EconoMonitor

Economics Blog Aggregator

    Global Macro

  • Brad DeLong's Grasping Reality...

    Links and Tweets...

    Joe Nye: The American Century Will Survive the Rise of China http://www.ft.com/intl/cms/s/0/48c84460-d250-11e4-ae91-00144feab7de.html Evening Must-Read: Michael Strain: How to Cut Taxes and Help the Poor http://equitablegrowth.org/?p=10116 Kenneth Thomas: Wikileaks Releases Trans-Pacific Partnership Investment Chapter http://www.middleclasspoliticaleconomist.com/2015/03/wikileaks-releases-trans-pacific.html Nick Bunker: Risk-Sharing and Student Loans http://equitablegrowth.org/news/effects-risk-sharing-student-loans Today's Must-Must-Read: Ilyana Kuziemko et al.: What Do Americans Think Should Be Done About Inequality? http://equitablegrowth.org/?p=10099 Jan Ebbeler: Felicior Augusto, Melior Traiano http://inventingtrajan.blogspot.com/2015/03/felicior-augusto-mel...more

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  • Marginal REVOLUTION

    How a genre of music affects life expectancy of famous musicians in that genre

    That is from Dianne Theodora Kenny, via Ted Gioia.  Kenny notes: For male musicians across all genres, accidental death (including all vehicular incidents and accidental overdose) accounted for almost 20% of all deaths. But accidental death for rock musicians was higher than this (24.4%) and for metal musicians higher still (36.2%). Suicide accounted for almost 7% of all deaths in the total sample. However, for punk musicians, suicide accounted for 11% of deaths; for metal musicians, a staggering 19.3%. At just 0.9%, gospel musicians had the lowest suicide rate of all the genres studied. Murder accounted for 6.0% of deaths across the sample, but was the cause of 51% of deaths in rap musicians and 51.5% of deaths for hip hop musicians, to date. Beware selection, becaus...more

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  • VoxEU.org: Recent Articles

    Mismeasuring China’s military spending

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  • TIME

    Apple CEO Tim Cook Warns Against Discriminatory Laws Sweeping U.S.

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  • Beat the Press

    It's Monday and Robert Samuelson Wants to Cut Social Security and Medicare

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  • International Political Economy Zone

    China Buys Europe Cheaply, Pirelli Edition

    Presumably, ChemChina will get the risque Pirelli calendar too* [*NOTE: The IPE Zone being a family-oriented blog, pictures from the 2015 calendar aren't included here, though you can view them yourselves, of course.] The weak euro currency has meant that many things in the eurozone are dirt cheap in comparison to what they were just a year ago. It goes without saying that some of Europe's prestige brands can be had for a song, one of them being the Italian tire manufacturer Pirelli. The firm certainly needs no introduction. It has been the sole supplier of tires in Formula One for the last five years, bolstering its famous name in the performance segment of the automotive supplier industry.And of course, we all know who the prospective buyers are: the cash-laden C...more

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  • The Big Picture

    60 Minutes: Killing Cancer

    60 Minutes follows brain cancer patients in a Duke University clinical trial of a therapy that uses a re-engineered polio virus to kill cancer cells   Using polio to kill cancer: A producers’ notebook ...more

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  • Economist's View

    'A Separating Equilibrium in Indiana'

    Rajiv Sethi: A Separating Equilibrium in Indiana: In the wake of Indiana's passage of the Religious Freedom and Restoration Act, the following stickers have started appearing on storefronts across the state: These signs allow business owners to signal their disapproval of the law, and if they spread sufficiently far and wide, will force those not displaying them to implicitly signal approval of the law. It's worth reflecting on the consequences of this for customer choices, the profitability of firms, and the beliefs of individuals about the preferences of those with whom they occasionally interact. At any given location, the meaning of the symbol will come to depend on the number and characteristics of the nearby firms displaying it. If all businesses were t...more

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  • Paul Krugman

    Austerity, Big and Small

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  • John Quiggin

    Monday Message Board

    Another Monday Message Board. Post comments on any topic. Civil discussion and no coarse language please. Side discussions and idees fixes to the sandpits, please.

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  • Cafe Hayek - Article Feed

    Brackish Economists

    (Don Boudreaux) I just went to the supermarket to buy a steak.  In the parking lot I spotted – literally – a $20 bill lying on the ground.  I picked it up.  No one else was nearby who appeared to be a likely true owner, so I also pocketed this booty. Freshwater economists pay heed: markets are not perfect; unclaimed $20 bills are indeed sometimes found just lying around. Saltwater economists pay heed: $20 bills available for the taking do not long lie around before being fully exploited for all they are worth; such easily appropriated riches are relatively rare, and reports of the existence of any specific ones are generally to be dismissed as fanciful.  (It is, after all, noteworthy that I found today a $20 bill lying on the ground.  I’m 56 year...more

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  • Brad DeLong's Grasping Reality...

    Reading the Federal Reserve's Tea Leaves Dot Plots

    Over at Equitable Growth: It is always instructive to look at the materials that the Federal Reserve's Federal Open Market Committee pumps out, especially their semi-anonymized (hi, Charlie Evans, with your 3% longer-run value) estimates of what the appropriate federal funds rate would be. Thus we can see, comparing January 2012 when the Federal Reserve began publishing its dot-plots to today, the Federal Reserve collectively and slowly come to recognize current reality. Back at the start of 2012 the FOMC participants all thought that in the "longer run"--which at the beginning of 2012 I take to be next year, 2016--the federal funds rate ought to be back at its normal mid-expansion level, which they all took to be in the 3.75%-4.5% per year range. Today, of course, o...more

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  • TIME

    This Glow-in-the-Dark Spray Could Make Cycling at Night Way Safer

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  • Marginal REVOLUTION

    Facts about MIT economics

    1. It is believed that MIT graduating Ph.d. students are more likely to stay in academia than those from any other school or field. 2. Across 1977-2011, MIT economists made up 34 percent of the members of the CEA, and Robert Solow supervised one-third of that group. 3. Even in the early days of MIT, Paul Samuelson was not a major thesis advisor, and his students were not so likely to return to MIT as faculty. 4. Out of 35 J.B. Clark medalists until 2012, 47% of them have some affiliation with MIT, either a degree from there or teaching there. 5. As of a few years ago (I am not sure of the exact date), there were 1316 holders of an MIT Ph.d. in economics. 6. In the 2000s, Daron Acemoglu was the most active thesis advisor at MIT. That is all from “MIT’s Rise t...more

