Is Ben Bernanke an Inflation Dove?

This week Tennessee Senator Bob Corker (R) called Federal Reserve Chairman Ben Bernanke “the biggest dove since World War II.”  He means to say that Bernanke has not done enough to prevent inflation.  This sets up an interesting question: How do Fed Chairmen stack up next to one another on key variables such as unemployment and price stability?

Figure One is a key component of my survey, but I'll break it down by tenure.  The figures were taken as percent change from previous month and annualized from those figures for each term.  It will go from the Fed Chairman with the lowest average inflation to the highest.

Figure 1

Federal Reserve Performance by Chairmen:

Eugene Meyer (1930-1933)

(photo: Harris & Ewing)

Eugene Meyer presided over the worst parts of the Depression, including the failure of many banks including the Bank of United States.  His average annualized inflation rate is -9.8% and his average annualized change in GDP is a staggering -19.7%.

 

Roy Young (1927-1930)

Roy Young presided during the Stock Market crash of 1929.  He had an average inflation rate of -1.6%.

 

Daniel Crissinger (1923-1927)

(photo: Harris & Ewing)

Crissinger's era is also considered to be the Benjamin Strong era, because Strong was Governor of the Bank of New York and exerted significant influence on Federal Open Market Committee meetings.  Crissinger's average inflation rate was 0.6%.

 

William Martin (1951-1970)

(photo: Federal Reserve)

William McChesney Martin is perhaps the ideal central banker.  He practiced under the gold standard and the Bretton-Woods system.  He did not write books on monetary policy, but he did unorthodox maneuvers such as the original Operation Twist.  He spoke against inflation constantly, but promoted removing elements of the gold standard during his tenure.  The practice of regional Fed Governors sharing their information days before Federal Open Market Committee meetings originated with him and led to many unanimous votes.

"Any presumed benefits that flow from inflation are based on self-deception.  We will certainly grow faster and stronger if we do not pretend that we can enrich ourselves depreciating our currency.  Stable prices and a sound currency that both we and the rest of the world can rely upon is the only seal that is morally and economically defensible."

His average inflation rate was 2%; his average change in GDP was 6.6% and his average change in unemployment was -0.1%.

 

Benjamin Bernanke (2006-present)

(photo: Gerald Ford School of Public Policy)

Bernanke has overseen a major financial crisis and the Great Recession, and is still attempting to return the unemployment rate to its natural rate (between 5-6%).  His average inflation rate is currently 2.2%; his average change in GDP is currently 3.2% and his current average change in unemployment is 0.4%.

 

Thomas McCabe (1948-1951)

McCabe negotiated the 1951 Accord which re-established Federal Reserve independence.  During the war, Marriner Eccles agreed that interest rates would be kept accommodatingly low irregardless of price stability factors because funding the nation during the war was a national priority.  The 1951 Accord ended this accommodation.  His average inflation rate was 2.7% and his average change in GDP was 6.5%.

 

Alan Greenspan (1987-2006)

(photo: Financial Times)

Greenspan's tenure started rocky in October 1987 when the Dow Jones Industrial Average dropped 22.6% in one day.  The rest of his term have been called the great moderation because it was known as a long period of only slight recessions and generally modest growth.  His average inflation rate was 3%; his average change in GDP was 5.6% and his average change in unemployment was -0.1%.

 

Charles Sumner Hamlin (1914-1916)

(photo: Harris & Newman)

The first head of the Federal Reserve.  His average inflation rate was 3.9%.

 

Marriner Eccles (1934-1948)

The Federal Reserve board building in Washington D.C. is named after Eccles.  He is another looming Fed figure along with New York Fed Governor Benjamin Strong.  He presided over the 1937 recession within the Great Depression and Fed operations during World War II.  He acquiesced to President Roosevelt by making monetary policy accommodating during World War II and the post-war period resulting in the nation's most significant inflation event (see figure 1).  His average inflation rate was 4.3% and his average change in GDP was 11%.

