I don’t think I’d pay money – that is where turning this into a money spinner could get difficult.

BAHAHAHAHAHA, I do love ridiculous sarcasm – I wish there was a specific text format for sarcastic comments. That would be a money spinner … or not.

Miguel, stop being like Hitler.

“All the more reason to be asking questions”

Agree 100%, just want to make sure they are questions rather than attacks on the independence of said work is all 😉

“Look, it’s all very well to model what would happen IF there was a long-lived global supply shock; I don’t think the outcome of that modelling would surprise any economist”

Agreed.

“But then to title it “High food prices WILL harm the New Zealand economy” (my emphasis), and to insinuate the whole way through that this is a forecast, not just a thought experiment, is a tad shady.”

Agreed in terms of the emphasis of the paper. I also felt that the emphasis of the piece was slightly off, and the counterfactual being tested wasn’t clear/could be highly misinterpreted. That was the fact that got me to write the post, to try and clear up the “why”.

You are right that it isn’t really the higher relative prices hurting the economy, it is the resource scarcity/negative relative supply shock (I use relative as the counterfactual could well assume growing capacity to meet current demand conditions, while the main piece assumes no such growth in supply) that causes said damage. And I suspect that point should have been made clearer – even for a lay audience.

All the more reason to be asking questions. Look, it’s all very well to model what would happen IF there was a long-lived global supply shock; I don’t think the outcome of that modelling would surprise any economist. But then to title it “High food prices WILL harm the New Zealand economy” (my emphasis), and to insinuate the whole way through that this is a forecast, not just a thought experiment, is a tad shady.

As suggested in my previous comment – the reports were discussing two different counterfactuals essentially.

Note that in the recent release New Zealand performed “relatively” well – but there was an absolute loss relative to the “less scarcity/higher aggregate supply” scenario.

My impression is that one study was on a demand shock, the other was on a supply shock – so we would expect different results.

“maybe you can explain what kind of quality control this organisation has that allows it to make two such deeply contradictory statements at the same time”

Lets try to not let this get too personal, NZIER is a reputable institution that is known to provide robust analysis of economic issues – name calling is a bit unnecessary. Debate on what assumptions seem reasonable is encouraged (I admitted to personally disagreeing on some things), but could we please avoid unnecessary attacking if possible.

Yes, you’d think that might have rung some alarm bells…

rauparaha: fret not, that last comment was sarcasm. But since you worked on that report, maybe you can explain what kind of quality control this organisation has that allows it to make two such deeply contradictory statements at the same time.