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3 months

Are Firms Doing a Lousy Job in How they Hire?

In a lot of economic models, firms decide to hire based on whether they need more workers to meet the demand for their products; in the lingo, labor is a "derived demand," derived from the desired level of output. Beyond that, economic models often don't pay much attention to the details of how hiring happens, assuming that profit-maximizing firms will figure out relatively cost-effective ways of gathering and keeping the skills and workers they need. But what if that hypothesis is wrong?

3 months

Trade War: An Excuse To Sell

We have been alerting for months about the excessively optimistic expectations on the possible trade agreement between China and the US.

3 months

How To Cut US Child Poverty in Half

Back in the 1960s, the poverty rate for those over-65 was about 10 percentage points higher than the poverty rate for children under 18. For example, in 1970 the over-65 poverty rate was about 25%, while the under-18 poverty rate was 15%. But government support for the elderly rose substantially, and  in the 1970s, the over-65 poverty rate dropped below the under-18 rate. For the last few decades, the under-18 poverty rate has been 7-9 percentage points higher than the over-65 poverty rate. In 2017, for example, the under-18 poverty rate was 17.5%, while the over-65 poverty rate was 9.2%. (For the numbers, see Figure 6 in this US Census report from last fall.)

3 months

Debasing the Baseless - Modern Monetary Theory

·        Populist politicians are turning to Modern Monetary Theory  ·        Fiscal stimulus has not led to significant inflation during the last decade ·        MMT is too radical to be adopted in full but the allure of fiscal expansion is great ·        Asset markets will benefit over the medium-term

3 months

The High Costs of Renewable Portfolio Standards

A "renewable portfolio standard" is a rule that a certain percentage of electricity generation needs to come from renewable sources.  Such rule have been spreading in popularity. But Michael Greenstone and Ishan Nath argue in "Do Renewable Portfolio Standards Deliver?" that they are an overly costly way of reducing carbon emissions (Becker Friedman Institute, University of Chicago, April 21, 2019). As they explain in the Research Summary (a full working paper is also available at the link):

4 months

Single Payer Requires Many Choices

I sometimes hear "single payer" spoken as if it was a complete description of a plan for revising the US health care system. But "single payer" actually involves a lot of choices. The Congressional Budget Office walks through the options in their report "Key Design Components and Considerations for Establishing a Single-Payer Health Care System" (May 2019).

4 months

Globalization: More Than Before, But Less than You Think?

Globalization can be loosely defined as increases in the flow of goods, services, finance, people, and information across national boundaries. It has been generally on the rise in recent decades, although this trend experienced a substantial hiccup around the time of the Great Recession. Steven A. Altman, Pankaj Ghemawat, and Phillip Bastian have written "DHL Global Connectedness Index 2018: The State of Globalization in a Fragile World"(February 2019). Most of the report is country- and region-level descriptions of the level globalization.