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Chair of Monetary Policy
Contributor's Links: The Money Illusion

Scott Sumner is the Ralph G. Hawtrey Chair of Monetary Policy at the Mercatus Center at George Mason University.  He is also Professor Emeritus at Bentley University and Research Fellow at the Independent Institute. In his writing and research, Sumner specializes in monetary policy, the ... more

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Is COVID's Impact Semi-Permanent?
It seems likely that COVID-19 will be over long before 2025, so there seem to be some semi-permanent effects. Why? It looks like a loss of roughly 3 percentage points in the US (or 0.6% per year for 5 years).
Moore’s Law And Hyperinflation
In pre-modern times there was almost no hyperinflation, at least for extended periods of time. That’s because kingdoms mostly relied on some sort of commodity money. Thus you did not observe the sort of inflation we see under fiat money regimes.
The September Retail Sales Shocker
It’s almost impossible to overstate the weirdness of this recession. In a normal recession, retail sales plunge sharply and take years to fully recover.
Robert Hetzel And The Risks Of Inflation
The quantity theory, which posits a causal relationship between money and prices, is among the oldest theories in economics.
Just How Expansionary Has The Fed Actually Been?
In my view, Fed policy during 2020 has been contractionary, as both NGDP and price level forecasts have declined. Many people prefer to look at monetary policy in a different way, focusing on the money that the Fed injects into the banking system.
Trade Deficit Whack-A-Mole
In recent years, the US government has imposed tariffs on a number of nations, notably China.
Identifying Monetary Shocks
This post is a follow-up to my recent post on the “masquerading problem”. Recall that changes in interest rates are not a reliable indicator of changes in the stance of monetary policy.
Money Still Matters
Some people claim that open market operations no longer matter in a world with IOER, where banks have large holdings of excess reserves. This is not true.
This Isn't A Keynesian Business Cycle
In the standard Keynesian business cycle model, consumption is driven by changes in disposable income. This underlies the famous “multiplier” concept.
Stephen Williamson On NGDP Level Targeting
We should never assume that if low rates and lots of QE failed, then even lower rates and even more QE would have been needed to hit the target.
Words Matter
People often say, “I don’t care what Trump says; I support his corporate tax cuts and Supreme Court nominees”. But is it true that words don’t matter?
The Lessons Of Abenomics
This seems to be the consensus as to the “lessons” of Abenomics. Monetary stimulus is not enough; you also need fiscal stimulus. And yet if you look at the actual record of Abenomics, there’s not a shred of evidence to support this claim.
Taiwan's Surprising Boom
You might argue that 1.6% of RGDP growth is not a boom. But consider that Taiwan’s population growth rate is only 0.2%. A growth rate of 1.4% in per capita terms is fairly normal for a rich economy like Taiwan.
Characteristics Of A Banana Republic
People have asked me how I define “banana republic”. So I’ll do that in this post.
The Remainder Of The Decade
The Fed has given us its inflation forecast for the first 4 years of this decade.
Fiscal Stimulus Also Boosts Inflation
When at the zero bound for interest rates, the central bank can lower the real interest rate by raising the inflation target.
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