Economics Roundtable

May 2014 Payroll Employment

After 76 months, we finally got back to the prerecession level of payroll employment.

Click on the image to get a bigger version.


Jobs

The best summary of the state of our economy is the graph (below) of employment as a fraction of population for people over 16 years old. The decrease is large, but the most troubling feature of the graph is the flat trend .


Click on the image to get a bigger version.


Graph-of-the-Year Candidates

Donald Marron likes European interest rates. Click on the image to get a bigger version. Can you find three distinct subperiods?

Brad DeLong favors the U.S. gdp gap.


Remember M1?

Money Supply M1 growth is now over 20% per year over a 12 month lag. M1 growth has touched 20% before, but not with excess reserves of $1.6 trillion. Where is M1 headed?


Click on the chart for a larger version.


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September 2, 2014, 4:45 pm, 1328058
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September 2, 2014, 4:05 pm, 1328055

September 2, 2014, 4:04 pm, 1328054

The ECB raised its benchmark rate in 2011 from 1.0% to 1.5%. Since then the rate has moved down to 0.15%. After their benchmark rate was raised in 2011, the Euro area went into a recession. Did the ECB cause ...


September 2, 2014, 3:33 pm, 1328050
US manufacturing continued its expansion for the 15 consecutive month. It has been in expansion since May of 2013 when it registered 50.0.

Manufacturing ISM Index



For details, lets turn to the August 2014 Manufacturing ISM® Report ...


September 2, 2014, 3:33 pm, 1328049
Anna Snider

In her speech “Labor Market Dynamics and Monetary Policy” at the Kansas City Fed’s recent Jackson Hole symposium, Fed chairwoman JanetYellen discussed economic puzzles challenging policymakers, including topics we’ve addressed on Liberty Street Economics. A central and much-debated question is: how tight ...


September 2, 2014, 3:33 pm, 1328048

Talk about two worrisome long-term trends. America, as I have written, is experiencing fewer business startups and less labor market churn. The result, according to a new JP Morgan research note, is the “economic calcification” of the US economy:

The churning that has long characterized the US ...


September 2, 2014, 3:33 pm, 1328047

Uber has been banned, at last temporarily, in Germany. Here is Dieter Schlenker, chairman of Taxi Deutschland a “co-operative founded by taxi companies to provide services to the industry”:

“The Passenger Transport Act regulates the protection of drivers and consumers. That can’t easily be overturned no matter how neoliberal ...


September 2, 2014, 3:33 pm, 1328046

The Energy Information Administration (EIA) released new state crude oil production data yesterday for the month of June, and one of the highlights of that monthly report is that oil output in America’s No. 1 oil-producing state – Texas – continues its phenomenal, eye-popping rise. Here are some details ...


September 2, 2014, 3:23 pm, 1328045
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September 2, 2014, 3:03 pm, 1327983

Tim Duy:

Solid Start to September, by Tim Duy: The ISM manufacturing report came in ahead of expectations with the strongest number since 2011:

Moreover, strength was evident throughout the internal components:

...


September 2, 2014, 2:44 pm, 1327982
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September 2, 2014, 2:34 pm, 1327981

A teacher in Maryland finds himself suspended and the subject of a police investigation because of a science fiction story he wrote that includes a shooting at a school in the 31st Century:

He’s a man with many names, and the books he has written have raised ...


September 2, 2014, 2:05 pm, 1327978

Today is the sixty-fifth birthday of Hans-Hermann Hoppe. In the Preface to his The Economics and Ethics of Private Property, Hans says: “My largest debt is to Ludwig von Mises and Murray N. Rothbard, the twentieth century’s two greatest—though much neglected—economists ...


September 2, 2014, 2:05 pm, 1327977

Michael Pettis writes:

The choice, in other words, is not between hard landing and soft landing. China will either choose a “long landing”, in which growth rates drop sharply but in a controlled way such that unemployment remains reasonable even as GDP growth drops to 3% or less, or it will ...