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  • Worthwhile Canadian Initiative

    Funding and the Future of Ontario Universities

    Well, the Council of Ontario Universities or COU is looking for a new President and CEO.  The role of COU is to serve as a voice for the province’s university sector and help improve the public policies that affect the sector.  As the ad for the position states: “As a member-based organization, COU provides the collective voice of Ontario universities to government in an effort to enhance higher education in the province. COU works with its member institutions to convene the dialogue on issues, develop consensus, advocate positions, and advise policy makers. In addition to its important advocacy and policy work, COU co-ordinates a number of shared services for members, including inter-university transit of documents, application processing, and an online...more

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  • Cafe Hayek - Article Feed

    That’s Where the Logic Leads

    (Don Boudreaux) Here’s a letter to a sympathetic correspondent, whose name I use with his kind permission: Mr. Glenn Temple Dear Mr. Temple Thanks for the link to Ken Blackwell’s Daily Caller essay on immigration. You correctly guess that I reject his argument.  Blackwell supplies no evidence that “the nation as a whole has seen a dramatic depression in wages as we import more and more workers to compete for jobs.”  As obvious as such a connection between higher immigration and wage depression is to uncritical minds, long historical experience calls this connection into doubt.  Consider that in 2015 America’s population is 3.2 times larger than it was in 1915 and 39 times larger than it was in 1815.  If Blackwell’s implicit economic theory is correct...more

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  • Marginal REVOLUTION

    Assorted links

    1. Sam Cooke with the Soul Stirrers (music video). 2. How much does time spent with your kids matter, ages 3-11 edition? 3. The myth of Europe’s little ice age. 4. The intangible corporation.  And competition and working conditions, a rebuttal to me from Stumbling and Mumbling. 5. There is no great stagnation. 6. Yuval Levin on what conservatives and libertarians share. ...more

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  • Paul Krugman

    Talking Econoheads

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  • The Big Picture

    Hate Mail Rules

    1. CHECK YOUR GRAMMAR No one’s going to take you seriously if you use “there” instead of “their” or “your” instead of “you’re.” Maybe you should write your missives in Word first, where there’s a grammar checker. Or maybe run your prospective words by your mother, since you want her to be proud of you. I’d say to get a review by your significant other, but I’ve yet to find a hater with a spouse. 2. SPELLCHECK This is built into so many of today’s programs, especially e-mail. How much effort does it take to scroll up to the menu and give it a go? Then again, you’re probably hating from your smartphone, and you don’t want to risk waiting and having your anger subside. Otherwise...more

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  • Beat the Press

    The Invisible Skills Gap in Almost Every Industry

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  • Brad DeLong's Grasping Reality...

    Weekend Reading: Janet Yellen: Normalizing Monetary Policy: Prospects and Perspectives

    Janet Yellen: FRB: Speech--Yellen, Normalizing Monetary Policy: Prospects and Perspectives--March 27, 2015: I would like to thank President Williams for his kind introduction and the Federal Reserve Bank of San Francisco for inviting me to what promises to be a very stimulating and important conference. As you know, last week the Federal Open Market Committee (FOMC) changed its forward guidance pertaining to the federal funds rate. With continued improvement in economic conditions, an increase in the target range for that rate may well be warranted later this year. Of course, the timing of the first increase in the federal funds rate and its subsequent path will be determined by the Committee in light of incoming data on labor market conditions, inflation, an...more

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  • Marc to Market

    Week Ahead is Short but Eventful

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  • Cafe Hayek - Article Feed

    Voice, Voting, and Choice

    (Don Boudreaux) This Wall Street Journal report on elections in Nigeria features this photo of voters holding their “new electoral cards.”  This photo reminds me of the many photos of Iraqis who have voted displaying their purple fingers as a proud sign of their participation in political elections. The reaction that we western readers are expected to have such photos (and to the accompanying reports of more or less successful elections that such photos are meant to signify) is one of satisfaction and applause and happiness for the citizens of those places.  ”See, people who have long not known the joys of democracy are now experiencing democracy!  How wonderful for them – and for the rest of the world now that these former backwaters are c...more

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  • Econbrowser

    Oil sands outlook

    On Friday I visited the University of Alberta in Edmonton, where falling oil prices have brought a record provincial budget deficit despite aggressive tax increases and spending cuts. Here I pass along some of what I learned about how the plunge in oil prices is affecting Alberta’s oil sands operations. A couple of factors have cushioned Canadian oil producers slightly from the collapse in oil prices in the U.S. First, while the dollar price of West Texas Intermediate has fallen 45% since June, the Canadian dollar depreciated against the U.S. dollar by 18% over the same period, and now stands at CAD $1.26 per U.S. dollar. Since the costs of the oil sands producers are denominated in Canadian dollars, the currency depreciation is an important offset. There has...more

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  • The Fabius Maximus website

    Star Trek reboots to give us simple stories, the cartoons we like.

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  • Greg Mankiw's Blog

    The Economics of Skyscrapers

    A friend points me to this article in The Economist about the economics of skyscrapers.  Lots of good food for thought for micro and macro classes.

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  • Beat the Press

    Deflation Due to Lower Commodity Prices Is Not a Problem (Except to Commodity Producers)

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  • The Big Picture

    10 Sunday Reads

    Good Sunday morning. Round out your weekend with some interesting reads you may have missed: • Need Financial Advice? Ask the Future You (NY Times) • Vanguard snubs outsiders in digital advice: As firms like Schwab and Vanguard build more online portfolios, money managers face an ‘open architecture’ question (Investment News) • Activist Investor Bill Ackman Sets a $1 Million Debate Bet (Vanity Fair) • Does bankruptcy trump privacy? (Digitopoly) • Piketty’s Three Big Mistakes (Bloomberg View) • The War Over Who Steve Jobs Was (Medium) see also Becoming Steve Jobs biography: ‘Much of it was chutzpah and self delusion’ (The Register) • How Poor Are the Poor? (NY Times) • BBC’s Hypocrisy Shifts Into ‘Top GearR...more

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  • naked capitalism

    Links 3/29/15

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  • John Quiggin

    How should we tax banks?

