Category: Economics

The New York Times has a fantastic piece about the amount of cash incentives state and local governments provide to businesses. The Times found that local governments provide over $80 billion to firms each year. I do not have anything meaningful to add to the story, but it deserves pointing out very clearly what mechanics… Continue reading Federalism sets the stage for corporatism

The so-called fiscal cliff has been dominating the political economics coverage of late. It is perhaps an exciting story from a politicking perspective, but fairly boring in just about every other respect. The conventional wisdom in an economy still reeling from a recession like this one is to cancel all the scheduled cuts and tax… Continue reading Unemployment still a huge problem

Mitt Romney stirred the pot in the last debate with the always vague bromide that government does not create jobs. A few notables have commented on this statement — Karl Smith and Paul Krugman among them. I have absolutely no idea what this means, but it’s stupid on just about any level you can imagine.… Continue reading Apparently no one ever creates any jobs

Garett Jones has a really bad post at econlib. And I mean really bad. Jones seems to think he has hit upon something really clever by analyzing the income effect and substitution effect in a way that is sensitive to the resulting government spending. For those unfamiliar, the income effect refers to the way taxes… Continue reading Garett Jones’ confused idea

Mike Konczal has a good piece in the American Prospect about the coming possibility of full employment and the monetary policy battles on the horizon. Central to Konczal’s piece is the debate over the non-accelerating inflation rate of unemployment (NAIRU). In lieu of giving a full explanation of NAIRU, it suffices here to simply say… Continue reading The problem of NAIRU and racial justice