Search Results
Report
The jointly optimal inflation tax, income tax structure, and transfers
The welfare-maximizing income tax structure, rate of money creation, and amounts of intergenerational transfers are jointly determined for given rates of government consumption. When government consumption is zero, it is found for the parameter values examined that the income tax structure is progressive, the rate of money change is negative, and positive transfers are made to the old. As government consumption increases, the tax structure's progressivity declines and turns increasingly regressive, the rate of money change rises, and transfers decrease. It is found that the bulk of the ...
Journal Article
TIP: the wrong way to fight inflation
Journal Article
The right way to price Federal Reserve services
Report
The CBO's policy analysis: an unquestionable misuse of a questionable theory
The analyses of fiscal and monetary policies that the Congressional Budget Office (CBO) provides Congress tend to be biased, encouraging the use of activist stabilization policies. The CBO?s virtual neglect of economic uncertainties and its emphasis on very short time horizons make active policies appear much more attractive than its own model implies. Moreover, the CBO?s adoption of the macroeconometric approach fundamentally biases its analyses. Macroeconometric models do not remain invariant to changes in policy rules and are mute on the implications of alternative policies for efficiency ...
Working Paper
The policy procedure of the FOMC: a critique
Working Paper
A monetarist approach to federal budget control
Journal Article
A simple way to estimate current-quarter GNP
This paper describes a method developed to predict the advance (first) estimate of inflation-adjusted gross national product (real GNP) using hours-worked data. Besides generating fairly accurate forecasts of advance GNP, the method has two implications. First, the Commerce Department seems to weigh the hours-worked data most heavily in its early estimates of real GNP but less and less so in its revised estimates. Second, analysts attempting to predict current-quarter outcomes in real time need to consider the availability and reliability of data at the time the forecasts are made.
Report
How little we know about budget policy effects
Using a simple model, we show why previous empirical studies of budget policy effects are flawed. Due to an identification problem, those studies? findings can be shown to be consistent with either policies mattering or not.