EconLog Archive
Public Goods
Analogy for Government
Chris Dillow writes, I’ve got an idea that would revolutionize the way we do our weekly shopping. Every few years, we all vote for our favourite supermarket company. The one that gets more votes across the country than any other then gets to deliver our shopping every week to all of us, regardless of whom .. MORE
Behavioral Economics
Politics and Academia
The issue of why academics lean left has received considerable notice. I am not sure of the answer, but one thing I do not buy is the notion that people become professors out of an unusually strong desire for public service. I write, Overall, I think it is difficult for George Lakoff to make the .. MORE
Economics of Health Care
Tax Breaks vs. Subsidies
Edward Lotterman writes, When or why should government use direct payments versus tax breaks? The answers are more political than economic. One skeptic has argued, “Politicians and economists have a love-hate relationship with tax breaks. Politicians love them and economists hate them.” For example, follow some of the links in Tyler Cowen’s post about the .. MORE
Finance: stocks, options, etc.
Housing Bubble?
Jonathan McCarthy and Richard W. Peach, two economists at the New York Fed, agree with me that there is no housing bubble. we see that the adjusted rent-to-price ratio is not at a level that suggests a home price bubble exists. Instead, the period when this ratio was quite low was in 2000, but the .. MORE
Social Security
Progressive Implications of Social Security Privatization
In this essay, I wonder why the Left and the Right do not reverse their positions on Social Security privatization. However, there is one important difference between keeping Social Security as it is and switching to privatization. Under the current system, Social Security’s liabilities will continue to be funded by payroll taxes. However, under privatization, .. MORE
Economics of Health Care
Health Insurance Regulation
Radley Balko and Michael Cannon propose changes in health insurance regulation. Currently, many states require health insurers to charge the same premiums for any member of a group health plan, regardless of risk. This means that the costs of the donuts-and-pizza couch potato’s unhealthy decisions are imposed on the gym rat who keeps a careful .. MORE
Economics of Health Care
Subsidize Health Care to Cut Costs?
John F. Cogan, R. Glenn Hubbard, and Daniel P. Kessler argue that by broadening the health care tax subsidy to include personal spending (not just corporate spending), costs would go down. According to our calculations, based on research from the RAND Health Insurance Experiment and others, we estimate that tax deductibility would reduce spending by .. MORE
Economics of Education
Education Outcomes and Spending
An OECD report on comparative performance of high school students in different countries is receiving a lot of attention. Overall, wealthier countries tend to do better in educational terms than poor nations, but there are exceptions: Korea’s national income, for example, is 30 per cent below the OECD average but its students are among the .. MORE
Economic History
History of Markets
Brad DeLong posts the syllabus for his economic history course. Included is this paper by Peter Temin. He claims that in the Roman Empire, the prices represent extensive market exchanges typical of a market economy, not reciprocal exchanges typical of an economy based on reciprocity. It seems likely that almost all farmers were aware of .. MORE
International Macroeconomics
Whose Debt is it, Anyway?
Don Boudreaux is puzzled as to why I should care about my country’s net savings position, as opposed to just my personal net savings position. Suppose that government starts collecting trade data on blonde-haired people. The government could then calculate the “blonde current-account” and the “blonde capital-account” – that is, reporting the value of blondes’ .. MORE
Social Security
Social Security Transition Cost
Responding to a comment on the previous post, I write, Suppose that your house has a very dilapidated roof. The next big winter storm is likely to cause huge damage unless it is repaired. So you borrow $20,000 and fix the roof. What is the cost of this transaction? The “cash flow cost” is that .. MORE
Social Security
Social Security Reform
The New York Times has two relevant op-eds. John Kasich writes, benefits are growing faster than inflation. First-time Social Security benefits are now tied to wage growth, and wages are rising faster than prices. The result: over the next 75 years, benefits are expected to increase nearly eighteenfold, while prices will go up less than .. MORE
Regulation and Subsidies
Subsidies Raise Prices
Steve Pearlstein uses his column to explain some freshman economics. What two things do a college education, health care and housing have in common? One is that the price of these things has been rising at least twice as fast as other prices. The other thing is that they are all subsidized by government… Let’s .. MORE
Economic Education
Remembering a Teacher
Bernard Saffran, known to many economists for his regular column in the Journal of Economic Perspectives, died suddenly of a heart attack on Monday. When I was an undergraduate, I took most of my economics courses from Bernie. I wrote this essay when I found out about his death. I tried to recall a few .. MORE
Economics of Health Care
Health Care Disintermediation
The Bureau of Labor Statistics’ William J. Wiatrowski reports on a decline in workers receiving employer-provided medical benefits over the past decade. Some of this reflects employee choice. In 1992-93, roughly 3 out of 4 private industry workers were offered medical care and 63 percent participated; in 2003, 60 percent were offered a plan and .. MORE
Economics of Health Care
Health Care and Moral Values
Dr. James J. Mongan writes, After 30 years of waging the battle for broader health insurance, I am convinced the debate over universal coverage is more about values than it is about specific plans. If the resources were made available, we could easily develop a plan. We should focus on the question of what happened .. MORE
Books: Reviews and Suggested Readings
Flynn Effect
Following Marginal Revolution’s recommendation, I bought Ian J. Deary’s Intelligence, which is a summary of research on IQ testing. For me, the most interesting chapter was on the Flynn effect (see also this post), which is that IQ scores have been increasing by about three points per decade. This fact has generally been masked by .. MORE
Income Distribution
Working Poor
The plight of low-skilled has received notice in several recent books. See Jane Galt’s post, for example. Now, Russ Roberts weighs in. Waiters and waitresses, a janitor to push the improved vacuum cleaner or power waxer, the cleaning service that comes once a week. That may be true, but there’s nothing inherently demeaning about those .. MORE
Tax Reform
Complex System, Poorly Enforced
Amar Bhide writes, India’s financial difficulties stem from a badly designed and administered tax system. Rates and rules for personal and corporate income taxes appear reasonable by international standards. Nonetheless, India’s government collects income taxes amounting to only about 3.7% of GDP, about half that in South Korea and the other Asian tigers. …Cheating occurs .. MORE
Finance: stocks, options, etc.
Pension Guarantee Hazards
A Wall Street Journal editorial notes, Congress and the White House produced a big, fat bailout for the most financially shaky companies, and some of those same companies are now joining the queue to dump their liabilities on the feds. Meanwhile, PBGC’s [Pension Benefit Guaranty Corporation] deficit was left to balloon, as it now has .. MORE
Social Security
Kotlikoff’s Social Security Plan
Lawrence Kotlikoff has a long description in today’s Boston Globe. One way to make up for the loss in revenue from privatization as well as cover the existing revenue shortfall is dramatically but gradually to cut Social Security benefits. Such cuts are part of each of the commission’s plans [referring to the Social Security reform .. MORE