Rebecca Patterson's recent New York Times essay uses a Jenga tower as a metaphor for the American economy in 2025. Blocks are being removed—small businesses cutting jobs, federal layoffs, consumption concentrating among the wealthy—while AI companies pile massive investments on top. Eventually, she warns, Jenga towers fall down. She's right about the instability. But the … Continue reading When the Tower Can’t Be Rebuilt: What Institutional Economics Misses About the Next Decade
Tag: economics
Baumol Effect or Baumol’s Cost Disease
"In economics, the Baumol effect, also known as Baumol's cost disease, first described by William J. Baumol and William G. Bowen in the 1960s, is the tendency for wages in jobs that have experienced little or no increase in labor productivity to rise in response to rising wages in other jobs that did experience high productivity growth."
The ABC of Contemporary Capital by David Harvey
https://www.youtube.com/watch?v=gVtHfFRStSk 1 of 13 Presentations on the ideas of Marxism. "As a part of this course, I’m sharing rough drafts of pieces of a manuscript I am working on, a sort of textbook on Marx’s political economy. I’m experimenting with crowd sourcing the revision process." http://davidharvey.org/2022/01/new-course-the-abc-of-contemporary-capital/ I've talked about Hypothes.is for annotating in the past. I … Continue reading The ABC of Contemporary Capital by David Harvey
Participatory Economics Overview: What, Why, How
"Vision is not only about the future, but also the present. What would having a vision like the one called participatory economics imply for today’s practical choices?Broadly considered, if you want to get someplace new, it behooves you to take steps towards where you want to go, not steps that take you somewhere else. An … Continue reading Participatory Economics Overview: What, Why, How
Revisiting “A China Prediction”
...there’s going to be a reckoning, and the funny thing is that reckoning is going to begin in China and then eventually spread to the rest of the world. Whether it will happen in close proximity to the end of the COVID-19 pandemic remains to be seen, but there is definitely a short term correction … Continue reading Revisiting “A China Prediction”
A China Prediction: A Debt Deleveraging in a Decade
"What happens when torrid monetary and fiscal reflation in the West meets tighter credit and evaporating liquidity in China?We will find out soon enough who calls the shots for world inflation in a globalised economy dominated by cross-border capital flows. We will also find out whether these two colliding forces moderate each other, or set off the … Continue reading A China Prediction: A Debt Deleveraging in a Decade
Conversations on Political Economy
Capitalist: Capitalism provides for the most efficient allocation of resources, wealth creation and individual choice. It's the best economic system we've got. State Socialist: There are other values than efficiency, prosperity and choice. Capitalism tends toward oligarchy and monopoly. As industries concentrate and gain economies of scale, wealth creation is concentrated for the benefit of … Continue reading Conversations on Political Economy
Kondratiev Waves & Social Unrest
"In the United States, 50-year instability spikes occurred around 1870, 1920 and 1970, so another could be due around 2020. We are also entering a dip in the so-called Kondratiev wave, which traces 40-60-year economic-growth cycles. This could mean that future recessions will be severe. In addition, the next decade will see a rapid growth … Continue reading Kondratiev Waves & Social Unrest
Harvard’s Reinhart and Rogoff Say This Time Really Is Different
"And you want to talk about a negative productivity shock, too. The biggest positive productivity shock we’ve had over the last 40 years has been globalization together with technology. And I think if you take away the globalization, you probably take away some of the technology. So that affects not just trade, but movements and … Continue reading Harvard’s Reinhart and Rogoff Say This Time Really Is Different
Knowledge of the Future
"...there are (a) facts, (b) informed extrapolations from analogies to other viruses and (c) opinion or speculation....if you’re experiencing something that has never been seen before, you simply can’t say you know how it’ll turn out....There’s no algorithm for deciding whether to favor life for a few (or for thousands) versus economic improvement for millions."-Howard … Continue reading Knowledge of the Future
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