September 2, 2014, 2:04 pm, 1327976
(September 2, 2014 01:45 PM, by David Henderson) A simple economic truth is that water-price hikes can get the job done without the expense--and the inefficiency--of conservation ads and water police--as well as the discord that can arise when neighbors snitch on and shame each other. Also, people... (1 ...


September 2, 2014, 1:33 pm, 1327972

Paul Krugman is wasting his time trying to figure out why the rich and powerful don't like inflation. There's a simple answer, that also explains why the non-rich and non-powerful don't like inflation either.

And you don't need any fancy political economy to figure out the answer. If you ...


September 2, 2014, 1:33 pm, 1327971
Ukraine is already on the hook to the IMF to the tune of $16.7 billion. Today the IMF reassessed: Ukraine Crisis Hits Economy and Could Require Bigger loan.

In its first full review since agreeing a $16.7bn standby facility earlier this year, the IMF warned that the two ...


September 2, 2014, 1:33 pm, 1327970

It may be the most famous bit of economic policy advice ever given to a US president. “Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate,” Treasury Secretary Andrew Mellon told his boss President Hoover. “It will purge the rottenness out of the system. High costs of ...


September 2, 2014, 1:33 pm, 1327969

September 2, 2014, 1:03 pm, 1327908
Bloomberg News

Mario Draghi has set the bar high for the European Central Bank’s next meeting Thursday.

The bank president’s warning about reduced inflation expectations, made in a speech on Aug. 22, fanned hopes that the ECB may announce ...


September 2, 2014, 1:03 pm, 1327907

At MoneyWatch:

How to shock the U.S. economy back to life, by Mark Thoma: During the Great Recession, U.S. gross domestic production -- the nation's total output of goods and services -- dropped below the trend rate of growth that prevailed before the collapse. More than five years into ...


September 2, 2014, 1:03 pm, 1327906
Notes: This CoreLogic House Price Index report is for July. The recent Case-Shiller index release was for June. The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: CoreLogic Reports Home Prices Rose by 7.4 Percent Year Over Year ...


September 2, 2014, 12:44 pm, 1327905
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September 2, 2014, 12:35 pm, 1327904

The Congressional Budget Office recently put out new budget projections and commentators have had a series of feel-good moments about it. Debt is under control, they say. Projections of Medicare costs continue to fall, they point out. The CBO’s estimates of future interest rates, and hence interest payments, have ...


September 2, 2014, 12:34 pm, 1327903

Despite the presence of several movies anticipated to be blockbusters on the schedule, Hollywood has its worst summer movie season in nearly two decades this year:

LOS ANGELES — American moviegoers sent a clear message to Hollywood over the ...


September 2, 2014, 12:05 pm, 1327898

Mises Daily Tuesday by Robert Batemarco:

Austrian economists have been wrongly accused of many intellectual crimes when it comes to fractional reserve banking. Robert Batemarco adds some clarity to the debate.


September 2, 2014, 12:05 pm, 1327899

Mises Daily Monday by Frank Shostak:

It’s difficult to envisage a downward-sloping yield curve in an unhampered market economy since this would imply that investors are assigning a higher risk to short-term maturities than long-term maturities. But in today’s economy, an upward- ...


September 2, 2014, 12:05 pm, 1327897

Our new class on international finance is up here.  The class description reads as follows:

International finance covers some of the most complex but also important topics in economics. How are exchange rates determined? When if ever are ongoing trade deficits harmful? Are fixed or floating exchange rates better? ...


September 2, 2014, 12:04 pm, 1327896
(September 2, 2014 11:45 AM, by Art Carden) I got off the parking lots roads leading to Samford at around 7:55 after leaving my house three miles away 20 minutes earlier. My time stuck in traffic gave me ample opportunity to think about what my beloved dismal science... (0 ...


September 2, 2014, 12:04 pm, 1327895
(Don Boudreaux)

One of Russ’s classic essays is this contribution to the May 18, 1995, edition of the Wall Street Journal; it’s entitled “If You’re Paying, I’ll Have Top Sirloin.”

Keep Russ’s lesson in mind as you enjoy this photo taken in a restaurant by Texas A&M emeritus economist Steve Pejovich’s daughter ...


