Tuesday, July 29, 2014 12:03pm

Economic Stimulus (revisited)

Question A: Because of the American Recovery and Reinvestment Act of 2009, the U.S. unemployment rate was lower at the end of 2010 than it would have been without the stimulus bill. (The experts panel previously voted on this question on February 15, 2012. Those earlier results can be found here.)

Responses
 

Source: IGM Economic Experts Panel
www.igmchicago.org/igm-economic-experts-panel

Responses weighted by each expert's confidence

Source: IGM Economic Experts Panel
www.igmchicago.org/igm-economic-experts-panel

Question B: Taking into account all of the ARRA’s economic consequences — including the economic costs of raising taxes to pay for the spending, its effects on future spending, and any other likely future effects — the benefits of the stimulus will end up exceeding its costs. (The experts panel previously voted on this question on February 15, 2012. Those earlier results can be found here.)

Responses
 

Source: IGM Economic Experts Panel
www.igmchicago.org/igm-economic-experts-panel

Responses weighted by each expert's confidence

Source: IGM Economic Experts Panel
www.igmchicago.org/igm-economic-experts-panel

Question A Participant Responses

Participant University Vote Confidence Comment Bio/Vote History
Acemoglu Daron Acemoglu MIT Agree 4
Bio/Vote History
         
Alesina Alberto Alesina Harvard Disagree 8
Bio/Vote History
         
Altonji Joseph Altonji Yale Strongly Agree 6
Bio/Vote History
         
Auerbach Alan Auerbach Berkeley Strongly Agree 7
Bio/Vote History
         
Autor David Autor MIT Agree 8
Can never be certain, but evidence suggests that ARRA was effective in preventing the Great Recession from being even more calamitous.
Bio/Vote History
         
Baicker Katherine Baicker Harvard Agree 3
Bio/Vote History
         
Banerjee Abhijit Banerjee MIT Strongly Agree 7
Bio/Vote History
         
Bertrand Marianne Bertrand Chicago Agree 5
Bio/Vote History
         
Brunnermeier Markus Brunnermeier Princeton Strongly Agree 8
Bio/Vote History
         
Chetty Raj Chetty Harvard Did Not Answer
Bio/Vote History
         
Chevalier Judith Chevalier Yale Did Not Answer
Bio/Vote History
         
Currie Janet Currie Princeton Agree 6
Bio/Vote History
         
Cutler David Cutler Harvard Strongly Agree 10
Bio/Vote History
         
Deaton Angus Deaton Princeton Strongly Agree 7
Bio/Vote History
         
Duffie Darrell Duffie Stanford Agree 5
Usually, when an activity is subsidized, it increases. Inefficiency feedback effects would need to be strong to defeat the direct effect.
Bio/Vote History
         
Edlin Aaron Edlin Berkeley Strongly Agree 8
Bio/Vote History
         
Eichengreen Barry Eichengreen Berkeley Strongly Agree 9
Bio/Vote History
         
Einav Liran Einav Stanford Agree 6
Bio/Vote History
         
Fair Ray Fair Yale Agree 5
Bio/Vote History
         
Finkelstein Amy Finkelstein MIT Strongly Agree 5
Bio/Vote History
         
Goldberg Pinelopi Goldberg Yale Agree 5
Bio/Vote History
         
Goolsbee Austan Goolsbee Chicago Strongly Agree 10
Bio/Vote History
         
Greenstone Michael Greenstone MIT Strongly Agree 8
There is pretty convincing empirical literature in support Plus the budget cutting since ARRA seems related to the slow employment recovery
Bio/Vote History
         
Hall Robert Hall Stanford Did Not Answer
Bio/Vote History
         
Hart Oliver Hart Harvard Agree 9
Given that wages/prices are sticky Keynesian-type stimulus will increase economic activity if the economy is not at full employment.
Bio/Vote History
         
Holmström Bengt Holmström MIT Agree 7
Bio/Vote History
         
Hoxby Caroline Hoxby Stanford Did Not Answer
Bio/Vote History
         
Hoynes Hilary Hoynes Berkeley Strongly Agree 10
Bio/Vote History
         
Judd Kenneth Judd Stanford Agree 4
Bio/Vote History
         
Kaplan Steven Kaplan Chicago Agree 7
Bio/Vote History
         
Kashyap Anil Kashyap Chicago Strongly Agree 7
This is a very low bar
Bio/Vote History
         
Klenow Pete Klenow Stanford Agree 7
Caveat: The Fed may have pursued less unconventional stimulus (than it otherwise would have) because of the Fiscal Stimulus package.
Bio/Vote History
         
