From today's NYT.
Krugman notes that the outsourcing of low-education jobs may be reaching a plateau, and that outsourcing of high-ed jobs may be speeding up. If so, strong education policy may not be the golden ticket to growth. Interesting perspective. I buy the "hole in the middle" argument, though I'm not sure I buy the idea that high-tech or high-ed jobs are "more offshorable". I haven't yet read the Blinder and Krueger paper, but it seems there's a parallel between these ideas and traded goods vs. non-traded goods. Which types of labor are easily outsourced to the lowest and/or most educated bidder?
How might this affect the college premium? The grad school premium? Will the effects vary by discipline? What might this do to the demand for certain college majors in the U.S.?
Monday, March 7, 2011
Kristof on Islam and economic growth
Nicholas Kristof has a great column in Sunday's NYT.
Note the role of the accumulation of capital.
He has a brief follow-up in his blog today.
Note the role of the accumulation of capital.
He has a brief follow-up in his blog today.
Thursday, March 3, 2011
So much news, so little time...
Sorry for the blogging hiatus. I've been playing catch-up for a couple of weeks now.
There's a lot going on in the world that relates to our class, so let's dig in.
Big stories:
Unrest in the middle east and north Africa continues. What are the implications for those nations and for the rest of us? I'll post links to related stories and analysis soon. Feel free to send me links to what you're reading.
An obvious market connection is that gas prices are rising quickly. What are the implications of energy prices for economic growth and development? Read about it here at the WSJ, here at The Press (New Zealand), and here at the San Francisco Chronicle (note the estimate of a "fear premium" in a linked Business Week story).
In what some are labeling a "Cairo moment", attempts at union-busting are causing a stir in Wisconsin and Ohio. One side of the argument is that state's obligations to public union workers (pensions, health care) are exacerbating budget shortfalls. Curtailing collective bargaining will therefore rein in spending, they say, and help states climb out of severe budget shortfalls.
The other side argues that without unions, the working class will have little political power and will be taken advantage of, resulting in a shrinking middle class and more inequality (among other things). Unions provide a needed balance to the political power of corporations, they say, especially in light of the Supreme Court's recent ruling on political contributions. From this perspective, union busting is simply an attempt at knee-capping the principle contributor to one party's interests. One side says differentiating between private sector and public sector unions is at the heart of the matter, the other side downplays the distinction.
Whether the arguments of 2011 are for budget austerity or simply a political power-play, what role does collective bargaining play in economic growth and development? Read about the issues here at the NYT, here at MSNBC, and here at Fox News.
Here is a pro-union look at income, equality and unions by Ryan Witt at The Examiner. Interesting, but we have to be careful jumping from correlation to causation. Read more on the pro-union perspective here from the Center for American Progress Action Fund. You can also check the AFLCIO for their perspective.
Here is a paper from Holcombe and Gwartney presenting a detailed and non-technical look at the effect of unions on economic growth via their effect on labor laws. The paper provides great information and a thought-provoking thesis. But we have to keep in mind that CATO is a conservative think tank, so as with the links above, you sort of know the conclusions before starting the paper.
Here's a piece from two economists at LSE suggesting the effect of unions is negative, but can be offset.
Here's a link to an old blog post from Greg Mankiw on the subject. Here's a YouTube video of Krugman providing a different perspective and an excerpt from a Krugman interview at AFL-CIO.
Interesting related aside: Matthew Kahn (environmental econ prof at UCLA) has some interesting research related to unions and manufacturing firms' location decisions (and associated pollution).
Taking it one step further, if this is about politics then we have to think about how (and if) political regimes are related to economic growth.
OK, that's a ton of reading... I don't expect you to get through it all in one sitting, by try to consider both sides of the arguments and give thought to what we know and what we don't know. Like most of the issues under study this semester, these are complex and opaque relationships, and there are strong opinions on both sides.
There's a lot going on in the world that relates to our class, so let's dig in.
Big stories:
Unrest in the middle east and north Africa continues. What are the implications for those nations and for the rest of us? I'll post links to related stories and analysis soon. Feel free to send me links to what you're reading.
An obvious market connection is that gas prices are rising quickly. What are the implications of energy prices for economic growth and development? Read about it here at the WSJ, here at The Press (New Zealand), and here at the San Francisco Chronicle (note the estimate of a "fear premium" in a linked Business Week story).
In what some are labeling a "Cairo moment", attempts at union-busting are causing a stir in Wisconsin and Ohio. One side of the argument is that state's obligations to public union workers (pensions, health care) are exacerbating budget shortfalls. Curtailing collective bargaining will therefore rein in spending, they say, and help states climb out of severe budget shortfalls.