September 2, 2014, 11:33 am, 1327893

Should bankers be prudent? Well, of course, and their policies and organizational cultures should promote prudence, as everybody agrees. In his classic book on banking, “Lombard Street,” Walter Bagehot stated the abiding maxims. “You can afford to run much less risk in banking than in commerce, and you must take ...


September 2, 2014, 11:03 am, 1327832

TUESDAY

ECB’s Knot speaks in The Hague at 1500 GMT

WEDNESDAY

ECB’s Lautenschläger speaks on “Countdown to November: European Supervision Ready for Liftoff” in Frankfurt at 0930 GMT Bank of Canada releases a policy statement at 10 a.m. EDT Fed Board of Governors holds an open meeting on rulemaking in Washington at 10:30 a.m. EDT Fed releases ...


September 2, 2014, 11:03 am, 1327831

I have a new column:

Objections to Fiscal Policy are Groundless—It Works: One of the more controversial policies instituted in an attempt to stimulate the economy out of the Great Recession was the $816.3 billion fiscal stimulus package enacted just after Obama took office....

[The artwork is a bit mixed ...


September 2, 2014, 11:03 am, 1327830
The ISM manufacturing index suggests faster expansion in August than in July. The PMI was at 59.0% in August, up from 57.1% in July. The employment index was at 58.1%, down slightly from 58.2% in July, and the new orders index was at 66.7%, up from 63.4% in July.


September 2, 2014, 11:03 am, 1327829
Earlier the Census Bureau reported that overall construction spending increased in July:

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during July 2014 was estimated at a seasonally adjusted annual rate of $981.3 billion, 1.8 percent above the revised June estimate of $963.7 ...


September 2, 2014, 10:44 am, 1327828
Where in the country is most knowledge being created? The answers point to states with good prospects for at least high-tech growth.


September 2, 2014, 10:44 am, 1327827
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September 2, 2014, 10:34 am, 1327826
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September 2, 2014, 10:34 am, 1327825
Teaser:

The ...


September 2, 2014, 10:04 am, 1327822

Barkley Rosser at Econospeak writes an op-ed on the Washington Post’s reporting:

Dana Milbank Joins Parade Of WaPo Hysterics Over Social Security And Medicare

Dean Baker has posted on this more completely and effectively than I shall do here (and his url is so long on this one, I ...


September 2, 2014, 9:03 am, 1327777

One of the loudest critics of the recent wave of corporate inversions is University of Southern California law professor Ed Kleinbard, who warns that these transactions will erode the U.S. corporate tax base because these newly relocated firms will use “intragroup interest payments” to “strip” income out of their ...


September 2, 2014, 9:03 am, 1327776

The Wall Street Journal’s Daily Report on Global Central Banks for Tuesday, September 2, 2014

Sign up for the newsletter.

Highlights

Blackstone’s Take: Euro Will be Judge and Jury for Mario Draghi CBO, Fed Growth Forecasts ...


September 2, 2014, 8:44 am, 1327775
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September 2, 2014, 8:44 am, 1327774
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September 2, 2014, 8:44 am, 1327773

Plan confirmation time. Doesn't everyone relish a big trial? Headlines in national newspapers breathlessly proclaim that the fate of Detroit's future is ...


September 2, 2014, 8:35 am, 1327772

Congress is in recess until Monday, September 8. The Daily Deduction will resume its regular schedule when Congress returns.

There will be credits.” Alaskans like the way oil industry profits are taxed–barely. The state grants a corporate income tax credit for qualified oil and gas service-industry expenditures. ...


September 2, 2014, 8:05 am, 1327771

Most colleges are non-profits with unclear ownership status so their incentives do not lead to simple profit-maximization. Don’t be fooled, however, neither do colleges maximize student welfare or the public good. Instead colleges pursue some index of free cash flow, prestige, and administrative and faculty independence. The result is some peculiar outcomes. ...


September 2, 2014, 8:04 am, 1327770
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September 2, 2014, 8:04 am, 1327769
(September 2, 2014 07:01 AM, by Alberto Mingardi) The BBC reports that Uber has been banned in Germany by a Frankfurt court: A court in Frankfurt ruled that the firm lacked the necessary legal permits to operate under German law. It has emerged that the firm was told... (0 ...


