EconLog Archive
Economic and Political Philosophy
One Requirement of the Rule of Law
There is something that, I think, libertarians have learned, or should be learning, from the current American administration about the rule of law. One illustration among many was provided on March 13 when Ursula von der Leyen announced the European Union’s response to Trump’s 25% tariffs on steel and aluminum imports. (See “EU and Canada .. MORE
Family Economics
Homo Economicus and Home Buying Economics
Economists are often criticized for assuming people behave like homo economicus – some kind of perfectly rational machine making emotionless decisions based entirely on money. Of course, no competent economist actually thinks this way, just as no competent physicist believes that billiard balls are perfectly round spheres operating in a vacuum on a perfectly flat, frictionless surface. .. MORE
Macroeconomics
Why Torsten Sløk was correct
Bloomberg has an article with the following title and subhead: How Torsten Slok Solved the ‘Sherlock Holmes Mystery’ of the Economy When others thought a recession was inevitable, Apollo’s chief economist correctly predicted more growth. He did it by looking at the data. Sløk seems to be one of the few economic pundits that is .. MORE
Fiscal Policy
My New Thought about DOGE
I gave an OLLI (Osher Lifelong Learning Institute) talk on Tuesday on President Trump’s economic policies and actions. As you might imagine, it was pretty negative–on failure to cut major spending programs, on cracking down on both illegal and legal immigration, and on tariffs. The one potentially bright spot was on DOGE. I led .. MORE
Business Economics
Defending Apple’s DEI Program
DEI is often criticized as a modern religion. Without getting into the weeds of that discussion, I would say that my attitude toward DEI, broadly understood, actually does fit neatly into the First Amendment’s view of religion – that the state should pass no law establishing it, nor prohibit the free exercise thereof. Many companies .. MORE
Economic and Political Philosophy
My Talk at UW – Superior
On March 4, I had the great pleasure of giving a talk at UW – Superior on my research on cascading expert failure (ungated version here). You can find a video of the talk on my YouTube channel . Thanks to Dr Joshua K. Bedi for hosting and for the Wisconsin Institute for Citizenship and .. MORE
Income and Wealth distribution
The Data is Right: Americans are Prospering Economically
A recent essay by Eugene Ludwig published by Politico argues that despite most economic data showing a healthy US economy in 2024, things are actually really bad. He tries to convince us by providing alternative data. However, a close examination of his alternative data is unconvincing. These alternative measures are not better measures of labor .. MORE
Liberty
Manuel Klausner, Joyous Libertarian
If you seek his monument, look around. I learned yesterday that Manny Klausner died recently at age 85. Photo credit Reason magazine. I remember Murray Rothbard referring to H.L. Mencken as the “joyous libertarian.” For me, Manny was the joyous libertarian. My late friend Harry Watson and I came down from Canada in September 1972 .. MORE
Social Security
A Win-Win Proposal to Fix Social Security
Everyone knows Social Security is broke and broken. According to the latest OASDI Trustees Report, Social Security has been paying out more than its total revenue (payroll taxes and trust fund) since 2021, and the latest projections have the Social Security trust fund depleted by 2033. After that date, it will only pay 79% of .. MORE
Government Growth
Good Goals, Poor Implementation
The Department of Government Efficiency (DOGE), the quasi-official advisory board led by Elon Musk to recommend workforce reductions and cost-savings in the Federal Government, has a laudable goal. There certainly is a lot of waste in the government. Fraud, too. There are probably many tasks that the Feds currently do that states or private entities .. MORE
Macroeconomics
Listen to Dallas
The Federal Reserve has begun a review of its monetary policy framework. The previous review was conducted in 2020, and led to the “Flexible Average Inflation Targeting” framework. The FAIT approach would have been effective, if it had been tried. Unfortunately, the Fed forget the meaning of “average”. In a recent podcast with David Beckworth, .. MORE
Economic and Political Philosophy
A Proposed Amendment to David Hume
In his essay “Of the Independency of Parliament” (first published c. 1741), David Hume defends the Enlightenment idea that constitutions should assume that individuals, including politicians, are self-interested and that rulers will try to abuse their power. A famous passage reads: In constraining any system of government and fixing the several checks and controuls of .. MORE
Cost-benefit Analysis
Exercise, Economics, and Margins
Recently, the YouTuber and bodybuilder Jeff Nippard released a video where he ran an interesting experiment. He did two days of training, each with a different budget. On the first day, he would have only $10 to cover all of his training related costs. This included four meals, gym and equipment costs, app based food .. MORE
Free Markets
Free the Beer, Free the Trade
Gerard Comeau beer. Photo by the author CBC Radio has a great report on what we can learn from the Supreme Court of Canada case R. v. Comeau, popularly known up here as the “Free the Beer” case. In 2012, Gerard Comeau loaded his car with beer (and whiskey and liquor) in Quebec and headed .. MORE
Social Security
Social Security: The Proposal
I’ve run two installments from the Social Security chapter of my book The Joy of Freedom: An Economist’s Odyssey. Installment one was “Social Security is a Ponzi Scheme,” March 11, 2025. Installment two was “Flawed from the Start and Ponzi versus Stocks,” March 14, 2025.. Here’s the final installment. Of course, all the numbers .. MORE
Business Cycles
Corrections are Unhealthy
I see two problems with the term “correction”. Yes, there is a sense in which any change in market prices is a “correction”, as with new information the previous price becomes inappropriate. But that’s equally true of an increase or a decrease in market prices. In contrast, the term market correction tends to be used .. MORE
Economics of Health Care
My Weekly Reading and Viewing for March 16, 2025
Government Goons Destroy Tree House by Autumn Billings, Reason, March 12, 2025. Excerpt: Bringing the tree house into compliance was no simple task. Polizzi tells Reason that while he had secured the necessary zoning permit for the tree house—a feat in and of itself—he’d been unable to obtain a building permit from the L.A. Department of .. MORE
Economic and Political Philosophy
The Obvious Superiority of Collective Choices?
If someone external to your group wants to invest in a certain territory encompassing you, your group’s permission should be required. The argument seems obvious. It is nearly by definition that when we make a decision collectively, the individual must submit. The individual is just one but the collective is more than one. Or so .. MORE
Austrian Economics
Ludwig von Mises and the Berlin Batman
A body of literature called the New History of Capitalism argues (incorrectly, I believe) that Western prosperity is built on legacies of exploitation like colonialism and slavery. Economists are very skeptical because the New Historians of Capitalism rest much of their case on fundamental misunderstandings of basic economic concepts like national income accounting. Economists have .. MORE
Social Security
Social Security: Flawed from the Start
When I posted on Social Security as a Ponzi scheme on March 11, I didn’t expect the degree of interest I got. It also led to a discussion of what to do now that we’re in a mess. So I’ve decided to post the rest of my chapter of The Joy of Freedom: An Economist’s .. MORE
Cross-country Comparisons
The Conservative Cruel Kids
A new trend is emerging in left-wing circles in the Americas- denouncing rivals as ‘cruel.’ In the US, the New York Magazine (NYMag) recently ran a cover titled ‘The Cruel Kids’ Table,’ which featured a picture of partying conservatives who apparently would have been, according to the implied message, bullies in high school. Never mind .. MORE