Bu arada genelde yanlış anlaşılan bir konuya da biraz değıneyim: verimlilik. TR'de verimliliğin düşük olduğunu biliyoruz. Artırmak için ne yapmalı? İnsanın aklına ilk gelen, AR-GE, inovasyon, yüksek teknolojilere yatırım gibi çözümler oluyor. Ama bu doğru çıkarım değil. + Verimliliğin en kapsamlı ölçütü, toplam faktör verimliliği (TFV) denen kavram. TFV ülkedeki kaymakların (iş gücü, sermaye) toplamının ne kadar verimli kullandığını ölçüyor. TR gibi ülkelerde en önemli belirleyici unsurlardan biri, +

Türk ekonomisini sağlam bir temele oturtabilmemiz için bir gerçeği anlamamız ve zaman içinde değiştirmeye çalışmamız lazım. Uzun zamandır izlenen büyüme modeli, sürdürülemeyen ve krizlere yol açan bir model. Yüksek dış finansman ve düşük iç tasarrufa dayalı bir model. + Ülke büyüyünce cari açık artıyor;  cari acık finanse edilemediği zaman büyüme düşüyor. Bu uzun zamandır böyle ama RTE döneminde, finansal küreleşme yardımıyla da, bu strateji derinleşti, kök saldı. +

Released today: my new paper on "An Industrial Policy for Good Jobs." Proposes a combination of local and federal initiatives to enhance good job creation. hamiltonproject.org/assets/files/2… I argue that, as important as they may be, recent industrial policy initiatives such as the CHIPS act or green subsidies will not be adequate to generate adequate good jobs in the economy. +

I had two rejections from top economics journals in recent days. Disappointed at personal level as always. But with the caveat that I don’t deal with journals as often these days as I used to, let me say two things. + First, journal decision times were much much shorter than what they used to. Second, very high quality referee reports that are generally helpful and constructive. Profession is moving in right direction in these respects.

Watching the Turkish Lira’s collapse today, the thought that keeps popping in my head is “live by financial markets, die by financial markets.” + For years, Erdogan was given a very long leash by financial markets, as his unsustainable macro policies were supported by external inflows, attracted by the short-term yield gap. +

From a new paper (with Jacob Greenspon): the global distribution of authorship of top-10 economics journal authorship versus economic size Authors based in developing countries have made little gains over time, and where they have, it is limited to the lowest-ranked journals.

Re utility of classics in Economics, I’d like to take a position that I think is intermediate between @BrankoMilan and @florianederer. There's a sense in which Economics is like the natural sciences, with cumulative progress and you only need to read the latest articulation. + So to understand comparative advantage, or efficiency of markets or a particular mode of oligopoly you do not need to read Ricardo, Smith, or Cournot. Contemporary textbooks are much better at explaining the theory, clarifying where it applies, and presenting relevant evidence. +

A word about manufacturing, prompted by Biden’s “buy American” proposals. It is important to distinguish between production and employment. + Manufacturing production exerts outsized influence on a nation’s innovative capacity and productivity. It is important to have sensible industrial policies that promote it. And it’s possible to reinvigorate manuf in the sense of preventing a decline in MVA/GDP. +

There’s been much discussion in recent days about Economics’ race problem. Some of what has come out is quite disturbing. I have not said much, but I have listened and thought. Here are a few reflections I want to add. + It doesn’t surprise me that the field, as a whole, reflects the ingrained attitudes and practices of the society of which it is part. But there are some features of the discipline that magnify and aggravate the problem. +

Short thread on technology and skills: I am struck by how much we focus on education/training (to match the demands of innovation) and how little we think about redirecting innovation (to match the skills of the current and prospective labor force). + Technological determinism runs deep. We tend to think we have little control over innovation and that society must somehow adjust to its consequences. Yet who innovates, who benefits from innovation, whom it replaces, and how it is deployed are all the result of choices we make +

I’m starting to think the idea that Trump captured the Republican Party has it exactly backward. It’s the party that’s captured Trump, making him pursue all its favorite policies (taxes, judges, deregulation), just with a modicum of space for Trumpian idiosyncrasy on trade. Moreover, Trump has the great virtue from the standpoint of the R party that he can increase support for it among the less well off whites by playing the racism and nativism card. Otherwise, plutocratic policies would have dwindling electoral support.

There are good economic and political reasons why the compensation part of the liberalization-cum-compensation bargain was not fulfilled (and could not have been). See argument here drodrik.scholar.harvard.edu/files/dani-rod…. +

https://twitter.com/LarryMishel/status/1167482142210891779

But in brief: First, when trade barriers are very low reducing them does not generate enough resources to redistribute under reasonable assumptions about the deadweight loss of taxes and transfers. +

A new paper in AER demonstrating empirically what many suspected for a long time: globalization has led to reduced tax burden on the top 1% while increasing it on the median pubs.aeaweb.org/doi/pdfplus/10… What's especially interesting in this paper is that it shows the pre-1994 period was quite different: in the earlier period, increased trade was associated with more progressivity in taxes. (See Fig. 2.) The nature of globalization clearly changed after the mid-1990s.

“a vast majority of economists argue that over all, tariffs cost more jobs than they create.” This has become almost a truism in the media but a graduate student who wrote this in an exam, without tons of qualifiers, would fail it. nytimes.com/2018/07/23/bus… First, the standard teaching in economics is that tariffs affect the structure of jobs and not their quantity. The level of employment is determined by macroeconomic considerations and monetary/fiscal policy in particular.

The hard cold economic fact is that if retail prices of washers-dryers increase only by around $50, this will be a big "net gain" for the U.S. economy wsj.com/articles/lg-to… It means the bulk of the increase in tariffs is being absorbed by foreign sellers, with the U.S. treasury (tariff collection) the big winner.