So there has been discussion on incentive problems in economics here before (here, here, and here). However, now there seems to be a little bit of hard empirical evidence indicating that there is a problem. It seems that 51% of graduate students at the top 15 US universities think that knowledge of the actual economy […]
Justin Wolfers says Charles Plosser is being a bit silly on the Freakonomics blog. Specifically he says that: Plosser says we should tighten more quickly than estimates of “slack” suggest, as the level of slack is uncertain, However, since slack is uncertain it could be higher or lower – so this doesn’t make sense unless […]
One of my favourite excuses for the “high” NZ dollar is currency reserves being built up overseas (in order to “keep their currency low” they need to buy up foreign dosh, building up currency reserves you see). It is an argument the US likes to make without actually doing any analysis as well. However, work […]
From TVHE. And don’t forget – if it wasn’t that we arbitrarily valued the idea of people spending time “thinking” about our gifts (and that the gift givers sometimes value looking like they are thinking) it would just be optimal for us to give each other money 😉 Also note that the cost of Christmas […]
What happened! It will be here. I’m not around (I am currently visiting our lucky neighbour in Australia). I bet that we had a negative quarter didn’t we. That would be a pretty negative shock for people, given that some OK growth was expected. If we did have negative growth does that mean we are […]
There seems to be some hatred for the idea that if nominal wages were more flexible unemployment would not rise as high (here, here, and here). However, I am a fan of the flexibility argument – and not just because my mind struggles to get outside of partial equilibrium 😉 When I view wage flexibility […]