Keynes and Krugman are walking down the street and see dog droppings.
Keynes says to Krugman: "I'll pay you $20,000 to eat those."
Krugman thinks about it, decides he really wants a ...new car, and eats the droppings.
They continue walking, then Krugman sees some other dog's droppings up ahead and says to Keynes: "Same deal: I'll pay you $20,000 to eat that."
Keynes didn't expect Krugman to take him up on his bet earlier, and he really needs the money, so he agrees.
Then Krugman says to Keynes: "We both have the same amount of money as before, but we both ate a lot of s**t."
Keynes replies: "Yeah, but there was $40,000 in stimulus to the national GDP."
Nod to Sid K.
Keynes says to Krugman: "I'll pay you $20,000 to eat those."
Krugman thinks about it, decides he really wants a ...new car, and eats the droppings.
They continue walking, then Krugman sees some other dog's droppings up ahead and says to Keynes: "Same deal: I'll pay you $20,000 to eat that."
Keynes didn't expect Krugman to take him up on his bet earlier, and he really needs the money, so he agrees.
Then Krugman says to Keynes: "We both have the same amount of money as before, but we both ate a lot of s**t."
Keynes replies: "Yeah, but there was $40,000 in stimulus to the national GDP."
Nod to Sid K.
5 comments:
Are you stoopid or what?
Anon-
Diggin ditches, building pyramids or eating shit. What's the dif?
Sid came up with a good one!
Keynes was right, there was a meaningful increase in GDP of $40 K. Both parties entered into voluntary transactions using their own money. What Krugman enjoys for breakfast is no business of ours.
But next time you teach intermediate macro try this exam question.
Obama and Boehner are walking together when they spot a pile of horse manure. Obama turns to Boehner and says "this is an environmental hazard. If you eat that, I'll see that the EPA pays you $20,000." Boehner gobbles it down and they continue the walk.
A few minutes later they're close to the Pentagon when they come accross a pile of dog poop. Boehner stops in his tracks and tells Obama, "This is a threat to national security. If you eat that, I'll pass a bill paying you $20,000." Obama agrees.
Later that day the two hold a joint press conference in which Obama says, " We made a bipartisan effort and while we both had to eat some s**t, we managed to raise GDP by $40,000."
When grading the question deduct 2 points each time the student uses the word "multiplier". Give extra crediti if the student considers whether it matters whether taxes or borrowing went up to pay for the spending.
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