27 Comments
Sep 21, 2021Liked by Noah Smith

Wow that is just a shockingly bad take from Mankiw. I remember even in the econ 101 textbook I got, in the chapter about basic concepts of supply and demand, they discussed the possibility that the curves might sometimes be wonky, and they very specifically used the wage / leisure trade-off to illustrate this -- sometimes when people get richer (higher wages) they will choose to "spend" some of those gains by way of working less, and it's entirely possible that the equilibrium might have lower headline income. (But if working fewer days lowers commute costs, or provides intangible benefits, like unpriced-but-valuable time with family, this can still result in a net improvement in the earner's welfare.)

Expand full comment
Sep 21, 2021Liked by Noah Smith

Many popular economists act more like mass psychology gurus than empirical scientists.

Expand full comment
Sep 21, 2021Liked by Noah Smith

Unlike this *my* theory of everything (neogeorgism) is perfect

Expand full comment

Has Mankiw no shame? He's just mailing in a hack job and the NYT editors are doing the same by allowing such poor opinions. Oh, he's Harvard, give him a pass.

Expand full comment

Grand Theory: Free time is a Kuznets curve and America is just self selected weirdos. QED.

Expand full comment

For context, people might find of interest Robert Skidelsky, What’s Wrong with Economics?: A Primer for the Perplexed, Yale University Press, 2020. https://www.amazon.com/Whats-Wrong-Economics-Primer-Perplexed/dp/030024987X James Galbraith reviews: Skidelsky wants economics to be a multidisciplinary subject again. The problem is that economics no longer encourages reflection on its own philosophical foundations. It consists, rather, of the application of settled techniques – constrained optimization of intertemporal utility functions, “computable general equilibria,” and the “dynamic stochastic general equilibrium” model in “macroeconomics.” With these tools, academics compete for attention, citations, rankings, promotions, and – above all – the approval of those who taught them those tools in the first place. As such, Skidelsky’s appeal for a return to an economics that is rooted in history, sensitive to ethics, and alert to the limits of the “self-regulating” market is doomed to fall on deaf ears. The average economist today has been trained to disparage such things, regarding them as at best a waste of time, and at worst as a threat to one’s personal professional standing. “

Expand full comment

"The differences in work hours between the U.S. and other rich countries are probably due mostly to things other than tax rates."

Exactly. In any case The UN chief has much more useful things to say about tax and poverty eradication:

<<"This means making bold investments in systems that support human development - from education and universal social protection, to health care and jobs. It means putting people above profits, including through progressive taxation, and ending tax evasion, money laundering, and illicit financial flows," he said. "And it means reforming the global financial system, tackling debt distress and ensuring that developing countries benefit from the recent allocation of Special Drawing Rights," he said.>>

Much of the world's working-age population is too poor - and too unemployed - to pay any tax at all. so lowering tax rates will not "incentivize them to work harder"....

Expand full comment

Mankiw is a lying scumbag reactionary who uses mathy window dressing to pretend his dystopic ideology is required by scientific truth. And the sky is blue.

Expand full comment

Mankiw's been so transparently dishonest for so long... it's embarrassing that he's still respected in the profession.

Expand full comment

Believe me, I'm no fan of Prescott's RBC theory. As Noah points out, it's just dumb to think that we can explain employment *fluctuations* as shifts along the labor supply curve. But is it accurate to say that Prescott is applying RBC theory here? As far as I can tell, he's trying to use labor supply logic to explain long-run *trends* in employment. The idea that labor supply might be an important determinant of employment in the long run actually doesn't seem super illogical-- think of people deciding when they're going to retire, households deciding whether one or both adults will work, etc.

I'm sympathetic to the point that Prescott's empirical analysis is shitty (it always is), but to my knowledge, the basic theoretical idea underlying his argument long predates his nonsense RBC theory. Moreover, even in a lot of Keynesian models, workers are on their labor supply curves, so it's not really the case that saltwater economists completely dismiss labor supply decisions as being a thing. Are we being too hard on the basic economic idea of an upward-sloping labor supply?

Expand full comment

The job of an economist is to make sure that the wealthy and powerful stay that way so as to continually increase their shares. Economists have no other job, so given the concentration of wealth I'd say economists have done a fine job of looking out for their bosses, all that was needed was a bit of pseudo science and they delivered and the public swallowed the necessary lies hook line and sinker.

Think about it, if you are a top billionaire you can buy all the economists you need and as first priory do, the likelihood that economics will become corrupt over time is 100%, no other field has anywhere near this much incentive to become corrupt and obviously so, why would we even consider buying into the lies? .

Expand full comment

Sounds like just a whole lot of same ole Lang sang. Come catch me, it's now. 🙈🙉🙊👁👄👂👃🙌👊👏💪

Expand full comment

You see actually the did have it all figured out, they figured out how to hoodwink the unfortunate and they pulled it all off perfectly, the victims willingly swallowed the whole scam, eager to be deceived, the middle class demanded to be abolished by how they voted, deceived by economists into thinking you can consume your way to success

Expand full comment

Macro-economists' favorite mode of argumentation is building a strawman by selectively picking sparse pieces of evidence and plugging them in into whichever mathematical method which will output their desired conclusion. I've seen it often enough to trust most sociologists more than macro-economists. Micro-economists, on the other hand, when they're working at the firm level, can make pretty good deductions.

Expand full comment

Mankiw really brings out the tankies

Expand full comment