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November 16, 2016


From Arse To Elbow

Given that the NHS is obliged to be polite (if negative) about homeopathy, due to high-profile supporters among the anti-expert crowd, I'm not sure it's quite true that the medical profession is wholly "rid" of the problem.


Staring death in the face has a way of sharpening minds. Economics doesn't have that punch. Unemployment, perhaps - but not for the policy setter. Only their fellows.

Mark Brinkley

Another one for you. Increasing the level of housebuilding will slow the rate of houses prices increases. The actual effect is so marginal as to make hardly any difference. House prices are 99% to do with credit conditions.


"To the extent that immigration or cheap imports raise inequality, a better solution might be more redistributive tax and benefit policy."

Something like this?

US welfare spending has increased from $949 per caput, in 1980, in 2009$, to more than $1,300 by 2015.

Nicholas Shaxson

I'm a journalist, but I read lots of academic stuff (and I'm a regular reader of this blog.) My comment is a general one: in general, you write extremely clearly - but every now and then you throw in words like 'heuristic' which are purely academic words. You will rarely or never see this word in a mainstream media publication (unless it's to discuss the meaning of the term) and that's for a good reason: only academics use it, and it will annoy most non-academics. Academic words like this are roadblocks which may please academic readers but will irritate everyone else, even when they do know what it means. It's fine to discuss 'doctrine of signatures' because you explain very clearly what it is. I'd be a bit careful with 'secular stagnation' because while most economically literate people will know what it is, some won't. Just trying to help, here.


At the low end of the wage scale, immigration has affected the ability of employees to unionize. There's a reason that most US chickens are prepped by illegal immigrants. In those low end markets, there is lots of evidence that immigration has hurt wages by destroying bargaining power. Even in England, an employer faced with uppity employees could easily put an ad in the Warsaw paper and avoid the problem completely, at least pre-Brexit.

The attraction of higher minimum wages is that they are something that can actually be implemented in our current political climate. Sure, the right solution might be to increase worker bargaining power and stimulus spending, but those just aren't going to fly in the current political climate. A higher minimum wage, particularly at the state or city level will.

I agree with you to some extent on cheap imports. Their main impact has been the loss of the innovative community and drive to automate further domestically. We've just started to see the real long term cost of this. Follow the "maker" community a bit, and you'll get an idea of what I am talking about. Anyone who values the idea of place in the human psyche also understands the importance of import replacement.

One problem is that there are two economies. As a Marxist, you might have noticed this. There is the economy that most people live in. They go to work, if they can find it. They earn money. They spend it mostly on goods like a place to live, stuff to eat, things to wear and so on. In the other economy, which is probably almost as big, people earn money based on the orientation of magnetic fields in the computers of various banking firms and they spend most of that money on buying shares of corporations, symbolic goods with minimal labor content, prestige items and so on.

If you assume one economy, it is hard to explain a lot of things e.g. the lack of risk premium for share ownership. If you assume two economies, things get a lot simpler. I think economists get confused because the two economies use the same currency, but it might be something deeper than that.

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