Economics

49

A new virus in economics

From Elgaronline via Steve Keen: A new virus, known as ‘Reality’, has started to afflict Mainstream Economists, causing them to reject the ‘as if’ arguments they used to use to justify their models. There is no known cure for the virus, and complete avoidance of ‘Reality’ is the only effective strategy to prevent infection. The WHO

34

More debt for less work

From JP this week: Similar to one of our long-term investment trends – although the use of retired workers only (ignoring kids which were a much larger proportion in the 1960s) does make the graph look more dramatic than it might otherwise be.

48

Blinkered consultant offers serfdom as super-pension reform

The scourge of the neo liberal age is the management consultant type which never actually delivers much of an outcome for anyone, but regularly appears in private sector and public sector workplaces, usually under the guise of doing something ‘strategic’ which involves talking to lots of ‘stakeholders’ but sometimes looking at ‘processes’ and how ‘efficiencies’

22

Let’s measure human progress instead of GDP growth

Cross posted from The Conversation by Tani Shaw PhD Scholar, Institute for Sustainable Futures, University of Technology Sydney Ever since 1944, Gross Domestic Product (GDP) has been a primary measure of economic growth. It’s in the news regularly and, even though few can define what it means, there is general acceptance that when GDP is growing,

81

Finns trial a new safety net

Finland is trialing a Basic Income project that has the potential to create a more robust safety net for the multitude of Western middle and lower class employees that are being disrupted on almost every front – economic, political, technological and ideologically. Just as the swamp is about to be backfilled in Washington instead of draining

35

Central banks pushing on strings again

by Chris Becker This month has seen the antipodean central banks both cut rates, with almost no flow through to mortgages to relieve consumer debt and an appreciation in their respective currencies, in perfect opposition to their stated goals. This is not a new trend – far from it. What’s supposed to happen when the

25

Wealth effect is but a dream

Barry Ritholz has penned a piece at Bloomberg shaming the Federal Reserve – and the economic establishment – about their slavish devotion to the so-called “wealth effect”. This is something that is bandied about as the reason why high house prices are always “good”, as mortgage holders feel good about the ephemeral equity, boosting consumer

334

Easter links March 25-28, 2016

Sydney Heads, 1865, Eugene von Guérard, Art Gallery of NSW …more to come…   China Chinese premier vows to stabilise the property market – SCMP ‘Skyrocketing’ debt at state firms among biggest challenges facing China’s economy – SCMP Shanghai Said to Be Nearing Purchase Curbs for Warming Property Market – Caixin China’s rust-belt city Shenyang may

65

Capitalism needs saving from itself

The WSJ has a great book advertisement/review, disguised as an op-ed with Robert Reich, former secretary of labor under President Bill Clinton, but interestingly enough it strikes to the core of the problem with today’s capitalism. It is plain that while developing economies have made huge progress in terms of prosperity, rising living standards including

50

When the rich get richer they pay less tax

Cross posted from The Conversation: David Ingles Senior Research Fellow, Tax and Transfer Policy Institute, Crawford School of Public Policy, Australian National University Should we tax the capital income people receive from their investments or property? This may seem a strange question – don’t we already? But the answer is that due to exemptions, we

30

Missing: Morality and flexibility in economics

I spoke last week at the EDO LawJam about missing elements in the economic analysis of major projects in Queensland, and across Australia. Assessments of the merits of such projects typically require some kind of cost-benefit analysis. This analysis is intended to take into consideration the vast array of externalities and second round effects of major mines,

41

Why trickle down economics doesn’t work

by Chris Becker From the chaps at The Renegade Economist, an interesting preview into why trickle down economics – Reagonomics or supply side or more plainly, bullshit economics – doesn’t work and why it has captured the political process. The IMF recently disproved the theory but like a lot of the stink arising from modern

16

Division of labour is the outcome, not cause

I’ve written twice now on the spurious ideas in the division of labour story as an underlying cause of productivity growth in economics. First I questioned whether Adam Smith’s observation of a division of labour in 18th century pin factories made much sense, given that the 18 tasks required to make a pin were undertaken by

119

Chart of the Day: Pain in Spain

by Chris Becker Today’s chart is a sorry pair out of Fitch’s 2015 Global Housing and Mortgage Outlook, that we previewed earlier today with regard to Australian house prices. While the chart highlighting nominal house price growth was both awesome and disgusting, showing Australia leading the way, the detailed specs on Spain were equally sobering.

20

Do we need social stock exchanges?

Cross posted from The Conversation by Danielle Logue, Senior Lecturer in Strategy, Innovation & Organisation at University of Technology, Sydney & Markus A. Höllerer, Senior Scholar at UNSW Australia Public interest in the development of global impact investing received a significant boost last year, due to an international campaign to divest in fossil fuels by

79

Target the rentseekers, not workers on tax

Cross posted from The Conversation by Warwick Smith, Research economist at University of Melbourne Tax is back in the spotlight with coalition MPs and the Australia Institute talking about getting rid of some of the exemptions to the GST. There has also been a lot of talk about whether or not corporate Australia is paying their fair share

31

Cash or copyright or real creativity?

Cross posted from The Conversation by Dan Hunter, Dean, Swinburne Law School at Swinburne University of Technology Imagine you were asked to write a law that encouraged creativity. What would it look like? Whatever your answer, it’s pretty clear that it wouldn’t look like copyright. Which is weird, right? Because copyright is supposed to be the

58

Job survival in the 21st century

Cross posted from The Conversation: by David Tuffley, Lecturer in Applied Ethics and Socio-Technical Studies at Griffith University It is a sobering thought that in ten years, around 65% of the jobs that people will be doing have not even been thought of yet, according to the US Department of Labor. In Australia, there are reports that up

17

Debunking Economics graphic novel needs help

A group of economic operatives have joined forces to mobilise the economics community through the IDEAeconomics initiative. Influential thinkers including Ann Pettifor, Michael Hudson, Dirk Bezemer, James Galbraith, Steve Keen and others, are promoting  a dynamic monetary view of the economy – hence the full name Institute of Dynamic Economic Analysis – and are advancing practical policies that

11

And the ersatz Nobel goes to…

FTAlphaville explains: The 2014 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel has been awarded to Jean Tirole, a French professor of economics at the Toulouse School of Economics for his analysis of market power and regulation. As the release from Nobelprize.org explains, Tirole’s contribution comes in figuring out the costs of information asymmetry

37

It really does pay to be a central banker

by Chris Becker In case you missed this – on the back of my suggestion that perhaps the RBNZ and RBA should merge given the former’s credibility comparative advantage over the latter, at least currency wise – The Australian reported Captain Glenn’s pay-package yesterday: The Remuneration Tribunal, that decides his salary, determined an increase of 2.4