 

Eugene Black (1933-1934)

Black was one of the first Fed heads to use activist monetary methods.  He was promoted from Governor of the Federal Reserve Bank of Atlanta to being Chairman of the Board of Governors after his easy lending policies in the early 1930's showed that significantly fewer banks in the Atlanta region failed.  His average inflation rate was 5% and his average change in GDP was 6.6%.

 

Paul Volcker (1979-1987)

(photo: Harvard Ethics)

Paul Volcker is known as the ultimate inflation hawk.  So why is he so far down this list?  Volcker's place on this list also shows a major defect in the methodology of this list.  Each Chairman's average begins with their first month as Chairman, but because the methods and channels of monetary transmission are muted at best, their impact is only felt months later.  It would be impossible to make a uniform number of months after because the methods of Fed communication have varied significantly over the century.

Volcker entered as chairman when inflation was significantly high, and he raised interest rates into double digits to control it.  Unfortunately he also caused a significant recession by these actions, but it did kill the major inflation of the 1970's.  His average inflation rate was 5.6%; his average change in GDP was 8% and his average change in the unemployment rate was 0.1%.

 

Arthur Burns (1970-1978)

Arthur Burns was one of the foremost monetary theorists of the 20th Century, but his reputation was harmed by his tenure at the Federal Reserve and the inflation that started and continued during his tenure.  The prolonged period of inflation was accompanied by recessions creating a condition of "stagflation" which combined economic stagnation and inflation.  The "Nixon shock" took place during his term when Nixon abruptly ended the gold standard by issuing an executive order.  He was the first academic economist to head the Federal Reserve.  He taught future Nobel laureate Milton Friedman at Rutgers University and was heavily influential within the monetarist school of economic thought.  His average inflation rate was 6.3%; his average change in GDP was 9.5% and his average change in the unemployment rate was 0.5%, the highest of the survey.

 

William Harding (1916-1922)

(photo: Federal Reserve)

Harding's tenure included the end of World War I, a significant recession, and a notably quick recovery from that recession.  His average inflation was 7.2%.

 

G. William Miller (1978-1979)

Miller is notable for being the only Fed Chairman that also served as Secretary of the Treasury Department.  His average inflation rate was 10.7%, the highest of the survey.  His average change in GDP was 12.3%, the highest of the survey, and his average change in unemployment was -0.7%, the biggest drop in the survey.



So was Senator Corker being crazy when he called Federal Reserve a dove on inflation?  No, the Federal Reserve has taken unprecedented steps to provide the market accommodation in response to deflationary forces (see Figure 2).  He is being ignorant of Bernanke's results and the results of his predecessors.  As I've said time and time again, the challenge for Bernanke (as with any central banker in a recession) is two-fold: both to be accommodating enough, but then perhaps more difficultly to pull back appropriately.  Bernanke's moment to pull back has not happened yet, but it will likely be a challenge as well because so much of the Fed's asset purchases have been somewhat less than liquid.

Figure 2

Top Economists of 2012

Election years seem to be challenging for economists, although many seem to make the most of them.  Economic analysis is generally quite complicated and often starts out with the words, "It depends."  These answers are terrible in the segmented world of television and radio.  The general public wants concise answers that say this is good because blah blah blah and this is bad because blah blah blah.  On the one hand 2012 was great because so many people are interested in talking about topics that economists study, but on the other hand most people still just want the headline rather than the story.

 

Paul Krugman (photo: Zé Carlos Barretta)

Part of this task is determining who is an economist and who is not.  I have made an editorial decision not to include economists that were most famous for being elected politicians.  There are other dilemmas, such as central bankers.  I have decided to leave them in as they are often also academic economists, and while there are political aspects to the job, it is inherantly an post concerned with monetary economics.  The other major dilemma this year is Nate Silver.  He had a spectacular surge in popularity based on his election prediction blog with The New York Times and has a new book out called The Signal and the Noise.  He is often referred to as a statistician because he uses those skills frequently in his writing, but he majored in economics at the University of Chicago.  I've decided to include him, but he blows out my stats on the other economists.  What a year he's had!

