The NZ Initiative has a research note out on how fiscal policy needs to work with monetary policy. They comment: This analysis does not dispute that the RBNZ’s high interest rates were the proximate cause of the downturn. However, it argues the Bank had little choice. It was confronted with the insidious threat of inflation […]
Monetary policy needs mates
Monetary policy needs mates
29 Sep 2025 Leave a comment
in budget deficits, business cycles, economic growth, fiscal policy, inflation targeting, macroeconomics, monetary economics, politics - New Zealand Tags: monetary policy
Article for Central Banking magazine on Orr/Quigley/Willis saga, and lessons
25 Sep 2025 Leave a comment
in economics of bureaucracy, inflation targeting, macroeconomics, politics - New Zealand, Public Choice
A couple of weeks ago the editor of Central Banking magazine (something of an house journal for central bankers, and for whom I’ve done book reviews for some years) invited me to write a fairly full article for a non-NZ audience on the extraordinary events of recent months. Having been so caught up in the […]
Article for Central Banking magazine on Orr/Quigley/Willis saga, and lessons
Outstanding questions
13 Sep 2025 1 Comment
in economics of bureaucracy, financial economics, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice
A couple of nights ago, shortly after the Minister and Treasury finally released the suite of texts between Willis and Rennie, ZB featured interviewer Heather du Plessis-Allan talking to Herald journalist Jenee Tibshraeny (who has been over the Orr/Quigley/Willis saga issue from day one). There wasn’t anything concrete that was new in the conversation but […]
Outstanding questions
💰 Inflation, Debt & The Future of the Economy | A Conversation with John Cochrane
12 Sep 2025 1 Comment
in budget deficits, business cycles, currency unions, fiscal policy, history of economic thought, inflation targeting, macroeconomics, Milton Friedman, monetarism, monetary economics Tags: monetary policy
If the election was scheduled for next week, Hipkins could win – but (luckily for Luxon) it’s next year
26 Aug 2025 Leave a comment
in economic growth, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice Tags: 2026 general election
Chris Trotter writes – “There is a tide in the affairs of men, which taken at the flood, leads on to fortune”. Those words, taken from Shakespeare’s Julius Caesar, are often quoted in the context of politicians facing the hard choice between doing it now, or not doing it at all.
If the election was scheduled for next week, Hipkins could win – but (luckily for Luxon) it’s next year
Reading Grant Robertson
25 Aug 2025 Leave a comment
in budget deficits, business cycles, economic growth, economic history, economics of bureaucracy, fiscal policy, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice Tags: economics of pandemics, monetary policy
I got home from Papua New Guinea at 1:30 on Saturday morning and by 3:30 yesterday afternoon I’d finished Grant Robertson’s new book, Anything Could Happen, and in between I’d been to two film festival movies, a 60th birthday party, and church. It is that sort of book, a pretty easy read. In some respects, […]
Reading Grant Robertson
How New Zealand invented inflation targeting
13 Jun 2025 1 Comment
in business cycles, history of economic thought, inflation targeting, labour economics, macroeconomics, monetary economics, politics - New Zealand, unemployment Tags: monetary policy
…the very next day, [Roger] Douglas appeared on TV declaring his intention to reduce inflation to ‘around 0 or 0 to 1 percent’ over the next couple of years, and then went on to make several similar comments in the following days. Douglas would soften his stance on specific timelines but ask the Reserve Bank and […]
How New Zealand invented inflation targeting
The Orr story (well, part of it anyway)
11 Jun 2025 Leave a comment
in economics of bureaucracy, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice Tags: monetary policy
Months after various OIAs had been lodged on the question of Adrian Orr’s sudden departure on 5 March, we finally got a partial dump of documents this morning. (Sufficiently mishandled that at 10:04 this morning they’d send an email to OIA requesters saying they’d email out the response at 10:45 and then have it on […]
The Orr story (well, part of it anyway)
Advertising for a Governor
03 Jun 2025 Leave a comment
in economics of bureaucracy, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice Tags: monetary policy
