"In the literature neither taxes, government spending nor deficits are robustly correlated with economic growth when evaluated individually. The lack of correlation may arise from the inability of any single budgetary component to fully capture the stance of fiscal policy. We use pair-wise...

With integrated trade and financial markets, a collapse in aggregate demand in a large country can cause "natural real interest rates" to fall below zero in all countries, giving rise to a global "liquidity trap." This paper explores the optimal policy response to this type of shock, when...

The macroeconomic theories and models favoured by academics, as well as those used more commonly by policymakers, effectively rule out by assumption economic and financial crises of the sort we are living through. In particular, the longer run dangers posed by the rapid expansion of credit and...

Remarks before the Dallas Friday Group, Dallas, Texas, October 21, 2011 ; "Absent some shock, I envision a slow but steady improvement in the economy into 2012. That is, if our fiscal authorities will remove their stranglehold on clarifying fiscal initiatives. If not, then, in my view, I expect...

Remarks before the Dallas Friday Group, Dallas, Texas, April 11, 2006 ; "Competition brings benefits to the public sector the same way it does the private sector. Because factors of production are increasingly mobile in an era of globalization, governments vie to gain and hold onto them. Mobile...

Remarks before the 2010 Pre-Session Legislative Conference, Austin, Texas, December, 2010 ; "With each passing year, Texas has consistently outperformed the rest of the nation in growing economic prosperity. Over the past three especially difficult years, the Texas economy has outperformed all...

"While it appears urgent, if not agreeable, to use massive public spending to stimulate an economy under duress, an economy cannot sustain long-term growth under the weight of significant fiscal burdens." ; Remarks before the World Affairs Council of Dallas/Fort Worth, Dallas, Texas, February...