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Can We Restart the Recovery All Over Again?

Author

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  • John B. Taylor

Abstract

Many have argued that a deviation from good economic policy has been a cause of the poor U.S. economic performance of the past decade and that policy reforms are needed to restore strong growth. Yet others argue that the recent stagnation is secular or that the possibility of a rapid recovery is long gone without more fiscal stimulus. Here I show that unusual economic conditions leave plenty of room for a reform-induced rebound. Taking demographics and the growth of capital services into account, labor force participation and productivity growth are unusually low. Hence, policy reforms could generate a post-recession-like acceleration as well as sustained growth and stability.

Suggested Citation

  • John B. Taylor, 2016. "Can We Restart the Recovery All Over Again?," American Economic Review, American Economic Association, vol. 106(5), pages 48-51, May.
    • Handle: RePEc:aea:aecrev:v:106:y:2016:i:5:p:48-51
    Note: DOI: 10.1257/aer.p20161007
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    References listed on IDEAS

    as
    1. Steven J. Davis, 2015. "Regulatory Complexity and Policy Uncertainty: Headwinds of Our Own Making," Economics Working Papers 15118, Hoover Institution, Stanford University.
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    Cited by:

    1. Jin Fan & Hongshu Wang & Xiaolan Zhang, 2022. "A General Equilibrium Analysis of Achieving the Goal of Stable Growth by China’s Market Expectations in the Context of the COVID-19 Pandemic," Sustainability, MDPI, vol. 14(22), pages 1-22, November.
    2. Beverly, Josh & Stewart, Shamar L. & Neill, Clinton L., 2024. "What drives labor force participation rate variability? The case of West Virginia," Economic Modelling, Elsevier, vol. 140(C).
    3. Jin, Yuying & Luo, Mingjin & Wan, Chao, 2018. "Financial constraints, macro-financing environment and post-crisis recovery of firms," International Review of Economics & Finance, Elsevier, vol. 55(C), pages 54-67.
    4. Beverly, Joshua P. & Neill, Clinton L. & Stewart, Shamar, 2022. "The Dynamics of Labor Force Participation: All Quiet on the Appalachian Front?," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322258, Agricultural and Applied Economics Association.
    5. Josh Beverly & Shamar L. Stewart & Clinton L. Neill, 2023. "The dynamics of labor force participation: Is all quiet on the Appalachian front?," Empirical Economics, Springer, vol. 65(6), pages 2867-2898, December.

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    More about this item

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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