September 2, 2014, 7:33 am, 1327766

Yes, indeed, it usually does. Victor Davis Hanson, "Obama Fails History 101".


September 2, 2014, 7:33 am, 1327765

Ms. Gorin may list herself as a "standup comic based in Las Vegas" but she could have a great run as a political pundit. Or a forecaster: notice the column's date and her use of "caliphate".

Freud called it displacement. People fixate on the environment when they ...


September 2, 2014, 7:33 am, 1327762

Nice piece by Farhad Manjoo about technological change in general but focusing on cars in particular.


September 2, 2014, 7:33 am, 1327763

Pretty much nailed it. #2 is probably the most apt:

Don’t ask the professor if you “missed anything important” during an absence.

No, you didn’t miss anything important. We spent the whole hour watchingcats play the thereminon YouTube!

Of course you missed something ...


September 2, 2014, 7:33 am, 1327764

You can put this down as a law of human behavior: if the stakes are high and if a system can be gamed, then, sooner or later, the system will be gamed. This is a fascinating if rather depressing case study.

(So what would be a good college rating ...


September 2, 2014, 7:33 am, 1327761
Jaison R. Abel and Richard Deitz

This post is the first in a series of four Liberty Street Economics posts examining the value
of a college degree.

Not so long ago, people rarely questioned the value of a ...


September 2, 2014, 7:33 am, 1327760

This is a good thing:

Tar Heels in search of the easy A, beware. Starting this fall, UNC-Chapel Hill transcripts will provide a little truth in grading.

From now on, transcripts for university graduates will contain a healthy dose of context.

Next to a student’s grade, the record will include the median grade ...


September 2, 2014, 7:23 am, 1327759

In 2007, EU economies, on the surface, seemed to be doing relatively well – with positive economic growth and low inflation. Public debt was often high, but (apart from Greece) it appeared to be manageable assuming a positive trend in economic ...


September 2, 2014, 7:23 am, 1327758

Readers Questions: Could you not also argue not that the Euro is a failure but that it’s members/ECB are pursuing the wrong policy? Predictions of the death of the Euro seem to have been much exaggerated & surely Europe ...


September 2, 2014, 7:03 am, 1327721
Courtesy of the Peterson Institute for International Economics

For the past 30 years, Nicholas Lardy has chronicled the immense changes in China’s economy and revealed some of the system’s ...


September 2, 2014, 7:03 am, 1327719
A baby-themed ad in Taizhou. Reuters

China needs a baby boom—and badly, researchers say.

“Get married soon and have lots of children.” That’s the advice that 49-year-old Huang ...


September 2, 2014, 7:03 am, 1327720

The Congressional Budget Office’s projection of modest annual U.S. output growth of 2.2% in the coming decade is unattainable, as is the Federal Reserve’s expectation of growth near 3% in the next two years, according to a new paper by Northwestern University economics professor Robert Gordon.

Slow growth in the productivity ...


September 2, 2014, 6:44 am, 1327718

The subprime lending crisis in the US triggered a broad financial panic that lead to the global recession. Domestically, it meant bankruptcy and disaster for many households. This column analyses racial discrimination in subprime lending. Careful estimation of a detailed dataset reveals across-lender effects to have substantially disadvantaged black and ...


September 2, 2014, 6:44 am, 1327717

Since the Global Crisis, support has grown for the use of time-varying capital requirements as a macroprudential policy tool. This column examines the effect of bank-specific, time-varying capital requirements in the UK between 1990 and 2011. In response to increased capital requirements, banks gradually increase their capital ratios to restore ...


September 2, 2014, 6:44 am, 1327716
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September 2, 2014, 6:44 am, 1327715
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September 2, 2014, 6:04 am, 1327713
(Don Boudreaux)

… is from page 193 of James Gwartney’s insightful 2013 essay “The Public Choice Revolution and Principles of Economics Texts,” which is chapter 13 of Public Choice, Past and Present: The Legacy of James M. Buchanan and Gordon Tullock (Dwight R. Lee, editor, 2013) (link added):​

The bulk of the economics ...


