More in Global Economy


5 years

Where Will America Find Caregivers as its Elderly Population Rises?

As we look ahead two or three decades into the future, we know several demographic facts with an extremely high degree of confidence. We know that that the number of elderly people in the population will be rising, and as a result, the demand for long-term care services will rise substantially. We also know that the birthrate has been falling, and so this generation of the eventually-will-be-elderly has had fewer children than the previous generation.

5 years

Interview with William “Sandy” Darity Jr.: Inequality, Race, Stratification, and More

Douglas Clement interviews William "Sandy" Darity Jr. in The Region magazine from the Federal Reserve Bank of Minneapolis (June 3, 2019). As the subtitle reads: "His recent focus has been on reparations for African Americans, but his scholarship spans decades and ranges from imperialism to psychology, from “price-specie flow” to rational expectations." Here are a few points that caught my eye, but the entire interview is worth reading.

5 years

The Global Paper Industry: Still on the Rise

Paper is an old industry, dating back to 100 BC in China. For several decades now, there have been predictions that paper would decline, as businesses converted to the "paperless office" and as people moved to reading online rather than on dead tree. How is that transition going? The short answer is "only OK." For a longer answer, the Environmental Paper Network offers a review in The State of the Global Paper Industry, subtitled "Shifting Seas: New Challenges and Opportunities for Forests, People and the Climate (April 2018).

5 years

Pareidolia: When Correlations are Truly Meaningless

"Pareidolia" refers to the common human practice of looking at random outcomes but trying to impose patterns on them. For example, we all know in the logical part of our brain that there are a roughly a kajillion different variables in the world, and so if we look through the possibilities, we will will have a 100% chance of finding some variables that are highly correlated with each other. These correlations will be a matter of pure chance, and they carry no meaning. But when my own brain, and perhaps yours, sees one of these correlations, I can feel my thoughts start searching for a story to explain what looks to my eyes like a connected pattern. 

5 years

Strengthening Automatic Stabilizers

For economists, "automatic stabilizers" refers to how tax and spending policies adjust without any additional legislative policy or change during economic upturns and downturns--and do so in a way that tends to stabilize the economy. For example, in an economic downturn, a standard macroeconomic prescription is to stimulate the economy with lower taxes and higher spending. But in an economic downturn, taxes fall to some extent automatically, as a result of lower incomes. Government spending rises to some extent automatically, as a result of more people becoming eligible for unemployment insurance, Medicaid, food stamps, and so on. Thus, even before the government undertakes additional discretionary stimulus legislation, the automatic stabilizers are kicking in.

5 years

Why Did the US Labor Share of Income Fall So Quickly?

The share of US national income going to labor was sagging through the second half of the century, but then plunged starting around 2000. The McKinsey Global Institute takes "A new look at the declining labor share of income in the United States" in a report by James Manyika, Jan Mischke, Jacques Bughin, Jonathan Woetzel, Mekala Krishnan, and Samuel Cudre (May 2019).

5 years

Origins of Microeconomics and Macroeconomics

Economists have written about topics that we would now classify under the headings of "microeconomics" or "macroeconomics" for centuries. But the terms themselves are much more recent, emerging only in the early 1940s. For background, I turn to the entry on "Microeconomics" by Hal R. Varian published in The New Palgrave: A Dictionary of Economics, dating back to the first edition in 1987.

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