Top Economists of 2012:

 

rank.  name, institution (rank last year)

 

1.   Nate Silver (NR)

2.   Paul Krugman, Princeton University (1)

3.   Ben Bernanke, Federal Reserve Board of Governors (4)

4.   Amartya Sen, Harvard University (5)

4.   Thomas Sowell, Hoover Institute (9)

6.   Mario Draghi, European Central Bank (3)

7.   Joseph Stiglitz, Columbia University (9)

8.   Alan Greenspan (7)

8.   Robert Reich, University of California - Berkeley (9)

8.   Walter Williams, George Mason University (9)

11. Daniel Kahneman, Princeton University (NR)

11. Nouriel Roubini, New York University (7)

13. Mark Carney, Bank of England (NR)

13. Simon Johnson, M.I.T. (16)

13. Robert Lucas, University of Chicago (18)

13. Jeffrey Sachs, Columbia University (16)

17. Brad DeLong, University of California - Berkeley (23)

17. Peter Diamond, M.I.T. (19)

17. David Friedman, Santa Clara University (19)

17. Robert Merton, M.I.T. (19)

21. Dean Baker, C.E.P.R. (NR)

21. Gary Becker, University of Chicago (25)

21. Mervyn King (19)

21. Greg Mankiw, Harvard University (25)

21. Raghuram Rajan, University of Chicago (NR)

21. Robert Shiller, Yale University (23)

21. Vernon Smith, Chapman University (NR)

21. Lawrence Summers, Harvard University (14)

29. Daron Acemoğlu, M.I.T. (NR)

29. Olivier Blanchard, I.M.F. (NR)

29. Tyler Cowen, George Mason University (25)

29. Esther Duflo, M.I.T. (NR)

29. Steven Levitt, University of Chicago (25)

29. Thomas Sargent, Seoul National University (NR)

29. Michael Spence, New York University (29)

 

The rankings were calculated on December 31, 2012.  Elinor Ostrom was removed from this list due to her death this past June.  She will be missed and remembered.  There are also (as ever) a number of great economists that unfortunately have names that are not the number one or obvious google search.  That list includes John Taylor, Kevin Mitchell, Robert Hall, Justin Lin, and others.  Please feel free to add more names in the comments.  To acquire the rankings, I simply used the Google Trends website.  Although Nate Silver was first, I used Paul Krugman and Mark Carney as the base individuals and ran all the economists I could think of.  I'm sure I missed some good people.

Inflation Targeting Formally Begins in the U.S.

The Federal Reserve just announced its first formal inflation target.  They set a target of 2% interest as a long term target for inflation.  This is in step with Bernanke's academic work on monetary policy and with the recent Fed moves towards transparency and their attempts to create expectations rather than simply respond to them.  Many central banks have already practiced this for some time.

Brief Case Study: Sweden

Sweden Consumer Price Index

Sweden has been targeting inflation since recovering from a currency crisis in 1993.  This gives us a long period of time to examine inflation targeting's effectiveness.  The first graph (above) shows the monthly inflation rate of Sweden since their online data begins in 1980.  Their maximum inflation rate during the period has been 5.2%, and the minimum -1.9% with the average being 1.56%.  The standard deviation has been 1.42%, but while it has had a lot of variation, it has been pretty centered around 1.5% as shown by the histogram below.

The histogram shows the number of times that Sweden has hit a given percentage of inflation since they introduced inflation targeting in 1993.  I added a box from 1% to 3%, with a line down the middle at 2% showing the target and the acceptable range.  This shows that Sweden has been conservative in their approach to their intention, which has been a static 2% inflation target ±1%.  It looks more like that they've targeted 0-3% inflation rather than 1-3%, which ended up with a median 1.5%.  This policy has been largely successful in creating relatively stable growth for their economy, as shown in the graph below which begins in 1993.

Target Too Low?

Almost immediately after releasing the target, it was criticized.  This is probably to be expected, but not in the way that I expected it to be.  One of the first critics of the policy was Paul Krugman, who argued that 2% is too low.  Two percent is a pretty standard number in inflation targeting central bank circles.  It would be more shocking if they chose to formally inflation target and didn't choose 2%.

