Krugman vs. Krugman 3 Days Earlier (A New Record For Self-Contradiction)
People like to compare what Krugman writes today in his political hack era with what he wrote in his real economist era. But this time I do not have to look that far back.
On February 5 and On February 6, Krugman essentially agrees with the OMB review of Obamacare effects on employment, saying that the health care subsidies for lower-income workers would cause millions to work less by reducing the incentive to work, which he called "a good thing." More here.
On February 9, Krugman returns to a theme he has been hitting on for some weeks now, calling the Republicans anti-science, mean-spririted, etc. for actually believing that unemployment benefits might reduce employment by reducing the incentive to work. And here is what he wrote on the topic on December 8:
The view of most labor economists now is that unemployment benefits have only a modest negative effect on job search — and in today’s economy have no negative effect at all on overall employment. On the contrary, unemployment benefits help create jobs, and cutting those benefits would depress the economy as a whole.
Yes I understand the shape of the subsidy patterns with income are different, but good God man you cannot reasonably argue that the labor supply curve is sensitive to means-tested government subsidies for one program but not at all for another without a heroic analysis that I cannot imagine and Krugman has not supplied.
Curtis:
Heroic and Krugman should never occur in the same sentence.
February 11, 2014, 1:07 pmMingoV:
Hello, I'm the Nobel Prize-winning economist Dr. Paul Krugman. In the mid-1990s I decided to toss away my career as an economist so I could spout whatever nonsense would best help left-wingers. I've been doing so for 16 years, and I still get published and quoted by the media. The only honest things I've said in the past 16 years were coincidences. I'm proud to say that I lie almost as often as President Obama. Thank you.
February 11, 2014, 3:27 pmherdgadfly:
From NRO:
In 1999 Paul Krugman was paid $50,000 by Enron as a consultant on its “advisory board,” and that same year he wrote a glowing article about Enron for Fortune magazine. But he would change his tune. After Enron collapsed in 2001, Krugman wrote several columns excoriating the company. (One featured what may be the most absurd howler in the history of op-ed journalism: “I predict that in the years ahead Enron, not Sept. 11, will come to be seen as the greater turning point in U.S.society.”) In most of these columns Krugman worked hard to link Enron to the Bush administration, and in one he actually blamed Enron’s consultants for the company’s collapse — while neglecting to mention that he, too, had been an Enron consultant.
February 11, 2014, 4:48 pmherdgadfly:
MingoV
There were two famous economists named Paul Krugman and the dead one was awarded a Nobel Prize in Economics posthumously in 2008.
February 11, 2014, 4:56 pmJoe_Da:
Krugman the left wing Pundit - "The view of most labor economists now is that unemployment benefits have only a modest negative effect on job search — and in today’s economy have no negative effect at all on overall employment."
That is exactly the opposite of he states in his textbook "introduction to economics"
People respond to incentives. If unemployment becomes more attractive because of the unemployment benefit, some unemployed people may no longer try to find a job or may not try to find one as quickly as they would without the benefit….
“A high minimum wage can cause structural unemployment. Generous unemployment benefits can increase both structural and frictional unemployment. So government policies intended to help workers can have the undesirable side effect of raising the natural rate of unemployment.”
– Paul Krugman, Robin Wells, and Kathryn Graddy, Essential of Economics, 2nd Edition (New York: Worth Publishers 2011) pp. 7, 345
February 12, 2014, 6:32 amirandom419:
How to apply, but not get a job for an unemployment vacation. Simple apply at companies that have layoffs. Then there was the single mom that got laid off and her first thought was road trip. Yeah, right modest disincentive.
February 12, 2014, 10:01 amKenneth_Almquist:
"you cannot reasonably argue that the labor supply curve is sensitive to means-tested government subsidies for one program but not at all for another..."
Indeed, which is why Krugman doesn't argue that. Saying that unemployment benefits have a "negative effect on job search" is another way of saying that "the labor supply curve is sensitive to" unemployment benefits. Your perception that Krugman has contradicted himself is the result of a failure of reading comprehension on your part.
February 12, 2014, 10:51 amJoe_Da:
Reading comprehension test - "The view of most labor economists now is that unemployment benefits have only a modest negative effect on job search — and in today’s economy have no negative effect at all on overall employment."
Krugman does indeed argue that very point and he has frequently argued that point over the last 5-6 years.
February 12, 2014, 12:43 pmKenneth_Almquist:
I agree that Krugman has made this point repeatedly. Please note that I am not the one accusing Krugman of inconsistency. In fact, the point of my previous comment was that Krugman has *not* contradicted himself on this point.
Perhaps you are wondering why decreasing the incentive to work will "have no negative effect at all on overall employment" in the current economy. The short answer is that currently there are more people looking for work than there are jobs available. This means that the employment level is determined by the number of jobs available, not by the number of people looking for work. If a few people leave the work force, that won't decrease the employment level because there will still be workers available to fill all of the available jobs.
February 12, 2014, 11:12 pmMeekrob:
Whoops! Must've slipped his mind.
February 22, 2014, 2:41 pm