Friday, 10 June 2011

Interesting blog bits

  1. Eric Crampton suggests that you Check my sources
    If the Government said that the minimum price for a new car were $50, nobody would expect it to affect sales. Neither would an increase to $65. But it would certainly start mattering if the Government applied a minimum price of $5000 to all cars, new and used. This is the situation in New Zealand with youth minimum wages, which were abolished in 2008 in favour of adult rates for all workers over 16 years old. This increased the youth minimum wage by 25 per cent.
  2. Al Roth has a few Misc. repugnant transactions: marijuana, camel meat, and concealed carry on campus.
  3. Raghuram Rajan on Money Magic
    Some Americans view Fed Chairman Ben Bernanke as a modern-day wizard, able to revive the economy through a swish of his monetary wand – first ultra-low interest rates, then quantitative easing, and perhaps eventually money-printing. If inflation is low, they want the Fed to use every spell it knows to revive the economy. Like the World War I generals who reacted to every slaughter of their men by sending even more over the top of their trenches in a vain attempt to overwhelm the enemy, “free money” types react with “More!” if their policy does not seem to be working.
  4. George Selgin on Those “Other” 100 Percent Reserve Banking Advocates
    It was in response to this supposedly inherent drawback of fractional reserve banking that several prominent economists—including Henry Simons, Irving Fisher, Loyd Mints, and (eventually) Milton Friedman—began offering or endorsing proposals for “100 Percent Money,” meaning money consisting either of basic money itself or of bank deposits fully backed by basic money. Although these proposals closely resembled later proposals for 100-percent reserve banking forwarded by Murray Rothbard and his Austrian-School followers, they differed in treating either fiat or “commodity-bundle” central bank money rather than either gold or silver as the ideal form of basic money, and also in not basing their arguments on any appeal to ethics: unlike their Austrian counterparts, the “Chicago” 100-percenters (for want of a more accurate designation) did not claim that fractional-reserve banks swindled their customers. Instead they condemned them solely for contributing to monetary instability.
  5. John Taylor is Comparing 2011 with 1937
    He explores reasons for the current weak recovery, and in particular whether there is an analogy with what happened in the recession of 1937-38 which interrupted the recovery from the Great Depression. Several charts elaborate on numbers provided there which argue against such an analogy.
  6. Don Boudreaux on More on the Economic Irrelevance of Political Borders
    Writing about the economically unjustified Trade Adjustment Assistance (TAA) program in today’s Washington Post, George Will gets it exactly right about the nature of that lamentable program. Here’s the heart of the column.
  7. Shimelse Ali, Uri Dadush and Rachel Esplin Odell ask Is protectionism dying?
    The limited resort to protectionism during the financial crisis is often attributed to the WTO or to sensible macroeconomic policy. This column argues that there is more to the story. The combination of national laws, regional agreements, and powerful interest groups has worked to stop protectionism in its tracks.
  8. Holger Görg and Christiane Krieger-Boden note that Trade protection backfires on FDI
    The global financial crisis has raised the threat of protectionism. This column argues that the worst offenders will suffer a drop in foreign direct investment inflows.

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