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The Benefits (and Costs) of Foresight and Hindsight in Macro Policy Formulation

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  • Nigel Stapledon

Abstract

This paper looks at the difficulties for fiscal and monetary policy posed by the inherent uncertainty of the economic outlook. It contrasts the excessive optimism of policymakers in the approach to the 1989-91 recession with the excessive pessimism of the outlook in Australia in 2008.

Suggested Citation

  • Nigel Stapledon, 2011. "The Benefits (and Costs) of Foresight and Hindsight in Macro Policy Formulation," Agenda - A Journal of Policy Analysis and Reform, Australian National University, College of Business and Economics, School of Economics, vol. 18(1), pages 41-52.
    • Handle: RePEc:acb:agenda:v:18:y:2011:i:1:p:41-52
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    File URL: http://press-files.anu.edu.au/downloads/press/p115201/pdf/ch055.pdf
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    References listed on IDEAS

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    1. Bernie Fraser, 1992. "Two Perspectives On Monetary Policy," Economic Papers, The Economic Society of Australia, vol. 11(4), pages 19-29, December.
    2. Paul Bloxham & Christopher Kent & Michael Robson, 2010. "Asset Prices, Credit Growth, Monetary and Other Policies: An Australian Case Study," RBA Research Discussion Papers rdp2010-06, Reserve Bank of Australia.
    3. Mark Crosby & Philip Bodman, 2005. "When the US Sneezes, Do We Need to Catch a Cold? Historical and Future Linkages between the Australian and US Business Cycles," RBA Annual Conference Volume (Discontinued), in: Christopher Kent & David Norman (ed.),The Changing Nature of the Business Cycle, Reserve Bank of Australia.
    4. Mr. Nigel A Chalk, 2002. "Structural Balances and All That: Which Indicators to Use in Assessing Fiscal Policy," IMF Working Papers 2002/101, International Monetary Fund.
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