For a few decades, economists used to imagine how the world works, write down a theory describing their idea, and call it a day. If some statisticians came along and found some support for the theory, well, great! But usually they didn’t, and that was fine too. As one old joke put it, if an […]

The harm of inflation cited in economics textbooks seems laughably unimportant. For example, inflation generates so-called shoe-leather costs — a term for the hassle of moving money from one’s brokerage or savings account to one’s checking account. This hassle is larger when prices change a lot, since you have to put spending cash in your […]

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