Olivier Blanchard was an early major economist to write of raising the inflation target in his paper (along with Giovanni Dell'Ariccia and Paolo Mauro) "Rethinking Macroeconomic Policy" which considered more than monetary policy, but also fiscal and tax policies as well.  Blanchard mainly asks if there would be substantially higher costs and benefits to targeting 4% compared to 2% inflation.

Stephanie Schmitt-Grohe and Martin Uribe wrote an interesting paper in 2010 titled, "The Optimal Rate of Inflation" where they attempt to formalize some aspects of the debate on inflation targeting.  "For a realistic model of the monetary transmission mechanism must incorporate both major sources of monetary nonneutrality, price stickiness and a transactional demand for fiat money. Indeed, in such a model the optimal rate of inflation falls in between the one called for by the money demand friction—deflation at the real rate of interest—and the one called for by the sticky price friction—zero inflation. The intuition behind this result is straightforward. The benevolent government faces a tradeoff between minimizing price adjustment costs and minimizing the opportunity cost of holding money. Quantitative analysis of this tradeoff, however, suggests that under plausible model parameterizations, this tradeoff is resolved in favor of price stability."

They bring up an incredible amount of ideas that I hadn't considered.  They examine ways in which the Friedman rule, or the optimal monetary policy that focuses on zero opportunity cost to holding money,  could break down.  All three of these ways are related to taxation, whose relation to monetary policy I had not considered.

While I'm not sure if I agree with them, all of these are important concepts to consider, especially when current monetary policy is constrained by the Zero Lower Bound due to our current liquidity trap.  Formally announcing a target seems to be a way of creating expectations both for better and for worse.  The better is that it signals to the market that the central bank is taking steps to create inflation, and the market can often help by making the claim a self-fulfilling prophecy.  Similarly for worse, inflation hawks can be cooled by the setting of a reasonable level of inflation target.

The latter of the two is important as the Federal Reserve will eventually have to perform a tricky dismount of these current monetary policies.  They have undoubtedly increased the monetary base in shocking amounts.  Much of this has been done with relatively normal operations using Treasury security repo's, but much of it has been done with alternative monetary policies.  This has been done to combat liquidity trap conditions, but as those conditions ease, longer term inflation problems will start.  The Fed has a large amount of sub-prime mortgages and it is unclear whether, even now, that there is a market for those assets.  The point being that many of the assets that the Fed purchased might not be incredibly easy to sell.

John B. Taylor has talked about crisis policies of the Fed being unprecedented and that there is a need for a clear exit strategy.  This is due to the fact that if or when inflation does creep above the target, all of the old devilish aspects of relatively high inflation will creep back into society.  The chief of those being: increases in the cost of capital to the user.  I recently wrote an article in praise of Chairman Bernanke, and I stand by that post, but to be clear... the most tricky part for Bernanke's Fed is still to come.

References:

Blanchard, Olivier and Giovanni Dell'Ariccia and Paolo Mauro.  "Rethinking Macroeconomic Policy."  Washington DC: IMF.  2010. 

     Working Paper.

Cohen, Darrel, Kevin Hassett, and R. Glenn Hubbard.  ED: Martin Feldstein.  The Costs and Benefits of Price Stability.  "Inflation

     and the User Cost of Capital: Does Inflation Still Matter?"  Chicago: University of Chicago Press.  NBER Conference Report. 

     1999.  Print.

Krugman, Paul.  "Two Percent is Not Enough."  The New York Times.  New York: New York Times Publishing.  1/26/12.  Web. 

      http://krugman.blogs.nytimes.com/2012/01/26/two-percent-is-not-enough/

McCallum, Bennett.  "Should Central Banks Raise Their Inflation Targets?  Some Relevant Issues."  Economic Quarterly. 

     Richmond: Federal Reserve Bank of Richmond.  Vol. 97, No. 2.  2011.  Journal.

Schmitt-Grohe, Stephanie and Martin Uribe.  "The Optimal Rate of Inflation."  2010.  Working Paper.

