Must-Read: Paul Krugman: Calling Literatures From The Vasty Deep

Must-Read: My two—three—macro papers would be: Krugman (1998), Blanchard-Leigh (2013), and Mian-Sufi (2011)

Paul Krugman: Calling Literatures From The Vasty Deep: “Noah [Smith’s]… Two Paper Rule…

…Give me two papers in this vast literature that are “exemplars and paragons” of the literature. If you can’t, the whole literature is probably a waste of time. Which… sets some of us to work trying to think of the two papers…. My examples. [While] Noah is generally very down on macroeconomics… I believe that we’ve learned a lot… since… 2008…. Fiscal policy: before the crisis there was strikingly little solid evidence… because history gave us so few natural experiments…. I’d point to Blanchard and Leigh, using austerity as an experiment, and Nakamura-Steinsson, exploiting regional shocks from defense spending. Not saying these are the only fine papers, but they’re enough to show that there’s a real there there…. Dramatic confirmation of what some of us thought we knew about monetary policy at the zero lower bound. I can think, for example, of a 1998 paper that has held up really well…. Trade? Autor/Dorn/Hanson on the China shock may not be the last word, but surely a revelatory approach…. Subramanian and Kessler… realizing that this globalization is different….

I’m pushing back against Noah’s nihilism (noahlism?) even while endorsing his method…


Brad DeLong
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