US

QE3

Question A:

Even if the third round of quantitative easing that the Fed recently announced increases real GDP growth over the next two years, the increase will be inconsequential.

Responses weighted by each expert's confidence

Question B:

Even if the third round of quantitative easing that the Fed recently announced increases annual consumer price inflation over the next five years, the increase will be inconsequential.

Responses weighted by each expert's confidence

Question C:

Even if inflationary pressures rise substantially as a result of quantitative easing and low interest rates, the Federal Reserve has ample tools to rein inflation back in if it chooses to do so.

Responses weighted by each expert's confidence

Question A Participant Responses

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Uncertain
3
Bio/Vote History
Alesina
Alberto Alesina
Harvard Did Not Answer Bio/Vote History
Altonji
Joseph Altonji
Yale
No Opinion
Bio/Vote History
My guess is QE3 will have a small positive effect on GDP, but I am not well informed on this issue.
Auerbach
Alan Auerbach
Berkeley
Uncertain
3
Bio/Vote History
Autor
David Autor
MIT
No Opinion
Bio/Vote History
Baicker
Katherine Baicker
University of Chicago
No Opinion
Bio/Vote History
Bertrand
Marianne Bertrand
Chicago
Uncertain
1
Bio/Vote History
Chetty
Raj Chetty
Harvard
Uncertain
4
Bio/Vote History
Chevalier
Judith Chevalier
Yale Did Not Answer Bio/Vote History
Currie
Janet Currie
Princeton
Disagree
5
Bio/Vote History
Cutler
David Cutler
Harvard
Disagree
3
Bio/Vote History
Deaton
Angus Deaton
Princeton
Uncertain
1
Bio/Vote History
What does inconsequential mean?
Duffie
Darrell Duffie
Stanford
Disagree
7
Bio/Vote History
The impact might be small, but "inconsequential" , to me, means "of negligible value." The Fed is doing this for a reason, not for fun.
Edlin
Aaron Edlin
Berkeley
Disagree
8
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Uncertain
3
Bio/Vote History
Purchases are open ended so consequences will depend on magnitude which remains uncertain. And does your question encompas forward guidance?
Fair
Ray Fair
Yale
Agree
5
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale
No Opinion
Bio/Vote History
Goldin
Claudia Goldin
Harvard
Agree
1
Bio/Vote History
Goolsbee
Austan Goolsbee
Chicago
Agree
6
Bio/Vote History
Greenstone
Michael Greenstone
University of Chicago
No Opinion
Bio/Vote History
Hall
Robert Hall
Stanford
Agree
8
Bio/Vote History
Current activity depends mainly on shorter rates, so lowering long rates has little effect. See my 1977 Brookings paper.
-see background information here
Holmström
Bengt Holmström
MIT
Uncertain
4
Bio/Vote History
Hoxby
Caroline Hoxby
Stanford
Agree
7
Bio/Vote History
Judd
Kenneth Judd
Stanford
Uncertain
5
Bio/Vote History
Kashyap
Anil Kashyap
Chicago Booth
Strongly Agree
7
Bio/Vote History
Too many other negative pressures around the world (europe, fiscal cliff, china) for the Fed's policy to make much difference
Klenow
Pete Klenow
Stanford
Disagree
5
Bio/Vote History
Lazear
Edward Lazear
Stanford
Agree
7
Bio/Vote History
Levin
Jonathan Levin
Stanford Did Not Answer Bio/Vote History
Maskin
Eric Maskin
Harvard Did Not Answer Bio/Vote History
Nordhaus
William Nordhaus
Yale
Disagree
8
Bio/Vote History
Likely to be small, but consequential if it has net job creation.
Obstfeld
Maurice Obstfeld
Berkeley
Uncertain
9
Bio/Vote History
Saez
Emmanuel Saez
Berkeley
Uncertain
3
Bio/Vote History
Scheinkman
José Scheinkman
Columbia University Did Not Answer Bio/Vote History
Schmalensee
Richard Schmalensee
MIT
Agree
4
Bio/Vote History
Shin
Hyun Song Shin
Princeton
Uncertain
6
Bio/Vote History
Stokey
Nancy Stokey
University of Chicago
Strongly Agree
2
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
Uncertain
1
Bio/Vote History
don't know and will never know. Economy is likely to start growing at some point and no one will know what caused it.
Udry
Christopher Udry
Northwestern
No Opinion
Bio/Vote History
Zingales
Luigi Zingales
Chicago Booth
Agree
6
Bio/Vote History