    The first real Budget leak of the season has sprung, with indications that the government will introduce a tax on bank deposits, aimed at financing a deposit insurance fund. This was proposed by Labor in 2013, and attacked by Tony Abbott at the time. Judging by Andrew Leigh’s comments that “I don’t think we’re going to take any lessons on bipartisanship from Joe Hockey”, they haven’t forgotten. The best course for Labor would be to support the measure, but to impose ACCC supervision to stop the banks passing the charge onto consumers. That should be the wedge for permanent ACCC oversight of fees and charges. None of this, however, gets to the real issue. Banks are immensely profitable, and their profitability rests on the fact that ...more

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  • Economist's View

    Links for 03-29-15

    The myth of Europe’s Little Ice Age - Vox EU When Your Occupation Is Poverty - Mike Cassidy Employment and the Minimum Wage - Econbrowser Politicians or Technocrats: Who Splits the Cake? - Carola Binder Unreal Keynesians - Paul Krugman Privatization Memories - Paul Krugman Mild Winters and Crank Economics - Paul Krugman The bond-stock conundrum - Moneyness More choice can be confusing - Cass Sunstein The introduction of air conditioning and interstate mobility? - Tyler Cowen Do Air Conditioners Explain the Rise of the South? - Marginal Revolution ...more

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  • naked capitalism

    Elizabeth Warren Strikes Back as Citigroup Tries to Blackmail the Democratic Party

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  • naked capitalism

    Joe Firestone: The New York Times Soft-Pedals the Dangers of the TPP

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  • International Political Economy Zone

    Should Korea Partner Japan for 2018 W Olympics?

    Korea would save $$$ partnering Japan in hosting certain events, but it probably won't. The out-of-control costs of hosting Olympic events is a well-worn trope by now. Unfortunately for South Korea, it's now its turn to feel the financial burn for the 2018 Winter Olympics in Pyeongchang. It was originally meant to promote development outside the overcrowded capital of Seoul, but like most of these Olympics, the costs are soaring and the local government officials don't know where to find the money to complete venues amid cost overruns. Actually, the IOC has become increasingly mindful of this phenomenon and recently passed a new provision allowing the co-hosting of the Olympics:For years the International Olympic Committee ignored the rising costs and indebtedness asso...more

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  • Economist's View

    'Unreal Keynesians'

    Paul Krugman: Unreal Keynesians: Brad DeLong points me to Lars Syll declaring that I am not a “real Keynesian”, because I use equilibrium models and don’t emphasize the instability of expectations. ... I don’t care whether Hicksian IS-LM is Keynesian in the sense that Keynes himself would have approved of it, and neither should you. What you should ask is whether that approach has proved useful — and whether the critics have something better to offer. And as I have often argued, these past 6 or 7 years have in fact been a triumph for IS-LM. Those of us using IS-LM made predictions about the quiescence of interest rates and inflation that were ridiculed by many on the right, but have been completely borne out in practice. We also predicted much bigger advers...more

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  • Econbrowser

    Estimates of the Elasticity of Employment with Respect to the Minimum Wage

    Some people would have you believe the impact of a minimum wage hike on employment is known to be large and negative. A cursory acquaintance with the literature helps in immunizing one (if one believes in vaccines and the like) against falling for such assertions. The meta-analysis of Doucouliagos, Hristos, and Tom D. Stanley. “Publication Selection Bias in Minimum-Wage Research? A Meta-Regression Analysis.” British Journal of Industrial Relations 47.2 (2009): 406-428. [ungated working paper version] is useful in this regard. Figure 2 from Doucouliagos, Hristos, and Tom D. Stanley. “Publication Selection Bias in Minimum-Wage Research? A Meta-Regression Analysis.” British Journal of Industrial Relations 47.2 (2009): 406-428. [ungated working pap...more

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  • The Fabius Maximus website

    The GOP budget shows us the New America that lies ahead

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  • Paul Krugman

    Air Conditioning and the Rise of the South

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  • Marc to Market

    Talkin' and Yellen: Understanding the Fed

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  • Marc to Market

    Near-Term Dollar Conviction Went MIA

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  • Greg Mankiw's Blog

    Getting Promoted

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  • The Fabius Maximus website

    A Tale of New America: a judge burns the Constitution

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  • VoxEU.org: Recent Articles

    The myth of Europe’s Little Ice Age

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  • John Quiggin

    Voting with their feet, and following the business cycle

    Among the regular themes in the Australian business press is the claim that we are being outperformed, in economic terms, by New Zealand. I collected a bunch of such claims here, and they were even more prevalent (but hard to find now, being pre-Internet) in the late 1980s. I’m seeing the same theme recurring today (too many repetitions to link). This is a recurring rather than a continuous theme: there are long periods during which Oz-NZ comparisons are absent from the press. So, if you took the Australian press at face value, it would be reasonable to suppose that Australia was becoming relatively poorer than NZ, not continuously, but in a series of downward steps. In fact to a close approximation, the reverse is the case. But because market economies are cyc...more

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  • TIME

    Jury Clears Silicon Valley Firm in Sex Bias Suit

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  • Free exchange

    Predicting the next crisis

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  • iMFdirect - The IMF Blog

    Fiscal Policy And Structural Reform

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  • Free exchange

    South Korea's economy, a riposte to Piketty and skyscrapers

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  • The Skeptical Speculator

    Stocks fall amid concerns over oil and earnings

    Stocks fell again on Thursday.The S&P 500 fell 0.2 percent, declining for the fourth consecutive day and turning negative for the year.The STOXX Europe 600 fell 0.9 percent and the Nikkei 225 fell 1.4 percent.Stocks declined as oil prices jumped after news of military strikes in Yemen by five Gulf states and Egypt triggered worries about crude supply.Stocks are also declining on weakening earnings expectations. Analysts predict that profits for the S&P 500 companies will be down 4.6 percent this quarter from the first quarter of 2014. This would be the first time profits have declined since the third quarter of 2012....more

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  • VoxEU.org: Recent Articles

    Microeconomic origins of macroeconomic tail risks

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  • International Political Economy Zone

    And Vietnam's Largest Foreign Investor is...Samsung

    Making mobiles for the Man in Vietnam, AKA Samsung.Unbeknownst to many, Vietnam has, in a number of respects, become the "Republic of Samsung." As labor costs in China have gone up as its development continues apace, it was inevitable that MNCs would move on to countries with relatively skilled workers and more competitive wages. Today's case in point is the Korean electronics behemoth Samsung. How reliant has Vietnam become on Samsung? The Nikkei Asia Review points out that Samsung subsidiaries are three of the four largest foreign investors in Korea; these subsidiaries account for about a fifth of all Vietnamese exports; and a slowdown in global smartphone sales could tip Vietnam into a trade deficit [!] If you're a Marxist, you'd say it's Korean imperialism:[T]he Vie...more

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  • Econbrowser

    Pompeii on SF Bay?

