Austéricos ¡a favor del QE!

Hay un debate en la red de los que echan humo. El que prendió la mecha fue Steve Williamson, que ha creado un modelo en el que - no he entendido bien el curso de su lógica- el QE produce deflación (Sic). Casi todos se le ha echado encima, menos algunos,como Andolfatto y Noah Smith, que le defiende.

Hasta ahora el último en terciar creo que es Nick Rowe, y ahí encontrarán todos los links que han entrado en el torneo.

A mi me da cierta pereza entrar a estudiar minuciosamente en qué circunstancias un aumento de la base monetaria puede producir deflación. Los dos que le defienden, Noah y Andolfatto, no me convencen. Nick Rowe tiene una brillante respuesta, pero creo que lo esencial de lo que dice es:

For the last 20 years, the Bank of Canada has said it has been targeting 2% inflation. And the Bank of Canada has said it has been doing this by raising nominal interest rates whenever it thinks that inflation would be above 2% otherwise, and lowering nominal interest rates whenever it thinks that inflation would be below 2% otherwise. And actual inflation has averaged almost exactly 2% over the last 20 years...

... Suppose, just suppose, that I ever did become convinced that the data on inflation supported Steve Williamson's theory. I would then conclude that everything I had ever learned in economics was totally wrong, and that the rate of inflation was in fact determined by a benevolent deity, or some secret cabal operating in the national interest, that ensured that the actual and expected rate of inflation always adjusted to ensure continuous full employment despite whatever stupid thing the Bank of Canada might do with nominal interest rates. I would throw out methodological individualism, and the idea that agents act in their own self-interest in setting prices and forming beliefs about prices. I would decide that the Functionalist Fallacy was not a fallacy after all.

Sí. Supongamos que Williamson está en lo correcto. Entonces, los austéricos-liquidacionistas tendrían que cambiar rápidamente de modelo, y adoptar el QE con amor -con amor apasionado- puesto que produce justo lo que desean, deflación. Sería acojonante, ¿no?

NOTA: añado la opinión de Krugman, clarificadora:

Immaculate Stability (Wonkish)

David Andolfatto, understandably, rises to Steve Williamson’s defense against the barbarians. But I’m sorry to say that he still doesn’t get the point.

He says that he’s simply offering an alternative model — and Noah Smithtakes him at his word. But what he’s actually doing is using the word “stability” to mean something completely different from the way Brad DeLong and I are using it. I don’t think there’s much point in fighting over who gets property rights over a term, so let me pose my problem in a different way that is, in fact, equivalent to my little arrows problem. If you get what I’m saying, you’ll see the equivalence. If you don’t, well, I can’t help you.

So, here’s how Andolfatto describes Williamson’s point:

Evidently, one of the effects of QE (in the model) is to increase the real stock of currency held by the private sector, and agents require an increase in currency’s rate of return (a fall in the inflation rate) to induce them to hold more currency. (Remember that the results are all contingent on the way monetary and fiscal policy are modeled.)

OK, so “agents require” a fall in the inflation rate to induce them to hold more currency. How does this requirement translate into an incentive for producers of goods and services — remember, we’re talking about stuff going on in the real economy — to raise prices less or cut them? Don’t retreat behind a screen of math — tell me a story.

I don’t think either Andolfatto or Williamson have any such story in mind; they are, in some form, invoking the doctrine of immaculate inflation. And I don’t even think they realize that they have a problem.

Look, economics is about how people (the word “agents” is itself a kind of tribal marker) are motivated to take actions, and how those actions interact. Equilibrium is often a very convenient way to think through all of that, and all of us sometimes use wording about what the economy “needs” or “requires” as shorthand. When I talk about the Dornbusch overshooting model of the exchange rate, for example, I might say something like “the currency has to overshoot its long-run value, so that investors expect appreciation that offsets the interest differential.” But behind that verbal shorthand is a story about people doing stuff: investors selling the currency because yields are down, the currency falling until it’s so low that people figure it has nowhere to go but up.

The trouble is that we have a lot of economists who apparently don’t understand why they’re doing what they’re doing; they solve their equations without even trying to picture what those equations are supposed to be saying about the actual behavior of consumers and firms.