Economics, Events, Ideas, and Policies The 60s and After

The 1960s represented a turning point in the application of economic analysis to U.S. policymaking. The decade was marked by widespread optimism that government policies could improve economic and social outcomes. Developments since then illustrate how policies can shift, along with changes in the environment, changes in theory and understanding, or changes in dominant values. The papers in this volume are taken from a November 1999 conference: Economic Events, Ideas and Policies: The 1960s and After. Sponsored by Yale University and the Brookings Institution, the conference was held in memory of economist Arthur Okun. Okun, along with George L. Perry, founded the Brookings Panel on Economic Activity and its journal, the Brookings Papers on Economic Activity. A former professor of economics at Yale University and chairman of the President's Council on Economic Advisers, Okun authored many important articles and books, including Equality and Efficiency, a Brookings bestseller. Prices and Quantities, published after his death in 1980, is still considered a major professional contribution to macroeconomic analysis and the problems confronting stabilization policy. Contributors include William J. Baumol (Princeton University, New York University), Robert Haveman (University of Wisconsin), Barry Eichengreen (University of California), Richard Cooper (Harvard University), Alan Krueger (Princeton University), Paul Krugman (Massachusetts Institute of Technology), Robert Solow (Massachusetts Institute of Technology), William Brainard (Yale University), and George Perry (Brookings Institution). Part I. Stabilization and growth. Rapid economic growth, equitable income distribution, and the optimal range of innovation spillovers William J. Baumol. Comments by George Akerlof [and] Martin Neil Baily Making policy in a changing world / William C. Brainard and George L. Perry. Comments by Ray C. Fair [and] John B. Taylor The end of stabilization policy? / Paul Krugman. Comments by Stanley Fischer [and] Benjamin M. Friedman The Kennedy Council and the long run / Robert M. Solow. Comments by Robert E. Hall [and] Charles L. Schultze. Part I. Stabilization and growth. Rapid economic growth, equitable income distribution, and the optimal range of innovation spillovers William J. Baumol. Comments by George Akerlof [and] Martin Neil Baily Making policy in a changing world / William C. Brainard and George L. Perry. Comments by Ray C. Fair [and] John B. Taylor The end of stabilization policy? / Paul Krugman. Comments by Stanley Fischer [and] Benjamin M. Friedman The Kennedy Council and the long run / Robert M. Solow. Comments by Robert E. Hall [and] Charles L. Schultze. Part II. The United States and the international economy. Foreign economic policy in the 1960s : an enduring legacy / Richard N. Cooper. Comments by Francis M. Bator [and] Maurice Obstfeld From benign neglect to malignant preoccupation: U.S. balance of payments policy in the 1960s / Barry Eichengreen. Comments by Robert Z. Lawrence [and] Jeffrey Sachs Part III. Labor markets and distribution. Poverty and the distribution of economic well-being since the 1960s / Robert Haveman. Comments by Gary Burtless [and] Lawrence F. Katz Labor policy and labor research since the 1960s : two Part II. The United States and the international economy. Foreign economic policy in the 1960s : an enduring legacy / Richard N. Cooper. Comments by Francis M. Bator [and] Maurice Obstfeld From benign neglect to malignant preoccupation: U.S. balance of payments policy in the 1960s / Barry Eichengreen. Comments by Robert Z. Lawrence [and] Jeffrey Sachs Part III. Labor markets and distribution. Poverty and the distribution of economic well-being since the 1960s / Robert Haveman. Comments by Gary Burtless [and] Lawrence F. Katz Labor policy and labor research since the 1960s : two " In November 1999 the Brookings Institution and Yale University jointly sponsored a conference to reconsider the national economic policies of the 1960s and the theories that influenced them, in light of subsequent events in the economy and of developments in economic theory and research. This volume contains the papers and comments of the participants. The 1960s were years of difficult challenges to U.S. policymakers and of important initiatives to meet them. The economic doldrums at the start of the decade gave way to strong expansion and prosperity, which, however, ended with excessive inflation. The decade that followed was the most turbulent of the postwar period, with global shock waves from oil prices, two deep recessions, and historic changes in the international financial system. Both policymaking and economic thinking have evolved since the 1960s. The papers gathered in this volume examine the economics of the 1960s as the starting point in this evolution.Several of the contributors to this volume were involved in policymaking in the 1960s. Their papers provide firsthand insights to the analyses and priorities of that period and a prelude to examination of subsequent ideas and policies. Younger scholars represented in the volume bring different perspectives. All participants have been active in economic research since the 1960s; collectively they represent a wide range of expertise in economic analysis.This volume is dedicated to the memory of Arthur Okun, a major figure in economics and economic policy throughout the Kennedy-Johnson era, at Yale, at the Council on Economic Advisers, and at Brookings. He served as chairman of the council and chief economic adviser to President Johnson. At Brookings, he and George Perry founded the Brookings Panel on Economic Activity and its journal, Brookings Papers on Economic Activity. "