Question B Participant Responses

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Uncertain
3
Bio/Vote History
Alesina
Alberto Alesina
Harvard Did Not Answer Bio/Vote History
Altonji
Joseph Altonji
Yale
No Opinion
Bio/Vote History
Auerbach
Alan Auerbach
Berkeley
Uncertain
3
Bio/Vote History
Autor
David Autor
MIT
No Opinion
Bio/Vote History
Baicker
Katherine Baicker
University of Chicago
No Opinion
Bio/Vote History
Bertrand
Marianne Bertrand
Chicago
Agree
2
Bio/Vote History
Chetty
Raj Chetty
Harvard
Uncertain
1
Bio/Vote History
Chevalier
Judith Chevalier
Yale Did Not Answer Bio/Vote History
Currie
Janet Currie
Princeton
Uncertain
3
Bio/Vote History
Cutler
David Cutler
Harvard
Agree
6
Bio/Vote History
Deaton
Angus Deaton
Princeton
Agree
3
Bio/Vote History
Duffie
Darrell Duffie
Stanford
Uncertain
7
Bio/Vote History
The path of Inflation could be raised moderately over 5 years by this QE. The Fed has said as much, and probably wants a bit more inflation.
Edlin
Aaron Edlin
Berkeley
Uncertain
5
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Uncertain
3
Bio/Vote History
Increase is unlikely to exceed 1-2 percentage points per annum. Is this inconsequel? I'm not sure how to interpret the word in this context.
Fair
Ray Fair
Yale
Agree
5
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale
Agree
6
Bio/Vote History
Goldin
Claudia Goldin
Harvard
Agree
1
Bio/Vote History
Goolsbee
Austan Goolsbee
Chicago
Strongly Agree
6
Bio/Vote History
Greenstone
Michael Greenstone
University of Chicago
No Opinion
Bio/Vote History
Hall
Robert Hall
Stanford
Strongly Agree
7
Bio/Vote History
Holmström
Bengt Holmström
MIT
Agree
5
Bio/Vote History
Hoxby
Caroline Hoxby
Stanford
Disagree
6
Bio/Vote History
Judd
Kenneth Judd
Stanford
Agree
5
Bio/Vote History
Kashyap
Anil Kashyap
Chicago Booth
Agree
7
Bio/Vote History
Only way this is incorrect is if the Fed ignores lots of warnings. Given current FOMC membership that risk is small.
Klenow
Pete Klenow
Stanford
Disagree
5
Bio/Vote History
Lazear
Edward Lazear
Stanford
Uncertain
3
Bio/Vote History
Levin
Jonathan Levin
Stanford Did Not Answer Bio/Vote History
Maskin
Eric Maskin
Harvard Did Not Answer Bio/Vote History
Nordhaus
William Nordhaus
Yale
Agree
8
Bio/Vote History
Again, inconsequential is poor word choice. Surely less than 50 basis points per year.
Obstfeld
Maurice Obstfeld
Berkeley
Uncertain
9
Bio/Vote History
Depends what you mean by 'consequential.' I doubt there is a chance of inflation as high as 5% before the Fed tightens.
Saez
Emmanuel Saez
Berkeley
Agree
3
Bio/Vote History
Scheinkman
José Scheinkman
Columbia University Did Not Answer Bio/Vote History
Schmalensee
Richard Schmalensee
MIT
Strongly Agree
8
Bio/Vote History
Shin
Hyun Song Shin
Princeton
Disagree
7
Bio/Vote History
Stokey
Nancy Stokey
University of Chicago
Disagree
2
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
Agree
3
Bio/Vote History
Inflation risk still seems low.
Udry
Christopher Udry
Northwestern
Agree
1
Bio/Vote History
Zingales
Luigi Zingales
Chicago Booth
Disagree
2
Bio/Vote History

