Recent Posts
(Note: Page numbers referenced in posts prior to June 1, 2011 refer to 5th edition)
January 12
Judging Presidents
Presidents have far less influence on job creation than many people believe.
Textbook References:
Chapter 28 “Unemployment”Chapter 33 “Aggregate Demand and Aggregate Supply”
October 16
The Increased Role of the Minimum Wage
The increase in the minimum wage means that it now covers a larger fraction of workers.
Textbook References:
Pages 117-119 “The Minimum Wage”Page 428 “Minimum Wage Laws”
Pages 606-608 “Minimum Wage Laws”
September 10
A Plan for Zero Unemployment
Steve Allen suggests a novel plan to eliminate unemployment.
Textbook References:
Pages 7-9 “Principle 4: People Respond to Incentives”Pages 604-605 “How Much Do the Unemployed Respond to Incentives?”
July 15
Why aren't businesses hiring?
Steven Davis identifies reasons why businesses are not hiring as fast as one might expect in a recovery. Reasons include uncertainty about government policy that reduces recruiting intensity and a skills mismatch.
Textbook References:
Chapter 28 “Unemployment”July 8
The Disappointing Recovery
A chart shows that the civilian employment to population ratio remains roughly 5 percentage points below its pre-recession level.
Textbook References:
Pages 598-599 “Does the Unemployment Rate Measure What We Want It To?”Pages 720-722 “Three Key Facts about Economic Fluctuations”
Pages 745-748 “The Recession of 2008-2009”
July 7
Rogoff on Inequality
Kenneth Rogoff argues that "technological innovation will lead ultimately to commoditization of many skills that now seem very precious and unique." That implies that what are now high-skilled, high-paying jobs will become routine and will make the income distribution more equal.
Textbook References:
Pages 376-382 “The Demand for Labor”Chapter 20 “Income Inequality and Poverty”
April 27
Height Over Time
People are much taller than they used to be. A new book attributes it to technological advances that improved nutrition, sanitation, and medicine.
Textbook References:
Pages 550-554 “Economic Growth Around The World”Pages 565-566 “Health and Nutrition”
Page 632 “Worker Health”
April 25
The World's Poor and Hungry
Abhijit Banerjee and Esther Duflo discuss why the issue of world hunger is much more complicated than most people think.
Textbook References:
Pages 550-554 “Economic Growth Around The World”Pages 565-566 “Health and Nutrition”
Page 632 “Worker Health”
April 2
A V, 2 Us, and an L
The U.S. Department of Labor presents a graph of the civilian employment to population ratio.
Textbook References:
Pages 614-623 “Identifying Unemployment”Pages 740-742 “Key Facts About Economic Fluctuations”
March 6
Richard Freeman on Unions
Richard B. Freeman recommends five books about labor unions. He argues that unions are, on net, a positive force in the economy.
Textbook References:
Pages 421-422 “Above-Equilibrium Wages: Minimum-Wage Laws, Unions, and Efficiency Wages”Pages 629-631 “Unions and Collective Bargaining”
February 28
Barro on Unions
Robert Barro argues that states with right-to-work laws have much higher growth in manufacturing employment than states without such laws.
Textbook References:
Pages 629-631 “Unions and Collective Bargaining”
February 4
The Jobs Report
Dilbert illustrates an effect of high unemployment on the employed.
Textbook References:
Chapter 28 “Unemployment”
January 10
How much unemployment is structural?
Raghuram Rajan argues that up to 3 percentage points of unemployment may be structural. A large chunk of the unemployed are in construction and related industries. No increase in aggregate demand will revive the construction industry in the foreseeable future, so funds would be better spent retraining these workers..
Textbook References:
Page 622 “Why Are There Always Some People Unemployed”
December 16
The Economics of Seinfeld
Clips from the TV show "Seinfeld" are used to illustrate a variety of economic concepts.