Taylor, John B.  ED: John B. Taylor.  The Road Ahead for the Fed.  "The Need for a Clear and Credible Exit Strategy."  Stanford:

     Hoover Institution Press.  2009.  Print.

Federal Open Market Committee.  "Press Release."  Washington DC: Federal Reserve System.  1/25/12.  Web. 

     http://www.federalreserve.gov/newsevents/press/monetary/20120125c.htm

The Increasingly Transparent Federal Reserve

The Federal Reserve has become significantly more transparent in the past few years.  Amid appeals from Congress and the public to "audit the Fed," they posted to their homepage, that they get audited by the Government Accountability Office.  Chairman Bernanke has even recently started giving press conferences and this week they announced that they would release their Federal Funds Rate forecasts.  They announced it from the minutes from the December F.O.M.C. meeting.  This has been a pet project of Chairman Bernanke for some time, he gave a speech in 2010 on the subject.  To many, this might come as an obvious positive step, but I'm left scratching my head a bit.  I'm thinking... how is this going to help and how might it harm the pursuit of monetary policy?



(photo: MeDill News Service)



There are two issues in monetary policy that relate to this, and they are (as most things in monetary policy) opposing relationship to one another.  The first issue is central bank credibility.  It could be said that the Federal Reserve's reputation as a Central Bank has suffered in the past few years (rightly or wrongly) in the eyes of the general public.  In this sense their credibility has gone down.  Most monetary economists, not the Austrian school (of course), give high marks for the job that they have done.



The second issue is information asymmetry.  Not many people write about it (perhaps because it is elementary Keynesian economics, but perhaps not), but nominal price changes waxing over real price changes is a product of not much more than an enormous information asymmetry problem with regard to fiduciary media (money).  Robert Barro was (maybe) the first to write about it in his article "Rational Expectations and the Role of Monetary Policy." (gated)  I'm writing about the issue as a potential moral dilemma in "The Morality of Monetary Policy" (forthcoming).  The root of this idea is a purely Keynesian one, "Whilst workers will usually resist a reduction of money-wages, it is not their practice to withdraw their labor whenever there is a rise in the price of wage-goods.  It is sometimes said that it would be illogical for labor to resist a reduction of money-wages, but not to resist a reduction of real wages." (Keynes, The General Theory of Employment, Interest and Money, 9) This demonstrates what has come to be known as wage rigidity, an example of sticky prices.

So, if information asymmetry is essential for nominal changes in prices to affect positive changes in output, then why is Bernanke's Fed reducing it?  I think that is because of rational expectations.  Rational expectations involve what the public thinks the future value of money will be.  Typically, expectations are formed from the average of the past few quarters price movements (inflationary or deflationary).  This is why monetary economists are interested in trend inflation, because we think that we are measuring expectations.  There can be deviations from this when the consumer has information that runs strongly counter to this.  Also, inflation can deviate from this when it begins to escalate take on a momentum of its own.

Keeping expectations within trend inflation is easy for a central bank with a good reputation, but not easy for one that does not.  Bernanke's moves towards transparency likely show that he is interested in promoting the Central Bank as credible, and promoting the effects of shrinking the money supply as soon as he can or sooner.

This is likely a good move, as long as he understands that when or if the Fed needs to expand the money supply again... they likely will need to increase information asymmetry rather than decrease it.  So if Bernanke is using this as a tool to promote Fed actions to curb inflation when inflation becomes more of a problem, I'm all for it.  If he's planning to be more transparent generally... we'll have to see how it impacts the implementation of monetary policy.

One last thing to note is the stark comparison for how the Bernanke Fed uses information to transmit monetary policy and affect behavior versus the way that every other Fed administration has.  Obviously they've been much more vocal and transparent.  One could compare if the public has been more sensitive and responsive to changes in the money supply when they are expecting it and understand the reasoning better or when it just occurs without comment.  I think this would be an good research project.

Top Economists of 2011

(Here are the Top Economists of 2012)

Comparing economists is a bit like comparing apples and oranges.  There is so much diversity in the topics that they approach, and different approaches that they take.  Still, it can be quite fun even if ultimately meaningless.

