Wednesday, February 15, 2012 8:41am

Economic Stimulus

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.

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.

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 3
Bio/Vote History
         
Alesina Alberto Alesina Harvard Agree 6
Bio/Vote History
         
Altonji Joseph Altonji Yale Did Not Answer
Bio/Vote History
         
Auerbach Alan Auerbach Berkeley Agree 7
Bio/Vote History
         
Autor David Autor MIT Agree 7
Bio/Vote History
         
Baicker Katherine Baicker Harvard Did Not Answer
Bio/Vote History
         
Banerjee Abhijit Banerjee MIT --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 8
i think everyone was in a complete funk in 2009 and the assurance of government support stopped a potential meltdown.
 
Bertrand Marianne Bertrand Chicago Agree 3
Bio/Vote History
         
Brunnermeier Markus Brunnermeier Princeton --- ---
---
Bio/Vote History
Joined 11/2013 Agree 4
It would have been better if the stimulus would have been more effectively employed and led to better long-run investments.
 
Chetty Raj Chetty Harvard Did Not Answer
Bio/Vote History
         
Chevalier Judith Chevalier Yale Agree 9
Bio/Vote History
         
Currie Janet Currie Princeton Agree 3
Bio/Vote History
         
Cutler David Cutler Harvard Strongly Agree 10
Bio/Vote History
Revote 11/2013 Strongly Agree 6
 
Deaton Angus Deaton Princeton Strongly Agree 9
Bio/Vote History
         
Duffie Darrell Duffie Stanford Agree 2
Subsidizing employment leads employment to go up, other things equal. Adverse impacts through growth incentives might take time.
Bio/Vote History
         
Edlin Aaron Edlin Berkeley Did Not Answer
Bio/Vote History
         
Eichengreen Barry Eichengreen Berkeley Strongly Agree 9
Bio/Vote History
         
Einav Liran Einav Stanford --- ---
---
Bio/Vote History
Joined 11/2013 Agree 6
 
Fair Ray Fair Yale Strongly Agree 10
Bio/Vote History
         
Finkelstein Amy Finkelstein MIT --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 8
 
Goldberg Pinelopi Goldberg Yale Agree 6
Bio/Vote History
         
Goldin Claudia Goldin Harvard Agree 7
Bio/Vote History
         
Goolsbee Austan Goolsbee Chicago Strongly Agree 9
quit with the politics and just go read the official ARRA reports for a review of the evidence
Bio/Vote History
         
Greenstone Michael Greenstone Chicago Strongly Agree 8
Bio/Vote History
         
Hall Robert Hall Stanford Agree 7
All reasonable models have this implication, but there's enough the models are missing...
Bio/Vote History
         
Hart Oliver Hart Harvard --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 8
I'm enough of a Keynesian to believe this.
 
Holmström Bengt Holmström MIT Agree 9
Bio/Vote History
         
Hoxby Caroline Hoxby Stanford Strongly Disagree 5
High confidence on an issue like this would be foolish.That being said, the depressing effect of future liabilities likely exceeded benefits
Bio/Vote History
         
Hoynes Hilary Hoynes Berkeley --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 10
 
Judd Kenneth Judd Stanford Uncertain 6
There has been no serious study of this. Most analyses that try to analyze 2008-2011 are too simple and/or plagued with mathematical errors.
Bio/Vote History
         
Kaplan Steven Kaplan Chicago --- ---
---
Bio/Vote History
Joined 11/2013 Agree 3
 
Kashyap Anil Kashyap Chicago Strongly Agree 7
But this is an incredibly low bar.
Bio/Vote History
         
Klenow Pete Klenow Stanford Agree 8
Caveat: how much was it offset by less agressive (than otherwise) unconventional monetary policy?
-see background information here
Bio/Vote History
         
Lazear Edward Lazear Stanford Disagree 6
The estimates are varied and the highest are based on ex ante models, not experienced-based data. The upper bound estimate is low.
Bio/Vote History
         
Levin Jonathan Levin Stanford Did Not Answer
Bio/Vote History
         
Maskin Eric Maskin Harvard Agree 6
Bio/Vote History
         
Nordhaus William Nordhaus Yale Strongly Agree 9
See the various CBO studies on the subject.
Bio/Vote History
         
