Saturday , January 19 2019
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Tag Archives: Economics

I don’t actually favor the “citizen dividend” side of a carbon tax

The carbon tax idea makes perfect sense to me, and I have endorsed the proposal for some time, but why return the revenue to citizens in the form of dividends?  It strikes me as economists thinking they know what makes good politics, something which economists are rarely good at.  Arguably it makes the policy seem less important, and mainly about the dividend, in a slightly cynical, Chavez-like sort of way.  Furthermore, it tries to make a carbon tax a free lunch, which it is not, no matter...

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A simple test for whether or not you understand an organization

Can you identify the implicit leverage in that organization? Most (not all) organizations have forms of leverage which are built in and which do not show up as debt on the balance sheet.  Banks may have off-balance sheet risk through derivatives, companies may sell off their valuable assets, and NBA teams may tank their ability to keep draft picks and free agents in their future. Or a university the school may have ambitious plans, or payroll commitments, which require an ongoing stream of...

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Who again has the power to end the government shutdown?

That is the topic of my latest Bloomberg column, here is one excerpt: The real power here is held by government employees, especially those in critical jobs. Let’s say that more TSA screeners decided to walk off the job. It’s already the case that the TSA absentee rate has gone up to 7.6 percent, from 3.2 percent a year ago. It is possible to imagine screeners staying home in much greater numbers, thus crippling the entire nation. That could either force President Donald Trump’s hand or lead...

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Declining Labor Force Growth Explains Declining Dynamism

The best paper I have read in a long time is Hopenhayn, Neira and Singhania’s From Population Growth to Firm Demographics: Implications for Concentration, Entrepreneurship and the Labor Share. HNS do a great job at combining empirics and theory to explain an important fact about the world in an innovative and surprising way. The question the paper addresses is, Why is dynamism declining? As you may recall, my paper with Nathan Goldschlag, Is regulation to blame for the decline in...

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Government shutdown (price-capped) markets in everything

Dozens of air traffic controllers are keeping Austin-Bergstrom International Airport functioning smoothly through the longest government shutdown in US history — and all without a paycheck. Friday was the first payday since the shutdown began and while hundreds of thousands of federal workers can expect to be paid for the work they put in during the shutdown, they are not receiving paychecks until it ends. Tuesday marks Day 25 of the shutdown. Austin pilots want to do what they can to...

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Employment Comparisons for Grand Forks, ND

So despite the continued need to focus on wages I branched out a bit this week. Wage level growth, or the lack of it, can explain a significant amount of the problems for Grand Forks in terms of labor market dynamics as well as a general radio caller sense that things are not moving in the right direction. It seems to me that we should also look at a broader picture at the same time and bring in more labor market variables and some variables completely outside the labor market. In this...

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John Bogle, RIP

In 1974, Paul Samuelson wrote Challenge to judgement, a searing critique of money managers. Samuelson challenged the money managers to show that they could beat the market. He concluded that “a respect for evidence compels me to incline toward the hypothesis that most portfolio decision makers should go out of business.” Samuelson hoped for something new: At the least, some large foundation should set up an in-house portfolio that tracks the S&P 500 Index — if only for the...

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How to study history of economic thought

The Center for the History of Political Economy at Duke University will be hosting another Summer Institute on the History of Economics this summer from June 10-19, 2019. The program is designed for students in graduate programs in economics, though students in graduate school in other fields as well as newly minted PhDs will also be considered. Students will be competitively selected and successful applicants will receive free housing and a booklet of readings. We are also able to provide...

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Still more wages in ND

Of late my discussions on the Jarrod Thomas show centered on the issue of ranking the performance of Grand Forks. Ranking against whom is an open question that is still not even close to resolved. By default the early comparisons are against other places in the state, though for reasons we discussed on the radio and I mentioned in other posts, that does not feel like a perfect comparison. Still it seems like the statewide comparison is what we have for now. With that in mind I...

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