Edward Conard

Top Ten New York Times Bestselling Author

  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
Upside of Inequality Oxford Unintended Consequences

AI Summary. Evidence including the Council of Economic Advisers' own suggests US inflation would have peaked 1–2 percentage points lower without the $1.9tn American Rescue Plan, but the author argues a smaller package would still have left an inflation spike. The excess demand is credited with a quick return to full employment and a powerful expansion.

Jared Bernstein Jared’s Substack
Date Posted:

.@econJaredB argues @jasonfurman overstates his case against Bidenomics: given the supply shock, the ARP only increased inflation by 1-2pp.

Was the inflation from excess pandemic stimulus worth the rapid recovery?

Core argument: Evidence including the Council of Economic Advisers' own suggests inflation would have peaked perhaps 1–2 percentage points lower without the American Rescue Plan, with a $650 billion package instead of $1.9 trillion possibly putting the peak near 7.5–8% rather than 9%.

All that said, good evidence, including our own at CEA, suggests that inflation would have peaked lower, perhaps by 1-2 percentage points, without the ARP. However, nobody, including Jason, is arguing there should have been no Rescue Plan. That is a totally unrealistic counterfactual. Had we done Jason’s $650 billion instead of $1.9 trillion, maybe inflation would have peaked at ~7.5-8% instead of 9%. And it matters, inflation-wise, what you’d cut. The $350 billion in state and local support may have been too large given their budget conditions, but those dollars spent out very slowly over many years. For these reasons, I’m pretty confident that a smaller ARP wouldn’t have changed the public mood very much. There's no outcome here wherein inflation would not have spiked, and the excess demand helped get us back quickly to full employment, staved off a lot of pain and scarring, and set up a uniquely powerful expansion.

Takeaways by Macro Roundup® AI

  1. Evidence including the Council of Economic Advisers' own suggests inflation would have peaked perhaps 1–2 percentage points lower without the American Rescue Plan, with a $650 billion package instead of $1.9 trillion possibly putting the peak near 7.5–8% rather than 9%.
  2. A smaller American Rescue Plan would likely not have changed the public mood much, since inflation would have spiked under any scenario and what was cut would have mattered for the inflation path.
  3. The $350 billion in state and local support may have been too large given state budget conditions, though those dollars spent out slowly over many years, while excess demand helped return the economy quickly to full employment and limited scarring.

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  • Bidenomics and Its Contradictions — Bidenomics rests on the claims that growth's quality matters more than its quantity, that industrial policy should replace laissez-faire, and that trade policy should favor workers over consumers. Defining market failure that broadly—covering regional, racial and gender inequities, rural internet access and child care costs—leaves no limiting principle on government intervention.
  • The Cost of Money is Part of the Cost of Living: New Evidence on the Consumer Sentiment Anomaly — Variation in the University of Michigan consumer sentiment index that inflation and unemployment cannot explain is strongly correlated with growth in consumer borrowing costs, such as mortgage and car loan rates. The authors estimate that including interest payments and homeownership costs in the consumer price index would raise measured inflation from 3% to 9%.
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