4 ms·

The point about how obama can claim a victory no matter what the outcome is closely paralleled here in Australia where the government has a 42billion stimulus p

by robryan 17y ago

The point about how obama can claim a victory no matter what the outcome is closely paralleled here in Australia where the government has a 42billion stimulus package including giving nearly the whole population $950. They have claimed that the handouts have been effective in saving jobs despite the trend towards higher unemployment still occurring like America. It's impossible to truly gauge the effects of the handout on the economy.

earl 17y ago
Um, no it isn't impossible at all. It's called statistics and all sorts of government organizations collect a bunch of them. While it is impossible to finely estimate, it is nothing like impossible to come up with pretty good estimates. And for what it's worth, industrial output has fallen at a pace faster than during the beginning of the Great Depression. That we haven't seen similar knockon effects (30% unemployment?) is most likely due to government stimulus ala Keynes. Now it is fair to claim that the economy has more services and less goods, so the GD isn't a perfect comparison, but it is pretty good. See, eg, (industrial output) http://voxeu.org/files/image/eichengreen_update_fig1.gif http://voxeu.org/files/image/eichengreen_update_fig1.gif (world trade -- more important now than then) http://voxeu.org/files/image/eichengreen_update_fig3.gif http://voxeu.org/files/image/eichengreen_update_fig3.gif (industrial output, 4 big europeans) http://voxeu.org/files/image/biigeuro.gif http://voxeu.org/files/image/biigeuro.gif Source: http://voxeu.org/index.php?q=node/3421 http://voxeu.org/index.php?q=node/3421
- randallsquared 17y ago
  You can get some important and interesting insights from economic statistical data, but macroeconomics is a series of just-so stories, at best; it isn't even really the same thing as microeconomics. Microeconomics deals, in part at least, with things you can run experiments on, with actual controls. Macro, not so much; like politics, you can find a macro pundit to give pretty much any conclusion you'd like, even when they mostly agree on micro. [Edit: apparently I'm just rephrasing the article summary. I guess I should have read it before ranting...]
dlnovell 17y ago
it's impossible to gauge the effects of any policy decision ever if it is applied universally. The only way to determine the effect of a policy is to apply it specifically to smaller groups and try to tease the effect out while controlling for various other factors. In a situation like a global economic meltdown, you simply don't have time to study the efficacy of the policy. It's damn near impossible, but it has been done. The books "Super Crunchers" and "Freakonomics" have discussions of how and when it's been done successfully
jswinghammer 17y ago
I love that they can be successful if unemployment rises or falls.

by robryan 17y ago

earl 17y ago

Um, no it isn't impossible at all. It's called statistics and all sorts of government organizations collect a bunch of them. While it is impossible to finely estimate, it is nothing like impossible to come up with pretty good estimates. And for what it's worth, industrial output has fallen at a pace faster than during the beginning of the Great Depression. That we haven't seen similar knockon effects (30% unemployment?) is most likely due to government stimulus ala Keynes. Now it is fair to claim that the economy has more services and less goods, so the GD isn't a perfect comparison, but it is pretty good. See, eg, (industrial output) http://voxeu.org/files/image/eichengreen_update_fig1.gif http://voxeu.org/files/image/eichengreen_update_fig1.gif (world trade -- more important now than then) http://voxeu.org/files/image/eichengreen_update_fig3.gif http://voxeu.org/files/image/eichengreen_update_fig3.gif (industrial output, 4 big europeans) http://voxeu.org/files/image/biigeuro.gif http://voxeu.org/files/image/biigeuro.gif Source: http://voxeu.org/index.php?q=node/3421 http://voxeu.org/index.php?q=node/3421

randallsquared 17y ago
You can get some important and interesting insights from economic statistical data, but macroeconomics is a series of just-so stories, at best; it isn't even really the same thing as microeconomics. Microeconomics deals, in part at least, with things you can run experiments on, with actual controls. Macro, not so much; like politics, you can find a macro pundit to give pretty much any conclusion you'd like, even when they mostly agree on micro. [Edit: apparently I'm just rephrasing the article summary. I guess I should have read it before ranting...]

dlnovell 17y ago

it's impossible to gauge the effects of any policy decision ever if it is applied universally. The only way to determine the effect of a policy is to apply it specifically to smaller groups and try to tease the effect out while controlling for various other factors. In a situation like a global economic meltdown, you simply don't have time to study the efficacy of the policy. It's damn near impossible, but it has been done. The books "Super Crunchers" and "Freakonomics" have discussions of how and when it's been done successfully

jswinghammer 17y ago

I love that they can be successful if unemployment rises or falls.