N. Gregory Mankiw

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Nicholas Gregory Mankiw (born February 3, 1958) is a macroeconomist. In 2003, he became the chairman of President Bush's Council of Economic Advisors.

Mankiw was born in Trenton, New Jersey. Graduating from Princeton University summa cum laude in 1980 with an A.B. in Economics, he worked as a staff economist for the Council of Economic Advisers from 1982-83, foreshadowing his later position as chairman of that organization. After leaving the Council, he earned his Ph.D. in Economics from the Massachusetts Institute of Technology in 1984. He taught at MIT for a year and then became an assistant professor of Economics at Harvard University in 1985 and full professor in 1987. He returned to politics when he was appointed Chairman of the Council of Economic Advisors in May 2003. He has since returned to teaching at Harvard, taking over the introductory economics course, Social Analysis 10, taught for many years by Martin Feldstein. He is currently a visiting fellow at the American Enterprise Institute.

He wrote two popular college-level textbooks, Principles of Economics and Macroeconomics; the former is popular in among high-school Advanced Placement Economics teachers. Together, one million copies of the books have been sold in seventeen languages.

Mankiw is a New Keynesian economist. He did important work on menu costs, which are a source of price stickiness, one of the fundamental tenets of Keynesian economics. In 1989, he wrote a paper arguing that the aging of the baby boomers was going to undermine the housing market in the 1990s and 2000s. His advocacy at the CEA of tax cuts even in the face of large deficits led some other economists, such as Paul Krugman and J. Bradford DeLong, to criticize him as in thrall to Bush administration policies.

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Controversy

Several controversies arose from CEA's February 2004 Economic Report of the President.[1] In a press conference, Mankiw spoke of the gains from free trade, noting that outsourcing of jobs by U.S. companies is "probably a plus for the economy in the long run."[2][3] While this reflected mainstream economic analysis, it was criticized by many people who drew a link between outsourcing and the still-slow recovery of the U.S. labor market in early 2004. The White House economic forecast contained in the report was criticized for being overly optimistic about job gains--and indeed, job growth turned out to be slower than the Administration forecast.

Finally, controversy arose from a rhetorical question posed by the report (and repeated by Mankiw in a speech [4] about the report): "when a fast-food restaurant sells a hamburger, is it providing a service or combining inputs to manufacture a product?" The intended point was that the distinction between manufacturing and service industry is somewhat arbitrary and therefore a poor basis for policy. Even though the issue was not raised in the report, a news account [5] led to criticism that the Administration was seeking to cover up job losses in manufacturing by redefining jobs such as flipping hamburgers as manufacturing.

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