If you want to be Reserve Bank Governor, think you have what it takes, (and haven’t yet been approached by the Board’s recruitment company) you will need to get moving. Applications close on Friday. As a reminder, much of the process (unusually by international standards) is controlled by the Bank’s Board, most of whom were […]
Advertising for a Governor
May Monetary Policy Statement
30 May 2025 Leave a comment
in budget deficits, business cycles, economic growth, fiscal policy, inflation targeting, labour economics, macroeconomics, monetary economics, politics - New Zealand, public economics, unemployment Tags: monetary policy
Michael Reddell writes – Procrastinating this morning, I asked Grok to write a post in my style on yesterday’s Monetary Policy Statement. Suffice to say, I think I’ll stick to thinking and writing for myself for the time being. Among the many oddities of Grok’s product was the conviction that Adrian Orr was still Governor. Mercifully […]
May Monetary Policy Statement
Not much parliamentary scrutiny
01 Apr 2025 Leave a comment
in business cycles, econometerics, economic history, economics of bureaucracy, inflation targeting, labour economics, labour supply, macroeconomics, monetary economics, politics - New Zealand, Public Choice, unemployment Tags: economics of pandemics, monetary policy
This was the post I was planning to write this morning to mark Orr’s final day. That said, if the underlying events – deliberate attempts to mislead Parliament – were Orr’s doing, the post is more about the apparent uselessness of Parliament (specifically the Finance and Expenditure Committee) in holding him and the rest of […]
Not much parliamentary scrutiny
My Former Economics MPhil and DPhil Class-Mate for many hard years, Mark Carney, becomes PM of Canada.
10 Mar 2025 Leave a comment
in business cycles, economic history, economics of bureaucracy, economics of education, history of economic thought, human capital, inflation targeting, labour economics, labour supply, macroeconomics, monetary economics, occupational choice, politics - New Zealand, Public Choice Tags: Canada, monetary policy
Congratulations Mark Carney. When I went to the UK to study economics, we started off doing a degree called Master of Philosophy in…
My Former Economics MPhil and DPhil Class-Mate for many hard years, Mark Carney, becomes PM of Canada.
Bernanke on inflation targeting
09 Mar 2025 Leave a comment
in applied price theory, budget deficits, business cycles, economic growth, economic history, financial economics, fiscal policy, history of economic thought, inflation targeting, labour economics, macroeconomics, monetary economics, politics - New Zealand, unemployment Tags: monetary policy
Former chairman of the Federal Reserve Board of Governors (and FOMC), Ben Bernanke, was yesterday the first of two keynote speakers at the Reserve Bank’s conference to mark 35 years of inflation targeting, which first became a formalised thing here in New Zealand. He indicated that he’d be speaking about inflation targeting in general and […]
Bernanke on inflation targeting
Adrian Orr resigns
05 Mar 2025 Leave a comment
in business cycles, economic history, economics of bureaucracy, fiscal policy, inflation targeting, labour economics, macroeconomics, monetary economics, politics - New Zealand, Public Choice, unemployment Tags: economics of pandemics, monetary policy
Adrian Orr has resigned as Reserve Bank Governor. I normally try to highlight the good as well as the bad when someone resigns, but I have to admit in this case I struggle. I welcomed his appointment in 2017. I noted the currency rose on his appointment and that he had a very good legacy […]
Adrian Orr resigns
The cost of Reserve Bank regulation
02 Mar 2025 Leave a comment
in applied price theory, business cycles, economics of bureaucracy, economics of natural disasters, economics of regulation, inflation targeting, macroeconomics, monetary economics, politics - New Zealand, Public Choice Tags: monetary policy
Roger Partridge writes: A new submission to the Committee from banking experts Andrew Body and Simon Jensen provides fresh evidence of these costs. Their analysis shows the Reserve Bank’s capital rules add between 0.25 and 0.375 percentage points to mortgage rates compared with Australia. For a million-dollar mortgage, that means between $2,500 and $3,750 in […]
The cost of Reserve Bank regulation
Utopia, you are standing in it! 
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