The other side argues that without unions, the working class will have little political power and will be taken advantage of, resulting in a shrinking middle class and more inequality (among other things). Unions provide a needed balance to the political power of corporations, they say, especially in light of the Supreme Court's recent ruling on political contributions. From this perspective, union busting is simply an attempt at knee-capping the principle contributor to one party's interests. One side says differentiating between private sector and public sector unions is at the heart of the matter, the other side downplays the distinction.
Whether the arguments of 2011 are for budget austerity or simply a political power-play, what role does collective bargaining play in economic growth and development? Read about the issues here at the NYT, here at MSNBC, and here at Fox News.
Here is a pro-union look at income, equality and unions by Ryan Witt at The Examiner. Interesting, but we have to be careful jumping from correlation to causation. Read more on the pro-union perspective here from the Center for American Progress Action Fund. You can also check the AFLCIO for their perspective.
Here is a paper from Holcombe and Gwartney presenting a detailed and non-technical look at the effect of unions on economic growth via their effect on labor laws. The paper provides great information and a thought-provoking thesis. But we have to keep in mind that CATO is a conservative think tank, so as with the links above, you sort of know the conclusions before starting the paper.
Here's a piece from two economists at LSE suggesting the effect of unions is negative, but can be offset.
Here's a link to an old blog post from Greg Mankiw on the subject. Here's a YouTube video of Krugman providing a different perspective and an excerpt from a Krugman interview at AFL-CIO.
Interesting related aside: Matthew Kahn (environmental econ prof at UCLA) has some interesting research related to unions and manufacturing firms' location decisions (and associated pollution).
Taking it one step further, if this is about politics then we have to think about how (and if) political regimes are related to economic growth.
OK, that's a ton of reading... I don't expect you to get through it all in one sitting, by try to consider both sides of the arguments and give thought to what we know and what we don't know. Like most of the issues under study this semester, these are complex and opaque relationships, and there are strong opinions on both sides.
Thursday, February 10, 2011
Kuznets
Here is a link to Kuznets' AER paper.
The full citation is:
Kuznets, S., 1955. "Economic Growth and Income Inequality". The American Economic Review, Vol. 45, No. 1, pp. 1-28.
What does he say about measuring inequality?
What does he say about the causes of inequality as related to economic growth?
Other important considerations?
The full citation is:
Kuznets, S., 1955. "Economic Growth and Income Inequality". The American Economic Review, Vol. 45, No. 1, pp. 1-28.
What does he say about measuring inequality?
What does he say about the causes of inequality as related to economic growth?
Other important considerations?
Monday, February 7, 2011
Technological change and economic growth
Tyler Cowen (econ prof at George Mason) argues in a recently released e-book ("The Great Stagnation") that technological change has reached a plateau. As a result, he argues that economic growth and improvements in living standards will slow dramatically in the coming years.... unless we do something.
His basic thesis that we've consumed all the low-hanging fruit, especially with regard to innovation that results in public goods in the areas of health, education and infrastructure. The most recent "big idea" is of course the internet, which despite our expectation to the contrary, has failed to deliver much of anything in terms of real improvements in productivity and economic growth according to Cowen.
Here's an interview with Cowen at the NYT.
Here's an article at the WSJ.
The Atlantic has an interesting article discussing technological change in kitchens.
More good reading on the topic here from Forbes.
Here's a 30-minute interview with Cowen at The American Enterprise Institute.
What is Cowen's solution?
How can we frame this discussion in terms of the Solow model?
What are some criticisms of Cowen's thesis?
What are the big productivity-enhancing innovations in history, and when did they occur?
His basic thesis that we've consumed all the low-hanging fruit, especially with regard to innovation that results in public goods in the areas of health, education and infrastructure. The most recent "big idea" is of course the internet, which despite our expectation to the contrary, has failed to deliver much of anything in terms of real improvements in productivity and economic growth according to Cowen.
Here's an interview with Cowen at the NYT.
Here's an article at the WSJ.
The Atlantic has an interesting article discussing technological change in kitchens.
More good reading on the topic here from Forbes.
Here's a 30-minute interview with Cowen at The American Enterprise Institute.
What is Cowen's solution?
How can we frame this discussion in terms of the Solow model?
What are some criticisms of Cowen's thesis?
What are the big productivity-enhancing innovations in history, and when did they occur?
Tuesday, February 1, 2011
Bill Gates says helping the world's poor is a good investment
Read about his efforts directed at poverty and polio here at the Wall Street Journal, and here at the Seattle Times. Short blurb here with Daily Show clip.
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