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Robert Shiller: A Skeptic and a Nobel Winner
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Robert Shiller and "winter on the family farm" as a metaphor in tough economic times instead of "tightening the family belt"
01/27/2009
Shiller cites the "balanced budget theorem" of Salant and the economist Paul Samuelson during the FDR period. This showed that with taxes and expenditures going up during tough economic times the higher output leads to national income increasing by the amount of the tax. French president Hollande's plan to hire 60,000 teachers is of this kind, says shiller, because the higher taxes on incomes over 1 million euros supporting the hiring would increase national income by that amount.
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Its the hearts and minds of the people that are the thing takes makes an economy or country tick not just use or overuse in recent years of financial incentives. Shiller and other economists make this point.
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