Over the Past Month (or Earlier) Kevin Hassett Edition]( "So coauthoring the book "Dow 36,000" does not ever disqualify an economist... >...but even get him a recommendation for a better jobs, such as Chairman of the Council of Economic Advisers, from a long list of presumably famous economists. >Hmm, how comes advocating for the flat earth theory did never provide me with recommendations by leading geographers and geophysicists for even an adjunct job at a Community College? >(Actually, I think, Community Colleges are great, no slight intended.)..." Continue reading
**Comment of the Day: Phil Koop**: []( "There are some not so surprising names on that list, but too many that are astonishing... >...How the hell can Dean Baker, Adam S. Posen, or Justin Wolfers be surprised that the author of Dow 36,000 is also the author of Wage Gain $9,000?..." Continue reading
**Should Not Read**: THE WHITE HOUSE: Office of the Press Secretary: Embargoed For Release Until 5:00 a.m. EDT, October 16, 2017: ON-THE-RECORD PRESS CALL BY COUNCIL OF ECONOMIC ADVISERS CHAIRMAN KEVIN HASSETT ON UPCOMING CEA REPORT >MS. STROM: Hey, everybody. Thanks for taking time out of your Sunday to join us on this call, as Kevin said, to preview the President's Council of Economic Advisers' upcoming report, "Corporate Tax Reform and Wages: Theory and Evidence." >Here on the line with me is Kevin Hassett, Chairman of the CEA, who's going to walk through the report with you and take some of your questions on it. Kevin will be speaking on the record. The information on the call, as well as your copy of the report that you were sent -- if you didn’t get one, just ping me or send me an email, and I'll send you one -- that copy is embargoed until tomorrow morning, Monday, October 16th at 5:00 a.m. Eastern. And that's for the report and for the information on this call. >So, without further ado, I'll hand it over to Kevin to give an overview of the report, and then we'll open it up for questions.... Continue reading
**Should-Read**: And now Larry Summers has had it with Kevin Hassett. Me? I am not surprised that Kevin has taken this road. But, then, I read _Dow 36000_ 20 years ago. I am surprised that people are surprised: **Larry Summers**: [Hassett’s flawed analysis of the Trump tax plan]( "Kevin Hassett... accuses me of an ad-hominem attack... >...I am proudly guilty of asserting that it is some combination of dishonest, incompetent and absurd. TV does not provide space to spell out the reasons why, so I am happy to provide them here. >I believe strongly in civility in public policy debates, and before the Trump administration do not believe I have ever used words like dishonest in disagreeing with the policy analyses of other economists. Part of my rationale for speaking so strongly here is that Mr Hassett called into question the integrity of the Tax Policy Center, a group staffed by highly respected former civil servants, by calling their work “scientifically indefensible” and “fiction”.... Hassett throws around the terms scientific and peer reviewed, yet there is no peer-reviewed support for his central claim that cutting the corporate tax rate from 35 per cent to 20 per cent would raise wages... Continue reading
**Should-Read**: What were they thinking of, signing this? Wasn't Kevin Hassett's behavior since 100% predictable? [Letter in Support of the Nomination of Kevin Hassett to be Chairman of the Council of Economic…]( "Alan J. Auerbach... Martin N. Baily... Dean Baker... >...Robert J. Barro... Ben S. Bernanke... Jared Bernstein... Alan S. Blinder... Michael J. Boskin... Arthur C. Brooks... John H. Cochrane... Karen Dynan... Janice Eberly... Douglas W. Elmendorf... Martin S. Feldstein... Jason Furman... William G. Gale... Ted Gayer... Austan D. Goolsbee... Alan Greenspan... Robert E. Hall... Douglas J. Holtz-Eakin... R. Glenn Hubbard... Randall S. Kroszner... Alan B. Krueger... Edward P. Lazear... Lawrence Lindsey... N. Gregory Mankiw... Donald B. Marron... Peter R. Orszag... Adam S. Posen... James Michael Poterba... Christina D. Romer... Harvey S. Rosen... Cecilia Elena Rouse... Jay C. Shambaugh... Robert J. Shapiro... Betsey Stevenson... James H. Stock... Michael R. Strain... Phillip Swagel... John B. Taylor... Laura D. Tyson... Justin Wolfers... Mark M. Zandi... Continue reading
**Should-Attend**: I think this paper is badly mistitled. It should be "Indiana Jones Gojko Barjamovica, Thomas Chaney, A. Kerem Cosar, Ali Hortacsu, and the Lost Cities of the Cuneiform Administrative Documents": **Gojko Barjamovica _et al._**: [Trade, Merchants and Lost Cities of the Bronze Age]( "Seminar 211: Economic History | October 16 | 2-3:30 p.m. | 597 Evans Hall... >...