Other Group

Pigou Club

Type:

Informal Membership Organization

Founder:

Greg Mankiw

The Pigou Club is an informal membership organization founded by macroeconomist Gregory Mankiw.

Background

The Pigou Club is an informal membership organization that supports penalty taxes on certain consumption (known as Pigovian taxes after Arthur Cecil Pigou, a 20th century English economist who proposed them), especially conventional energy sources such as gasoline. Gregory Mankiw, a macroeconomist known for his work on New Keynesian economics and in the George W. Bush administration, is the Pigou Club’s creator. The Club, which exists as an informal membership organization, supports the levying of Pigovian Taxes. In a 2006 op-ed in the Wall Street Journal titled “Raise the Gas Tax,” which Mankiw on his blog describes as “The Pigou Club Manifesto,” Mankiw argues that legislators should gradually increase the tax on gasoline by $1 per gallon over the course of a decade. [1] In his defense of the increase, Mankiw cites environmental concerns as well as concerns about the costs of federal welfare programs, including Social Security and Medicare. [2]

In March 2008, at a meeting of the Eastern Economic Association, Mankiw gave a talk on energy-related Pigovian Taxes. Later, the Eastern Economic Journal, a periodical of the association, published an edited version of the talk under the title “Smart Taxes: An Open Invitation to Join the Pigou Club.” In the article, Mankiw contends that a tax on carbon emissions is more economically efficient and attractive from a policy perspective than both regulations mandating more fuel-efficient equipment and cap-and-trade-systems. [3]

Membership

Membership in the Pigou Club is informal; according to Mankiw’s description of the group, it consists of “economists and pundits with the good sense to have publicly advocated higher Pigovian taxes.” Members whom Mankiw recognizes on his blog are usually recognized as such after having publicly advocated for a Pigovian Tax (usually on energy) of some sort, usually in an op-ed, blog post, academic article, or television interview. Figures recognized by Mankiw include economist Bill Nordhaus, left-progressive New York Times columnists Thomas Friedman and Paul Krugman, environmentalist activist and former Vice President Al Gore, political commentator Andrew Sullivan, and economist Gary Becker. [4]

Gregory Mankiw

Gregory Mankiw is the Robert M. Beren Professor of Economics at Harvard University and a former chairman of the President’s Council of Economic Advisors during the presidency of George W. Bush from May 29, 2003 to February 18, 2005. [5] While teaching, Mankiw also acted as an economic advisor to former Massachusetts Gov. Mitt Romney (R) during his presidential campaigns in in 2008 and 2012. [6] On October 28, 2019, Mankiw announced on a post on his blog that he had switched his voter registration from Republican to independent while lamenting that the “Republican Party has largely become the Party of [President Donald] Trump.” [7]

References

  1. Mankiw, Gregory. “The Pigou Club Manifesto.” Greg Mankiw’s Blog. October 20, 2006. Accessed November 18, 2019. https://gregmankiw.blogspot.com/2006/10/pigou-club-manifesto.html ^
  2. Mankiw, Gregory. “Raise the Gas Tax.” Wall Street Journal. October 20, 2006. Accessed November 18, 2019. https://www.wsj.com/articles/SB116131055641498552 ^
  3. Mankiw, Gregory. “Smart Taxes: An Open Invitation to Join the Pigou Club.” Eastern Economic Journal. 2009. Accessed November 18, 2019. https://scholar.harvard.edu/files/mankiw/files/smart_taxes.pdf ^
  4. Mankiw, Greg. “Rogoff joins the Pigou Club.” Greg Mankiw’s Blog. September 16, 2019. Accessed November 18, 2019. http://gregmankiw.blogspot.com/2006/09/rogoff-joins-pigou-club.html ^
  5. KetoDow, Alex. “Mankiw Resigns as Key Adviser to Bush on Economic Policy.” Wall Street Journal. February 17, 2005. Accessed November 18, 2019. https://www.wsj.com/articles/SB110857020030656511 ^
  6. “Mankiw ’80, Economic Advisor to 2012 Presidential Candidate Mitt Romney and Harvard Economics Professor, to speak at WWS, October 20.” Woodrow Wilson School of Public & International Affairs. Accessed November 18, 2019. https://wws.princeton.edu/news-and-events/events/item/mankiw-80-economic-advisor-2012-presidential-candidate-mitt-romney-and ^
  7. Mankiw, Gregory. “I am no longer a Republican.” Greg Mankiw’s Blog. October 28, 2019. Accessed November 18, 2019. https://gregmankiw.blogspot.com/2019/10/i-am-no-long-republican.html ^

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