The Boran Gym Debates Paul Krugman
We had a lively debate about Paul Krugman at my Muay Thai gym the other evening. I know most of you folks don't understand Turkish, so I'll translate. At about minute 1:00, my instructor, Ercan, offers the idea that Mr. Krugman might be underplaying the link between firms’ and households’ behaviour and their expectations of future tax and spending policy. As you see, a few of the students in the foreground immediately agreed that Mr. Krugman's command of modern macro leaves something to be desired; we all reflect on that for about a minute. The debate gets a little worked up around minute 6:00 -- someone brings up the whole issue of intertemporal price speculation and the optimal current-account deficit, and I have to admit things get a bit heated. The proper translation of the exchange at around minute 10:00 would be something like, "large capital inflows that lead to real exchange rate appreciation large enough to induce resource reallocation will typically be followed by a depreciation of the real exchange rate to below its original level." Then the guy in the orange shorts says, "only if you're modeling an economy in which it's costly to move resources between the tradeable and nontradeable sectors!"
Anyway, unfortunately for Mr. Krugman, the debate was indeed resolved with a unanimous conclusion that the man's a crude Keynesian.
(You can sort of spot me around minute 15:00, I'm in the background in the red shorts. I'm not more prominent, I reckon, because they're all deeply embarrassed that I'm there at all.)
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May '10
Re: The Boran Gym Debates Paul Krugman
Okay, you got me. Ha ha, made me look!
What's the guy saying at 9:31? It sounds like, "Dance, Eddie! Dance, Eddie!"