Category: economics

Basic Economics Has a Liberal Bias

Basic Economics Has a Liberal Bias

People to the left of econ 101 will typically invoke the phrase “political economy” to explain why, for example, econ 101 underrates labor unions. Conversely those to the right of econ 101 will instead invoke the phrase “public choice” to explain why, for example, econ 101 overrates utility regulation. But in both cases the critics are saying the same thing, namely that the moderately liberal policies advocated by introduction to economics textbooks are ignoring certain realities of institutional design, practical politics, power dynamics, etc.

That is 100% spot on. I just do not see how it fits in with his title. Maybe I am missing something but it reads like Yglesias is making the mistake of confusing economics with a morality play.

The Undeserving Rich

The Undeserving Rich

conservatives seem fixated on the notion that poverty is basically the result of character problems among the poor. This may once have had a grain of truth to it, but for the past three decades and more the main obstacle facing the poor has been the lack of jobs paying decent wages. But the myth of the undeserving poor persists, and so does a counterpart myth, that of the deserving rich.

I’m waiting on the right wing responses to this. I’m guessing the same old crap about taxation and gubmint.

What Happens When the Poor Receive a Stipend?

What Happens When the Poor Receive a Stipend?

What precisely did the income change? Ongoing interviews with both parents and children suggested one variable in particular. The money, which amounted to between one-third and one-quarter of poor families’ income at one point, seemed to improve parenting quality.

…

That “helps parents be better parents,” she said.

Turns out that giving poor people money helps then escape poverty.

Enemies of the Poor

Enemies of the Poor

our patchwork, uncoordinated system of antipoverty programs does have the effect of penalizing efforts by lower-income households to improve their position: the more they earn, the fewer benefits they can collect. In effect, these households face very high marginal tax rates. A large fraction, in some cases 80 cents or more, of each additional dollar they earn is clawed back by the government.The question is what we could do to reduce these high effective tax rates.

That’s Friedman’s argument for a negative income tax.

Mankiw makes an argument against raising the minimum wage

Mankiw makes an argument against raising the minimum wage

Mankiw makes an argument against raising the minimum wage.

My two big issues with this is that the EITC acts as a de-facto subsidy to those who hire low wage workers. This subsidy would, (using Mankiw’s logic) dis-incentivize productivity gains via automation and advantage industries that are built around low-wage, low skill work.

So, why should the income tax system be used to subsidy low-wage, low-skill, low productivity workers and the industries that require them rather than advantage higher-skill, higher-wage higher productivity work?

Voucher-mania: Conservatives have exactly one answer for all spending questions

Voucher-mania: Conservatives have exactly one answer for all spending questions

it is probably only a matter of time before some ambitious young right-wing intellectual devises a scheme of personal defense vouchers, which individuals could choose to spend on U.S. military services, foreign armies and navies, mercenary gangs or, perhaps, to bribe the enemy into sparing him or her.