**Gojko Barjamovica, Thomas Chaney, A. Kerem Cosar, and Ali Hortacsu**: [Trade, Merchants and Lost Cities of the Bronze Age]( We analyze a dataset of business documents inscribed in the cuneiform script and preserved on clay tablets informing us about the long-distance caravan trading system that connected northern Iraq, northern Syria and central Turkey in 19th century BCE. The standard gravity specification fits this ancient trade data remarkably well. Using data on modern-day trade of Turkish cities with Iraq and Syria, we find persistent patterns across four millennia. An inverse-gravity exercise suggests a methodology for estimating the location of lost cities. The size distribution of merchant coalitions is approximately Pareto... ---- * 1000 copper = 10 silver = 1 gold * 1 shekel = 10 g * 1 deben = 80 g * 1 mina = 500 g * 1 talent = 30000... Continue reading
**Live from the Universe: NASA**: [First Light from a Gravitational-Wave Event]( "For the first time, NASA scientists have detected light tied to a gravitational-wave event... >...thanks to two merging neutron stars in the galaxy NGC 4993, located about 130 million light-years from Earth in the constellation Hydra. >Shortly after 8:41 a.m. EDT on Aug. 17, NASA's Fermi Gamma-ray Space Telescope picked up a pulse of high-energy light from a powerful explosion, which was immediately reported to astronomers around the globe as a short gamma-ray burst. The scientists at the National Science Foundation’s Laser Interferometer Gravitational-wave Observatory (LIGO) detected gravitational waves dubbed GW170817 from a pair of smashing stars tied to the gamma-ray burst, encouraging astronomers to look for the aftermath of the explosion. Shortly thereafter, the burst was detected as part of a follow-up analysis by ESA’s (European Space Agency’s) INTEGRAL satellite. >Swift’s Ultraviolet/Optical Telescope imaged the kilonova produced by merging neutron stars in the galaxy NGC 4993 (box) on Aug. 18, 2017, about 15 hours after gravitational waves and the gamma-ray burst were detected. The source was unexpectedly bright in ultraviolet light. It faded rapidly and was undetectable in UV when Swift looked again on Aug. 29. This false-color... Continue reading
**Must-Read**: Smart meditations by the extremely sharp Danny Quah. I find myself wishing that he would engage with Habermas on the "public sphere" here, somehow... **Danny Quah**: [When Open Societies Fail]( "Why is Wikipedia mostly OK, but so many comments at the end of newspaper articles make you weep for humanity’s future – when both are open for everyone to write?... >...Jimmy Wales of Wikipedia spoke at Khazanah Megatrends Forum in Kuala Lumpur. He reflected on, among other things, Wikipedia’s openness of knowledge production, its usefulness to many, and its sustainability. About 18 months before then, Microsoft had shut down a failed experiment on openness and Artificial Intelligence: Tay, the online Twitterbot AI-enabled to learn from its interaction with users. In the event, Internet trolls ended up keying in so much venom-driven input that Tay came to spew hate, racism, and misogyny. These three story arcs — Wikipedia, Tay, online newspaper commentary — reflect generally on the workings of open societies. >Many observers find appealing the hypothesis that open, individual-oriented, bottom-up societies achieve outcomes that, even if not point-wise optimal, are dynamically robust and resilient. Since at least Popper and Friedman, this idea has been a plank of Western economic... Continue reading
**Should-Read: Jay Shambaugh _et al._**: Thirteen Facts About Wage Growth: "Economic and policy changes are both important for the division of economic gains... >...We explore the roles of technological progress, globalization, and changing returns to education in driving some of these wage trends over the long run. We also examine declines in the rate of union membership and the real minimum wage, focusing on how these developments have affected the level and distribution of wages... Continue reading
**Should-Read**: I share some of Carolyn Sissoko's concerns here. IMHO, there is great and enormous value in a "Talmudic" style of intellectual engagement. But in order for it to work, it requires that: * senior members give junior members points for challenging them—even if the challenge ultimately reveals only the junior's ignorance or lack of experience thinking things through. * senior members hold to the "democracy of ideas": "that's an interesting idea you have set forward; thank