Obstfeld Maurice Obstfeld Berkeley Agree 9
Bio/Vote History
         
Rouse Cecilia Rouse Princeton Strongly Agree 10
With the caveat that there is no perfect experiment, the evidence suggests it boosted the economy.
Bio/Vote History
         
Saez Emmanuel Saez Berkeley Strongly Agree 8 Bio/Vote History
         
Samuelson Larry Samuelson Yale --- ---
---
Bio/Vote History
Joined 11/2013 Agree 6
 
Scheinkman José Scheinkman Princeton Agree 4
Bio/Vote History
         
Schmalensee Richard Schmalensee MIT Agree 6
Bio/Vote History
         
Shapiro Carl Shapiro Berkeley --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 10
Theory and empirical evidence line up in a convincing manner on this point.
 
Shimer Robert Shimer Chicago --- ---
---
Bio/Vote History
Joined 11/2013 Agree 8
 
Shin Hyun Song Shin Princeton Agree 7
Bio/Vote History
         
Stock James Stock Harvard Strongly Agree 8
Bio/Vote History
         
Stokey Nancy Stokey Chicago Agree 8
Block grants to the states allowed them to cut education, health, and other services by less as state tax revenues fell.
Bio/Vote History
         
Thaler Richard Thaler Chicago Agree 7
Even clearer by 2011. Why ask about 2010 when much of the stimulus is slow acting? The stimulus project on my way to work just finishing.
Bio/Vote History
         
Udry Christopher Udry Yale Strongly Agree 3
Bio/Vote History
         
Zingales Luigi Zingales Chicago Agree 6
At the very minimum the transfer to the states prevented them from firing state employees. But I do not know how big the overall effect was
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 Strongly Disagree 4
Bio/Vote History
         
Altonji Joseph Altonji Yale Did Not Answer
Bio/Vote History
         
Auerbach Alan Auerbach Berkeley Agree 7
Bio/Vote History
         
Autor David Autor MIT Agree 5
Bio/Vote History
         
Baicker Katherine Baicker Harvard Did Not Answer
Bio/Vote History
         
Banerjee Abhijit Banerjee MIT --- ---
---
Bio/Vote History
Joined 11/2013 Agree 6
The only reason I hesitate is that the US political system is totally broken. As result the readjustment may be anything but rational.
 
Bertrand Marianne Bertrand Chicago Uncertain 3
Bio/Vote History
         
Brunnermeier Markus Brunnermeier Princeton --- ---
---
Bio/Vote History
Joined 11/2013 Uncertain 3
 
Chetty Raj Chetty Harvard Did Not Answer
Bio/Vote History
         
Chevalier Judith Chevalier Yale Uncertain 9
This is in part an empirical question and I think it would be difficult to answer this with any certainty.
Bio/Vote History
         
Currie Janet Currie Princeton Uncertain 3
Bio/Vote History
         
Cutler David Cutler Harvard Strongly Agree 10
Bio/Vote History
Revote 11/2013 Strongly Agree 6
Not changing my vote but interesting that no one asked me why. I believe the HITECH Act (part of it) was extremely valuable as health policy
 
Deaton Angus Deaton Princeton Agree 7
Bio/Vote History
         
Duffie Darrell Duffie Stanford Uncertain 2
Bio/Vote History
         
Edlin Aaron Edlin Berkeley Did Not Answer
Bio/Vote History
         
Eichengreen Barry Eichengreen Berkeley Strongly Agree 9
Bio/Vote History
         
Einav Liran Einav Stanford --- ---
---
Bio/Vote History
Joined 11/2013 Agree 5
 
Fair Ray Fair Yale Uncertain 5
I am working on this question now using my macro model. Any thoughts on what discount rate to use for increased future unemployment?
Bio/Vote History
         
Finkelstein Amy Finkelstein MIT --- ---
---
Bio/Vote History
Joined 11/2013 Agree 4
 