September 2, 2014, 5:33 am, 1327711

September 2, 2014, 5:23 am, 1327710

In the near future, I will be writing a a review of Guy Spier’s The Education of a Value Investor, which will be released next week.  Until then, to whet your appetite, here is an 11 question Q&A that I did with ...


September 2, 2014, 5:03 am, 1327657

Coming over a century after many of the original events, we thought it was about time we got around to revisiting the history of the S&P 500, or rather, its predecessor indices and components, during the era of the First World War.

Our table below presents ...


September 2, 2014, 5:03 am, 1327656

September 2, 2014, 5:03 am, 1327655

Tim Duy:

Fed Positioning to Normalize Policy, by Tim Duy: With the leaves turning to gold signaling the end of summer, so too will the Fed be facing its own change of seasons as quantitative easing comes to an end. With asset purchases likely ending in October, time is ...


September 2, 2014, 4:44 am, 1327654
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September 2, 2014, 4:36 am, 1327653
Most markets around the globe bounced back in August after July’s drubbing. Although there’s still plenty of risk percolating around the world, there were few signs that investors were becoming cautious last month. US equities led the rally in August: … Continue reading →


September 2, 2014, 3:33 am, 1327649
It is amusing reading day in and day out the Keynesian cure for what ails Europe, especially France.

Consider France. Public spending amounts to 57% of French GDP, yet Keynesians want still more. The sad irony is that 100% would not be enough. In fact, it would make matters ...


September 2, 2014, 3:23 am, 1327648

This is a book that starts with a simple premise: buy stocks at a fraction of the per share intrinsic value of the company, conservatively calculated.  Neat idea, huh, and it is called value investing.

The author starts by giving a preview of where ...


September 2, 2014, 2:05 am, 1327611

Well, “endorsed” isn’t exactly the right word, but I did say “simpatizante.”  Here are my views:

1. I disagree with most of his economic policy, for reasons you can find stated in Adam Smith and the other classical economists.

2. Governments work very hard to stay in power.

3. In a weighted average ...


September 2, 2014, 1:33 am, 1327610
LA boomed in the 1950s and 1960s and much of this infrastructure is now old and depreciating. Durable capital depreciates over time. Walk around my Little Holmby neighborhood in Westwood and you will see some ugly 1950s homes whose current owners are investing in upgrading. These are private homes and ...


September 2, 2014, 1:03 am, 1327586

BRUSSELS—European Union leaders aim to meet in Italy in October and hold other discussions on the economy in the coming months amid concerns about the faltering recovery.

“In recent weeks, economic data have confirmed that the recovery, particularly in the euro area, is weak, inflation exceptionally low and unemployment unacceptably high,” ...


September 2, 2014, 1:03 am, 1327585
A sales promotion advertisement at a housing sales office in Hangzhou, Zhejiang province.  Newscom

After a modest uptick in the middle of the year, the Chinese economy ...


September 2, 2014, 1:03 am, 1327587
Next week it is the jobs data’s world, we just live in it. At the Jackson Hole conference, Federal Reserve chairman Janet Yellen highlighted central bank research on labor-market conditions that depends on up to 24 different labor-related series. Many of them will be updated in various releases due next ...


September 2, 2014, 1:03 am, 1327584
An employee works at a production line inside a Geely factory in Ningbo, Zhejiang province. Reuters

China’s productivity is slipping away, the miracle days are largely over ...


September 2, 2014, 1:03 am, 1327582

The White House and union leaders are using Labor Day reinvigorate efforts to raise the minimum wage.

Legislation to increase the federal pay floor from $7.25 an hour stalled in Congress this spring, but Democrats hope the issue will resonate with voters in November, especially in states with closely contested Senate ...


September 2, 2014, 1:03 am, 1327583

 

Indonesian motorists queue up for gasoline amid a shortage of subsidized fuel. Agence France-Presse/Getty Images

Indonesia squeezed out a narrow trade surplus in July but the Southeast ...