you; let's think about how to find out whether it is right or not..." * which entails a willingness to mark their beliefs to market, and ask themselves questions like: "we have taken the residual from a production function and called it our driving independent variable for forty years now; has this been a productive thing to do?" * seminar questions typically take one of several forms: * a question designed to allow the speaker to repair a hole that has opened in his or her presentation * a question designed to demarcate where the argument applies from where the argument does not apply * a question designed to allow the speaker to move on to his or her next topic * never... Continue reading
**Should-Read: CPPC**: [Victory in California! Drug Price Transparency Bill Becomes Law]( "California Governor Jerry Brown signed SB 17, a drug price transparency bill, into law... >...Brown said there is: >>real evil when so many people are suffering so much from rising drug prices...The essence of this bill is pretty simple. Californians have a right to know why their medical costs are out of control, especially when the pharmaceutical profits are soaring...This measure is a step at bringing transparency, truth, exposure to a very important part of our lives -- that is the cost of prescription drugs. >The new law will go into effect on January 1st, 2018. >The law... make drug price... more transparent... requiring drug companies to give health insurers and government health plans at least sixty days' warning before prescription drug hikes that would exceed 16% over a two-year period. Drug companies will also have to provide reasons behind the price increases. Big Pharma strongly opposed the bill.... >Drug prices have been skyrocketing over the past decade, and policymakers want to take action to reduce them. One of the major problems has been a great lack of information on drug prices, what contributes to their increase, and who... Continue reading
**[Polybius XXXI.23 ff.](*.html)**: "Now that the progress of my narrative and the date call our special attention to this family... >...I wish in order to satisfy the reader's curiosity to execute a promise I made in the previous book and left unfulfilled, and this was that I would tell how and why the fame of Scipio in Rome advanced so far and became so brilliant more quickly than it should, and to tell also how his friendship and intimacy with the author grew so great that this report about them not only spread to Italy and Greece, but that even further afield their liking and intercourse were a matter of common knowledge. >Now I have already explained that their acquaintance took its origin in the loan of some books and conversation about them. But as their intimacy grew, and when the Achaeans in detention were sent off to provincial towns, Fabius and Scipio, the sons of Lucius Aemilius, urgently begged the praetor to allow Polybius to remain in Rome. This was done, and their intercourse now becoming much closer, the following incident took place. >On one occasion when they were all coming out together from the house of Fabius, the... Continue reading
Anybody have any suggestions? ---- **UPDATE**: OK. There are no suggestions for high quality DeLong smackdowns. And there is one request in comments for a Kevin Hassett smackdown, with a link. So here goes: **Jim Tankerley**: [Trump’s Top Economist Says Corporate Tax Cuts Will Lift Workers’ Wages]( "[Kevin Hassett of] the Trump administration on Monday... ignor[ed]... studies that showed few benefits from corporate tax cuts for average workers and relyi[ed]... on research that supported a politically desirable result... >...Seth Hanlon, a senior fellow at the Center for American Progress think tank and a former economic adviser to President Barack Obama, said Mr. Hassett had “cherry-picked” studies on the effects of corporate taxation on wages. Jason Furman, a professor at the Harvard Kennedy School and a former Council of Economic Advisers chairman in the Obama administration, called Mr. Hassett’s findings “implausible” and noted they were rooted in studies that had not been published in major academic journals. “This lies outside the mainstream of economists,” he said. Those are actually the last paragraphs of Tankersley's story. The first paragraphs are: >President Trump’s top economist argued in a report issued on Monday that corporate tax cuts being pushed by Republicans would increase a... Continue reading
