The $1.7 trillion Road Not Taken
It turns out that Christina Romer recommended the Obama Administration implement a $1.7 trillion rather than $800 billion stimulus in late 2008 in order to “eliminate the output gap by 2011-Q1.” In one respect, it’s unfortunate that this was not implemented. While one can have an argument about whether an $800 billion stimulus was large enough, it would have been impossible to rationalise the failure of a $1.7 trillion stimulus. It would have been a definitive, even if disastrous, macroeconomic policy experiment.
posted on 23 February 2012 by skirchner in Economics, Fiscal Policy
(0) Comments | Permalink | Main
Next entry: FIRB Transparency and the Colmer Doctrine Revisited
Previous entry: Mortgage Interest Rate Margins in Australia and the US