September 2, 2014, 1:03 am, 1327581
Black Knight Financial Services (BKFS) released their Mortgage Monitor report for July today. According to BKFS, 5.64% of mortgages were delinquent in July, down from 5.70% in June. BKFS reports that 1.85% of mortgages were in the foreclosure process, down from 2.82% in July 2013.

This gives ...


September 2, 2014, 12:34 am, 1327580

Austrian economists have been wrongly accused of many intellectual crimes when it comes to fractional reserve banking. Robert Batemarco adds some clarity to the debate.


September 2, 2014, 12:04 am, 1327579

Sandwichman at Econospeak writes more on the of ‘labor’:

Lump of Labor Day Special: Advanced (Elementary) Concepts in Mathematics

“…if there be but a certain proportion of work to be done; and that the same be already done by the not-Beggars; then to employ the Beggars about it, will but ...


September 1, 2014, 11:33 pm, 1327577
Giulio Zanella has a nice post on noisefromamerika, dissecting the sources of Italian deflation. (In Italian, but Google translate does a pretty good job.) Deflation can come from lack of "demand," or from technical innovation and increases in supply. What do the data suggest?


The ...


September 1, 2014, 11:33 pm, 1327576
The significance of the annexation of Crimea by Russia goes far beyond land territorial claims. Here are a couple of maps that show how Crimea affects oil rights in the black sea.

Black Sea Claims Before Crimea Annexation



Black ...


September 1, 2014, 10:45 pm, 1327575
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September 1, 2014, 10:04 pm, 1327572
(September 2, 2014 12:22 AM, by Bryan Caplan) When I was a child, adults taught us to look down on bad winners. The maxim: "It's not whether you win or lose; it's how you play the game." The implicit model was something like: Yes, winning is better than... (1 ...


September 1, 2014, 8:04 pm, 1327566

I think this is too good to excerpt just read
“Want better, smaller government? Hire another million federal bureaucrats.”

by John DiIulio. He argues that the obsession with keeping the number of Federal civilian employees low has reduced efficiency and created powerful concentrated interests represented by powerful lobbies. The ...


September 1, 2014, 7:33 pm, 1327565

Dallas Morning News editorial writer William Ruggles (pictured above) “thought every American had a right to work. He used those words in an editorial on September 1, 1941 (Labor Day) asking for a 22nd amendment to the ...


September 1, 2014, 5:33 pm, 1327550
If I'm reading this correctly, the British Prime Minister will require that British citizens who have spent considerable time in Iraq and Afghanistan will have to attend "deprogramming" classes if they return to England. The enormous economics literature on "treatment effects" has some insights to offer.

I have ...


September 1, 2014, 4:04 pm, 1327549
(September 1, 2014 04:00 PM, by Scott Sumner) MaynardGKeynes recently left this comment: Simple fact is that Shiller correctly predicted 3 of the last 3 bubbles (2000, housing, 2007). That's a widely held view, but is it correct? This is from Eugene Fama's Nobel Prize lecture (in the... (0 ...


September 1, 2014, 3:33 pm, 1327547

The hardest part of doing research is escaping from prejudices.


September 1, 2014, 2:44 pm, 1327518
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September 1, 2014, 2:44 pm, 1327517

THIS week: Central bank meetings and the performance of real wages


September 1, 2014, 2:35 pm, 1327516

by Roger Koppl

Oliver Blanchard tells us “Where Danger Lurks”  in the macro-finance world.

The big theme is nonlinearity, which is a profoundly conservative move: DSGE modeling is just fine and we don’t need to rethink it at all. We just need to add in some nonlinearities. Blanchard does not tell ...


September 1, 2014, 2:05 pm, 1327513

Chinese authorities in the restive western region of Xinjiang have begun offering large cash incentives for interracial marriages in the latest attempt to quell growing unrest among the mainly Muslim Uighur ethnic group that inhabit the region.

The policy, celebrated by local Communist party officials as advancing the “great cause ...


