This economist responds to an article on reforms to social security by Thomas Michl in our November December 2001 issue. Thomas Palley believes the best way to finance social security is to cut payroll taxes and finance the public pension system from general tax revenues. Prefunding social...

This paper presents a new interpretation of the Phillips curve that rests on the process of nominal wage adjustment in a multi-sector economy. Nominal demand growth causes inflation in sectors with full employment, but it speeds up the process of employment creation in sectors with unemployment....

Fiscal conservatives are using the recession-induced spike in budget deficits to revive fiscal austerity, which is based on flawed economic analysis and is not supported by thoughtful budget analysis. Although the need for deficits to provide short-term Keynesian fiscal stimulus is recognized,...

Many economists contend that the European Monetary Union is in serious danger. This economist argues that it needs a fiscal authority to issue Europewide bonds that the European Central Bank can trade so that the bank can lower country funding costs and counter bond market speculation.

The Federal Reserve has recently activated its newly acquired powers to pay interest on reserves of depository institutions. The Fed maintains that its new policy increases economic efficiency and intends it to play a lead role in the exit from quantitative easing. This paper argues it is a bad...

This paper presents a Post Keynesian model explaining the determination of employment and income distribution. A major innovation is the incorporation of the insider-outsider description of labor markets into a macro framework. This introduces power and conflict into the macro process....

This paper presents a theory of consumption that synthesizes the seminal contributions of Keynes (1936), Duesenberry (1948), and Friedman (1957). The model is labeled the 'relative permanent income' theory of consumption. The key feature is that the share of permanent income devoted to...

The comeback of most Asian economies from the crises of 1997 put talk of reform on hiatus. But most agree that reform there should still be. The author revisits the controversies surrounding the Tobin tax.