Real-World Economics Review

from Asad Zaman A driving spirit of the modern age is the desire to banish all speculation about things beyond the physical and observable realms of our existence. This spirit was well expressed by one of the leading Enlightenment philosophers, David Hume, who called for burning all books which did not deal with the observable and quantifiable phenomena: “If we take in our hand any volume; of divinity or school metaphysics, for instance; let us ask, Does it contain any abstract reasoning...

from David Ruccio On Tuesday, I began a series on the unhealthy state of the U.S. healthcare system—starting with the fact that the United States spends far more on health than any other country, yet the life expectancy of the American population is actually shorter than in other countries that spend far less. Today, I want to look at what U.S. workers are forced to pay to get access to the healthcare system.According to the Kaiser Family Foundation, about half of the non-elderly...

from Grazia Ietto-Gillies The business media is awash with news about transnational companies (TNCs) be they in the services or manufacturing or agriculture sector. The news may refer to performance or strategies or plans for real investment (or the lack of them) or takeovers. There is currently also considerable interest in their tax minimization strategies. Yet economics textbooks and courses are still shying away from this most relevant part of our contemporary economies. This is true...

Why did the crisis last so long in Italy, the Netherlands, Spain and Denmark (graph 1) and much shorter (four years!) in the UK, Poland and Sweden (graph 2, at the end)? Lack of Aggregate Demand in the former countries? Not according to Scott Sumner. This post will however show, point by point, some counterexamples to the ideas of Scott Sumner about what he calls ‘AD voodoo‘- and especially his claim that “there is almost no theoretical or empirical support for the new voodoo claims, and...

from David Ruccio While I was finishing up the latest right-wing libertarian dystopian finance novel, I was also trying to figure out the dystopia that the U.S. healthcare system has become. Clearly, for most Americans, the combination of private healthcare and private health insurance (and, now with Obamacare, public subsidies) is a nightmare. There is a glaring contradiction between healthy profits and the health of the U.S. population. Over the course of the next couple of weeks,...

from Peter Radford One of the major reasons, perhaps the major reason, economics is oftentimes irrelevant to our understanding of economies is that it fails to notice a rather salient fact: economies have no end. They have no beginning either. Or, rather, the choice of an ending or a beginning are merely arbitrary selections by an analyst needing to close up the system for analytical purposes. But this act of closure destroys the validity of any results from the subsequent analysis. Why?...

How are the EU and the Euro Area doing? some graphs about the labour force. Main points: Very fast employment and labour force growth in Germany during the last year (‘despite’ the new the minimum wage in many sectors). The labour force is increase is not just about refugees but to quite an extent about non-German inhabitants of the EU. Mind the employment decline after the Harz reform’ around 2001. I’m not sure if the fast increase also shows in the data of the Statistisches Bundesamt.A...

from Maria Alejandra Madi The Call for papers for the current conference Food and Justice is now open. We invite you to submit a paper to [email protected] by 15th  September, 2016.  A paperback, Food and Justice, of conference papers will be published by WEA Books in the new year. Visit the Conference website http://foodandjustice2016.weaconferences.net/ Food production has always been present in the economic debate because of the concern about population growth and demographic...

from David Ruccio Everyone has read or heard the story: the labor market has rebounded and workers, finally, are “getting a little bigger piece of the pie” (according to President Obama, back in June). And that’s the way it looked—until the Bureau of Labor Statistics revised its data. What was originally reported as a 4.2 percent increase in the first quarter of 2016 now seems to be a 0.4 decline (a difference of 4.6 percentage points, in the wrong direction). What’s more, real hourly...

from Dean Baker Donald Trump seems to have driven a substantial portion of the media into a frenzy with his anti-trade rhetoric. While much of what Trump says is wrong, and his solutions are at best ill-defined, the response in the press has largely been dishonest. For example, a New York Times editorial tried to imply that there was an ambiguous relationship between the size of the trade deficit and employment in manufacturing. It pointed out that Japan and Germany, both countries with...