Paul Krugman - Sir,
Firstly you have my vote as the 'current' winner of the saving vs. spending debate. But for a software geek interested in economics - this is beginning to appear like a deliberate ploy orchestrated by armchair intellectuals to sell books, newspapers and online print. Not that there is anything wrong with that, but with my 10000 feet vantage point and the backing of my wide eyed enthusiasm for macro economics - I honestly believe that this debate can be emphirically put to rest.
-Let me outline how -
The Input Parameters we have are :
To this we add the proposal for a stimulus :
And the output we need to compute is -
In effect, I'm asking for a sheet that says if you stimulate - this is the quantified effect. Shouldn't that be possible ?Instead what one gets to hear is hyperbole, dumb analogies or hindsight induced proof points (from both sides of the debate) - all of which make an interesting read, but are hardly of any 'real' use to seal a debate of this significance!
PS 1 - From what I hear, there is no clear guidance on how to use a stimulus package to effectively...well, stimulate the economy ? If things had played out differently, that would probably have been the topic for my Phd and my Nobel, but since that's not gonna happen, it would be good to see someone work on this critical guidance.
PS 2 - As naive as this may sound, I'd like to think that I'll get a repsonse :)
Firstly you have my vote as the 'current' winner of the saving vs. spending debate. But for a software geek interested in economics - this is beginning to appear like a deliberate ploy orchestrated by armchair intellectuals to sell books, newspapers and online print. Not that there is anything wrong with that, but with my 10000 feet vantage point and the backing of my wide eyed enthusiasm for macro economics - I honestly believe that this debate can be emphirically put to rest.
-Let me outline how -
The Input Parameters we have are :
- Debt to GDP ratio
- Current Deficit
- Inflation average at current levels
- Current Unemployment Levels
- Rate at which jobs are being added
- Cost of Borrowing (Bond Yields)
- Growth Rate
- Interest Rates
- Sectors which have lost the most jobs
- No. of unemployed folks with redundant skills
- Private sector spending
- Sectors which have deficit skills
- Cost of Unemployment Support
- Cost of Infrastructure improvements
To this we add the proposal for a stimulus :
- An objective amount that needs to be injected - Let's say 2 trillion dollars
And the output we need to compute is -
- Effect on inflation - What exact levels would it jump to and would that be acceptable.
- Commodity price increase owing to the above inflation
- No. of jobs created
- Effect on cost of borrowing
- Rate of increase of deficit for 5 years
- Deficit outlook for 5 years in light of the above stimulus
- Growth rate in this period
In effect, I'm asking for a sheet that says if you stimulate - this is the quantified effect. Shouldn't that be possible ?Instead what one gets to hear is hyperbole, dumb analogies or hindsight induced proof points (from both sides of the debate) - all of which make an interesting read, but are hardly of any 'real' use to seal a debate of this significance!
PS 1 - From what I hear, there is no clear guidance on how to use a stimulus package to effectively...well, stimulate the economy ? If things had played out differently, that would probably have been the topic for my Phd and my Nobel, but since that's not gonna happen, it would be good to see someone work on this critical guidance.
PS 2 - As naive as this may sound, I'd like to think that I'll get a repsonse :)
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