Textbook References:
Pages 4-5 “Principle 1: People Face Trade-offs”Pages 5-6 “Principle 2: The Cost of Something is What You Give Up to Get It”
Page 6 “Principle 3: Rational People Think at the Margin”
Pages 7-8 “Principle 4: People Respond to Incentives”
Pages 10-12 “Principle 7: Governments Can Sometimes Improve Market Outcomes”
Chapter 3 “Interdependence and the Gains from Trade”
Pages 67-72 “Demand”
Pages 73-76 “Supply”
Pages 144-153 “Controls on Prices”
Chapter 10 “Externalities”
Pages 226-227 “The Different Kinds of Goods”
Pages 227-232 “Public Goods”
Pages 230-232 “The Difficult Job of Cost-Benefit Analysis”
Pages 232-237 “Common Resources”
Pages 274-275 “Fixed and Variable Costs”
Page 281 “Economies and Diseconomies of Scale”
Pages 312-315 “Why Monopolies Arise”
Chapter 16 “Monopolistic Competition”
Pages 370-378 “The Economics of Cooperation”
Pages 399-400 “The Supply of Labor”
Page 414 “Compensating Differentials”
Page 442 “Utility”
Page 465 “Utility: An Alternative Way to Describe Preferences and Optimization”
Pages 484-489 “Asymmetric Information”
Pages 556-558 “Technological Knowledge”
Pages 578-580 “Financial Intermediaries”
Pages 598-600 “Present Value: Measuring the Time Value of Money”
Pages 603-604 “Diversification of Firm-Specific Risk”
Pages 606-609 “The Efficient Market Hypothesis”
Pages 630-631 “The Economics of Unions”
Pages 703-705 “The Prices for International Transactions: Real and Nominal Exchange Rates”
Pages 707-708 “The Basic Logic of Purchasing Power Parity”
Page 833 “Time Inconsistency”
December 4
My Agnosticism about UI
Mankiw discusses the pros and cons of unemployment insurance. He also mentions that we do not know enough to determine the optimal length for unemployment insurance.
Textbook References:
Pages 625-626 “Unemployment Insurance”
Pages 626-627 “Unemployment Policy At Home and Abroad”
Page 797 “Automatic Stabilizers”
August 5
President Obama's Pro-Union Stance
Gary Becker claims that the threat of pro-union policy harms the recovery.
Textbook References:
Pages 421-422 “Above-Equilibrium Wages: Minimum-Wage Laws, Unions, and Efficiency Wages”
Pages 629-631 “Unions And Collective Bargaining”
July 19
The Principle of Comparative Advantage Applies Even To Union Picketing
Non-union workers are earning minimum wage picketing for a union. The union is upset that its employer has hired non-union workers.
Textbook References:
Pages 54-57 “Comparative Advantage: The Driving Force of Specialization”Pages 629-631 “Unions and Collective Bargaining”
July 16
Median Duration of Unemployment
The Bureau of Labor Statistics reports that the median duration of unemployment in this recession is much higher than in previous recessions.
Textbook References:
Page 621-622 “How Long Are the Unemployed Without Work”Pages 740-742 “Three Key Facts About Economic Fluctuations”
April 5
Is "Unpaid" Below the Minimum Wage?
The U.S. Labor Department claims that unpaid internships violate minimum wage laws.
Textbook References:
Pages 119-121 “The Minimum Wage”Page 446 “Minimum Wage Laws”
Pages 627-629 “Minimum Wage Laws”
February 21
What Unions Are Getting
The Economist magazine argues that the Obama administration's policy towards unions has raised costs so that taxpayers are getting less for their money.
Textbook References:
Pages 421-422 “Above-Equilibrium Wages: Minimum-Wage Laws, Unions and Efficiency Wages”
Pages 629-631 “Unions And Collective Bargaining”
November 30
How to Create Jobs
Nobel laureates Paul Krugman and Gary Becker offer different advice on how to create jobs.
Textbook References:
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 400-405 “Equilibrium in the Labor Market”
Pages 614-623 “Identifying Unemployment”
Pages 787-793 “How Fiscal Policy Influences Aggregate Demand”
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”