Fiscal Policy

Fiscal Policy Hasn’t Been In Vogue Since 1953

Holly A. BellBlog, Economy, fiscal cliff, Politics

<h2>The Other Fiscal Cliff Resides In a Chart</h2> <p>While running some queries on Google's Ngram Viewer, a phrase-usage graphing tool searching over 5.2 million books in Google's digital library, I came across a rather startling trend. When comparing the use of the terms "monetary policy" and "fiscal policy" I discovered that discussion of fiscal policy in the literature has been falling since about 1953, while the discussion of monetary policy has been rising substantially (see chart below). The last time fiscal policy was a substantial topic in literature was during WWII and it has been falling dramatically since the end of the Cold War in 1989. Coincidence or design? What has caused this shift? Is it a cause or symptom of our current high dependence on monetary policy?</p> <p><iframe name="ngram_chart" src="https://books.google.com/ngrams/interactive_chart?content=monetary+policy%2C+fiscal+policy&year_start=1800&year_end=2000&corpus=15&smoothing=1&share=&direct_url=t1%3B%2Cmonetary%20policy%3B%2Cc0%3B.t1%3B%2Cfiscal%20policy%3B%2Cc0" height="378" width="678" frameborder="0" marginwidth="0" marginheight="0" scrolling="no"></iframe></p> <p><em>Dr. Holly A. Bell is an Associate Professor teaching business and economics at the Mat-Su College

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Why Krugman and Stiglitz Are Wrong About Government Spending

Holly A. BellEconomy, Global Economy, Politics 13

<a href="http://www.professorhollybell.com/wp-content/uploads/2012/11/ID-10053886.jpg"><img class="alignleft size-medium wp-image-2105" title="ID-10053886" src="http://www.professorhollybell.com/wp-content/uploads/2012/11/ID-10053886-240x300.jpg" alt="government spending"width="240" height="300" /></a> <h2><strong></strong>This is not the government spending of WWII</h2> By Holly A. Bell On October 23, 2012, the Institute for New Economic Thinking (INET) hosted an economics discussion with Paul Krugman and Joseph Stiglitz. The moderator of the discussion asked the Nobel Memorial Prize in Economic Sciences winning economists what the solution to our current recession is. Paul Krugman quickly spoke up and said that much more <i>government spending</i> was needed to pull us out of the recession. Both Krugman and Stiglitz began to justify this position using the example of how <u>government spending</u> that supported World War II pulled us out of the Great Depression. Specifically they laid out the history as follows: 1)   Two factors that lead to the Great Depression included a significant household debt bubble and a structural economic shift from a rural agricultural economy to an urban industrial economy. 2)  

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