I started entering all the living economists names that I could think of into Google Trends to see who is the most searched for name at Google in 2011.  I think it's an interesting addition to the ways of ranking economists because it shows searches and general awareness.  Here are the results:

Paul Krugman (photo: Cory Doctorow)

rank. name, affiliation (relative percent to top score, ranking last year)

1.   Paul Krugman, Princeton University (100%, 1)
2.   Manmohan Singh, India (85%, 2)
3.   Mario Draghi, European Central Bank (60%, NR)
4.   Ben Bernanke, Federal Reserve Board (46%, 3)
5.   Amartya Sen, Harvard University (34%, 4)

6.   Gloria Arroyo (30%, 16)
7.   Alan Greenspan (26%, 5)

7.   Nouriel Roubini, New York University (26%, 7)
9.   Robert Reich, University of California - Berkeley (24%, NR)
9.   Thomas Sowell, Hoover Institute (24%, 6)
9.   Joseph Stiglitz, Columbia University (24%, 8)
9.   Walter Williams, George Mason University (24%, 9)
13. Mario Monti, Italy (20%, NR)
14. Justin Lin, World Bank (18%, 10)
14. Lawrence Summers, Harvard University (18%, 30)
16. Simon Johnson, M.I.T. (16%, 12)
16. Jeffrey Sachs, Columbia University (16%, 12)
18. Robert Lucas, University of Chicago (14%, 30)
19. Peter Diamond, M.I.T. (12%, 20)
19. David Friedman, Santa Clara University (12%, NR)
19. Mervyn King, Bank of England (12%, 12)
19. Robert Merton, M.I.T. (12%, 16)

23. Brad DeLong, University of California, Berkeley (10%, 12)

23. Robert Shiller, Yale University (10%, 16)
25. Gary Becker, University of Chicago (8%, 20)

25. Tyler Cowen, George Mason University (8%, 20)
25. Steven Levitt, University of Chicago (8%, 26)
25. Greg Mankiw, Harvard University (8%, 16)
29. Elinor Ostrom, Indiana University / Arizona State University (6%, 20)
29. Michael Spence, Hoover Institute (6%, 30)

A number of economists were withdrawn because they were not their top Google search.  The best example of this is John B. Taylor of Stanford University who also shares the same name with a former NFL player and a member of rock group Duran Duran.  Others include, Robert Hall, Robert Lawrence, Peter Phillips, James Hamilton, Kevin Murphy, and James Robinson.

EDIT: As a commenter noticed, Robert Merton is now at M.I.T. and I switched that.  I appreciate everyone adding new economists that I did not think of, this can be considered my selection bias.  I'll leave them in the comments this year, but I will make sure to include them in my calculations next year.  Please keep them coming.

A Fun Way To Rank Economists!

Comparing economists is a bit like comparing apples and oranges.  There is so much diversity in the topics that they approach, and different approaches that they take.  A lot of places like JSTOR rank them by citations, IDEAS ranks them with a compilation of 31 methodologies.  According to their rankings, Andrei Shleifer of Harvard is number one.  I love ranking anything!  I think this goes back to my childhood love of baseball statistics.

There are so many awards that economists can have.  The Nobel Prize is probably the top award in the field, but the John Bates Clark Medal, and being President of the American Economic Association are both highly regarded as well.  Acquiring a great job is the best thing that can happen to any economist, so heading a central bank or any economics department are both extremely prestigious honors as well.

I started entering all the living economists names that I could think of into Google Trends to see who is the most searched for name at Google in 2011.  I think it's an interesting addition to the ways of ranking economists because it shows searches and general awareness.  Here are my results:

As you can see Paul Krugman has a pretty comfortable lead.  He is the trend setter in this exercise with a 1.00 that everyone else's scores are based on.  Why not?  The guy has the bully pulpit of a New York Times column to work with, not to mention all the best-selling books he's written and a Nobel Prize.

Both number two Manmohan Singh and number three Ben Bernanke fill important government positions which land them in the news regularly.  They both still appear on this list because they are both trained economists that later became the Prime Minister and Chairman respectively.


