One size does not fit all
(Will Governments start spending more to boost growth?)
Over the last few months there has been a notable shift in the narrative around economic policy.
Since the GFC, the main tool of policymakers has been monetary policy (think record low interest rates).
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Ever since the GFC, economists have struggled to explain events, to direct policy, or to accurately predict trends.
Could it be that their models (theories?) are missing something vital?
According to Richard Koo, economist with Nomura Research Institute, the answer is definitely, “yes”.
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