It’s Charlie Bean, the Bank of England’s deputy governor for monetary policy, on nominal income targets. An old wine in a new bottle apparently, even if it is edging closer to the establishment.
Some excerpts (with our emphasis):
The question is: would outcomes have been materially better under an alternative framework, such as a nominal income target?
It’s Carney live. We know George Osborne is
frustrated excited. Mark Carney, the next Governor of the Bank of England and the man Osborne once called “quite simply the best, most experienced and most qualified person in the world to do the job”, is in front of the Treasury select committee.
Here’s the live feed:
Getting a favourable leader in the Economist is pretty Establishment, surely.
At the very least, it’s interesting that the red-top weekly has managed to endorse and explain a fairly specific nominal GDP target for the Bank of England. Read more
Many thanks to economist Scott Sumner for this guest post responding to a recent comment by John Kemp, a Reuters analyst. Scott’s native writing home is The Money Illusion.
John Kemp recently posted the following questions in a comment at FT Alphaville:
Three questions for advocates of NGDPLT targeting to answer:
Given the boost that Goldman’s economists gave to the nominal GDP level targeting movement when they endorsed the idea near the end of 2011, it’s probably a good idea to listen to them when they write about the subject (whether you agree with them or not).
NGDPLT itself has many more high-profile evangelists now than it did then: the Fed adopting an Evans Rule was the latest shift in its direction, and of course the idea is being openly debated in the UK after Mark Carney suggested it would be more potent than flexible inflation targeting. Read more