This study investigated the antipoverty efficacy of minimum wage policies. Proponents of these policies contend that employment impacts are negligible and suggest that consumers pay for higher labor costs through imperceptible increases in goods prices. Adopting this empirical scenario, the analysis demonstrates that an increase in the national minimum wage produces a value-added tax effect …
Quote of the Day
Politeness buys you time. It leaves doors open. I’ve met so many people whom, if I had trusted my first impressions, I would never have wanted to meet again. And yet — many of them are now great friends. I have only very rarely touched their hair.One of those people is my wife. On our first date, …
Jonathan Gruber Accidentally Tells the Truth
One of the chief criticisms of those who did not like the Halbig decision is that Congress could not possibly have intended to restrict federal subsidies for coverage under Obamacare to only those states that established an exchange. Furthermore, by not taking intent into account, the D.C. Circuit Court of Appeals was creating "an 'absurd' result." It is …
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Quote of the Day
Income inequality has surged as a political and economic issue, but the numbers don’t show that inequality is rising from a global perspective. Yes, the problem has become more acute within most individual nations, yet income inequality for the world as a whole has been falling for most of the last 20 years. It’s a fact that …
The Tragedy of Thomas Piketty
The latest Pikettian response to Giles's and Giugliano's assertions regarding the quality of Piketty's data and research is to accuse Giles and Giugliano of being "dishonest." (Hat tip in comments here.) I suppose this means that Piketty's is employing a classic I-am-rubber-and-you-are-glue-whatever-you-say-bounces-off-me-and-sticks-back-to-you defense, but there is little substance to the accusation; at best, Piketty can assert (without …
What the Piketty Errors Mean
Remember the Reinhart/Rogoff spreadsheet error? In the event that you do not, here is a summary. Those who follow debates between economists will recall that the spreadsheet error led to all kinds of excorations of Reinhart and Rogoff on the part of liberal economists, who claimed that Reinhart and Rogoff were responsible for austerity policies …
Some More Piketty Critiques
Let's run through them: Kyle Smith has six ways in which Piketty's book fails the smell test. Many of the links have been already linked to by me, but it is nice and useful to have them in one convenient place. Don Boudreaux notes that Piketty doesn't seem to understand the impact of trade deficits. This has …
The French Critique Piketty
So report Tyler Cowen and Veronique de Rugy: . . . some other French economists have taken the lead in challenging Mr. Piketty’s empirical claims. One recent paper by four economists at l’Institut d’Etudes Politiques de Paris challenges Mr. Piketty’s view that inequality has increased because the return to capital has been greater than general growth in the …
More Critiques of Piketty
Ryan Decker points out that Piketty's "criticisms of mathematical economics (32, 574) are not surprising given that he relies so heavily on assumptions and mechanisms that would be highly vulnerable to criticism if they were forced into the transparency of a formal model." And the following from Garrett Jones is certainly worth reading: Market-oriented economies that learn to …
Paul Krugman Remains as Arrogant and Epistemically Closed as Ever
Don't believe me? Read this, in which he reviews Thomas Piketty's new book and says the following: So what’s a conservative, fearing that this diagnosis might be used to justify higher taxes on the wealthy, to do? He could try to refute Mr. Piketty in a substantive way, but, so far, I’ve seen no sign …
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Pejman Yousefzadeh 