How the 2024 Election Could Redefine US Policy: Free Resource for Econ Instructors

[MarisaBluestone]

If you ask most economists, they’ll tell you that presidential administrations have not had a substantial impact on overall economic measures. According to Nobel Prize-winning economist, NY Times Columnist and Economics author Paul Krugman, while the ideological divide between parties can result in policy differences on issues like taxation or social benefits, these changes haven’t typically had a noticeable effect on macroeconomic measures such as GDP growth, unemployment, or inflation. The fundamental drivers of economic growth, such as technological innovation and demographic trends, tend to operate independently of political leadership.

However, in a new and exclusive article The Impact of the Presidential Election on Economics Krugman argues that the 2024 presidential election could represent a break from that tradition. The resource is available to all instructors who are registered in the 7th education of Economics found in Achieve (Macmillan Learning’s digital learning platform).

In the piece, Krugman explains why previous presidents may not have dramatically shifted economic outcomes and why this election cycle is poised to be different. It’s an opportunity for students and instructors to dive into the relationship between politics and economics, and analyze the potential effects of each candidate’s proposals. 

Krugman’s article provides a detailed examination of these economic dynamics, including thought-provoking discussion questions for classroom engagement, such as: How might the imposition of tariffs on imported goods affect the short-run and long-run aggregate supply curves? Discuss the potential impact of tariffs on production costs and overall economic efficiency. If you’re not currently using Achieve, simply click here to request access. In the meantime, here are three things that we learned from reading the article:

Comparative Advantage in Trade: Krugman highlights how reducing international trade through tariffs—especially the high tariffs suggested on imports from China—could limit the U.S.’s ability to benefit from comparative advantage. This would likely impact GDP growth and overall living standards. Comparative advantage teaches us that countries should focus on producing goods where they have relative efficiency. Limiting trade would make the U.S. more self-sufficient, but we’d lose the benefits of specialization. This taps into core lessons in international economics, showing how protectionist policies create long-term tradeoffs between economic efficiency and self-sufficiency.

Federal Reserve Independence: Krugman also dives into the importance of Federal Reserve independence. Proposals to reduce the Fed’s autonomy by giving the White House more control over monetary policy could lead to higher inflation. The Fed needs to make long-term decisions without political pressure to keep inflation stable and the economy balanced. This is a powerful example of why central bank independence is essential for avoiding the short-termism that often comes with political influence.

Tariffs and Inflation: Krugman explains that tariffs function like selective sales taxes, driving up consumer prices by making imports more expensive—and empowering domestic producers to raise their prices too. This is a real-world example of how taxes and trade barriers can stoke inflation, a key lesson in understanding the connection between trade policy and inflationary pressures.

Krugman’s analysis doesn’t just explain the potential outcomes of policy proposals—it’s also a tool for illustrating fundamental economic principles. By linking real-world policy with macroeconomic theory, students can better understand the tradeoffs that come with political decision-making.

The article and its discussion questions give educators a chance to create dynamic learning experiences where students apply economic concepts to current events. Whether they’re analyzing tariffs, changes in the labor force, or monetary policy, Krugman’s piece provides a valuable framework for exploring the deep connections between elections, politics, and the economy—and why this election might break the mold. Click here to sample Achieve and gain access to the article at no cost to you or your students.