Rethinking Macro Policy: Ken Rogoff's remarks

Reading Time:

Rogoff's remarks at this year's IMF Spring Meeting start at about 19:30.

Many points are healthy food for thought, I just quickly wrote down five things that caught my attention:

  • Entertainment is now virtually free in advanced economies.
  • Uber allows for a more efficient use of the capital stock. We don't think enough about the implications for national statistics. Our statistics do not even begin to get at the implications of new technologies.
  • It's easy to be cynical about your kids wasting time on things like Facebook, but there is value... (if I heard correctly).
  • We don't know what the real interest rate is, since we don't really know how high inflation is... Maybe the real interest rate is higher than we think. (Rogoff seems to be saying that measured inflation is overstated.)
  • If we expand infrastructure and education, we shouldn't let government be bigger, but better.

Other speakers:

Olivier Blanchard, IMF Economic Counsellor and Director of Research Department
Raghuram Rajan, Governor, Reserve Bank of India
Larry Summers, President Emeritus and Charles W. Eliot University Professor, Harvard University

Update; 4/23/15: Via VoxEU:

Disruptive technologies such as Uber point the way towards vastly more efficient uses of the existing capital stock. Yes, there are negative trends such as environmental degradation that detract from welfare, but overall it is quite likely that measured GDP growth understates actual growth, especially when measured over long periods. It is quite possible that future economic historians, using perhaps more sophisticated measurement techniques, will evaluate ours as an era of strong growth in middle-class consumption, in contradiction to the often polemic discussion one sees in public debate on the issue.

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