September 1, 2014, 2:04 pm, 1327512
(September 1, 2014 01:51 PM, by David Henderson) Every Labor Day in the last few years, we hear about the decline of unions and how that has been a bad thing. What I find striking is how economically uninformed most of this commentary is. Start with the fact... (2 ...


September 1, 2014, 1:03 pm, 1327489

The White House and union leaders are using Labor Day reinvigorate efforts to raise the minimum wage.

Legislation to increase the federal pay floor from $7.25 an hour stalled in Congress this spring, but Democrats hope the issue will resonate with voters in November, especially in states with closely contested Senate ...


September 1, 2014, 1:03 pm, 1327488

Justin Fox:

What Unions No Longer Do, by Justin Fox: Forty years ago, about quarter of American workers belonged to unions, and those unions were a major economic and political force. Now union membership is down to 11.2% of the U.S. workforce, and it’s increasingly concentrated in the public sector ...


September 1, 2014, 12:05 pm, 1327487

1. What people cured of blindness see.

2. Shoes that show you the way.

3. Which states are in the Midwest?  I say no to all the marginal cases, including Kentucky.  And how can it be that not everyone thinks Iowa is in the Midwest?

4.


September 1, 2014, 12:04 pm, 1327486

September 1, 2014, 11:33 am, 1327484
The Markit Eurozone Manufacturing final data shows Eurozone Manufacturing PMI at 13-month low in August.

The rate of expansion in eurozone manufacturing production eased to its lowest during the current 14-month growth sequence in August, as companies faced slower increases in both total new orders and new ...


September 1, 2014, 11:23 am, 1327483
Is the U.S. economy in the midst of another bond market "conundrum"? The last time we had one was in 2005 when former Fed chairman Alan Greenspan became perplexed over long-term interest rates failing to rise with the tightening of monetary policy. Some observers see something similar ...


September 1, 2014, 11:03 am, 1327445
Two and half years ago I argued that "most of the drag from state and local governments would be over by mid-year 2012. Just eliminating the drag from state and local governments would help GDP and employment growth". This has been an important change.

Here is a graph ...


September 1, 2014, 10:35 am, 1327444

At the gym yesterday morning, I caught site of a TV show discussing "is fracking the future?" Who might usefully discuss this question: geologists? energy economists? Nope. There was the ubiquitous vested interest; Vivienne Westwood, a frock designer; and James Delingpole, whose field of expertise has ...


September 1, 2014, 8:36 am, 1327400
The ISM Manufacturing Index is expected to decline slightly to 56.8 in tomorrow’s update for August vs. the previous month, based on The Capital Spectator’s median econometric point forecast. The estimate is still well above the neutral 50.0 mark and … Continue reading →


September 1, 2014, 8:05 am, 1327397

From ChinaRealTime:

China’s 1% average annual growth in total factor productivity between 1978 and 2012 – a period when average per capita annual incomes rose from $2,000 to $8,000 — compares with 4% annual gains for Japan during its comparable 1950-1970 high-growth period, 3% for Taiwan from 1966-1990 and ...


September 1, 2014, 7:03 am, 1327358
A sales promotion advertisement at a housing sales office in Hangzhou, Zhejiang province.  Newscom

After a modest uptick in the middle of the year, the Chinese economy ...


September 1, 2014, 7:03 am, 1327356

 

Indonesian motorists queue up for gasoline amid a shortage of subsidized fuel. Agence France-Presse/Getty Images

Indonesia squeezed out a narrow trade surplus in July but the Southeast ...


September 1, 2014, 7:03 am, 1327357
An employee works at a production line inside a Geely factory in Ningbo, Zhejiang province. Reuters

China’s productivity is slipping away, the miracle days are largely over ...


September 1, 2014, 6:44 am, 1327355

Switzerland has had consistently low tax rates and a remarkably stable income distribution, although in the last 20 years the share of top incomes has risen. This column documents that the top 0.01%’s share doubled, meaning Switzerland is similar to European countries in terms of the top 1%’s income share, ...


September 1, 2014, 6:44 am, 1327353

European migration exhibits a bias towards low-skilled workers, whereas the US attracts the majority of the world’s skilled migrants. At the same time, the welfare system in Europe is more generous than the one in the US. This column describes an analytical framework that can explain the existence of these ...


