版权说明:本文档由用户提供并上传,收益归属内容提供方,若内容存在侵权,请进行举报或认领
文档简介
1、 2007 Thomson South-Western 2007 Thomson South-WesternFive Debates over Macroeconomic Policy1.Should monetary and fiscal policymakers try to stabilize the economy?2.Should monetary policy be made by rule rather than by discretion?3.Should the central bank aim for zero inflation?4.Should the governme
2、nt balance its budget?5.Should the tax laws be reformed to encourage saving? 2007 Thomson South-WesternDebate #1 Should monetary and fiscal policymakers try to stabilize the economy? 2007 Thomson South-WesternPro: Policymakers Should Try to Stabilize the Economy The economy is inherently unstable, a
3、nd left on its own will fluctuate. Policy can manage aggregate demand in order to offset this inherent instability and reduce the severity of economic fluctuations. 2007 Thomson South-WesternPro: Policymakers Should Try to Stabilize the Economy There is no reason for society to suffer through the bo
4、oms and busts of the business cycle. Monetary and fiscal policy can stabilize aggregate demand and, thereby, production and employment. 2007 Thomson South-WesternCon: Policymakers Should Not Try to Stabilize the Economy Monetary policy affects the economy with long and unpredictable lags between the
5、 need to act and the time that it takes for these policies to work. Many studies indicate that changes in monetary policy have little effect on aggregate demand until about six months after the change is made. 2007 Thomson South-WesternCon: Policymakers Should Not Try to Stabilize the Economy Fiscal
6、 policy works with a lag because of the long political process that governs changes in spending and taxes. It can take years to propose, pass, and implement a major change in fiscal policy. 2007 Thomson South-WesternCon: Policymakers Should Not Try to Stabilize the Economy All too often policymakers
7、 can inadvertently exacerbate rather than mitigate the magnitude of economic fluctuations. It might be desirable if policy makers could eliminate all economic fluctuations, but this is not a realistic goal. 2007 Thomson South-WesternDebate #2 Should monetary policy be made by rule rather than by dis
8、cretion? 2007 Thomson South-WesternPro: Monetary Policy Should Be Made by Rule Discretionary monetary policy can suffer from incompetence and abuse of power. To the extent that central bankers ally themselves with politicians, discretionary policy can lead to economic fluctuations that reflect the e
9、lectoral calendarthe political business cycle. 2007 Thomson South-WesternPro: Monetary Policy Should Be Made by Rule There may be a discrepancy between what policymakers say they will do and what they actually docalled time inconsistency of policy. 2007 Thomson South-WesternPro: Monetary Policy Shou
10、ld Be Made by Rule Because policymakers are so often time inconsistent, people are skeptical when central bankers announce their intentions to reduce the rate of inflation. Committing the Fed to a moderate and steady growth of the money supply would limit incompetence, abuse of power, and time incon
11、sistency. 2007 Thomson South-WesternCon: Monetary Policy Should Not Be Made by Rule An important advantage of discretionary monetary policy is its flexibility. Inflexible policies will limit the ability of policymakers to respond to changing economic circumstances. The alleged problems with discreti
12、on and abuse of power are largely hypothetical. Also, the importance of the political business cycle is far from clear. 2007 Thomson South-WesternDebate #3 Should the central bank aim for zero inflation? 2007 Thomson South-WesternPro: The Central Bank Should Aim for Zero Inflation Inflation confers
13、no benefit to society, but it imposes several real costs. Shoeleather costs Menu costs Increased variability of relative prices Unintended changes in tax liabilities Confusion and inconvenience Arbitrary redistribution of wealth 2007 Thomson South-WesternPro: The Central Bank Should Aim for Zero Inf
14、lation Reducing inflation is a policy with temporary costs and permanent benefits. Once the disinflationary recession is over, the benefits of zero inflation would persist. 2007 Thomson South-WesternCon: The Central Bank Should Not Aim for Zero Inflation Zero inflation is probably unattainable, and
15、to get there involves output, unemployment, and social costs that are too high. Policymakers can reduce many of the costs of inflation without actually reducing inflation. 2007 Thomson South-WesternDebate #4 Should the government balance its budget? 2007 Thomson South-WesternPro: The Government shou
