Economics @ ITT

What If Black America Were a Country?

Posted in economics by ittecon on October 14, 2014

If black America were a nation-state, how would it stack up against other countries? How would it fare on standard measures of national power and weakness?

via What If Black America Were a Country? – The Atlantic.

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Is the 1%’s Lack of Humility Is the Real Problem

Posted in economics by ittecon on September 26, 2014

[I]t’s human nature to show off, all the more so in highly unequal societies, people being the status-conscious beings that they are. It’s futile and beside the point to chide the rich for this behavior.

via Paul Krugman Dismantles the Notion That the 1%’s Lack of Humility Is the Real Problem | Alternet.

A Free (Rigged) Market is Good for Everyone Except 99% of Americans

Posted in economics by ittecon on September 16, 2013

A nice piece by Paul Buchheit.

Free-market libertarians go to outrageous exremes to convince themselves and others of the infallibility of the market. Even when opposing evidence smacks them in the face, they conjure up sound bites that seem vaguely convincing but are in reality meaningless. Here are some examples.

via A Free Rigged Market is Good for Everyone Except 99% of Americans.

Good Times at the Top

Posted in economics by ittecon on September 12, 2013

Of the gains made by the top 10 percent, almost none went to the 90-95 group; in fact, the great bulk went to the top 1 percent. The bulk of the gains of the top 1, in turn, went to the top 0.1; and the bulk of those gains went to the top 0.01.

via Good Times at the Top – NYTimes.com.

Why We’ll Be Better Off if the Walmart Protests Fail

Posted in environment by ittecon on September 5, 2013

I am not generally a fan of ad hominem attacks, but this Vedder is quite the wanker is the epitome of what is wrong with economics today.

The American economy has shown anemic, sputtering growth for several years—largely because businesses, investors, and consumers have been angry and fearful of public policies constraining their ability to operate efficiently and profitably.

That, in part, why I’m hoping that Walmart workers’ national protest movement will be a monumental failure.

via Why We’ll Be Better Off if the Walmart Protests Fail – The Daily Beast.

Amazon Unpacked – Why the UK is Less than Thrilled with Amazon.com

Posted in economics by ittecon on July 23, 2013

As online shopping explodes in Britain, helping to push traditional retailers such as HMV out of business, more and more jobs are moving from high-street shops into warehouses like this one. Under pressure from politicians and the public over its tax arrangements, Amazon has tried to stress how many jobs it is creating across the country at a time of economic malaise. The undisputed behemoth of the online retail world has invested more than £1bn in its UK operations and announced last year that it would open another three warehouses over the next two years and create 2,000 more permanent jobs. Amazon even had a quote from David Cameron, the prime minister, in its September press release. “This is great news, not only for those individuals who will find work, but for the UK economy,” he said.

via Amazon unpacked – FT.com.

The Problem with Price Gouging Laws

Posted in economics by ittecon on July 23, 2013

Many states have anti-gouging laws that curb price increases during disasters. In California, for instance, the maximum that retailers can raise prices after an emergency is 10%. Since this minimal upcharge wont effectively temper demand, limited supplies end up being rationed on a first-come, first-serve basis. While many view this policy as “fair,” gouging laws have two key drawbacks…

via The Problem with Price Gouging Laws – Rafi Mohammed – Harvard Business Review.

Upward Mobility Is a Lot Easier in Some US Cities

Posted in economics, employment by ittecon on July 22, 2013

A major new study by academic economists show that it’s still possible to get ahead in America but a great deal depends on where you’re trying to do it. As is the case with many socio-economic indicators, the northeast, and mountain and ocean west come out shining while the southeast and rustbelt lag behind.

via Upward mobility is a lot easier in some cities – Salon.com.

The Big Lie Behind Food Stamps

Posted in economics by ittecon on July 22, 2013

Walmarts wages and benefits are so low that many of its employees are forced to turn to the government for aid, costing taxpayers between $900,000 and $1.75 million per store…

via Daily Kos: The big lie behind food stamps.

Big Unemployment, the New Normal?

Posted in economics, employment, macroeconomics, Policy Issues, Regulation, Taxation by ittecon on July 9, 2013

I tried to respond to a post by Don Peppers responding to this article, but LinkedIn limits the character count. I quote Don’s post here for context.

It’s common knowledge that LESS government, LESS regulation, and LOWER marginal tax rates will all improve employment. Unfortunately, the politics of envy is irresistible to some, and there are very few politicians on either side of the aisle who will vote for less of anything related to the government.

It may be common knowledge that less of these things might increase employment, but this favours a local maxima at the expense of a global maxima. It is the typical short-term benefit with a long-term detriment. Still, this argument and its subarguments are specious. I won’t even give any more attention to the dubious official unemployment figure definition and methodology.

Less government is a vague term. What government? Fewer dog-catchers? Interesting how, ad reductio, this becomes an argument for anarchy.

As for regulations, business favours regulations that shield it from the public and markets; intellectual property “rights” come to the top of my mind. Government (or a quasi-government acting entity) are necessary so as not to devolve into a situation where warlords rule. Afghanistan comes to mind. I could imagine a football match with no rules or regulations. Even rugby and UFC have rules, as do wars.

In economic terms, the lower marginal taxes argument is patently false (without even delving into marginal verse effective territory). Laffer’s concept is not false in and of itself, but it fails on two accounts. First, we can agree that at some point lowering marginal tax rates will create positive incentives, but it doesn’t follow this is true at all levels. Empirically, we can easily determine that we are below that point. On a practical level, this not only means that a reduction with not have positive effects; there will be negative effects. Second, the primary driver to hiring is demand for products or services (or at least the prospect thereof). A marginal tax rate of zero has no impact if no one is purchasing what I am offering.