September 1, 2014, 6:44 am, 1327354

Central banks’ exchange rate interventions are typically attributed to precautionary, prudential, or mercantilist motives. This column documents the prevalence of an alternative motive – that of stabilising the exchange rate – in emerging markets, where, despite heavy intervention, the Global Crisis saw important deviations of the real exchange rate from ...


September 1, 2014, 6:44 am, 1327352

Nathan Blecharczyk, co-founder and chief technology officer of Airbnb, talks with EconTalk host Russ Roberts about Airbnb, one of the earliest companies to use technology to allow individuals to share underused resources, and in the case of Airbnb, housing. Blecharczyk and Roberts discuss how a ...


September 1, 2014, 5:33 am, 1327351

If you want to be on the Net on this holiday, this list should give you some things to look at.


September 1, 2014, 5:33 am, 1327350



(p. C6) The outcome was perhaps foreshadowed, as Mr. Marciano points out, when President Ford, using a customary unit, noted that American industries were "miles ahead" when it came to adopting the metric system.

Mr. Marciano tells his story more or less without editorializing, until the end. Surveying ...


September 1, 2014, 5:23 am, 1327349

Thanks for the questions, which have been building up in Readers Questions

During the summer holiday, I find it difficult to get into writing economics, but now the new term has started I will get back into the flow. Feel free ...


September 1, 2014, 5:23 am, 1327348

“Readers Question – A microeconomics question. In you labour market section you discuss a monopsonist.You say that “in order to employ one extra worker the firm has to increase the wages of all workers”- why? You give a coal mine as ...


September 1, 2014, 5:03 am, 1327329

 

Indonesian motorists queue up for gasoline amid a shortage of subsidized fuel. Agence France-Presse/Getty Images

Indonesia squeezed out a narrow trade surplus in July but the Southeast ...


September 1, 2014, 5:03 am, 1327328

September 1, 2014, 5:03 am, 1327327

Good news on health care costs:

The Medicare Miracle, By Paul Krugman, Commentary, NY Times: So, what do you think about those Medicare numbers? What, you haven’t heard about them? Well, they haven’t been front-page news. But something remarkable has been happening on the health-spending front, and it should ...


September 1, 2014, 4:04 am, 1327325
(Don Boudreaux)

… is from page 10 of Roger Koppl’s hot-off-the-press monograph, From Crisis to Confidence: Macroeconomics after the Crash (original emphasis):

[T]he central banks inappropriately and needlessly expanded the volume of credit in the years before the boom, thus ensuring a subsequent bust [in 2008].  It was not bankers gone ...


September 1, 2014, 3:03 am, 1327304
A sales promotion advertisement at a housing sales office in Hangzhou, Zhejiang province.  Newscom

After a modest uptick in the middle of the year, the Chinese economy ...


September 1, 2014, 3:03 am, 1327303
An employee works at a production line inside a Geely factory in Ningbo, Zhejiang province. Reuters

China’s productivity is slipping away, the miracle days are largely over ...


September 1, 2014, 2:05 am, 1327302

1. Bolivia became a semi-stable democracy in the early 1980s and it has stayed that way.

2. For all the rhetoric to the contrary, the current regime is a mix of 1990s-era market-oriented reforms and Evo Morales.  Probably you like one of these, though perhaps not both.

3. Many more Bolivian children ...


September 1, 2014, 1:03 am, 1327292
A sales promotion advertisement at a housing sales office in Hangzhou, Zhejiang province.  Newscom

After a modest uptick in the middle of the year, the Chinese economy ...


September 1, 2014, 12:44 am, 1327291
The White House and union leaders are using Labor Day reinvigorate efforts to raise the minimum wage.


September 1, 2014, 12:34 am, 1327290

It’s difficult to envisage a downward-sloping yield curve in an unhampered market economy since this would imply that investors are assigning a higher risk to short-term maturities than long-term maturities. But in today’s economy, an upward- or a downward-sloping yield curve reflects the ...