EconLog Archive
Books: Reviews and Suggested Readings
Notes From the Field
That is, from Alexander J. Field’s A Great Leap Forward. I rate the book as must-read. It is about the behavior of productivity in various eras of the twentieth century. He rates the 1930’s the highest (!) and the 1973-1989 period the lowest. Not much argument about the latter, of course. I am tempted to .. MORE
Finance: stocks, options, etc.
Private Accounts Can Save Social Security (????)
Martin Feldstein writes, With a 3% payroll deduction, someone with $50,000 of real annual earnings during his working years could accumulate enough to fund an annual payout of about $22,000 after age 67, essentially doubling the current Social Security benefit. That assumes a real rate of return of 5.5%, less than the historic average return .. MORE
Books: Reviews and Suggested Readings
Open Borders and The Walking Dead
I just finished volume 13 of The Walking Dead. It’s my favorite comics discovery since Barefoot Gen. At first glance, it’s mere genre fiction – an unexplained zombie plague destroys civilization in a matter of weeks, leaving a handful of desperate survivors to face the horrible aftermath. But before long, you know you’re reading something .. MORE
Business Economics
Yay is for Apple
After my devastating fire in 2007 in which I lost my computer, I switched from PCs to a Mac. I didn’t fall in love with the Mac instantly, as my Mac friends predicted I would. It took about 6 months. About a year later, my wife switched also. We are now an all-Mac family. Why .. MORE
Macroeconomics
Keynes and Central Planning
The new Keynes-Hayek video has been reviving academic interest in history of thought. The issue: Was Keynes an advocate of central planning? This is well outside my expertise, but I can’t resist quoting the infamous intro to the German edition of The General Theory. Don’t forget who’s ruling Germany when Keynes wrote these words: The .. MORE
Behavioral Economics
Just Try It; or, Nudge for Kids
The media have run me ragged for the last two weeks. But I’m not complaining; it’s a great experience, and I’m learning as I go. The single best point I’ve heard boils down to “nudge for kids.” It goes something like this: Sure, repeatedly pushing a kid to do an activity he knows he hates .. MORE
Finance: stocks, options, etc.
Accounting and Financial Crises
Hernando de Soto writes, Knowing who owned and owed, and fixing that information in public records, made it possible for investors to infer value, take risks, and track results. The final product was a revolutionary form of knowledge: “economic facts.” Over the past 20 years, Americans and Europeans have quietly gone about destroying these facts…Governments .. MORE
Austrian Economics
Two From Mark Thoma
1. He points to Noah Smith’s description of learning Dark Age Macro. I absolutely don’t blame Chris House for teaching what he taught. Our curriculum was considered to be the state of the art by everyone who mattered. Without a thorough understanding of DSGE models and the like, a macroeconomist is severely disadvantaged in today’s .. MORE
Central Planning
Keynes v. Hayek, Round 2
I’ll try to hit highlights that other people haven’t mentioned (much) on the latest video by John Papola and Russ Roberts. Big picture, though: I think it’s even better than the first one, both in content and in “production values.” [For the transcript, go here.] 0:42: 1066. That warmed the cockles of my former Canadian, .. MORE
Austrian Economics
Soros on Hayek
Yesterday, I attended an invitation-only event at the Cato Institute, featuring a new edition of the Hayek’s The Constitution of Liberty. [UPDATE: now available on youtube]. The panel consisted of Bruce Caldwell, Richard Epstein, and George Soros. In terms of volubility, Caldwell was overshadowed, but he was my favorite among the panelists. [UPDATE: For more .. MORE
Finance
Greider’s Ad Hominem
Examples of clearcut ad hominems, I’ve found, are rarer than I thought before I started looking for them. On closer inspection, most ad hominem arguments have a trace of logic or reason, however weak, that accompany them. But William Greider’s argument against Standard & Poor’s warning on U.S. government debt is about the cleanest case .. MORE
Taxation
Marginal vs. Average Tax Rates
From Anthony R. Palmer, M.D.’s letter in the April 26 Wall Street Journal: I got out my calculator and found that the President and Mrs. Obama paid 26.6% and Vice President and Mrs. Biden paid 22.8% of their adjusted gross income, respectively, in taxes. My tax rate was 28%, but my adjusted gross income was .. MORE
Behavioral Economics
Ibsen Against the Wisdom of Crowds
Here’s a position even I consider too strong. But as poetry, it’s hard to beat. From Henrik Ibsen’s An Enemy of the People: The majority never has right on its side. Never, I say! That is one of these social lies against which an independent, intelligent men must wage war. Who is it that constitute .. MORE
Business Economics
How Will I Rejoin the Developed World?
MIT Technology Review reports, In 2010 consumers bought more than 300 million smart phones–devices that include complete operating systems, and for which advanced software can be written–plus nearly 18 million tablet computers. (Meanwhile, more than 1.1 billion simpler phone handsets with text delivery capacity reached consumers around the world, mainly in poor countries.) “Every person .. MORE
Finance: stocks, options, etc.
A Misconception Worth Emphasizing
Charles Hugh Smith writes, Back at the top of the bubble, the middle class had $6 trillion more assets on the books. Considering the Mortgaged Middle Class now owns about $6 trillion in net assets, then the bursting of the housing bubble caused their net worth to drop by 50%. Read the whole thing. The .. MORE
Macroeconomics
Keynes and Hayek, Round 2
Wow. Mike Munger, a political science professor at Duke, gives an Oscar-caliber performance as a security guard in the opening scene. Keynes argues that we cannot simply sit back and watch unemployment mount up. Hayek argues that the economy is not a machine. The production is really superb. It’s probably better than Fear the Boom .. MORE
Economic Methods
10-year Budget Projections
Will Wilkinson writes (on Facebook), Tell me what you think about the usefulness/uselessness of 10-year budget/deficit projections. You can think of this as three questions. 1. Are the projections useful? I think they are useful if understood as conditional forecasts. They tell us what will happen if key macroeconomic variables follow a reasonable path. I .. MORE
Political Economy
Choose Your Metaphor
I suspect that a lot of the intractability of the disputes between people holding divergent political opinions reflects differences in the metaphors that we implicitly hold about government. It would be interesting to try to make these metaphors more explicit. I invite non-libertarians to play along. I am trying to come up with a list .. MORE
Energy, Environment, Resources
Robert Solow on Sustainability
In the comments on my post on sustainability, commenter Bill referenced a talk by Bob Solow in 1991. It’s quintessential Solow. The talk has his trademark sense of humor and his trademark clarity. A few of his points: 1. Like David Friedman, he emphasizes that we don’t know much about what the future will bring. .. MORE
Finance: stocks, options, etc.
Housing Policy
I spoke at a forum on housing finance reform. I have low energy these days, but viewing the talk it is not bad. It starts about minute 3 and goes to about minute 26. One of my themes is that government intervention in the housing market is based on misconceptions. For example, we seem to .. MORE
Economic and Political Philosophy
Of Kids and Kardashians
Check out Steve Sailer’s appreciative review of Selfish Reasons to Have More Kids. In many ways, we see eye to eye. But passages like this show just how far apart we are. Steve: Let me say that Caplan has written a delightful book, breezy in prose style, but reasonably rigorous in its handling of the .. MORE