by Sandwichman Microfoundations of Inequality and Sabotage “In sum, these models [efficiency wage] provide a new, consistent, and plausible microfoundation for a Keynesian model of the cycle.” — Janet Yellen (1984). Inequality and Sabotage, explored the relationship between Thomas Piketty’s “r > g” inequality and speculated, based on Veblen (1921) and Kalecki (1943), that businesses […]
As I look at different countries for evidence of the Fisher Effect, the thought occurred to look at China. Would the Fisher Effect be discernible since their central bank’s (PBoC) nominal rate is not at the ZLB? It is free to move anyway it chooses. But then one realizes that they hold their PBoC rate […]
It is a common trope among Austerians that the U.S. is passing on unsustainable debt to our children and grandchildren. And certainly there are some scary numbers out there, for example “$17.4 trillion!!” A very real number. But maybe it would be useful to render that number down so as to calculate real incidence of […]
For citizens against the prayers, the decision sets dangerous church-state precedent. For the town of Greece, court’s ruling is a victory for religious freedom. — Brett Harvey, senior counsel at Alliance Defending Freedom, which represented the town of Greece, in Town of Greece v. Galloway, at the U.S. Supreme Court, writing as a guest in […]
In an era in which corporations have been trying every possible stratagem to cut employee benefits (see our look at the Obamacare employer mandate earlier today), a new threat to retirement benefits has just arisen. The source of the threat is the Supreme Court, which earlier this month agreed to rule on when or whether employers can […]
When Japan’s call rate (the nominal rate from their central bank) went to the zero lower bound, Japan developed deflation. It was not a deflation where the bottom fell out and kept falling. It was a deflation somewhat stable below 0%. The stability of their low deflation would make sense according to the Fisher Effect […]
by Sandwichman The Sticky Wages of Sin “Only now can one fully understand the effrontery of these apologists.” — Karl Marx, Capital. “Under capitalism, man exploits man. Under communism, it is just the reverse.” — Polish joke (cited by J. K. Galbraith in Journey to Poland and Yugoslavia, 1958). David Spencer (2002) and Aaron Pacitti […]
It is not difficult to determine a dollar figure for Total U.S. Public Debt. In fact you have to round UP from the Treasury’s Debt to the Penny and Who Holds it web application which tracks that number daily. As of end of business Thursday that total was $17,472,051,696,926.14. Which is a lot of money […]
Paul Krugman wrote over the weekend… “Oh, and a word on Sweden, where the central bank is indeed on the edge of deflation but say never mind because output is currently growing. Um, does the bank have an inflation target or doesn’t it? Yes, the economy can expand some of the time even if inflation […]
by Sandwichman Canny Ca’canny Under imperfect competition, according to a 1960s Samuelson textbook, “The canny seller contrives an artificial scarcity of his product so as not to spoil the price he can get on the earlier pre-marginal unit.” The obvious corollary to this rule is that the canny employer of labor who has some monopsony […]