    Will a minimum wage increase induce an apocalyptic conflagration of small businesses and low wage employment? Here’s one prediction: This is not the time to force businesses to raise prices by laying-off employees in order to stay in business. What good is raising the minimum wage if prices go up? What good is raising the minimum wage if there are no jobs available? Businesses will be forced to raise prices in order to absorb a 26% pay increase. Restaurants will be especially hard hit. That is not a quote addressing the impending increase in the SF minimum wage. Rather, it’s the statement by the SF Restaurant Association regarding San Francisco’s Proposition L, in 2003 (ballot instructions here). For a current incarnation of this apocalyptic vision, one has ...more

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  • Greg Mankiw's Blog

    What do Larry Summers, Doug Elmendorf, and Greg Mankiw have in common?

    Only one of us won a John Bates Clark Medal. Only one of us became Director of the Congressional Budget Office. Only one of us wrote a best-selling textbook. But all three of us were ec 10 section leaders early in our careers. Being an ec 10 section leader is one of the best teaching jobs at Harvard. You can revisit the principles of economics, mentor some of the world’s best undergraduates, and hone your speaking skills. In your section, you might even have the next Andrei Shleifer or Ben Bernanke (two well-known ec 10 alums). And believe it or not, we even pay you for this! If you are a graduate student at Harvard or another Boston-area university and have a strong background in economics, I hope you will consider becoming a section leader in ...more

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  • iMFdirect - The IMF Blog

    The Elusive Quest for International Policy Cooperation

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  • CIPE Development Blog

    Improving Local Level Governance in the Philippines

    Efficient, transparent and accountable governance continues to be a major driving force behind reform movements around the world. In partnership with the Center for International Private Enterprise (CIPE), the Institute for Solidarity in Asia (ISA) has implemented the Performance Governance System (PGS) initiative in the Philippines. The Performance Governance System is a highly rigorous... ...more

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  • Worthwhile Canadian Initiative

    Monetary policy in New Keynesian models is Gesellian

    In one important respect, what we call "New Keynesian" macroeconomic models are in fact New Gesellian macroeconomic models. That's only in one respect, but it is important. Silvio Gesell proposed a tax on currency. The higher the tax rate, the faster people would spend that currency. A tax is a negative subsidy. The higher the subsidy rate, the slower people would spend that currency. Another name for a subsidy on currency is paying interest on currency. If that interest rate is 5%, for every $100 currency you hold, the bank that issued that currency pays you $5 currency per year. If I hold a $20 banknote, issued by the Bank of Canada, it is as if I have a chequing account at the Bank of Canada with $20 in it. If I buy something from you, and give you tha...more

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  • The Skeptical Speculator

    Stocks fall, oil rises

    Stocks fell sharply on Wednesday.The S&P 500 fell 1.5 percent while the Nasdaq Composite fell 2.4 percent.The STOXX Europe 600 fell 1.1 percent.However, oil rose to a two-week high on Wednesday.It rose further early on Thursday as Saudi Arabia and its Gulf Arab allies began a military operation in Yemen after Houthi rebels drove Yemen's president from his capital Sanaa....more

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  • Free exchange

    Worrying signs

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  • CIPE Development Blog

    Successful Public-Private Dialogue: The Kenyan Perspective

    The workshop explored how the government, private sector, and civil society organizations can effectively use PPD platforms for collaborative governance and leadership in addressing difficult challenges. Through its collaborative process, PPD provides a structured, participatory, and inclusive approach to policymaking directed at reforming governance and the business climate. As the CEO of CIPE... ...more

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  • The Skeptical Speculator

    Stock market looking like 1931?

    US stocks are currently trading near record highs. However, history shows that the trading pattern so far in 2015 may not bode well for stock market returns going forward.An article in The Wall Street Journal last week reported that analysis by Bespoke Investment Group showed that closing stock prices so far in 2015 were most similar to the closing prices in 1931. That year, the stock market posted its worst yearly return on record, falling 54 percent from 19 March.Other similar years have not been so bad though. In fact, in computing the 10 years with the highest stock-market correlations to 2015, Bespoke found that the market rose from here on out in every year but 1931, averaging a gain of 8.1 percent. That is better than the average gain for all years since 1928 of ...more

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  • Worthwhile Canadian Initiative

    Buyer's liquidity vs seller's liquidity

    Liquid goods are easy to buy and sell. Illiquid goods are hard to buy and sell. I think we need to break up "buy and sell" into its two component parts. In a buyer's market, goods are easy to buy and hard to sell. The same good is liquid from the buyer's perspective, and illiquid from the seller's perspective. In a seller's market, goods are hard to buy and easy to sell. The same good is liquid from the seller's perspective and illiquid from the buyer's perspective. I think it is true that buyer's liquidity and seller's liquidity vary inversely over the trade cycle. In a recession, buyer's liquidity rises and seller's liquidity falls. Recessions tend to be a buyer's market for normally illiquid goods. In a boom, sell...more

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  • CIPE Development Blog

    The Gaza Strip Today: The Challenges and Potential

    Besides experiencing three destructive wars in less than ten years – Operation Cast Lead, Operation Pillar of Defense, and Operation Protective Edge – the Gaza Strip has suffered since 2007 from two unprecedented major political events that affect both the lives and future aspirations of the Palestinians: the Israeli blockade and internal division. The Gaza Strip, now in its seventh year under... ...more