16、ld Balance Its Budget Budget deficits impose an unjustifiable burden on future generations by raising their taxes and lowering their incomes. When the debts and accumulated interest come due, future taxpayers will face a difficult choice: They can pay higher taxes, enjoy less government spending, or
17、 both. 2007 Thomson South-WesternPro: The Government Should Balance Its Budget By shifting the cost of current government benefits to future generations, there is a bias against future taxpayers. Deficits reduce national saving, leading to a smaller stock of capital, which reduces productivity and g
18、rowth. 2007 Thomson South-WesternCon: The Government Should Not Balance Its Budget The problem with the deficit is often exaggerated. The transfer of debt to the future may be justified because some government purchases produce benefits well into the future. The government debt can continue to rise
19、because population growth and technological progress increase the nations ability to pay the interest on the debt. 2007 Thomson South-WesternDebate #5 Should the tax laws be reformed to encourage saving? 2007 Thomson South-WesternPro: Tax Laws Should Be Reformed to Encourage Saving A nations saving
20、rate is a key determinant of its long-run economic prosperity. A nations productive capability is determined largely by how much it saves and invests for the future. When the saving rate is higher, more resources are available for investment in new plant and equipment. 2007 Thomson South-WesternPro:
21、 Tax Laws Should Be Reformed to Encourage Saving The U.S. tax system discourages saving in many ways, such as by heavily taxing the income from capital and by reducing benefits for those who have accumulated wealth. The consequences of high capital income tax policies are reduced saving, reduced cap
22、ital accumulation, lower labor productivity, and reduced economic growth. 2007 Thomson South-WesternPro: Tax Laws Should Be Reformed to Encourage Saving An alternative to current tax policies advocated by many economists is a consumption tax. With a consumption tax, a household pays taxes based on w
23、hat it spends not on what it earns. Income that is saved is exempt from taxation until the saving is later withdrawn and spent on consumption goods. 2007 Thomson South-WesternCon: Tax Laws Should Not Be Reformed to Encourage Saving Many of the changes in tax laws to stimulate saving would primarily
24、benefit the wealthy. High-income households save a higher fraction of their income than low-income households. Any tax change that favors people who save will also tend to favor people with high incomes. 2007 Thomson South-WesternCon: Tax Laws Should Not Be Reformed to Encourage Saving Reducing the
25、tax burden on the wealthy would lead to a less egalitarian society. This would also force the government to raise the tax burden on the poor. Raising public saving by eliminating the governments budget deficit would provide a more direct and equitable way to increase national saving.Summary 2007 Tho
26、mson South-Western Advocates of active monetary and fiscal policy view the economy as inherently unstable and believe policy can be used to offset this inherent instability. Critics of active policy emphasize that policy affects the economy with a lag and our ability to forecast future economic cond
27、itions is poor, both of which can lead to policy being destabilizing.Summary 2007 Thomson South-Western Advocates of rules for monetary policy argue that discretionary policy can suffer from incompetence, abuse of power, and time inconsistency. Critics of rules for monetary policy argue that discretionary policy is more flexible in responding to economic circumstances.Summary 2007 Thomson South-Western Advocates of a zero-inflation target emphasize
温馨提示
- 1. 本站所有资源如无特殊说明,都需要本地电脑安装OFFICE2007和PDF阅读器。图纸软件为CAD,CAXA,PROE,UG,SolidWorks等.压缩文件请下载最新的WinRAR软件解压。
- 2. 本站的文档不包含任何第三方提供的附件图纸等,如果需要附件,请联系上传者。文件的所有权益归上传用户所有。
- 3. 本站RAR压缩包中若带图纸,网页内容里面会有图纸预览,若没有图纸预览就没有图纸。
- 4. 未经权益所有人同意不得将文件中的内容挪作商业或盈利用途。
- 5. 人人文库网仅提供信息存储空间,仅对用户上传内容的表现方式做保护处理,对用户上传分享的文档内容本身不做任何修改或编辑,并不能对任何下载内容负责。
- 6. 下载文件中如有侵权或不适当内容,请与我们联系,我们立即纠正。
- 7. 本站不保证下载资源的准确性、安全性和完整性, 同时也不承担用户因使用这些下载资源对自己和他人造成任何形式的伤害或损失。
最新文档
- 产品质量免检协议范本解析
- 2025年冷链冷链物流多式联运协同发展效率提升策略报告
- 2026年网络文化活动组织合同
- 建筑隔离网安全施工方案范本
- 绿化养护管理月度计划与实施方案
- 幼儿园语文讲述教学方案设计案例集
- 高职院校实习管理方案及评价体系
- 厂房基础施工详细组织设计方案
- 供应链管理流程优化方案示范
- 教师教学反思记录与案例分析
- 中级消控证的试题及答案
- 4.2 地貌的观察 课件-高中地理人教版(2019)必修第一册
- 供应链总监竞聘演讲稿
- 智联网汽车技术 课件 13.2自适应巡航技术
- 睡眠质量对学习与表现的影响主题班会
- 2025-2030全球稀土掺杂光纤行业调研及趋势分析报告
- 《学生平安保险业务培训》课件
- 重庆大学《创业管理A》2023-2024学年第一学期期末试卷
- 2025年客房服务员(高级)客房服务员职业技能培训题库
- 手术患者保护性约束
- 《锂离子电池方向专业综合实验》课程教学大纲
评论
0/150
提交评论