Question C Participant Responses

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Agree
3
Bio/Vote History
Alesina
Alberto Alesina
Harvard Did Not Answer Bio/Vote History
Altonji
Joseph Altonji
Yale
Uncertain
1
Bio/Vote History
Auerbach
Alan Auerbach
Berkeley
Uncertain
3
Bio/Vote History
Autor
David Autor
MIT
No Opinion
Bio/Vote History
Baicker
Katherine Baicker
University of Chicago
No Opinion
Bio/Vote History
Bertrand
Marianne Bertrand
Chicago
Agree
2
Bio/Vote History
Chetty
Raj Chetty
Harvard
Agree
5
Bio/Vote History
Chevalier
Judith Chevalier
Yale Did Not Answer Bio/Vote History
Currie
Janet Currie
Princeton
Agree
3
Bio/Vote History
Cutler
David Cutler
Harvard
Agree
4
Bio/Vote History
Deaton
Angus Deaton
Princeton
Agree
3
Bio/Vote History
Duffie
Darrell Duffie
Stanford
Agree
9
Bio/Vote History
Yes, it clearly has the tools, but will it use them quickly and aggressively, especially given the short-run cost in jobs? We may find out.
Edlin
Aaron Edlin
Berkeley
Agree
7
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Agree
1
Bio/Vote History
Fair
Ray Fair
Yale
Disagree
5
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale
Agree
6
Bio/Vote History
Goldin
Claudia Goldin
Harvard
No Opinion
Bio/Vote History
Goolsbee
Austan Goolsbee
Chicago
Strongly Agree
7
Bio/Vote History
Greenstone
Michael Greenstone
University of Chicago
No Opinion
Bio/Vote History
Hall
Robert Hall
Stanford
Strongly Agree
9
Bio/Vote History
There's no upper bound on the Fed's contractionary power--it can sell bonds and raise the interest rate on reserves, the latter sans limit.
Holmström
Bengt Holmström
MIT
Agree
6
Bio/Vote History
Hoxby
Caroline Hoxby
Stanford
Uncertain
6
Bio/Vote History
Judd
Kenneth Judd
Stanford
Agree
4
Bio/Vote History
Kashyap
Anil Kashyap
Chicago Booth
Strongly Agree
10
Bio/Vote History
Lots of ways to tighten and failure to do so would have to be an active choice.
Klenow
Pete Klenow
Stanford
Agree
5
Bio/Vote History
e.g., the Fed phased out its liquidity lending facilities when the worst of the crisis passed.
-see background information here
Lazear
Edward Lazear
Stanford
Agree
6
Bio/Vote History
Levin
Jonathan Levin
Stanford Did Not Answer Bio/Vote History
Maskin
Eric Maskin
Harvard Did Not Answer Bio/Vote History
Nordhaus
William Nordhaus
Yale
Strongly Agree
8
Bio/Vote History
But recall that inflation is below Fed goal.
Obstfeld
Maurice Obstfeld
Berkeley
Uncertain
8
Bio/Vote History
Again depends on what 'substantially' means. There is some (uncertain) point at which long-term inflation expectations lose their anchor.
Saez
Emmanuel Saez
Berkeley
Agree
3
Bio/Vote History
Scheinkman
José Scheinkman
Columbia University Did Not Answer Bio/Vote History
Schmalensee
Richard Schmalensee
MIT
Strongly Agree
7
Bio/Vote History
Shin
Hyun Song Shin
Princeton
Disagree
8
Bio/Vote History
Stokey
Nancy Stokey
University of Chicago
Disagree
2
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
Agree
3
Bio/Vote History
Udry
Christopher Udry
Northwestern
Agree
1
Bio/Vote History
Zingales
Luigi Zingales
Chicago Booth
Uncertain
5
Bio/Vote History
The difference between can do it and will do it is a bit tricky when we are talking about the Fed