tag:blogger.com,1999:blog-5713178645208582139.post4142801758010668921..comments2024-03-22T02:37:15.030-05:00Comments on Macro Musings Blog: The Real Negative Real ShockDavid Beckworthhttp://www.blogger.com/profile/04577612979801459194noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-5713178645208582139.post-17584975521870898062011-12-29T21:16:17.045-06:002011-12-29T21:16:17.045-06:00http://www.bls.gov/news.release/prod2.nr0.htm
Wel...http://www.bls.gov/news.release/prod2.nr0.htm<br /><br />Well, productivity is rising nicely, according to the BLS.<br /><br />Really remarkable is durable manufacturing.<br /><br />I assume we are getting a bit of a "free ride" that any manufacturing business gets as output goes up, you get greater output per fixed unit of input. <br /><br />Still, I think any theory that productivity Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-85776418963906364902011-12-27T15:13:10.221-06:002011-12-27T15:13:10.221-06:00By the way I would suggest that the best measure f...By the way I would suggest that the best measure for monetary policy "tightness" is to look at NGDP growth minus your RGDP long-term growth expectations. If that number - which in my view is demand inflation - increases then monetary policy is becoming more loose. But of course we should be looking at levels of demand prices - or what I have termed the Quasi-Real Price Index (QRPI) httpLars Christensenhttps://www.blogger.com/profile/08409946182659964026noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-84808970780762620172011-12-27T15:08:49.336-06:002011-12-27T15:08:49.336-06:00David, I must admit I am a bit skeptical about the...David, I must admit I am a bit skeptical about the natural rate as a empirical concept and if you look at monetary aggregates the story is somewhat different (but I guess that is the Hummel/Selgin debate). Furthermore, if one looks at "demand inflation" then it is hard to argue that US monetary policy was overly loose after 2001. I don't mind bashing Greenspan, but I must say that ILars Christensenhttps://www.blogger.com/profile/08409946182659964026noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-26228332160047568112011-12-27T14:44:01.352-06:002011-12-27T14:44:01.352-06:00Lars,
In my view the figure, which shows expected...Lars,<br /><br />In my view the figure, which shows <i>expected productivity growth</i>, does shed some light on the stance of U.S.monetary policy in the early-to-mid 2000s. It shows expected productivity growth rates rising through about the mid-2000s. Robert Gordon's paper even talks about this 2002-2004 mini-productivity boom period. <br /><br />A surge in the productivity growth rate David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-1751646389829110542011-12-27T10:23:41.464-06:002011-12-27T10:23:41.464-06:00David, very interesting post.
There is no doubt ...David, very interesting post. <br /><br />There is no doubt that the USA long-term real growth outlook is worse than it used to be. However, in my view the present slump has very little to do with that. It is not exactly a "news" that RGDP growth is like to be lower in the coming decade than in the last couple of decades. To me it is still about overly tight monetary policy.<br /><br />Lars Christensenhttps://www.blogger.com/profile/08409946182659964026noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-38611025548706786332011-12-26T15:05:19.352-06:002011-12-26T15:05:19.352-06:00Benjamin,
Gordon explains the potential reason fo...Benjamin,<br /><br />Gordon explains the potential reason for the productivity growth slowdown are that the productivity gains of 1995-2004 are not sustainable ones. See his paper.David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-60846899804241626312011-12-26T15:04:15.334-06:002011-12-26T15:04:15.334-06:00ECB,
Glad to see you are still with us.ECB,<br /><br />Glad to see you are still with us.David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-89712468193249316042011-12-24T13:06:46.004-06:002011-12-24T13:06:46.004-06:00Why should productivity growth decline? I don'...Why should productivity growth decline? I don't get this. <br /><br />It may be a rotten Fed policy stifles GDP growth, lessening corporate profits, lessening money to invest in R&D and capital equipment. Is that why?<br /><br />I sense global productivity will soar as modern equipment become more commonplace globally. The cell phone alone is a wonderful source of productivity Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-22236819162720345342011-12-24T08:06:38.629-06:002011-12-24T08:06:38.629-06:00better late than never...better late than never...ecbnoreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-41339462476688316102011-12-23T21:00:47.040-06:002011-12-23T21:00:47.040-06:00David,
You are correct, I should have said produc...David,<br /><br />You are correct, I should have said productivity growth. I fixed that in the post.<br /><br />That is a great idea to check the variance around the mean forecast.David Beckworthhttps://www.blogger.com/profile/04577612979801459194noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-27322405332532939572011-12-23T20:24:35.449-06:002011-12-23T20:24:35.449-06:00So yes, the consensus forecast is that productivit...<i>So yes, the consensus forecast is that productivity is expected to decline over the next 10 years.</i><br /><br />Productivity <i>growth</i> is expected to decline. <br /> <br />How does one square these expectations (factor in population growth to boot) with the zero real yield on U.S. treasuries? <br /><br />I wonder whether these lower forecasts are also associated with more uncertainty? David Andolfattohttps://www.blogger.com/profile/12138572028306561024noreply@blogger.comtag:blogger.com,1999:blog-5713178645208582139.post-69032379892229312142011-12-23T16:50:47.281-06:002011-12-23T16:50:47.281-06:00Lower natural interest rate. If the market intere...Lower natural interest rate. If the market interest rate falls with the natural interest rate, no effect on nominal expenditure. Ceteris paribus, maintaining nominal expenditure would require faster money growth. The slower real output growth and constant growth path of nominal expendiutre-- higher inflation.<br /><br />Employment? Ambiguous. Unemployment? Should be no effect.<br /><br />Bill Woolseyhttps://www.blogger.com/profile/06330232724290161369noreply@blogger.com