Economic links
Ph.D thesis examines Ricardian equivalence in Oz and finds significant private-public saving offsets (which implies, amongst other things, that tax cuts and spending grants are significantly saved).
Continuing the argument over whether fiscal stimulus works.
About the battle inside the Fed over monetary policy. Pointing out that Obama is deeply culpable for taking so long to nominate to fill two vacancies on the Fed Board:
Look at the phrase “Key members of the five-man Board.” That refers to the Board of Governors. If you remember your money and banking classes you might think “doesn’t the Board have seven members?” Usually it does, and it usually dominates the 12 man FOMC (which includes 5 regional bank presidents.) But two seats were empty when Obama took office. Did Obama rush to fill the seats so that monetary stimulus could provide support for fiscal stimulus? No, he waited for over a year to even nominate anyone to the Board. From this article, I infer that the recent nominees have not yet been confirmed by the Senate. Ironically, the financial regulation bill agreed upon last night is far less important than getting those two nominees on the Board of Governors. The buck stops at the President, but I also assume he has not been getting good advice from advisors like Summers and Romer. Why else would he have waited so long if his economic advisers had been telling him how important it was to fill those seats? …
Just like in the Great Depression, the regional bank presidents are the biggest problem. And just like in the Great Depression, the British press had a better understanding of the deflationary impact of US monetary policy than did the American press. Funny how things never seem to change.
This is either appalling fecklessness on the part of the Administration or appalling Machiavellianism (maximise the economic crisis so as to maximise the regulatory and policy changes that can be justified).
Looking at the appeal and problems of Paul Romer’s charter cities concept:
beginning around 1980, Hong Kong’s example inspired the mainland’s rulers to create copycat enclaves. Starting in Shenzhen City, adjacent to Hong Kong, and then curling west and north around the Pacific shore, China created a series of special economic zones that followed Hong Kong’s model. Pretty soon, one of history’s greatest export booms was under way, and between 1987 and 1998, an estimated 100 million Chinese rose above the $1-a-day income that defines abject poverty. The success of the special economic zones eventually drove China’s rulers to embrace the export-driven, pro-business model for the whole country. “In a sense, Britain inadvertently, through its actions in Hong Kong, did more to reduce world poverty than all the aid programs that we’ve undertaken in the last century,” Romer observes drily. …
A few development economists argue that geography is destiny, but most share Romer’s conviction that decent rules are paramount. After all, Asia accounted for fully 56 percent of world income in 1820, only 16 percent in 1950, and a substantial 39 percent in 2008; what changed over this period was rules, not geography.
The blog. Suggesting that the problem with Paul Romer’s Charter cities idea is that it is not medieval enough:
Paul Romer needs to see the Hong Kong example fully-that only outside imposition made it happen in the first place, that repeatability sans foreign rule is what gave it transformative power-and go for the full medieval package of entrenched local rule. Harness particularist loyalty, not work against it.
Paper finds a positive correlation between high civic values and economic liberalising reforms.
Looking at the (very different) rates of productivity growth in Latin America for 1950-1975, 1975-1990, since 1990.
About that sovereign debt issue.
Despite the wars in Iraq and Afghanistan, US defence spending is still in long-term decline as a share of GDP.
Analysing the Chinese property bubble and economic prospects. China probably has very high public debt: it also has what looks like a massive property bubble. But they are doing a lot of building (scroll down for pictures). The property market boyfriend barrier:
Zhang's misfortune is not uncommon. China's housing boom has created a woefully frustrated class of bachelors.
Japan has one of the smallest and the toughest welfare states in the developed world. Sweden has recently managed to significantly reduce welfare-dependency.
Money goes a lot further in Houston than Chicago or Manhattan:
According to CNN Money, an $80,000 income in Houston means $194,580 in Manhattan to have a similar lifestyle with housing costs increasing by 424 percent, groceries by 72 percent, utilities by 58 percent, transportation by 35 percent and healthcare by 36 percent. In Chicago, a comparable salary would be $101,410 with a housing increase of 73 percent, while a $126,853 income and a 201 percent housing cost would correspond in Los Angeles.
Oz lenders are getting tougher in their mortgage requirements. Examining the Oz economy’s debt and asset profiles:
looking at a broad range of financial data, and considering the fact that the Australian economy and financial system have exhibited a high degree of stability over many years, despite the many global events that have tested their resilience, is, I think, grounds for confidence that the economic and financial structure that has evolved in Australia is sustainable.
Putting it another way: much better to have our economic issues than the US's, Japan's, the UK's ...
Almost one-fifth of the Oz workforce are in some form of self-employment. This reduces the effect of economic shocks (since lots of people can take a temporary income hit without losing their jobs), reflects the rise of two-income households (since fluctuations in income can be covered more easily) and the regulatory burden placed on permanent, full-time employment (which imposes costs in wasted resources or blocked opportunities that can be captured by moving to other forms of employment).