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  • Alpha.Sources

    QE and population ageing as macroeconomic externalities

    This discussion of market failures and externalities is mostly a microeconomic discussion. Students will tend to encounter it, in the context of the classic case of the polluting industrial company whose marginal private cost, or supply, curve is not the same as the marginal social cost curve. A firm which dumps toxic waste in a river does not bear the full cost of such actions; society also faces a costs even if this is not taken into account in the firm's profit maximization problem. The solution according to the welfare theorems is for the social planner, the government, to tax the company forcing the firm to produce at a lower output relative to what would have been optimal according to its own marginal revenue and marginal cost curves. Profit maximization on the fi...more

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  • iMFdirect - The IMF Blog

    Dams And Dikes For Public Finances

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  • Dani Rodrik's weblog

    Premature deindustrialization in the developing world

    Mention “deindustrialization,” and the image that comes to mind is that of advanced economies making their way into the post-industrial phase of development. In a new paper,[1] I show that the more dramatic trend is one of deindustrialization in the developing countries. This is a trend that is appropriately called premature deindustrialization, since it means that many (if not most) developing nations are becoming service economies without having had a proper experience of industrialization. Latin America appears to be the worst hit region. But worryingly similar trends are very much in evidence in Sub-Saharan Africa too, where few countries had much industrialization to begin with. The only countries that seem to have escaped the curse of premature industrializati...more

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  • Alpha.Sources

    Regulative Mission Creep?

    The financial sector has been regulated and fined into submission following the crisis, but the equity research team at Credit Suisse had a rebellious thought this weekend. In a piece extolling the virtues of dividend stocks, they postulate the following development: As bond yields fall to zero, duration matching for pension funds and insurance companies becomes nearly impossible and, consequently, we believe there will be significant pressure on regulators to allow higher equity weightings. On the global equity strategy team, we see a scenario where pension funds and insurance companies are allowed to hold a bigger share of their assets in high quality equities if bond yields remain around zero for a prolonged period. The definition of quality, in our view, is likely ...more

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  • Alpha.Sources

    Tightrope Walking

    Investors face some big questions at the moment, and depending on which answer you pick, your asset allocation will differ substantially.  The big macroeconomic question can be summed up in a discussion about inflation v deflation. The global economy are currently affected by three deflationary head winds . Firstly, the need to repair balance sheets following the crisis in 2008; secondly, the slowdown in China and unravelling of investment tied up in the commodities space; and thirdly, rapidly ageing populations in Europe and Japan. Faced with such tremendous forces, you would argue that deflation would easily vanquish inflation any day. But it isn't that simple. The cause and effect between stimulative macroeconomic policies are global in nature, and this creates ...more

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  • Smart Economy

    UPDATE on the Carbon[60] Hydrated Fullerenes-The Highest Antioxidant in the World

    Scientists  have made a  significant leap in cancer research. You never change things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete. R. Buckminster Fuller 90% of all cancer deaths come from cancer spreading in the body from one organ to another, called metastasis. Stop metastasis, stop many unnecessary premature cancer deaths. Belgium researches in 2014 determined that cancer metastasis  can only occur if there are excess free radicals in the body. Specifically they conclude: “under certain conditions, the mitochondria produce more free radicals known as superoxide ions (O2.-). It is this overproduction of superoxide that leads to the formation of metastasis and, consequently, the growth of a tumor...more

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  • Dani Rodrik's weblog

    Greek elections, democracy, political trilemma, and all that

    Two-and-a-half years ago I wrote a short piece titled "The End of the World as We Know It" which began like this: Consider the following scenario. After a victory by the left-wing Syriza party, Greece’s new government announces that it wants to renegotiate the terms of its agreement with the International Monetary Fund and the European Union. German Chancellor Angela Merkel sticks to her guns and says that Greece must abide by the existing conditions. Fearing that a financial collapse is imminent, Greek depositors rush for the exit. This time, the European Central Bank refuses to come to the rescue and Greek banks are starved of cash. The Greek government institutes capital controls and is ultimately forced to issue drachmas in order to supply domestic liq...more

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  • Dani Rodrik's weblog

    Levels of intellectual responsibility

    This piece on “Erdogan’s Willing Enablers” prompts me to put down a few thoughts on the role that various members of the Turkish media and intelligentsia have played in enabling the steady deterioration of the political climate in Turkey over the last decade. What stands out with these intellectuals is that, even if they were not in all cases liberal in outlook, they all claimed to espouse values consistent with Western democracy: respect for human rights, civil liberties, and the rule of law.    I don’t want to go over the entire saga of how leading Turkish intellectuals continually misrepresented what was happening over this period and bought into the Gulenist narrative, while overlooking the accumulating repression of media freedoms and violations...more

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  • CYNICONOMICS

    2014 Most Viewed Posts

    We posted sporadically this year – with nothing at all after July – but added up our page views anyway. Here are the five most widely read posts, based on page views on CYNICONOMICS as well as three other sites that publish our articles and report our stats (Zero Hedge, Market Oracle and Seeking Alpha): #5 with 41,690 views: “Why You Shouldn’t Fall For These Corporate Capex Fallacies.” We critique four popular arguments about capital expenditures, while showing that history contradicts all but one of the four. #4 with 44,509 views: “Reviving the ‘Real World’ Scenario That’s Disappeared from Government Reports.” We adjust the CBO’s official budget projections for glaring deficiencies in its “baseline scenario,” from an overly optimistic economi...more

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  • Rick Bookstaber

    Ex Ante versus Ex Post Social Policy

    I have written various posts on social policy related to the question of whether and how we redistribute income. One argument of equal opportunity and social egalitarianism is that it is fair to control for the randomness of life. For example, take the luck of the draw in who your parents are. If your best career choice was to be born into a wealthy family, if you got ahead because your father could pull strings to get you an internship at a big investment bank; because you built up your high school resume by spending a summer building houses in Tibet while a classmate had to spend the summer working at the 7-11; or because you could afford two years of one-on-one tutoring for the SAT, the result might be to score higher in an objective standard of selection and have a ...more