Goldberg Pinelopi Goldberg Yale Agree 6
Bio/Vote History
         
Goldin Claudia Goldin Harvard Agree 7
Bio/Vote History
         
Goolsbee Austan Goolsbee Chicago Agree 5
This all depends on how much you value avoiding short-run collapse versus the costs long-term. But it’s not free.
Bio/Vote History
         
Greenstone Michael Greenstone Chicago Strongly Agree 5
U.S. was losing 700K jobs per month & K markets were not functioning. economy was in crisis & ARRA helped, along with K markt interventions
Bio/Vote History
         
Hall Robert Hall Stanford Uncertain 3
I'd agree that the results are likely to be on the positive side, but I can think of future crashes caused by the accumulation of debt
Bio/Vote History
         
Hart Oliver Hart Harvard --- ---
---
Bio/Vote History
Joined 11/2013 Agree 8
Again, I'm enough of a Keynesian to believe this.
 
Holmström Bengt Holmström MIT Agree 2
Feedback effects too complicated to calculate. My best guess is that the program was marginally beneficial, but monetary easing helped more.
Bio/Vote History
         
Hoxby Caroline Hoxby Stanford Strongly Disagree 5
same as above
Bio/Vote History
         
Hoynes Hilary Hoynes Berkeley --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 10
 
Judd Kenneth Judd Stanford Uncertain 6
Same as response to previous question.
Bio/Vote History
         
Kaplan Steven Kaplan Chicago --- ---
---
Bio/Vote History
Joined 11/2013 Uncertain 5
 
Kashyap Anil Kashyap Chicago Uncertain 7
Payoffs to special interests (& associated political costs that paralyzed other efforts) made it far less effective than it could have been
Bio/Vote History
         
Klenow Pete Klenow Stanford Uncertain 8
Depends critically on how permanent and useful the stimulus to government spending.
Bio/Vote History
         
Lazear Edward Lazear Stanford Strongly Disagree 8
The cost is the enormous and tough-to-reverse growth of government. This swamps even high estimates of benefits. See my op-eds. that explain
-see background information here
Bio/Vote History
         
Levin Jonathan Levin Stanford Did Not Answer
Bio/Vote History
         
Maskin Eric Maskin Harvard Agree 6
Bio/Vote History
         
Nordhaus William Nordhaus Yale Agree 7
Hard to know how the increased debt will be paid (Congress could make a mess of it), so some uncertainty here.
Bio/Vote History
         
Obstfeld Maurice Obstfeld Berkeley Strongly Agree 9
Bio/Vote History
         
Rouse Cecilia Rouse Princeton Agree 9
Not sure how to interpret "effects on future spending" but I'm persuaded the alternative (without the ARRA) would have put us on a bad path.
Bio/Vote History
         
Saez Emmanuel Saez Berkeley Agree 6
Bio/Vote History
         
Samuelson Larry Samuelson Yale --- ---
---
Bio/Vote History
Joined 11/2013 Uncertain 1
Benefits and costs are sufficiently hard to measure that this remains largely an act of faith.
 
Scheinkman José Scheinkman Princeton Uncertain 3
This will depend on future tax and spending policies.
Bio/Vote History
         
Schmalensee Richard Schmalensee MIT Agree 3
Bio/Vote History
         
Shapiro Carl Shapiro Berkeley --- ---
---
Bio/Vote History
Joined 11/2013 Strongly Agree 9
Everyone should remember that the economy was in free fall when ARRA was passed. Recoveries from financial crises are long and hard.
 
Shimer Robert Shimer Chicago --- ---
---
Bio/Vote History
Joined 11/2013 Uncertain 8
 
Shin Hyun Song Shin Princeton Disagree 6
Bio/Vote History
         
Stock James Stock Harvard Agree 7
Bio/Vote History
         
Stokey Nancy Stokey Chicago No Opinion
How can anyone imagine this question is answerable, given the current state of economic science?
Bio/Vote History
         
Thaler Richard Thaler Chicago Strongly Agree 8
The part of the economy where we are still losing jobs is gov employment. Gov can create its own recession by being short sighted.
Bio/Vote History
         
Udry Christopher Udry Yale Agree 1
Bio/Vote History
         
Zingales Luigi Zingales Chicago Disagree 4
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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