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seeing research today saying that rebates to families did NOT help in this crisis.
my findings with Matthew Shapiro and Joel Slemrod from a high-quality, nationally representative survey say they worked well. /thread
my findings with Matthew Shapiro and Joel Slemrod from a high-quality, nationally representative survey say they worked well. /thread
Covid crisis is different in many ways (PANDEMIC!!!) from other recessions, in other ways it is the same (FREE FALL in demand) ... so we need to ask, is this time different?
ALWAYS set research findings in the CONTEXT of past studies. WE ALL STAND ON THE SHOULDERS OF GIANTS
what do we do? WE ASK PEOPLE!! what ya' do with the rebate? (protip for macro men: people like more money)
PS our method is not liked among the econos. but research on 2008 rebate shows asking people how they use their rebates gives similar answer to tracking their spending
PS our method is not liked among the econos. but research on 2008 rebate shows asking people how they use their rebates gives similar answer to tracking their spending
relief must be set within the economic environment ... so how is this economic crisis different? 1) unemployment skyrocketed 2) massive financial insecurity 3) huge job losses among Hispanic workers
MUST KNOW THY POLICY ... rebates are different (BETTER!!) than in 2008 or 2001. PS I did not sleep until the CARES Act passed in the middle of the night. good stuff.
on rebates: BIGGER MONEY, out FASTER, MORE PEOPLE got one
on rebates: BIGGER MONEY, out FASTER, MORE PEOPLE got one
I am team and/both when it comes to relief in a recession, especially one as disastrous as the current one. PS I wanted $6 trillion more from Congress last month. GOT ZERO!!! grrrr.
extra jobless benefits ABSOLUTE MUST and rebates too, they got a lot of money out very fast.
extra jobless benefits ABSOLUTE MUST and rebates too, they got a lot of money out very fast.
on to our results ... and our methods - see our survey question used now for decades in rebates research
what do we find? ... SPENDING SAME as 2008 ... SAVING MORE. tradeoff between saving and paying off debt.
PS saving is current spending and debt is past spending. PEOPLE SPEND MONEY, THEY NEED MONEY, especially when lost jobs and less income
PS saving is current spending and debt is past spending. PEOPLE SPEND MONEY, THEY NEED MONEY, especially when lost jobs and less income
but wait only 20% said "mostly spend" ... that's not much. ah but, many who mostly save or pay off debt, spend some AND some use rebates as down payment on big stuff, like a car ... adds up. we estimate that 40 to 60 cents of every rebate dollar spent = $120 to $175 BILLION
to fight free fall in demand and stem job losses in this crisis, rebates need to be spent fast, YES THEY WERE ... second quarter GDP would have been an even bigger bloodbath without them
common theme to everything we have lived since March? WHAT IS HAPPENING?? WHEN WILL IT STOP??
fear of losing your job, fear of a wage cut, fear of getting sick ... leads people to stash money away. we saw that BUT NOT FOR THOSE WHO HAD NOT BEEN HIT HARDEST
fear of losing your job, fear of a wage cut, fear of getting sick ... leads people to stash money away. we saw that BUT NOT FOR THOSE WHO HAD NOT BEEN HIT HARDEST
as with everything in this godforsaken world, Black and Hispanic families were least able to use the extra money to prepare for the worst. they started out with less savings, they were unable to save their rebates, and they will come out of this crisis with less savings
why is my research paper not out, along with the 1500+ economic research papers on the Covid crisis? I HAVE WORKED WITH CONGRESS SINCE MARCH NON STOP
helping provide evidence-based advice to policy makers is why I do what I do.
helping provide evidence-based advice to policy makers is why I do what I do.
when I give policy advice I NEVER rely on one paper. ABSOLUTELY NOT only one of mine. I read all papers and find overlap, robust set of results.
my fav paper on rebates is from JP Morgan Chase Institute: https://www.brookings.edu/bpea-articles/initial-impacts-of-the-pandemic-on-consumer-behavior/watch spending turns up when rebates arrive. WOW!
my fav paper on rebates is from JP Morgan Chase Institute: https://www.brookings.edu/bpea-articles/initial-impacts-of-the-pandemic-on-consumer-behavior/watch spending turns up when rebates arrive. WOW!
oops, it's almost 7 and my son hasn't had dinner yet, better scoot ... PS family work is another reason why paper isn't done yet, coming soon! #macromom
PPS what paper vouching around the internet got me off the couch and left my family waiting for food? https://twitter.com/elliswonk/status/1295400301202087937?s=21 REBATES HELPED... Congress had to send more money out to families, unemployed workers, and communities. did they? NO, they went home. https://twitter.com/elliswonk/status/1295400301202087937
PPPS Oli and Yuriy are good friends from grad school. #macromom doesnât play favorites 
will email them tomorrow, itâs their inference not summary stats that are off. pro-tip hardest part of research is interpreting your results, not getting them https://www.nber.org/papers/w27693.pdf
will email them tomorrow, itâs their inference not summary stats that are off. pro-tip hardest part of research is interpreting your results, not getting them https://www.nber.org/papers/w27693.pdf
last one, then TV. gave them comments a few weeks ago on their Jackson Hole paper about inflation expectations ... love theyâre so prolific at research and respect my opinion and are so supportive of others ... oh yeah, one may have convinced me to write that blog post same day
