I talk about Tyler Cowen’s The Great Stagnation on a new BHTV episode.
I think, however, that I may not have expressed my actual view of the situation very clearly. I think Cowen’s argument that the stagnation in question is caused by a semi-mysterious technological slowdown is ultimately less persuasive than the circumstantial Krugman and Hacker/Pierson case that it’s ultimately political in origin. But I think Winner Take All Politics often comes across as implying that the political problems here are very narrowly partisan in nature and could be easily remedied with more progressive taxation. The real issues, I think, are closer to Dean Baker’s less conventional analysis in The Conservative Nanny State—substantial dysfunctions in the health care, finance, education, and housing sectors of the economy plus loopy intellectual property policy that are conspiring to make growth slower and more concentrated.
I’m all for more tax and transfer and better science, but I think we should be more ambitious in our goals and more searching in our quest for improvements.
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