Levin Jonathan Levin Stanford Agree 4
Bio/Vote History
         
Maskin Eric Maskin Harvard Agree 7
Bio/Vote History
         
Nordhaus William Nordhaus Yale Strongly Agree 8
Bio/Vote History
         
Saez Emmanuel Saez Berkeley Strongly Agree 8
Bio/Vote History
         
Samuelson Larry Samuelson Yale Agree 7
Bio/Vote History
         
Scheinkman José Scheinkman Princeton Did Not Answer
Bio/Vote History
         
Schmalensee Richard Schmalensee MIT Agree 5
Bio/Vote History
         
Shapiro Carl Shapiro Berkeley Strongly Agree 9
Bio/Vote History
         
Shimer Robert Shimer Chicago Agree 4
Evidence for Keynesian channels of expansionary fiscal stimulus are weak, but the multiplier should still be positive
Bio/Vote History
         
Stokey Nancy Stokey Chicago Did Not Answer
Bio/Vote History
         
Thaler Richard Thaler Chicago Did Not Answer
Bio/Vote History
         
Udry Christopher Udry Yale Strongly Agree 2
Bio/Vote History
         

Question B Participant Responses

Participant University Vote Confidence Comment Bio/Vote History
Acemoglu Daron Acemoglu MIT Uncertain 3
Bio/Vote History
         
Alesina Alberto Alesina Harvard Disagree 7
Bio/Vote History
         
Altonji Joseph Altonji Yale Strongly Agree 6
Bio/Vote History
         
Auerbach Alan Auerbach Berkeley Agree 5
Bio/Vote History
         
Autor David Autor MIT Strongly Agree 8
Bio/Vote History
         
Baicker Katherine Baicker Harvard Uncertain 3
Bio/Vote History
         
Banerjee Abhijit Banerjee MIT Agree 7
Bio/Vote History
         
Bertrand Marianne Bertrand Chicago Agree 5
Bio/Vote History
         
Brunnermeier Markus Brunnermeier Princeton Agree 6
Bio/Vote History
         
Chetty Raj Chetty Harvard Did Not Answer
Bio/Vote History
         
Chevalier Judith Chevalier Yale Did Not Answer
Bio/Vote History
         
Currie Janet Currie Princeton Agree 7
Bio/Vote History
         
Cutler David Cutler Harvard Strongly Agree 8
Bio/Vote History
         
Deaton Angus Deaton Princeton Strongly Agree 7
Bio/Vote History
         
Duffie Darrell Duffie Stanford Uncertain 5
Stimulus of this type was potentially valuable. But I don't know much about the mechanics and efficiency of this particular program.
Bio/Vote History
         
Edlin Aaron Edlin Berkeley Agree 8
Bio/Vote History
         
Eichengreen Barry Eichengreen Berkeley Agree 6
Bio/Vote History
         
Einav Liran Einav Stanford Agree 5
Bio/Vote History
         
Fair Ray Fair Yale Uncertain 5
My results suggest that it is about a wash. See the URL.
-see background information here
Bio/Vote History
         
Finkelstein Amy Finkelstein MIT Agree 5
Bio/Vote History
         
Goldberg Pinelopi Goldberg Yale Agree 5
Bio/Vote History
         
Goolsbee Austan Goolsbee Chicago Strongly Agree 10
Bio/Vote History
         
Greenstone Michael Greenstone MIT Agree 7
Cumulative gap between potential & actual output much larger w/o ARRA. But would harmful budget cutting have happened w/o ARRA? Prob yes.
-see background information here
Bio/Vote History
         
Hall Robert Hall Stanford Did Not Answer
Bio/Vote History
         
Hart Oliver Hart Harvard Agree 9
Given that infrastructure expenditure was needed this was a good time to do it and so the benefits exceeded any costs.
Bio/Vote History
         
Holmström Bengt Holmström MIT Agree 5
Bio/Vote History
         
Hoxby Caroline Hoxby Stanford Did Not Answer
Bio/Vote History
         
Hoynes Hilary Hoynes Berkeley Strongly Agree 10
Bio/Vote History
         
Judd Kenneth Judd Stanford Uncertain 7
Bio/Vote History
         
Kaplan Steven Kaplan Chicago Disagree 7
Bio/Vote History
         
Kashyap Anil Kashyap Chicago Uncertain 3
Probably was worth it, but the political economy costs of the poor marketing and the fact that is was poorly designed have dogged it.
Bio/Vote History
         
Klenow Pete Klenow Stanford Uncertain 6 Bio/Vote History
         
Levin Jonathan Levin Stanford Uncertain 4
Bio/Vote History
         
Maskin Eric Maskin Harvard Agree 7
Bio/Vote History
         
Nordhaus William Nordhaus Yale Strongly Agree 7
Bio/Vote History
         
Saez Emmanuel Saez Berkeley Strongly Agree 7
Bio/Vote History
         
Samuelson Larry Samuelson Yale Uncertain 1
This is too complicated a cost-benefit problem to assess. I think the ARRA was a good idea, but this reflects faith rather than analysis.
Bio/Vote History
         
