Publications

2008
Feldstein M. Will the Euro Survive the Current Crisis?. Project Syndicate . 2008.
Feldstein M. Our Economic Dilemma . The Wall Street Journal. 2008.
Feldstein M. How to Stop the Mortgage Crisis. The Wall Street Journal. 2008.
Feldstein M. Enough With the Interest Rate Cuts . The Wall Street Journal. 2008.
Feldstein M. We Can Lower Oil Prices Now. The Wall Street Journal. 2008.
Feldstein M. The Tax Rebate Was a Flop. Obama's Stimulus Plan Won't Work Either. The Wall Street Journal. 2008.
Feldstein M, Taylor JB. John McCain Has a Tax Plan To Create Jobs . The Wall Street Journal. 2008.
Feldstein M. The Problem Is Still Falling House Prices: The bailout bill doesn't get at the root of the credit crunch. The Wall Street Journal. 2008.
Feldstein M. How to Help People Whose Home Values Are Underwater - The economic spiral will get worse unless we do something about negative equity . The Wall Street Journal. 2008.
Feldstein M. Defense Spending Would Be Great Stimulus. The Wall Street Journal. 2008.
Feldstein M. Optimal Currency Areas, in ECB Fifth Central Banking Conference. ; 2008.
Feldstein M. Monetary Policy Challenges in the Decade Ahead, in Remarks at the 7th Bank for International Settlements Annual Conference. ; 2008. bis2008.pdf
Feldstein M. Did Wages Reflect Growth in Productivity?. Journal of Policy Modeling [Internet]. 2008;30 :591-94. Publisher's VersionAbstract

The level of productivity doubled in the U.S. nonfarm business sector between 1970 and 2006. Wages, or more accurately total compensation per hour, increased at approximately the same annual rate during that period if nominal compensation is adjusted for inflation in the same way as the nominal output measure that is used to calculate productivity.

Total employee compensation as a share of national income was 66 percent of national income in 1970 and 64 percent in 2006. This measure of the labor compensation share has been remarkably stable since the 1970s. It rose from an average of 62 percent in the decade of the 1960s to 66 percent in the decades of the 1970s and 1980s and then declined to 65 percent in the decade of the 1990s where it has again been from 2000 until the most recent quarter.

Feldstein M. Resolving the Global Imbalance: The Dollar and the U.S. Saving Rate. Journal of Economic Perspective [Internet]. 2008. Publisher's VersionAbstract

The large trade and current account deficits of the United States cannot continue indefinitely because doing so would constitute a permanent gift to the U.S. economy. The process that will cause this gift to shrink and that will eventually cause it to reverse is a fall in the dollar. The dollar will fall as private investors and governments become unwilling to accept the risk of increasing amounts of dollars in their portfolios, especially in a context in which they realize that the dollar must fall to reduce the trade imbalance. Although a more competitive dollar is the mechanism that will cause the U.S. trade deficit to decline, the fundamental requirement for a lower trade deficit is an increase in the U.S. national saving rate. So a rise will be driven by higher household savings of the coming years as the two primary forces that depressed savings in recent years are reversed: the exceptionally rapid rise in household wealth and the high level of mortgage refinancing with equity withdrawal.

Feldstein M. Designing Institutions to Deal with Terrorism in the United States. The American Economic Review, Papers and Proceedings [Internet]. 2008;May. Publisher's VersionAbstract

The explosion in the 21st century of terrorist activities by Islamic radicals in the United States, Europe and Asia requires reforming the institutions for domestic counterterrorism (CT) and new international relations among individual national CT organizations. This paper discusses the institutional reforms for CT in the United States, focusing particularly on the changes in the FBI. These changes are compared with the way that the British CT activities of the MI5 and MI6 have evolved in response to terrorism in Britain. The paper also discusses the reasons why there is strong cooperation among the CT activities of all the major governments and with the United States in particular, even when those governments do not agree about military cooperation or about the use of economic sanctions.

Feldstein M. Effects of Taxes on Economic Behavior. The National Tax Journal [Internet]. 2008;LXI (1) :131-39. Publisher's VersionAbstract

This paper discusses how the effects of taxes on economic behavior are important for revenue estimation, for calculating efficiency effects, and for understanding short-term macroeconomoic consequences. The primary focus is on taxes on labor income but some attention is given to taxes on income from saving. Specific calculations illustrate the importance of behavioral responses for accurate calculation of the revenue effects and deadweight losses of tax changes.

Feldstein M. Why is the Dollar So High?. Journal of Policy Modeling [Internet]. 2008. Publisher's VersionAbstract

The level of the dollar is part of a complex general equilibrium system. Nevertheless, it is helpful to recognize that the high level of the dollar is necessary to generate the current account deficit equal to the difference between national saving and investment. Understanding the high level of the dollar therefore requires understanding the reasons for the low level of national saving in the United States. Reducing the large current account deficit will require both a higher rate of national saving and a more competitive dollar. Although the necessary decline in the real value of the dollar can in theory occur without a decline in the dollar's nominal value, the implied magnitude of the fall in the domestic price level is implausible. A decline of the real value of the dollar that is large enough to reduce the current account deficit significantly requires a significant decline in the nominal value of the dollar.

2007
Feldstein M. Liquidity Now! . The Wall Street Journal. 2007.
Feldstein M. Social Security Compromise . The Wall Street Journal. 2007.
Feldstein M. How to Avert Recession . The Wall Street Journal. 2007.

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