September 10

Judging Downturns II

The discussion of how severe the recession is that strated on September 9 continues.

Textbook References:

Chapter 23 “Measuring a Nation’s Income”
Pages 614-623 “Identifying Unemployment”
Pages 740-742 “Three Key Facts About Economic Fluctuations”

September 9

Judging Downturns

The current recession is not nearly as bad as the Great Depression.

Textbook References:

Chapter 23 “Measuring a Nation’s Income”
Pages 614-623 “Identifying Unemployment”
Pages 740-742 “Three Key Facts About Economic Fluctuations”

September 6

Unemployment Update

Unemployment is higher than the administration predicted.

Textbook References:

Pages 392-399 “The Demand for Labor”
Pages 399-400 “The Supply of Labor”
Pages 400-405 “Equilibrium in the Labor Market”
Chapter 28 “Unemployment”
Pages 778-787 “How Monetary Policy Influences Aggregate Demand”
Pages 787-793 “How Fiscal Policy Influences Aggregate Demand”
Pages 793-796 “Using Policy to Stabilize the Economy”
Pages 830-832 “Should Monetary and Fiscal Policymakers Try To Stabilize the Economy?

July 02

Unemployment Update

The administration predicted that, with its stimulus package, the unemployment rate would be much lower than it actually is.

Textbook References:

Chapter 28 “Unemployment”
Pages 787-793 “How Fiscal Policy Influences Aggregate Demand”
Pages 793-796 “Using Policy to Stabilize the Economy”
Pages 830-832 “Should Monetary and Fiscal Policymakers Try To Stabilize the Economy?”

June 12

The Case Against a Minimum Wage Hike

The minimum wage is scheduled to increase in July, David Neumark argues that a recession is an especially bad time to increase the minimum wage.

Textbook References:

Pages 118-121 “How Price Floors Affect Market Outcomes”
Chapter 18 “The Markets for the Factors of Production”
Pages 627-629 “Minimum-Wage Laws”

June 08

This Recession’s Gender Gap

The male unemployment rate is much higher than the female unemployment rate.

Textbook References:

Chapter 28 “Unemployment”

May 12

Measuring Jobs Created or Saved

Congress passed a bill that requires the Council of Economic Advisors to report on the number of jobs saved or created by the stimulus package. It is an impossible task.

Textbook References:

Pages 392-399 “The Demand for Labor”
Pages 399-400 “The Supply of Labor”
Pages 400-405 “Equilibrium in the Labor Market”
Chapter 28 “Unemployment”
Pages 778-787 “How Monetary Policy Influences Aggregate Demand”
Pages 787-793 “How Fiscal Policy Influences Aggregate Demand”
Pages 793-796 “Using Policy to Stabilize the Economy”
Pages 830-832 “Should Monetary and Fiscal Policymakers Try To Stabilize the Economy?

Apr. 4

Hoover Did It!

Lee Ohanian argues that higher wages, which were paid to prevent unions from organizing, was an important cause of the Great Depression.

Textbook References:

Pages7-8 “Principle 4: People Respond to Incentives”
Pages 8-10 “Principle 6: Markets Are Usually A Good Way To Organize Economic Activity”
Pages 10-12 “Principle 7: Governments Can Sometimes Improve Market Outcomes”
Pages 118-121 “How Price Floors Affect Market Outcomes”
Pages 421-422 “Above-Equilibrium Wages: Minimum-Wage Laws, Unions, and Efficiency Wages”
Pages 629-631 “Unions and Collective Bargaining”

Feb. 12

Labor Market Conditions

Mankiw presents a graph of initial and continued unemployment claims from January 1971 to January 2009.

Textbook References:

Chapter 28 “Unemployment”
Pages 740-742 “Three Key Facts About Economic Fluctuations”
Page 797 “Automatic Stabilizers”

Jan. 31

Summers vs Obama

Before becoming economic advisor to Obama, Larry Summers wrote that unions are a cause of long-term unemployment. Obama claims that unions are part of the solution.

Textbook References:

Pages 32-33 “Why Economists’ Advice is not Always Followed”
Pages 421-422 “Above-Equilibrium Wages: Minimum-Wage Laws, Unions, and Efficiency Wages”
Pages 629-631 “Unions and Collective Bargaining”