Krueger's Promise

While we mourn the exit of Ron Bloom as the administration’s point man on manufacturing (who was not permitted to utter the dread words “industrial policy”), we can welcome the appointment of Alan Krueger to chair the Council of Economic Advisers.

Given the administration’s penchant for naming Wall Street people to key economic posts, Krueger is rather better than we dared hope for. He is thoroughly mainstream in all his credentials, coming from a senior post at Princeton. But with two notable differences:

First, he was editor of the Journal of Economic Perspectives from 1996 to 2002. This is the most heterodox of the major economic journals, hospitable to dissenting viewpoints.

Second, Krueger is a labor economist, not a macro-economist. One of his most important books was a study co-written with David Card titled Myth and Measurement (1995), published when he was in his mid-thirties, challenging one of the most cherished sacred cows of conventional economics—the idea that increases in the minimum wage must raise unemployment.

Read More