Continuing the argument over whether fiscal stimulus works.
About the battle inside the Fed over monetary policy. Pointing out that Obama is deeply culpable for taking so long to nominate to fill two vacancies on the Fed Board:
Look at the phrase “Key members of the five-man Board.” That refers to the Board of Governors. If you remember your money and banking classes you might think “doesn’t the Board have seven members?” Usually it does, and it usually dominates the 12 man FOMC (which includes 5 regional bank presidents.) But two seats were empty when Obama took office. Did Obama rush to fill the seats so that monetary stimulus could provide support for fiscal stimulus? No, he waited for over a year to even nominate anyone to the Board. From this article, I infer that the recent nominees have not yet been confirmed by the Senate. Ironically, the financial regulation bill agreed upon last night is far less important than getting those two nominees on the Board of Governors. The buck stops at the President, but I also assume he has not been getting good advice from advisors like Summers and Romer. Why else would he have waited so long if his economic advisers had been telling him how important it was to fill those seats? …
Just like in the Great Depression, the regional bank presidents are the biggest problem. And just like in the Great Depression, the British press had a better understanding of the deflationary impact of US monetary policy than did the American press. Funny how things never seem to change.
This is either appalling fecklessness on the part of the Administration or appalling Machiavellianism (maximise the economic crisis so as to maximise the regulatory and policy changes that can be justified).
Looking at the appeal and problems of Paul Romer’s charter cities concept:
beginning around 1980, Hong Kong’s example inspired the mainland’s rulers to create copycat enclaves. Starting in Shenzhen City, adjacent to Hong Kong, and then curling west and north around the Pacific shore, China created a series of special economic zones that followed Hong Kong’s model. Pretty soon, one of history’s greatest export booms was under way, and between 1987 and 1998, an estimated 100 million Chinese rose above the $1-a-day income that defines abject poverty. The success of the special economic zones eventually drove China’s rulers to embrace the export-driven, pro-business model for the whole country. “In a sense, Britain inadvertently, through its actions in Hong Kong, did more to reduce world poverty than all the aid programs that we’ve undertaken in the last century,” Romer observes drily. …
A few development economists argue that geography is destiny, but most share Romer’s conviction that decent rules are paramount. After all, Asia accounted for fully 56 percent of world income in 1820, only 16 percent in 1950, and a substantial 39 percent in 2008; what changed over this period was rules, not geography.
The blog. Suggesting that the problem with Paul Romer’s Charter cities idea is that it is not medieval enough:
Paul Romer needs to see the Hong Kong example fully-that only outside imposition made it happen in the first place, that repeatability sans foreign rule is what gave it transformative power-and go for the full medieval package of entrenched local rule. Harness particularist loyalty, not work against it.
Paper finds a positive correlation between high civic values and economic liberalising reforms.
Looking at the (very different) rates of productivity growth in Latin America for 1950-1975, 1975-1990, since 1990.
About that sovereign debt issue.
Despite the wars in Iraq and Afghanistan, US defence spending is still in long-term decline as a share of GDP.
Analysing the Chinese property bubble and economic prospects. China probably has very high public debt: it also has what looks like a massive property bubble. But they are doing a lot of building (scroll down for pictures). The property market boyfriend barrier:
Zhang's misfortune is not uncommon. China's housing boom has created a woefully frustrated class of bachelors.
Japan has one of the smallest and the toughest welfare states in the developed world. Sweden has recently managed to significantly reduce welfare-dependency.
Money goes a lot further in Houston than Chicago or Manhattan:
According to CNN Money, an $80,000 income in Houston means $194,580 in Manhattan to have a similar lifestyle with housing costs increasing by 424 percent, groceries by 72 percent, utilities by 58 percent, transportation by 35 percent and healthcare by 36 percent. In Chicago, a comparable salary would be $101,410 with a housing increase of 73 percent, while a $126,853 income and a 201 percent housing cost would correspond in Los Angeles.
Oz lenders are getting tougher in their mortgage requirements. Examining the Oz economy’s debt and asset profiles:
looking at a broad range of financial data, and considering the fact that the Australian economy and financial system have exhibited a high degree of stability over many years, despite the many global events that have tested their resilience, is, I think, grounds for confidence that the economic and financial structure that has evolved in Australia is sustainable.
Putting it another way: much better to have our economic issues than the US's, Japan's, the UK's ...
Almost one-fifth of the Oz workforce are in some form of self-employment. This reduces the effect of economic shocks (since lots of people can take a temporary income hit without losing their jobs), reflects the rise of two-income households (since fluctuations in income can be covered more easily) and the regulatory burden placed on permanent, full-time employment (which imposes costs in wasted resources or blocked opportunities that can be captured by moving to other forms of employment).