Scheinkman José Scheinkman Princeton Did Not Answer
Bio/Vote History
         
Schmalensee Richard Schmalensee MIT Agree 6
Bio/Vote History
         
Shapiro Carl Shapiro Berkeley Strongly Agree 9
Bio/Vote History
         
Shimer Robert Shimer Chicago Uncertain 5
Cost benefit analysis is tricky here. There were winners and losers. Still it would have been difficult to do nothing
Bio/Vote History
         
Stokey Nancy Stokey Chicago Did Not Answer
Bio/Vote History
         
Thaler Richard Thaler Chicago Did Not Answer
Bio/Vote History
         
Udry Christopher Udry Yale Agree 2
Bio/Vote History
         

10 New Economic Experts join the IGM Panel


For the past two years, our expert panelists have been informing the public about the extent to which economists agree or disagree on important public policy issues. This week, we are delighted to announce that we are expanding the IGM Economic Experts Panel to add ten new distinguished economists. Like our other experts, these new panelists have impeccable qualifications to speak on public policy matters, and their names will be familiar to other economists and the media.

To give the public a broad sense of their views on policy issues, each new expert has responded to a selection of 16 statements that our panel had previously addressed. We chose these 16 statements, which cover a wide range of important policy areas, because the original panelists' responses to them were analyzed in a paper comparing the views of our economic experts with those of the American public. You can find that paper, by Paola Sapienza and Luigi Zingales, here. The paper, along with other analyses of the experts' views, was discussed during the American Economic Association annual meetings, and the video can be found here.

The new panelists' responses to these statements can be seen on their individual voting history pages. Our ten new economic experts are:

Abhijit Banerjee (MIT)
Markus K. Brunnermeier (Princeton)
Liran Einav (Stanford)
Amy Finkelstein (MIT)
Oliver Hart (Harvard)
Hilary Hoynes (Berkeley)
Steven N. Kaplan (Chicago)
Larry Samuelson (Yale)
Carl Shapiro (Berkeley)
Robert Shimer (Chicago)


Please note that, for the 16 previous topics on which these new panelists have voted, we left the charts showing the distribution of responses unchanged. Those charts reflect the responses that our original panelists gave at the time, and we have not altered them to reflect the views of the new experts.

We have also taken this opportunity to ask our original panelists whether they would vote differently on any of the statements we have asked about in the past. Several experts chose to highlight statements to which they would currently respond differently. In such cases, you will see this "revote" below the panelist's original vote. We think you will enjoy seeing examples of statements on which some experts have reconsidered.

As with the 16 previous statements voted on by new panelists, these "revote" responses are not reflected in the chart that we display showing the distribution of views for that topic: all the charts for previous questions reflect the distribution of views that the experts expressed when the statement was originally posed.

About the IGM Economic Experts Panel

This panel explores the extent to which economists agree or disagree on major public policy issues. To assess such beliefs we assembled this panel of expert economists. Statistics teaches that a sample of (say) 40 opinions will be adequate to reflect a broader population if the sample is representative of that population.

To that end, our panel was chosen to include distinguished experts with a keen interest in public policy from the major areas of economics, to be geographically diverse, and to include Democrats, Republicans and Independents as well as older and younger scholars. The panel members are all senior faculty at the most elite research universities in the United States. The panel includes Nobel Laureates, John Bates Clark Medalists, fellows of the Econometric society, past Presidents of both the American Economics Association and American Finance Association, past Democratic and Republican members of the President's Council of Economics, and past and current editors of the leading journals in the profession. This selection process has the advantage of not only providing a set of panelists whose names will be familiar to other economists and the media, but also delivers a group with impeccable qualifications to speak on public policy matters.

Finally, it is important to explain one aspect of our voting process. In some instances a panelist may neither agree nor disagree with a statement, and there can be two very different reasons for this. One case occurs when an economist is an expert on a topic and yet sees the evidence on the exact claim at hand as ambiguous. In such cases our panelists vote "uncertain". A second case relates to statements on topics so far removed from the economist's expertise that he or she feels unqualified to vote. In this case, our panelists vote "no opinion".

The Economic Experts Panel questions are emailed individually to the members of the panel, and each responds electronically at his or her convenience. Panelists may consult whatever resources they like before answering.

Members of the public are free to suggest questions (see link below), and the panelists suggest many themselves. Members of the IGM faculty are responsible for deciding the final version of each week’s question. We usually send a draft of the question to the panel in advance, and invite them to point out problems with the wording if they see any. In response, we typically receive a handful of suggested clarifications from individual experts. This process helps us to spot inconsistencies, and to reduce vagueness or problems of interpretation.

The panel data are copyrighted by the Initiative on Global Markets and are being analyzed for an article to appear in a leading peer-reviewed journal.

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