EconLog Archive
Cross-country Comparisons
Nobel Laureates speak
The Wall Street Journal asks a series of questions to a number of Nobel Laureates in economics. On one question, whether the global income distribution will be more equal 50 years from now, several of them say “yes,” because they are optimistic about China and India. I guess they model the future by extrapolating the .. MORE
Labor Market
Double-Counted Jobs?
Asymmetrical Information links to Random Jottings, who quotes an anonymous economist on the possibility that the payroll employment survey double-counts jobs whenever the labor market gets so tight that workers take new jobs before their old employers can even update their headcounts. This might have been an important phenomenon in 1998 and 1999. I raised .. MORE
Economics of Education
Policy Specifics
In my latest essay, I look at the specifics of the President Bush’s economic proposals. Overall, I am afraid that the President’s concept of the “ownership society” owes more to David Brooks than it does to Stephen Bainbridge. But the mainstream media’s characterization of the speech as short on specifics is 180 degrees wrong. For .. MORE
Income Distribution
Productivity vs. Distribution
Jeff Madrick is not impressed with Wal-Mart. Critics are compiling evidence that Wal-Mart’s success, while entrenched in the brilliant management of new technologies, is dependent on low labor costs… A new study by Arindrajit Dube and Ken Jacobs of the University of California, Berkeley, has produced clear evidence of Wal-Mart’s comparatively low wages. The researchers .. MORE
Economic Education
Should Pacey Teach Economics?
I have started teaching a class at George Mason called Economics and the Citizen It’s been over 20 years since I taught at a college level, and I feel like Rip Van Winkle. After the first class, I was given quick tutorial on the technology in the room. I was struck by the sound coming .. MORE
Income Distribution
Middle Class Squeezed Up
Bruce Bartlett explains what is happening to the shrinking middle class. In fact, the ranks of the poor have fallen along with those of the middle class. Using the Times’ characterization of any household with an income below $25,000 in 2003 as being poor, what do the data show? We see that this group fell .. MORE
Regulation and Subsidies
Elephants in the Big Tent
Who speaks for the Republicans? Is it David Brooks? Now almost every leading politician accepts that government should not interfere with the basic mechanisms of the market system. On the other hand, almost every leading official acknowledges that we should have as much of a welfare state as we can afford. He goes on to .. MORE
Cross-country Comparisons
Evaluating Health Care Systems
How can you tell whether one country’s health care system works better than another? In this essay (read the whole thing), I talk about how not to make the comparison. Overall, I think that it is a mistake to define the health care problem as the need to reduce the ratio of expenditures to life-expectancy .. MORE
Cross-country Comparisons
Data Request: Health Care Spending
Gerard F. Anderson, Uwe E. Reinhardt, Peter S. Hussey, and Varduhi Petrosyan write, the United States spends more on health care than any of the other OECD countries spend, without providing more services than the other countries do. This suggests that the difference in spending is mostly attributable to higher prices of goods and services. .. MORE
Income Distribution
Overspending and Obesity
My post-vacation essay is somewhat wide ranging. by far the biggest indicator that middle-class squeeze is not quite what is portrayed in the media was the volume of construction and the prices of homes. Since our first vacation there almost twenty years ago, thousands of housing units have been built in Bethany, with much of .. MORE
Fiscal Policy
The Budget Issue
How does John Kerry reconcile his spending and tax proposals with his promise to balance the Budget? The Washington Post reports, Kerry says he would offset the cost of those programs with cuts in federal contracting, some agriculture subsidies and “out-of-control administrative costs” in the government. Other savings would come from a revamping of the .. MORE
Regulation and Subsidies
Telephone Fees
The Milken Institute Review has an article by Robert W. Crandall, Robert W. Hahn, Robert E. Litan and Scott Wallsten, who note that Jerry Hausman of MIT has estimated that taxes on interstate and international telephone revenues that are used to support low-income subscribers, high-cost carriers, schools, libraries and rural health facilities, are about three .. MORE
International Trade
Disintermediation and Outsourcing
Julian Sanchez picked up from Gene Healy a Times of India story with a new twist on outsourcing. Says a programmer on Slashdot.org who outsourced his job: “About a year ago I hired a developer in India to do my job. I pay him $12,000 out of the $67,000 I get. He’s happy to have .. MORE
Economics of Health Care
Business and Health Care Costs
In an essay arguing against relying on linking health insurance with employment, I write If employers bear the cost of health insurance, then I’m the Easter Bunny. It is fairy-tale economics to believe that “nice” employers give away health insurance, while “mean” employers withhold it. In reality, employers compensate their employees using a combination of .. MORE
Behavioral Economics
Political Behavior
Steven Johnson reports on some brain scans to detect political differences, …early data suggested that the most salient predictor of a ”Democrat brain” was amygdala activity responding to certain images of violence… a recent study by Paul Goren at Arizona State found that voters typically formed their party affiliations before developing specific political values… Those .. MORE
Business Economics
Key Operating Ratio
Why are movie theaters gravitating toward large multiplexes? The Washington Post writes, With 16, 18 or 24 screens, the traffic in and out is constant and the popcorn sales never stop — yet the staffing costs are only incrementally greater than for an eight- or 10-screen theater. This suggests to me that the key operating .. MORE
Regulation and Subsidies
Drug Companies and Rent-Seeking
I discuss a suggestion that pharmaceutical companies should be treated like public utilities. Angell is accusing pharmaceutical companies of what economists call “rent-seeking,” which Gordon Tullock defines as “special interest coalitions lobbying the government to transfer wealth to them.” Her diagnosis is certainly correct. However, her prescription is the opposite of what economists would recommend… .. MORE
Behavioral Economics
Are Workers Getting Good Jobs?
Two pieces in the New York Times discuss the labor market. Alan Krueger talks about the issue of defining a “good job.” Neoclassical economics hardly recognizes a distinction between good jobs and bad ones. All workers are supposed to be in jobs that reward them appropriately for their performance, which depends on their skills and .. MORE
Economics of Health Care
Health and Taxes
In a rather disappointing conclusion to its series of editorials on economic policy, the Washington Post writes If all regions could emulate the most efficient fifth of the country, the cost of Medicare would fall by 30 percent. Enforcing efficiency will not be easy. Expensive regions are expensive because they have lots of hospitals and .. MORE
Behavioral Economics
Neuroeconomics
Newsweek has a survey of what I think it should have called neuroeconomics. They use the term “behavioral economics,” which I think of as looking at cognitive biases in decision making. Neuroeconomics links cognitive biases to brain science. Observing that some societies are consistently richer than others, social scientists have invoked such ingenious explanations as .. MORE
Public Goods
Mass Transit and Happiness
Peter Gordon reports on declining use of mass transit. As a group, the 20 largest U.S. metro areas declined in transit use (all trip purposes; thank you, Wendell Cox) in the 1990s. Not relative decline but absolute decline. As a group the areas with new (post-WWII) metros (San Francisco, Washington, DC, Atlanta and Miami) lost .. MORE