Market-Based Solutions: Resource Allocation Key
Conn Carroll /
New York University economics professor Mario Rizzo kicks off the second morning panel “Market-Based Solution.” He begins by taking fire at the macroeconomists who are claiming they know exactly how many jobs each version of Obama’s Trillion Dollar Debt Plan will create. Rizzo says:
Unfortunately, much of the policy advice offered recently by commentators, including many economists, is shockingly superficial. It is reminiscent of the simple prime-the-pump ideas of the early Keynes and does not acknowledge Keynes’s own cautions and qualifications after the General Theory was published.”
Rizzo then went onto stress that the microeconomic realities were the key to real economic recovery: “I wish to emphasize the resource allocation issues that characterize both the current situation and its underlying causes. The macroeconomic way of thinking ignores the complexity of our system and generates policies that will not bring lasting recovery.”
Turning to solutions, Rizzo recommends: (more…)