I don’t like to post on weekends, but I had to point to these asap:
The Government has no qualms about Australian companies shifting jobs to New Zealand because of lower wages.
Labour is concerned that New Zealand is becoming a desirable destination for Australian businesses taking advantage of the wage gap.
Several big Australian banks and food producers have shifted jobs to New Zealand in the last two years.
Now call centres are also making the move, mostly because it is cheaper.
Darien Fenton MP said the trend is deeply worrying.
Economic development Minister Steven Joyce said the wage gap with Australia is an opportunity to create more jobs.
But the Council of Trade Unions said an economy created on low paid jobs lowers productivity, which could actually widen the pay gap even further.
So it is a good idea for Labour to try to intervene in the exchange rate to cut labour costs to “create jobs”. But then if the exchange rate falls and people move over in of itself it is a worrying trend.
Give a community fish, and you feed them for a day.
Teach a community to fish, and they will overfish the common pool resource.
Give someone in the community a property right over the fish, and they will fish sustainably but will be endowed with monopoly rents over fish.
So surely you see why I’m vegetarian 😉
Note: I’m not being serious – I don’t hate you for the fact you kill animals. After all, as my niece tells me, I’m even worse as I recognised the sentience of animals and still enslave them for eggs, milk, and honey.
Let’s just leave it there so I can avoid sounding like any more of a douche. In actuality the moral of the story is that we want to allow property rights over the fish, but to ensure that we can redistribute the property right determined surplus in some way (while trying to avoid changing the incentives around how much to fish) – as a result lets just watch the MR University video on Ostrom.
This post is a little out of the ordinary for TVHE but I thought I’d talk a bit about the tools I use every day. If you’re anything like me you spend an inordinate amount of time cleaning up data. Even something as simple as using GDP in a regression involves finding the right page on the ONS/Stats NZ website, downloading a CSV, then importing the CSV while being careful not to catch any of the extra junk in there. Read more
Remember the energy policy disucssion (here and here on TVHE) – where the Labour and Greens took a number from the Wolak report to try to justify a single buyer model. Via a reader here is Frank Wolak himself: (More details here)
The Labour-Greens’ single buyer electricity policy has a problem.
While it remains politically resonant with voters who perceive power companies as rapacious and inescapable, the American academic whose analysis is a key plank of the Labour-Greens NZ Power proposal says the Opposition parties have got it wrong.
Not only that, but Stanford University’s Professor Frank Wolak – a top US electricity markets academic and one-time regulator – says that despite repeated assertions to the contrary, he never concluded that power companies here had ripped off consumers to the tune of $4.3 billion over the mid-2000’s.
Unfortunately, that $4.3 b figure has been the smoking gun fact around which the political argument for the policy has been built.
This quote blew my mind: (turns out it came from a release here)
“It is based on the notion that increasing supply of houses at any price will somehow bring down prices. This is trickle-down economics at its most dubious.”
What.