I think there are some great essays that could be written to make the case for why a transformed monetary policy (like NGDPLT) or transformed financial system (ie, using crypto) might be much better for creating a fairer, more stable and prosperous economy. And this might be important enough that supporting some aspect of the transition to this fairer/better world should be considered an EA cause. But sadly I think this essay does not live up to the potential, and makes the case poorly.
Hi Jackson, thanks for your comments. I agree, that I could definitely have made a better case in this post, however I had to cobble it together in half a day before the submission deadline. I’d be interested to learn more about the NGDPLT you speak of as I’m quite unfamiliar with it.
In terms of crypto, I intend to make a case for why Bitcoin is different from the rest of “crypto”. and I’m in general very skeptical of the promise of wider crypto.
I definitely appreciate the value of getting something out there and not letting ideas languish as unpublished drafts!
Responding about NGDPLT, this is “nominal GDP level targeting”—a proposed framework for the federal reserve to make better decisions about when to raise & lower interest rates, print money, or etc. Its biggest proponents are probably libertarian-leaning economists at George Mason University and the Mercatus Center (I generally like these folks). Here is a three-page summary of the idea, that the fed should stop targeting “inflation” (a rate of increase) and instead target a certain overall nominal GDP each year (a level rather than a rate): https://www.mercatus.org/system/files/Sumner-NGDP-Targeting-sum-v1.pdf
The main upsides here are:
the new system might perform better at avoiding inflation and recession.
the new system would be more objective and algorithmic, basically driven by prediction markets—we’d be putting control of the economy more on autopilot in a way that would be more trustworthy, predictable, and fast-acting in a crisis, compared to the current system of “whatever jay powell feels like, within some reasonable range of debate and political framing”. Although of course NGDP level targeting would not go as far as some crypto ideas of completely algorithmic monetary policy.
I think there are some great essays that could be written to make the case for why a transformed monetary policy (like NGDPLT) or transformed financial system (ie, using crypto) might be much better for creating a fairer, more stable and prosperous economy. And this might be important enough that supporting some aspect of the transition to this fairer/better world should be considered an EA cause. But sadly I think this essay does not live up to the potential, and makes the case poorly.
Hi Jackson, thanks for your comments. I agree, that I could definitely have made a better case in this post, however I had to cobble it together in half a day before the submission deadline. I’d be interested to learn more about the NGDPLT you speak of as I’m quite unfamiliar with it.
In terms of crypto, I intend to make a case for why Bitcoin is different from the rest of “crypto”. and I’m in general very skeptical of the promise of wider crypto.
I definitely appreciate the value of getting something out there and not letting ideas languish as unpublished drafts!
Responding about NGDPLT, this is “nominal GDP level targeting”—a proposed framework for the federal reserve to make better decisions about when to raise & lower interest rates, print money, or etc. Its biggest proponents are probably libertarian-leaning economists at George Mason University and the Mercatus Center (I generally like these folks). Here is a three-page summary of the idea, that the fed should stop targeting “inflation” (a rate of increase) and instead target a certain overall nominal GDP each year (a level rather than a rate): https://www.mercatus.org/system/files/Sumner-NGDP-Targeting-sum-v1.pdf
The main upsides here are:
the new system might perform better at avoiding inflation and recession.
the new system would be more objective and algorithmic, basically driven by prediction markets—we’d be putting control of the economy more on autopilot in a way that would be more trustworthy, predictable, and fast-acting in a crisis, compared to the current system of “whatever jay powell feels like, within some reasonable range of debate and political framing”. Although of course NGDP level targeting would not go as far as some crypto ideas of completely algorithmic monetary policy.