**Should-Read: David Anderson**: [State Approaches to Handling CSR Uncertainty for 2018 Premiums – Balloon Juice]( "The 2018 ACA Marketplace that begins on November 1, 2017... >...Much of the pricing variance will be a result of choices that states and insurers have made in response to the uncertainty over whether the federal government will continue to reimburse insurers for the Cost Sharing Reduction (CSR) subsidies that insurers are legally obligated to provide to qualified exchange enrollees. In the ACA Marketplace, enrollees choose among plans grouped in four “metal levels” defined by... the percentage of average medical costs the plan will cover. Bronze plans... 60 percent AV, Silver plans... 70 percent... Gold... 80... and Platinum... 90.... >CSR is available only to low income enrollees, and only with Silver plans. For low income enrollees, CSR boosts AV from a baseline of 70 percent to: >* 94 percent for enrollees with incomes up to 150 percent of the Federal Poverty Level (FPL) >* 87 percent for enrollees with incomes between 150 and 200 percent FPL >* 73 percent for enrollees with incomes between 200 and 250 percent FPL >At present, 57 percent of on-Marketplace enrollees access CSR, including over 80 percent of Silver plan... Continue reading
**Should-Read: Paul Krugman**: [Subsidies, Spite, and Supply Chains]( "I’ve been fairly complacent about NAFTA’s fate... >...Not that I imagine that Trump, or for that matter any of his senior advisers, has any understanding of what NAFTA does or the foreign-policy implications of tearing it down. But I thought sheer interest-group pressure would keep the agreement mostly intact.... Breaking it up would be hugely disruptive, and the losers would include major industrial players who tend to have the ear of even Republican administrations. So I thought we’d likely get a few cosmetic changes to the agreement, allowing Trump to declare victory and walk away. >But look what just happened on health care. Never mind the millions who may lose coverage: Trump demonstrably doesn’t care about them. But his decision will also cost insurers and health care providers, the kind of people you might expect him to listen to, billions. And he did it anyway, evidently out of sheer spite.... So is it safe to assume that he won’t screw over much of U.S. manufacturing in the same way? At this point, the answer has to be “no.”... Reasonable people are worried, I think rightly, that Trump’s rage and spite might lead... Continue reading
**Must-Read**: * **Olivier Blanchard and Lawrence Summers**: [Rethinking macro stabilization: Back to the future]( "Lessons from past crises... * **Tim Duy**: [Kevin Warsh, Very Serious Person]( "Scott Sumner is perplexed by... Kevin Warsh['s in 2010]... * **Noah Smith**: [Defending Thaler from the guerrilla resistance]( "This... by Kevin Bryan... [who] instead of explaining Thaler's research, Kevin decided to challenge it, in a rather dismissive manner... * **Royal Swedish Academy of Sciences**: [The Prize in Economic Sciences 2017]( "Richard H. Thaler... 'for his contributions to behavioural economics'... * **Simon Wren-Lewis**: [ Economics: too much ideology, too little craft]( "Paul Krugman argued... that... belief in the need for new economic thinking after the financial crisis was incorrect... * **Wolfgang Dauth, Sebastian Findeisen, Jens Südekum, and Nicole Woessner**: The rise of robots in the German labour market: "Robots have had no aggregate effect on German employment, and robot exposure is found to actually increase the chances of workers staying with their original employer... ---- **Should-Read**: * **Paul Krugman**: [Subsidies, Spite, and Supply Chains]( "I’ve been fairly complacent about NAFTA’s fate... * **@delong @pseudoerasmus @leahboustan**: [On Twitter: What high skilled jobs did the domestication of the horse eliminate?]( "**@leah_boustan**: @pseudoerasmus @de1ong To me, robot has... Continue reading
**For the Weekend: Stephen Vincent Benet**: The Devil and Daniel Webster VII : "'Foreign?' said the stranger. 'And who calls me a foreigner?'... >..."Well, I never yet heard of the dev—of your claiming American citizenship," said Dan'l Webster with surprise. >"And who with better right?" said the stranger, with one of his terrible smiles. "When the first wrong was done to the first Indian, I was there. When the first slaver put out for the Congo, I stood on her deck. Am I not in your books and stories and beliefs, from the first settlements on? Am I not spoken of, still, in every church in New England? 