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8 months

The Puzzle of the US Productivity Slowdown

In the long-run, the average standard of living in an economy is determined by the average productivity of its workers. For example, Paul Krugman started Chapter 1 of his 1990 book, The Age of Diminished Expectations, by stating: "Productivity isn't everything, but in the long run it is almost everything. A country's ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker."

8 months

Sustainable Government Debt – An Old Idea Refreshed

New research from the Peterson Institute suggests bond yields may fall once more. Demographic forces and unfunded state liabilities point to an inevitable reckoning. The next financial crisis may be assuaged with a mix of fiscal expansion plus QQE. Pension fund return expectations for bonds and stocks need to be revised lower.

8 months

Digitization of Media Industries: Quantity and Quality

Digitization has revolutionized media industries. The equipment needed to produce a movie, television show, or musical album has gotten remarkably cheaper. The cost of distributing video, sound, or text has dropped dramatically, too, in some cases to nearly zero. In addition, the power of the "gatekeepers" who used to determine what content would be broadly distributed--producers and publishers--has been substantially diminished.

8 months

How Food Banks Use Markets

"Imagine that someone gave you 300 million pounds of food and asked you to distribute it to the poor—through food banks—all across the United States. The nonprofit Feeding America faces this problem every year. The food in question is donated to Feeding America by manufacturers and distributors across the United States. As an example, a Walmart in Georgia could have 25,000 pounds of excess tinned fruit at one of its warehouses and give it to Feeding America to distribute to one of 210 regional food banks. How should this be accomplished?"

8 months

Do We Even Know If the Gig Economy Is Growing?

The concept of the "gig economy" clearly captures something real, but it can be hard to measure or define in the statistical sense that brings joy to my heart. For example, it clearly refers to those who drive for Uber and Lyft. But does it refer more broadly to all workers with "alternative work arrangements," who are hired for a short-term job with no serious expectation that it will become a longer-term employment connection? Does it cover people who obtain jobs through a temp agency and work for a series of employers, for example?

8 months

Venezuela: A Case of Socialist Organized Theft

Much has been written about the economic disaster perpetrated by the Maduro-Chavez regime in Venezuela. The magnitude of it is simply difficult to match. A sad global example of how to destroy a rich country.

8 months

Mexico Misallocated

Economic growth in Mexico presents a puzzle. Mexico has followed many of the standard recommendations that are said to support economic growth. For example, it has prevented a recurrence of the inflationary fevers that used to grip Mexico every few years. Rates of national investment are up. Investment in education and human capital is up. Mexican workers have a  high labor force participation rate. Mexico has signed international agreements to reduce trade barriers. It has done a reasonable amount of privatization and deregulation, and the result of all these changes has been slow growth.