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  • Rick Bookstaber

    On Death with Dignity

    We take the will to live as a positive attribute, and naturally so; it is, of course in our genes.  Whatever subset of our species took a lackadaisical view toward the prospect of death was screened out long ago. We look with admiration on those who battle against terminal illness --  “She’s a real fighter” -- and look down on those who take their own lives. Fighting for your life is the genetic prime directive.   Thus the recent death of Brittany Maynard spurred a flurry of news articles and posts on the Death with Dignity movement. There will be a lot more to come on this topic, and the movement will gather steam because whatever is in the crosshairs of the baby boomers weighs down on society as a whole. Soon the baby boomers will come to the...more

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  • Rick Bookstaber

    Uber: What could possibly go wrong

    Uber at the core is nothing more than a bunch of guys who came up with a clever app for streamlining the way you call for a car.  Rather than phoning or texting, you tap on the app.  Rather than paying with cash or credit cards, you have an account.  And rather than depending on the reputation of the car company, you depend on the ratings-based reputation of the specific driver. (Another feature, the pre-determined fare, with that fare essentially including all fees including tip, is nothing new for car services). And, by the way, it is readily replicable by any other car services, including those that already have a reputation and experienced drivers.  So it seems to me that it is only mildly innovative.  How do you build a successful world-wid...more

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  • Institutional Economics

    Capital Gains Tax Reform in Canada: Lessons from Abroad

    The Fraser Institute has released a new volume on international experience with capital gains taxes. I wrote the chapter on New Zealand, with some reference to Australia. Australia was deemed too similar to Canada to warrant a chapter in its own right....more

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  • The Street Light

    Transfer Pricing Economics

    I'd like to announce that after a long hiatus from blogging, I'm taking it up again in a new forum.  The new blog, Transfer Pricing Economics, is primarily devoted to exploring my particular area of professional specialty, namely "transfer pricing".  If that term doesn't mean anything to you, then feel free to check out my brief explanation of transfer pricing. My aim is to expose and analyze the connections between the arcane world of transfer pricing and broader developments in the economic and financial world. And the connections are significant: the rules and economic logic of transfer pricing have a direct impact on trillions of dollars of international trade every year. So please feel free to check in on and contribute to the discussions about these...more

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  • Smart Economy

    Belgian Researchers Discover Way to Block Cancer Metastasis

      Free Radicals and Cancer Metastasis KEY QUOTE:  The Belgian team led by Sonveaux has found the mechanism by which cells can control changes caused at least in part by free radicals. The free radical involved in the metastacism of tumor cells is superoxide. Tests in mice on melanoma and breast cancer cells showed that administering an antioxidant stopped the production of superoxide. That, in turn, prevented cell changes that would lead to metastasis.   N.B. This is confirmation why Carbon 60 Hydrated Fullerenes stops cancer metastasis, by scavanging free radicals that cause cancer. Ukrainian scientists have known this for over ten years!!--Walter Derzko September 18, 2014 12:28 AM                 WASHINGTON— Cancer remains one of the dea...more

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  • Smart Economy

    New non-invasive technique could revolutionize the imaging of metastatic cancer

                     IMAGE:   This is Paul Fisher, M.Ph., Ph.D., Thelma Newmeyer Corman Endowed Chair in Cancer Research and co-leader of the Cancer Molecular Genetics research program at VCU Massey Cancer Center, chairman of... Click here for more information.      Bioluminescence, nanoparticles, gene manipulation – these sound like the ideas of a science fiction writer, but, in fact, they are components of an exciting new approach to imaging local and metastatic tumors. In preclinical animal models of metastatic prostate cancer, scientists at Virginia Commonwealth University Massey Cancer Center, VCU Institute of Molecular Medicine and Johns Hopkins Medical Institutions have provided proof-of-principle of a new molecular...more

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  • Institutional Economics

    I am leaving CIS and returning to financial markets

    This is my last week at CIS. I will be returning to financial markets from whence I came back in 2008. Thanks to Greg Lindsay for giving me a platform to participate in the public policy debate over the last few years. Thanks also to those who contributed to Policy while I was editor over the last 18 months. Policy will continue under a new editor. My new employer won’t be paying me to blog or tweet during business hours, so you will be hearing even less from me on what is already a very low frequency blog. I will still post material here from time to time and link to what I am doing when appropriate. Needless to say, nothing on this web site should be attributed to current or previous employers. This blog has followed me around in various roles since 2003, back whe...more

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  • Institutional Economics

    Wayne Swan on Monetary Offset and the GFC

    Former Treasurer Wayne Swan is releasing some of his briefing notes from the GFC ahead of the launch of his upcoming memoir, The Good Fight. The first instalment from a meeting at the Prime Minister’s residence with the Prime Minister, Treasury Secretary and other senior officials on 4 August 2008 is remarkable for its acknowledgement of monetary offset. Indeed, the notes could just as easily have been written by Scott Sumner: There are three broad considerations the Government would need to keep in mind in taking a decision to engage in discretionary [fiscal] action: • The Reserve Bank through its control over interest rates, determines the overall level of aggregate demand in the economy, and the Bank would likely take account of any fiscal stimulus in its monet...more

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  • CYNICONOMICS

    Technical Notes for ‘Never Mind Their Distrust of Data and Forecasts…’

    This is a short appendix for our earlier post, “Never Mind Their Distrust of Data and Forecasts; Austrians Can Help You Predict the Economy,” in the usual Q&A format. Why do you show three different series in the first chart? We show “Net Private Debt from Census Bureau” because it has the longest history. We use it later to calculate 5-year credit growth figures for the period before the Fed’s “flow of funds” becomes available. We deduct financial and real estate corporation debt in the second dotted line to show that private debt growth in the late 1920s wasn’t skewed by financial debt (as it was in the 2000s). We can only back out financial debt from 1926 (not enough data to use in the “savings rates and credit growth” chart), but this series...more

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  • CYNICONOMICS

    Never Mind Their Distrust of Data and Forecasts; Austrians Can Help You Predict the Economy

    [O]f all the economic bubbles that have been pricked, few have burst more spectacularly than the reputation of economics itself. – From The Economist, July 16, 2009. It’s been five years since the The Economist magazine published the critical commentary  excerpted above. In hindsight, the noted reputational damage was neither lasting nor spectacular. As of today, we’d say it’s almost non-existent. Mainstream economists continue to dominate their profession and wield huge influence on public policies. They merely needed to close ranks after the financial crisis and wait for people to forget that their key theories and models were wholly discredited. Meanwhile, heterodox economists who stress credit market risks and financial fragilities – the Austrians, the Mi...more

