Good job to Jon Hartley to get the conversation going. All indented quotes are from Mankiw in the podcast.
Some history for those of us who write about sticky wages and prices.
But it was that idea that real wages weren’t countercyclical, that said, you have to start thinking about not only sticky wages, I have to start thinking about sticky prices.
And if I’m gonna start thinking about sticky prices, you have to have firms that are not competitive, that are price setters, not price takers. Because if you’re going to think about the incentives that firms have to adjust prices, you can’t have them being price takers. And it was that that got me to write my small menu cost paper…
There is a lot more on that topic in the transcript, for those who are interested.
How do we feel about big models?
I think people were getting a little tired of these big models because they were large, non intuitive. They seemed very black boxy, so you didn’t really know what was happening in them.
Haha. Here comes ChatGPT. ‘Leeroy Jenkins’ and all that.
One thing I’ll say about being Chair of the Council, which I did from 2003 to 2005. And I worked harder those two years than any two years of my life, by far, because the days are long. In the Bush administration, every day started with the 7:30 AM staff meeting in the Roosevelt room, which is the conference room right next to the Oval office.
In all my years at Harvard, I’ve been in Harvard almost 40 years, nobody’s ever called a 07:30 AM meeting. While I was at the White House, every day it was at 7:30 AM meeting. It’s not like you take off early at the end of the day, you work long hours at the end of the day too.
So they’re are very, very long days. I left my family behind in Boston, my wife was a saint and took care of my three small kids. And I basically moved into a hotel just a few blocks from the White House…
Note the saints lurking behind the intellectual contributions. With falling fertility all over the world, it raises the question of who watches the three small kids? Something I am pondering this week is that I’m glad I didn’t try to homeschool my kids this semester. I support others who make that choice, but it wouldn’t have been good for us.
Economist Writing Every Day 