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![handle is hein.amenin/aeiacpq0001 and id is 1 raw text is:
* Here are reflections on a central issue of economic policy ...
from one of this century's towering scholars. Economic policy will be far
more surefooted if people in governments will read and carefully ponder
the wisdom in this essay. PAUL W. MCCRACKEN,
University of Michigan
* Gottfried Haberler's remarkable essay provides a critical review
of the macro- and micro-policies of the last half centry in the United
States as well as in Western Europe. It should be read by all concerned
with the effects of these policies. BELA BALASSA,
Johns Hopkins University
* We are once again indebted to Professor Haberler. In his typical
scholarly but highly readable style, he draws extensively on economic
history . . .to] demonstrate the importance of paying careful attention
to microeconomic analysis when considering the major macroeconomic
problem of stagflation. THOMAS D. WILLETT,
Claremont Center for Economic Policy Studies
The Problem of Stagflation
Reflections on the Microfoundation of
Macroeconomic Theory and Policy
GOTTRIED HABERLER
Although falling prices have usually accompanied economic de-
cline, industrial nations since World War 11 have faced the prob-
lem of inflationary recession, or stagflation. Gottfried Haberler
examines the dilemma stagflation poses for macroeconomic pol-
icy: attempts to curb inflation through tight monetary and fiscal
policies increase unemployment, and attempts to reduce unem-
ployment through easy money accelerate inflation.
Haberler analyzes the leading paradigms of macroeconomic
policy-monetarism, rational expectations, and Keynesianism.
He contrasts the booming U.S. economy with the sluggish re-
covery of Europe and analyzes the problem of the strong dollar
and the large U.S. budget and trade deficits. The theory that the
United States needs an industrial policy and can no longer rely
on private enterprise to ensure growth is examined and rejected.
Gottfried Haberler is Galen L. Stone Professor of Interna-
tional Trade Emeritus of Harvard University, a past president of
the American Economic Association and of the International
Economic Association, and an AEI resident scholar.
American Enterprise Institute for Public Policy Research
1150 Seventeenth Street, N.W., Washington, D.C. 20036
ISBN 978-0-8447-3578-8
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American Enterprise Institute
Studies in Economic Policy
The
Problem
Of
Stagflation
Reflections on
the Microfoundation
of Macroeconomic
Theory and Policy
Gottfried Haberler](ViewImageLocal?handle=hein.amenin/aeiacpq0001&div=1&collection=&method=preview&ext=.png&size=3)