326 Items

Blog Post - Views on the Economy and the World

El Salvador Exemplifies the Surrealism of Cryptocurrencies

| Sep. 26, 2021

El Salvador this month became the first country to adopt a cryptocurrency, Bitcoin, as legal tender.  One says “the first” as if there will be others.  But the idea is highly dubious.

I will admit, like many economists, that I fail to see what problem cryptocurrencies solve. They aren’t well designed to fulfill any of the classic functions of money — unit of account, store of value, or means of payment – in part because they are so extraordinarily volatile in price.  This volatility is not surprising, since they are backed neither by reserves nor by the reputation of a well-established institution, such as a government or even a private bank or other trusted corporation.

Blog Post - Views on the Economy and the World

The G20 Agenda, As the Pandemic Continues

| Aug. 28, 2021

Italy hosts the G20 this year.  The 2021 Summit of the Heads of Government will take place in Rome in October. Officials of member countries, including the finance ministers and central bank governors, are preparing.

The G20 meeting will come at a time of great uncertainty as concerns the health and economic effects of the pandemic, midway through its 2nd year.  Although the mechanisms of international cooperation have been badly bruised by events of recent years, they are more important than ever, in light of the interconnectedness across nations that the pandemic so vividly demonstrates.

Of what, specifically, should international cooperation in such bodies as the G20 consist?  To begin with, by “cooperation,” I am not in this case referring to the coordinated setting of national monetary or fiscal policies.  For the most part, countries can, on their own, move those levers in the directions that are right for them.

Areas on which the G20 should focus include three: financial stability, trade, and vaccination.  This is in addition to other important areas, especially the existential issue of global climate change, which should and will receive a lot of attention.

Blog Post - Views on the Economy and the World

The Virus, Vaccination, and Voting

| July 26, 2021

Ever since the 1960s, we have heard the cliché, “If they can put a man on the Moon, why can’t they do X?” where X is usually some goal like eliminating hunger — technologically simpler than the scientific miracle of space flight, but harder to accomplish in practice because it involves human behavior.  In 2021, the salient question is, “If we can accomplish the scientific miracle of developing vaccines capable of ending the Covid-19 pandemic that has killed millions, why can’t we convince enough people to get vaccinated?”

In lower-income countries, jabs are often limited by the availability of the vaccines.  But this is not the case with countries as fortunate as the United States, where the problem is primarily vaccine hesitancy, or even outright vaccine hostility.

Blog Post - Views on the Economy and the World

"False Imbalance” in Reporting on Economic Policy

June 30, 2021

One obstacle to productive public discourse and deliberation is a syndrome whereby the media, whether mainstream or otherwise, present policies in a manner that could be called “false imbalance.”  No, I don’t mean “false balance.”  False imbalance is quite different. It refers to the temptation to cast in a negative light, policies that in fact are reasonable attempts to balance competing objectives.  Examples can be drawn from health care, fiscal policy, and monetary policy.

Blog Post - Views on the Economy and the World

The Covid-19 Death Rate Looks Less Bad in Historical Perspective

| May 30, 2021

My preceding blog post pointed out that excess mortality statistics show Covid-19 death rates to be much worse in most countries than are reported by official statistics.  In this sense, the pandemic is even worse than one thought.

But the news all around us is already depressing.  A consideration of longer-term history allows a more encouraging perspective on mortality — provided we handle the statistics properly.

Blog Post - Views on the Economy and the World

Focus on Official Statistics Makes Covid-19 Worse, But Look Better

| May 28, 2021

Mark Twain said, “There are three kinds of lies: lies, damned lies, and statistics.”  Too often, the pandemic has unnecessarily allowed scope for the sort of popular suspicions reflected in Twain’s bon mot. Statistics are in fact a critical component of the fight against Covid-19.  Their use ranges from judging the efficacy of different vaccines to judging the performance of different governments.

 

Blog Post - Views on the Economy and the World

What Three Economists Taught Us About Currency Arrangements

| Apr. 29, 2021

A generation of great international economists is passing from the scene.  Richard Cooper died on December 23. An American, he was teaching his classes at Harvard until the very end. Robert Mundell, passed away on April 4.  Originally Canadian, he was a winner of the Nobel Prize in economics.  And John Williamson, on April 11. Originally British, he had been the first scholar hired by the Peterson Institute for International Economics.