by Two weeks ago – it feels much longer now – I was up at UMass-Amherst to give a talk on the economic mobilizaiton of World War II and its lessons for the Green New Deal. Here is an audio recording of the talk. Including Q&A, it’s about an hour and a half. Here are the slides that I used. http://jwmason.org/wp-content/uploads/2020/03/University-of-Massachusetts-Amherst-2.m4a The big three lessons I draw are: 1. The more rapid the economic transformation that’s required, the bigger the role the public sector needs to take, in investment especially, and more broadly in bearing risk. 2. Output can be very elastic in response to stronger demand, much more so than is usually believed. There’s a real danger that over-conservative estimates of potential output will lead us to set our sights
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JW Mason considers the following as important: Economic history, Green New Deal, in the time of coronavirus, potential output, Uncategorized, WWII
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Two weeks ago – it feels much longer now – I was up at UMass-Amherst to give a talk on the economic mobilizaiton of World War II and its lessons for the Green New Deal.
Here is an audio recording of the talk. Including Q&A, it’s about an hour and a half. Here are the slides that I used.
The big three lessons I draw are:
1. The more rapid the economic transformation that’s required, the bigger the role the public sector needs to take, in investment especially, and more broadly in bearing risk.
2. Output can be very elastic in response to stronger demand, much more so than is usually believed. There’s a real danger that over-conservative estimates of potential output will lead us to set our sights too low.
3. Demand conditions have major effects on income distribution. Full employment is an extremely powerful tool to shift income toward the lower-paid and to less-privelged groups, even in absence of direct redistribution.
Unfortunately, I am not sure the underlying paper will ever see the light of day. it was written primarily to support the macroeconomic case for a major expansion in public spending, even in a situation that looks like full employment. But that’s not what the situation looks like now.