Top Economists in Google Trends:


1.  Paul Krugman, Princeton University (1.00)
2.  Manmohan Singh, India (.58)
3.  Ben Bernanke, Federal Reserve Board (.44)
4.  Amartya Sen, Harvard University (.38)

5.  Alan Greenspan (.28)

6.  Thomas Sowell, Hoover Institute (.26)
7.  Nouriel Roubini, New York University (.22)
8.  Joseph Stiglitz, Columbia University (.20)
9.  Walter Williams, George Mason University (.18)
10.Robert Hall, Stanford University (.12)

10.Justin Lin, World Bank (.12)

12.Brad DeLong, University of California, Berkeley (.10)
12.Simon Johnson, M.I.T. (.10)
12.Mervyn King, Bank of England (.10)
12.Jeffrey Sachs, Columbia University (.10)
16.Gloria Arroyo (.08)
16.Greg Mankiw, Harvard University (.08)
16.Robert Merton, Harvard University (.08)
16.Robert Shiller, Yale University (.08)
20.Gary Becker, University of Chicago (.06)
20.Agustin Carstens, Bank of Mexico (.06)
20.Tyler Cowen, George Mason University (.06)
20.Peter Diamond, M.I.T. (.06)
20.Austan Goolsbee, University of Chicago (.06)
20.Elinor Ostrom, Indiana University / Arizona State University (.06)
26.Esther Duflo, M.I.T. (.04)
26.Steven Levitt, University of Chicago (.04)
26.Gene Sperling, National Economic Council (.04)
26.Jean-Claude Trichet, European Central Bank (.04)
30.Michael Spence, Hoover Institute (.02)
30.Olivier Blanchard, M.I.T. (.02)
30.Mark Carney, Bank of Canada (.02)
30.Robert Lawrence, Harvard University (.02)
30.Robert Lucas, University of Chicago (.02)

30.Kenneth Rogoff, Harvard University (.02)

30.Lawrence Summers, Harvard University (.02)

If you notice a name that I have forgotten, just go to Google Trends and put in Paul Krugman's name first, separate with a comma, and then any additional economists (up to five at a time).  Put their name in quotes ("Paul Krugman") as to search for the term, and not the individual names Paul and Krugman.  I didn't list many economists that received 0's because I am not doing this exercise to embarrass anyone, it's just for fun.  Please post any new results in the comments section.

There were a hand full that I removed for having (what I felt were) abnormally high scores.  John Nash of Princeton received a 1.14.  I realise he is famous from A Beautiful Mind and game theory.  I'm going to skip him for the technicality that he is a mathematician but really it's because I don't understand his score at all.  John B. Taylor of Stanford received a .78, if just listed as John Taylor.  I removed him because he was not his top Google search, but rather third behind a musician and a football player.  Peter Phillips of Yale received a .24 but has the unfortunate position of having a member of the British royal family sharing his name, which skewed his results around the time of the recent royal wedding.  James Hamilton of University of California, San Diego received a .18, but the economist was not the top site listed in his Google search, and the same for Kevin Murphy (.28) of the University of Chicago and James Robinson of Harvard (.14).  Surely these economists receive and deserve recognition as well.

Here are also some other fun comparisons to make:

The "Marginal Revolution" Authors

Capitalism versus Socialism

Keynes versus Hayek

The Inflation Tiger

Notes:  

This essay won the 2011 F.A. Hayek Award at George Mason University.  The topic was: “Hayek famously warned that policy makers engaged in discretionary monetary policy are in effect holding a “tiger by the tail.”  From that perspective, how would you judge contemporary monetary policy since 2008?” 

This essay was written on Federal Reserve System monetary policy, and not United States public policy.  These two subjects are closely linked, but I did not address public policy issues because of the scope of the essay topic.

Modern Monetary Policies... and the Rules that Govern Them

This is the final essay that I wrote for my Economics and Public Policy Synthesis.  It can be considered useful for someone looking for an introduction to central banking, monetary economics, or some of the recent plans and Fed policies.