But Krugman also believes in monetary policy -- he was an advocate of aggressive QE -- while Koo thinks that monetary policy (especially now) is useless.
- 作者: Richard C. Koo
- 出版社/メーカー: Wiley
- 発売日: 2009/08/17
- メディア: ペーパーバック
- クリック: 5回
Even though quantitative easing failed to produce the expected results, the belief that monetary policy is always effective persists among economists in Japan and elsewhere. To these economists, quantity easing did not fail: it simply was not tried hard enough. According to this view, if boosting the excess reserves of commercial banks to ￥25 trillion has no effect, then we should try injecting ￥50 trillion, or ￥100 trillion.
At the risk of belaboring the obvious, imagine a patient in the hospital who takes a drug prescribed by her doctor, but does not react as the doctor expected, and, more importantly, does not get better. When she reports back to the doctor, he tells her to double the dosage. But this does not help, either. So he orders her to take four times, eight times, and finally a hundred times the original dosage. All to no avail. Under these circumstances, any normal human being would come to the conclusion that the doctor's original diagnosis was wrong, and that the patient suffered from a different disease.*1
A series of pre-announced VAT increases and a simultaneous reduction in income tax rates would result in a predictable increase in inflation without inducing additional uncertainty, would increase consumer spending today, and would not lead to higher budget deficits, all while keeping the total tax burden of households the same.
We find that the effect is significantly stronger for the more educated heads of household, for higher-income households, for households living in larger cities, and for working-age heads of household.
…, lower-income, lower-educated, and retired households, living in rural areas – should be targeted with specific communicative efforts so that the policy measures indeed deliver their full potential.