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  • The Becker-Posner Blog

    Farewell

    In memoriam: Gary S. Becker, 1930-2014. The Becker-Posner blog is terminated. Richard A. Posner

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  • Felix Salmon

    Post Felix

    By Shane Ferro Today is Felix’s last day at Reuters. Here's the link to his mega-million word blog archive (start from the beginning, in March 2009, if you like). Because we’re source-agnostic, you can also find some of his best stuff from the Reuters era at Wired, Slate, the Atlantic, News Genius, CJR, the NYT, and NY Mag. There’s also Felix TV, his personal site, his Tumblr, his Medium archive, and, of course, the Twitter feed we all aspire to. Counterparties may have been the brainchild of Felix and the recently departed Ryan McCarthy, but the blog, site, newsletter, and Twitter feed will continue to exist in their absence. It will be run by Ben Walsh and Shane Ferro, with some non-trivial amount of snark. Today we focus on the reason Felix started Counterparti...more

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  • Felix Salmon

    The Piketty pessimist

    By Felix Salmon This chart comes from the World Economic Forum’s 2014 Global Risks Report, which came out just before Thomas Piketty’s book started becoming the topic of discussion in economic and plutocratic circles.* You can clearly see what you might call the rise of inequality-as-an issue: before 2012 it’s nowhere to be found, but since then it’s been consistently in the top spot. My prediction is that in 2015, thanks to Piketty, the WEF will start talking less about income inequality, and more about wealth inequality. The big question, though, is whether inequality is really much of a risk at all. After all, from the point of view of the average billionaire WEF delegate, inequality would seem to look much more like a reward. Chrystia Freeland has a hopeful...more

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  • Felix Salmon

    The most expensive lottery ticket in the world

    By Felix Salmon No Exit, the new book from Gideon Lewis-Kraus, should be required reading for anybody who thinks it might be a good idea to found a startup in Silicon Valley. It shows just how miserable the startup founder’s life is, and raises the question of why anybody would voluntarily subject themselves to such a thing. A large part of the answer is that Silicon Valley is gripped by a mass delusion, compounded by a deep “fake it til you make it” attitude toward success. Why do so many people in Silicon Valley want to be founders? Because every founder they meet is always killing it, crushing it, having massive success, just about to close a huge round, etc etc. At some level, they must know this is impossible: if 90% of startups fail, it simply can’t be the...more

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  • The Becker-Posner Blog

    Sabbatical Notice

    Starting this weekend, we will be taking a one-month sabbatical from blogging. We will resume at the end of that period.

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  • The Becker-Posner Blog

    The Embargo of Cuba: Time to Go- Becker

    The US embargo of Cuba began in 1960, a year after Fidel Castro turned this island toward communism. It was extended to food and medicines in 1962, the same year as the showdown with Russia over the installation of missiles there. The embargo has prevented American companies from doing business with Cuba, and discouraged tourism to Cuba. The American government also tried with quite limited success to prevent other countries from trading with Cuba. In general economic embargoes are undesirable because they interfere with free trade among countries. Yet a case could be made for an embargo against Cuba. Castro not only allowed Russian missiles to be installed in Cuba, just 90 miles from Florida, but was also actively trying to interfere in other countries by sending troop...more

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  • Stefan Karlsson's blog

    New Blog Address: http://stefankarlssoneng.wordpress.com/

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  • Stefan Karlsson's blog

    Ukraine Crisis Isn't Over

    So now the so-called protestors have overthrown democratically elected President Yanukovich in what is in effect a coup. It is unclear what will happen, and how Russia and Yanukovich and his supporters will act, but this is almost certainly not the end of it.Indeed, how could it be the end? Some people argue that protestors were motivated by anger over corruption and abuse of power from Yanukovich. But while Yanukovich is no doubt corrupt and some protestors may indeed have been motivated by anger over that fact, the opposition movement led by Yulia Tymoschenko is just as corrupt as Yanukovich, so if they prevail, that won't mean less corruption and abuse of power.No, what this conflict is really about is that today's Ukraine is an artificial state created by Soviet com...more

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  • Stefan Karlsson's blog

    How Old Posts Can Become Popular Again

    Suddenly, my post about why Ukraine should be divided between its anti-Russian and pro-Russian parts has seen a dramatic increase in page views. That is no doubt related to the latest escalation of Ukraine's political crisis with both government forces and the neo-Nazi elements of the opposition increasingly using violent means in the confrontation. Ukraine is dangerously close to a full scale civil war. Let's hope that it doesn't come to that. Ukraine has been ravaged for a century by wars, German Nazis, Communism, corruption and ethnic conflict, to add a(nother) civil war would be really cruel. I remain convinced that secession is the best way to solve the conflict peacefully....more

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  • The Oil Drum - Discussions about Energy and Our Future

    The Oil Drum writers: Where are they now?

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  • International Political Economy at the University of North Carolina

    Why US Financial Hegemony Will Endure

    Will and I have a piece, now ungated, over at a fantastic new online magazine called Symposium. Our article translates much of the main points of our Perspectives Piece (co-authored with Thomas and Andy Pennock) for popular consumption. We are also blogging over there this week in support of the article. Please do check out our writing this week on the magazine's website, as well as the other great content on the site....more

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  • International Political Economy at the University of North Carolina

    Foreign Direct Investment, Human Rights, INGOs

    One of the major areas of underdeveloped research within political science is the interaction between non-state actors. From an international political economy perspective, the literature has largely ignored the interaction of various non-state actors that are growing in importance, and its effects on different forms of trade. In a recently published article "Avoiding the Spotlight: Human Rights Shaming and Foreign Direct Investment" by Colin Barry, Chad Clay and Michael Flynn, they lay the foundation for examining this interaction. They examine the interaction between non-state actors (INGOs) and multinational corporations (MNCs) and the extent to which private actors' choices to invest in countries are affected by the reputational costs of doing business in those...more

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  • The Oil Drum - Discussions about Energy and Our Future

