Tuesday, December 23, 2008

Blanchard Calls for More Vigorous Action

Olivier Blanchard, chief economist of the IMF, is calling for more vigorous action by states to stimulate their economies. "It is better for stimulus to proceed by increased public expenditure than by decreased public receipts," he insists (even though Greg Mankiw has cited a paper by Blanchard and Perotti in arguing for the opposite course). He also criticizes the confusion and lack of clarity of US stimulus measures to date.

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