Jeffrey Lacker on the inherent instability of the financial system
03 Oct 2016 Leave a comment
in economic history, global financial crisis (GFC)
The 10 largest economies 1970-2030
02 Oct 2016 Leave a comment
in development economics, economic history Tags: The Great Enrichment, The Great Escape
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The economic history of the world since 1 AD!
01 Oct 2016 Leave a comment
in development economics, econometerics, economic history, growth disasters, growth miracles
Immigration to Israel since its Declaration of Independence in 1948
30 Sep 2016 Leave a comment
in economic history Tags: economics of immigration, Israel
Graduate numbers quadruple! Zero economic growth premium?
29 Sep 2016 Leave a comment
in economic growth, economic history, economics of education, human capital, labour economics, macroeconomics Tags: education premium, endogenous growth theory, graduate premium
Some people get quite excited about the growth benefits and externalities from investing in more human capital such as more young people going to university. In New Zealand, the number of graduates quadrupled over the last 30 years but the trend GDP growth rate is unchanged. Please explain?
Source: Educational attainment of the adult population: The Social Report 2016 – Te pūrongo oranga tangata.
More on the emergence of Generation Rent in New Zealand
28 Sep 2016 Leave a comment
in applied welfare economics, economic history, politics - New Zealand, urban economics Tags: Generation Rent, housing affordability
Wealth, Poverty, and Politics | Thomas Sowell on the Importance of human capital
28 Sep 2016 Leave a comment
in applied price theory, development economics, economic growth, economic history, economics of education, human capital, labour economics, macroeconomics Tags: Thomas Sowell
When did creative destruction in newspapers begin?
27 Sep 2016 Leave a comment
in economic history, industrial organisation, survivor principle
The Territorial History of the United States
27 Sep 2016 Leave a comment
in economic history, economics Tags: maps
When did Canberra policy makers accept that inflation was a monetary phenomenon?
27 Sep 2016 3 Comments
in business cycles, economic history, macroeconomics, monetarism, monetary economics, politics - Australia Tags: central banks, monetary policy, The Great Inflation
Australian policymakers from at least 1971 viewed inflation as not a consequence of their monetary policy decisions. There were repeated references by them to wage-price spirals and both unsuccessful (1977) and successful attempts (1981) at wage freezes.
The prices and incomes accord from 1983 onwards was just another 1970s wage tax trade-off. An Incomes policy attributes inflation to non-monetary factors, as did Fraser and Lynch regularly.
• It was not until 1980 that the Fraser government’s monetary policy became genuinely anti-inflationary. With a lag, these changes halved inflation to the mid-single digits by 1983. The implementation lag on the 1975 Monday conference programme must have been long and variable and lasted for a three year window!? Three years out of 20 is hardly a monetarist hegemony!
• Australia had lower CPI inflation in the 1980s than the 1970s, but this was marred by rebounds in 1985–86 and 1988–90 to near 9%.
The monetary policy regime change in the late 1980s was triggered by factors besides rising inflation: a demonic view of currant account.
After several years of high interest rates, the budget papers forecasted a moderate slowing:
• The budget GDP forecast for 1990-91 was 2% with an actual of minus 0.4%; for inflation the actual and forecast were 5.3% versus 6.5%; 1989-90 inflation rate was 8% with GDP growth of 3.3%.
• In 1991-92, the budget GDP forecast was 1.5% with an actual of 2.1%; for inflation the actual and forecast were 1.9% versus 3.8%.
• In 1992-93, the budget papers forecast for inflation 3% for an actual of 1%.
• In 1993-94, the budget forecast for inflation 3.5% for an actual of 1.8%.
The monetarists in the Treasury, entranced as they were by Friedman’s 1975 visit, still had not clicked to the link between a tight monetary policy and low inflation as late as 1993. Australia pursued a stop-go monetary policy from 1971 to the early 1990s.
I worked in the next desk to the monetary policy section in the Prime Minister’s Department in the 1980s. They were determined that market set interest rates, not monetary policy.
I suggest you read the biography of keating by john edwards(?) – his economic advisor in the late 1980s.
Edwards quotes from numerous Treasury briefings to Keating. the Treasury remembered their Keynesian educations well, as did those at DPMC. the prices and incomes accord was very Keynesian: inflation as a non-monetary phenomenon
Mentioning Friedman’s name in the 1980s at job interviews would have been extremely career limiting. Not much better in the early 1990s. Back in the late 1980s, Friedman was graduating from ‘a wild man in the wings’ to just a suspicious character in policy circles.
If you name dropped Hayek in the 1980s and 1990s, any sign of name recognition would have indicated that you were been interviewed by people who were very widely read.
Poverty in NZ has been falling steadily for 20 years despite the dead hand of neoliberalism
26 Sep 2016 Leave a comment
in applied welfare economics, economic history, politics - New Zealand, poverty and inequality Tags: family poverty, job poverty, social insurance, The Great Enrichment
When did a house become an investment? 40% price crash has happened before!
26 Sep 2016 Leave a comment
in economic history, urban economics Tags: housing affordability, housing prices, land supply, RMA, zoning
The Resource Management Act was passed in 1993.
Note that there is considerable regional variation in housing prices in New Zealand.
Source: Property Prices in New Zealand | New Zealand Real Estate Prices.
Spot Generation Rent in New Zealand
25 Sep 2016 Leave a comment
in economic history, politics - New Zealand, urban economics Tags: Generation Rent, housing affordability
Source: Housing affordability: The Social Report 2016 – Te pūrongo oranga tangata from Perry (2015), Ministry of Social Development, using data from Statistics New Zealand’s Household Economic Survey.
Utopia, you are standing in it! 
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