    The Last Post

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  • The Oil Drum - Discussions about Energy and Our Future

    The House That Randy Built

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  • International Political Economy at the University of North Carolina

    Verizon, Vodafone, and Measuring FDI

    Recently back from APSA in Chicago, I've been reflecting on the state of our knowledge about FDI (or perhaps more accurately, cross-border management stakes in enterprises). That, and working on my dissertation, applying for academic jobs, and teaching. Oh, and telling everyone who'll listen about my Optimus Prime sighting on Michigan Ave.Anyway, I find a post-conference review of the discipline is generally a good way to consider potentially fruitful lines of new inquiry. In my experience, the quality of papers at conferences can be rather hit-or-miss. This generally fits into my view of conferences as important sources of external deadlines for getting drafts done as well as interacting with other scholars in more informal settings such as the hotel bar/lobby/over-cro...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-09

    Given that I block NSA & PRISM tweets, was entertaining tuning into twitter & trying to figure why everyone was on about Lord Snowdon -> Turned on GoT tonight just in time to catch Daenerys reenacting her Level 2 YMCA gymnastics pageant. -> How Not to Be Alone | Jonathan Safran Foer – http://t.co/HMFxg75lfh http://t.co/DzAtvWBQJr -> Excellent, but fellow sports-med geeks only: Sports and exercise-related tendinopathies: a review – http://t.co/WGkhRlO6Uz -> ...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-07

    Photo-set: Flooding Across Central Europe – http://t.co/8G6j8teCbd -> CDC Update: Severe Respiratory Illness Associated with Middle East Respiratory Syndrome Coronavirus – http://t.co/hWqN1338VN -> Col Flagg: Have you ever heard of Malaysian Chest Implosion Torture? Radar: No. Coll Flagg: Good. It hasn’t been invented… yet. -> tl;dr: There are Manchurian Candidate engineers at large tech cos that have stolen SSL root cert and NSA is using it for cattle mutilation. -> Brian: …Will you please listen? I'm not the Messiah! Do you understand? Honestly Woman: Only the true Messiah denies his divinity! -> ...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-05

    FRED: Free Energy Data – http://t.co/90H7GVDazO -> Solipsisms ‘r’ us, courtesy of my friends at @thinkup: I apparently mention me a lot – http://t.co/9rTRXvBM9D -> Almost 10,000 words on soccer/Italy/economics/racism by @wrightthompson? Yes, & it’s super. Go. http://t.co/g4sgEFLkIC -> When The Beautiful Game Turns Ugly: A journey into the world of Italy's racist soccer thugs http://t.co/nckrbeLPfs -> Can’t remember last time I read an OpEd or column. Do those still exist? -> ...more

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  • The Street Light

    Cyprus and Eurozone Bank Deposits

    To me, the central issue raised by this week's Cyprus debacle is how it has affected confidence across the eurozone.  To what degree has the possibility of insured depositors at a eurozone bank losing a portion of their deposits affected the mindset of depositors?  To what degree has ECB acquiescence to this possibility undermined the notion that deposit insurance in the eurozone means the same thing in all countries?  And to what degree has the ECB's direct threat to end support for Cyprus's banking system in the event that the government of Cyprus can not arrange sufficient funds to meet its conditions made a farce of its earlier promise to "do whatever it takes to preserve the euro"?These, to me, are the interesting questions prompted by this week's ev...more

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  • London Banker

    Chop Off Their Hands . . .

    President Truman famously called for a one handed economist. The Carolingian kings of France would have accommodated him. They realised that a kingdom required a common currency under the control of the king and well regulated markets to sustain the confidence of the people. At first mints were established widely, spread across the kingdom. Local barons began to profit from debasing the coinage, undermining confidence in the monetary system. So Charles the Bald established mints under his direct control and regulated the issue of coins: C.12. Following the custom of our predecessors, just as it is found in their capitularies, we decree that in no other place in all our kingdom shall money be made except in our palace, and in St. Josse and Rouen, which right in th...more

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  • The Street Light

    When the Fed Chair is an Academic

    The big economic news of the week was, in fact, big economic news: the Fed's announcement of significant changes from past practice in the the quantity of its next round of large scale asset purchases ("unlimited"), and in the timing of any future reversal of this expansionary policy ("a considerable time after the economic recovery strengthens").I view this as a pretty fundamental shift in how the Fed hopes to affect the economy.  Rather than trying to push economic activity one way or the other through its management of interest rates (which can alter economic activity through its portfolio-rebalancing and wealth effects, for example), the Fed is now quite explicitly trying to affect economic activity by altering interest rate and inflation expectations.  As...more

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  • London Banker

    For Want of a Nail, the Ship Was Lost

    Imagine a great ship dominating the skyline on a distant sea. Imagine the complexity of that ship: keel, ribs, planks, masts, spars, and an infinite number of less readily named components. Each component was hand-crafted by a craftsman skilled in his trade, to precise requirements, and secured in position to take the stress and strain of a life at sea.Now imagine a crew. They didn't build the ship. The crew are told that the one and only purpose of the ship is to realise a profit for every man jack aboard. Any hand not contributing a profit will be turned ashore. Down below in the ship are nails. Thousands and thousands of nails. Nails are useful. Nails are much sought after in every port the ship enters. Nails can be readily sold and never traced. The crew h...more

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  • London Banker

    Lies, Damn Lies and LIBOR

    I've been hesitant to write about the LIBOR scandal because what I want to say goes so much further. We now know that Barclays and other major global banks have been manipulating the calculation of LIBOR through the quotation data they provided to the British Bankers Association. What I suspect is that this is not a flaw but a feature of modern financial markets. And if it was happening in LIBOR for between 5 and 15 years, then the business model has been profitably replicated to many other quotation-based reference prices.Price discovery is not a sexy function of markets, but it is critical to the efficient allocation of scarce capital and resources, and to the preservation of the long term wealth of investors and the economy as a whole. If price discovery is compr...more

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Richard Wood Richard Wood

Richard has published papers on wages policy, the taxation of financial arrangements and macroeconomic issues in Pacific island countries. Views expressed in these articles are his own and may not be shared by his employing agency. He is the author of How to Solve the European Economic Crisis: Challenging orthodoxy and creating new policy paradigms