A roundup of economic news from around the Web.
- Jobs: Paul Krugman laments that a jobs-creation tax credit was never implemented. ” CBO gives pretty high marks to a job-creation tax credit, which is something a number of people, especially at EPI, have been calling for for a while. I endorsed the idea a couple of months ago, believing that it was one of the few measures Congress might pass that could actually have a noticeable impact on employment at relatively low budget cost. But the idea was never taken up, and my understanding is that this was due to skepticism on the part of those SAOs. Now maybe they were right but CBO disagrees. And given where we are now, shouldnt the White House have tried to do something about jobs?”
- Globalization: On voxeu, Ashoka Mody looks at which countries did best in the financial crisis. ” Virtually no country was untouched by the crisis. But which countries saw the sharpest declines in GDP and why? This column shows that those with higher growth rates before the crisis fell harder while relatively closed economies were somewhat insulated. In contrast, the relationship between current account deficits and the decline in growth rates is fuzzier.”
- John Taylor: Big Think interviews economist John Taylor. “I don’t think quantitative easing at this point would effectively smooth the recovery. I think right now, based on historical experience, the interest rate is about where it is, it’s not that we don’t need a lot of quantitative easing. We’ve had some and I think the job of the Fed now is to bring it back. They’re talking about doing that, which is good. But I think, for me, the most important thing now for policy to have a good recover is to reduce this tremendous amount of uncertainty that exists with both monetary policy and fiscal policy and the uncertainty for monetary policy is, we don’t know how rapidly the quantitative easing will be reversed. We don’t know what’s going to happen with interest rates. There is a lot of questions there. So Id say, get back to the things that were working during the great moderation period, the ’80’s and ’90’s primarily, and that means letting interest rates rise appropriately and reducing the amount of quantitative easing; getting back to where it was through most of policy of the ’80’s and ’90’s.”
Compiled by Phil Izzo