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Continuing the discussion with @JohnHCochrane and others, on the complexity of economic advice, and the role of economists. Suppose for the sake of argument, that the Zucman tax has a non-negligible negative effect on growth. But suppose that it also reduces the widely held sense of unfairness (“fiscal justice”) and allows a political compromise on the budget to emerge. Where should we stand? One answer is that knowing the effect of the tax on the sense of unfairness, and of unfairness on the political compromise, and of the political compromise on interest rates, growth, and so on, is inherently fuzzy, and thus one, as an economist, should ignore it. (Policy makers do not have that option). This is probably what John would argue. I do not think this is the right approach. As fuzzy as it is, we should, as economists, put together the bits of evidence we have and come to a (guarded) conclusion. (To be clear, not any economist has to take a position. Only those of us who want to influence the public debate. )
ojblanchard1 ↗