“How Should Long-Term Monetary Policy be Determined?”

Here is the jstor link, from the Journal of Money, Credit, and Banking, and the author is Lawrence H. Summers.  I very much liked the piece when it came out in 1991 and I think it has held up especially well with time (please do note that Summers’s views very likely have evolved since then and you should not take this short article as any kind of definitive touchstone for what he would be like as Fed chairman.)

Given the sudden sensitivity of this topic, I am reluctant to summarize it in my own possibly misleading or overgeneralizing words, so if need be I hope you can get through the gate.

Summers did see, circa 1991, the time consistency problem with limiting inflation as more important than most monetary economists would believe today, but that was a common view at the time and given the historical experience up until then it was hardly a mistake.

I’ve read a lot of recent commentary on Summers, often by those who write on monetary economics, yet none of those writers seems to be aware of this piece nor do they discuss his other writings on monetary economics, virtually all of which are insightful.

Update: This link probably works better for you, plus it gives you a download option for $44.00.


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