'Tis true the North claims me for a Southerner, and the South for a Northerner, but I am neither. I am merely an honest American like yourself—and of the best descent—for, to tell the truth, Mr. Webster, though I don't like to boast of it, my name is older in this country than yours." >"Aha!" said Dan'l Webster, with the veins standing out in his forehead. "Then I stand on the Constitution! I demand a trial for my client!" >"The case is hardly one for an ordinary court," said the stranger, his... Continue reading
**Live from the Orange-Haired Baboon Cage: Matthew Yglesias**: [Establishment Republicans mystified by their base should look at Ed Gillespie’s campaign]( "Gillespie and his campaign feel that a hysterical racialized scare campaign about gang rape with zero grounding in policy reality will sell better than some kind of tedious seminar about immigration’s impact on wages... >...**Grassroots Republicans learned it from watching you**: Establishment Republicans mystified by the party’s grassroots activists and rank-and-file members, in short, should consider taking a look at their own campaigns and policy rhetoric. Florida Man ran for president on the theory that tax cuts would generate 4 percent economic growth. Florida Man argued that Barack Obama was deliberately trying to damage the United States. Ed Gillespie claims that sanctuary cities that don’t even exist are responsible for the rise of a violent international criminal organization. The same congressional Republicans who swore for years that growing debt was the biggest threat to the country are lining up behind a budget that will authorize more than $1 trillion in new borrowing to finance tax cuts for the rich. >The difference between these guys and the new crop of kooks — between a respected colleague like Bob Corker and a... Continue reading
**Over at [Equitable Growth]( Must- and Should-Reads:** * **@delong @pseudoerasmus @leahboustan**: [On Twitter: What high skilled jobs did the domestication of the horse eliminate?]( "**@leah_boustan**: @pseudoerasmus @de1ong To me, robot has connotation of 'artificial intelligence' so CNC would be robot-like but assembly line would not be... * **Geoffrey Pulham** (2013): Why Are We Still Waiting for Natural Language Processing?: "Try typing this, or any question with roughly the same meaning, into the Google search box... * **Luigi Iovino and Dmitriy Sergeyev**: [Quantitative Easing without Rational Expectations ]( "We study the effects of risky assets purchases financed by issuance of riskless debt by the government (quantitative easing) in a model without rational expectations... * **Bruce Bartlett**: [I helped create the GOP tax myth. Trump is wrong: Tax cuts don’t equal growth]( "Even if they had released a complete plan — not just the woefully incomplete nine-page outline released Wednesday... * **Paul Krugman**: [Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies, Lies]( "Modern conservatives have been lying about taxes pretty much from the beginning of their movement... * **Simon Wren-Lewis**: [How Neoliberals weaponise the concept of an ideal market]( "I would tend to suggest... * **Martin Wolf**: [A political shadow looms... Continue reading
**Should-Read: Bruce Bartlett**: [I helped create the GOP tax myth. Trump is wrong: Tax cuts don’t equal growth]( "Even if they had released a complete plan — not just the woefully incomplete nine-page outline released Wednesday... >...Republicans have failed to make a sound case that it’s time to cut taxes. Nor have they signaled that they’ll commit to a viable process.... The first version of the ’81 tax cut was introduced in 1977 and underwent thorough analysis by the CBO and other organizations, and was subject to comprehensive public hearings. The Tax Reform Act of 1986 grew out of a detailed Treasury study and took over two years to complete. Rushing through a half-baked tax plan... should be rejected out of hand. As Sen. John McCain (R-Ariz.) has repeatedly and correctly said, successful legislating requires a return to the “regular order.” That means a detailed proposal with proper revenue estimates and distribution tables from the Joint Committee on Taxation, hearings and analysis by the nation’s best tax experts, markups and amendments in the tax-writing committees, and an open process in the House of Representatives and Senate. >There are good arguments for a proper tax reform even if it won’t raise... Continue reading
**Live from the Laugher Curve: Bill Easterly**: [On Twitter: @bill_easterly]( "The Laffer Curve napkin is mathematically incoherent: why is the x variable on the y-axis? Why is 100% at the origin?" Why does the "normal" range in which d(TR)/dt > 0 extend from a tax rate t of 100% down to 50%? Why does the "prohibited" range in which d(TR)/dt < 0 cover 50%>t>0%? Continue reading