Real-World Economics Review

Dean Baker explains how CEO pay has increased enormously over the past four decades while shareholder returns have remained low. Weak corporate governance has allowed management to 'capture' corporate boards – and push through massive executive pay increases. Baker shows how in many cases their compensation has nothing to do with the return to shareholders. Baker breaks down the CEO pay scam into four parts: patterns of CEO pay, the alternative argument for CEO pay, evidence that CEOs...

READ MORE: Two people are wanted by local authorities in connection to the death of a missing 30-year-old.

from Lars Syll The model is not . . . how one determines the soundness or otherwise of a mathematical proof; it is, rather, how one determines the reasonableness or otherwise of entries in a crossword puzzle. . . . The crossword model permits pervasive mutual support, rather than, like the model of a mathematical proof, encouraging an essentially one-directional conception. . . . How reasonable one’s confidence is that a certain entry in a crossword is correct depends on: how much support...

from Dean Baker With the United States data we have seen from the last few months, it’s fair to say that no one has a very good idea of where the economy is. At the most basic level, we have seen seven months of incredibly rapid job creation this year; the economy added 3.3 million jobs through July, along with two consecutive quarters of negative growth. We don’t have to join the Trumpers in calling this a recession, to be bothered by seeing two main economic indicators going in...

from Lars Syll The assumption of additivity and linearity means that the outcome variable is, in reality, linearly related to any predictors … and that if you have several predictors then their combined effect is best described by adding their effects together … This assumption is the most important because if it is not true then even if all other assumptions are met, your model is invalid because you have described it incorrectly. It’s a bit like calling your pet cat a dog: you can try...

from Peter Radford re-visiting economics’ basic concepts I am nothing if not annoying.  Allow me to elaborate. Let’s be basic. I mean really really basic. Our model world initially consists of two people, Adam and Eve.  I know, it’s been done before.  But we are economists.  What are we interested in?  What problems that Adam and Eve face do we want to study? Well, they need energy.  Human bodies, like all ordered structures, need flows of energy to maintain that structure.  The Second...

from Lars Syll The weaknesses of social-scientific normativism are obvious. The basic assumptions refer to idealized action under pure maxims; no empirically substantive lawlike hypotheses can be derived from them. Either it is a question of analytic statements recast in deductive form or the conditions under which the hypotheses derived could be definitively falsified are excluded under ceteris paribus stipulations. Despite their reference to reality, the laws stated by pure economics...

In this episode, I talked with Dean Baker, CEO of the Phoenix Group of Companies, a single-source provider of print solutions from concept to completion. Timecodes: 0:00 - Intro 0:41 - Dean’s origin story - how he came to be involved in direct mail 3:11 - The services Phoenix Group of companies provides 7:33 - Things marketers should keep in mind when choosing between digital vs offset printing 11:12 - How can print be sustainable? 14:53 - Some good ways to keep postage and paper...

from Ken Zimmerman  (originally a comment) Economic life is the activities through which people produce, circulate and consume things, the ways that people and societies secure their subsistence or provision themselves. Activities by which communities sustain themselves. ‘[T]hings’ is, however, an expansive term. It includes material objects, but also the immaterial: labor, services, knowledge and myth, poems, religion, names and charms, and so on. In different times and places, different...

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