A history of US growth per capita
21 Sep 2015 Leave a comment
in economic growth, economic history, macroeconomics, politics - USA Tags: prosperity and depression
Time to replace eagle with unicorn? The US as a high growth startup. @JimPethokoukis goo.gl/D4MK9x http://t.co/6WRB7nvUTp—
AEIdeas Blog (@AEIdeas) September 03, 2015
Hans Rosling’s "Don’t Panic – The Truth About Population"
20 Sep 2015 Leave a comment
in development economics, economic growth, economic history, human capital, labour economics, labour supply, macroeconomics, population economics Tags: endogenous growth theory, population bomb, The Great Fact
This #Vox political bias test is biased despite my good result
11 Sep 2015 Leave a comment
in economic growth, economic history, economics of climate change, economics of crime, environmental economics, health economics, macroeconomics
How frequent are simultaneous financial crises in one country?
04 Sep 2015 Leave a comment
in business cycles, currency unions, development economics, economic growth, economic history, Euro crisis, financial economics, global financial crisis (GFC), great depression, great recession, growth disasters, growth miracles, law and economics, macroeconomics, monetary economics, property rights Tags: bank runs, banking crises, banking panics, currency crises, current account crises, debt crises, pseudo financial crises, real financial crises, sovereign debt crises, sovereign default
Longest time without a recession
02 Sep 2015 Leave a comment
in business cycles, economic growth, economic history, fiscal policy, global financial crisis (GFC), great recession, macroeconomics, monetary economics, politics - Australia, politics - New Zealand, politics - USA Tags: Australia, recessions and recoveries
Human capital accumulation and economic growth
01 Sep 2015 Leave a comment
in economic growth, economics of education, human capital, labour economics, macroeconomics Tags: educational attainment, endogenous growth theory, human capital, knowledge capital
Could Wealth Redistribution End Global Poverty?
24 Aug 2015 Leave a comment
in development economics, economic growth, economic history, growth disasters, growth miracles, liberalism Tags: capitalism and freedom, extreme poverty, global poverty, The Great Enrichment, The Great Fact
Marginal tax rate of average earners in USA, UK, Australia and New Zealand since 2000
21 Aug 2015 Leave a comment
in applied price theory, business cycles, economic growth, economic history, labour economics, labour supply, macroeconomics, politics - Australia, politics - New Zealand, politics - USA, public economics Tags: Australia, British economy, productivity shocks, real business cycles, taxation and labour supply
Interesting to notice that in New Zealand and the USA after these increases in marginal tax rates on single taxpayers, their economies slowed down. What appears to have happened is a number of people reached the next income tax marginal tax rate threshold.
Source: OECD StatExtract.
Marginal tax rates of New Zealand average households since 2000
19 Aug 2015 Leave a comment
in economic growth, fiscal policy, labour economics, labour supply, macroeconomics, politics - Australia, politics - New Zealand Tags: Australia, lost decades, marriage and divorce, productivity shocks, real business cycles, taxation and labour supply
In 2000 in New Zealand, the marginal tax rates of single earners, married couples and dual income couples were 21%.
Sources: OECD StatExtract.and OECD Taxing Wages.
Net personal marginal income tax rates increased:
- to 51% for one earner couples with two children in 2001 and stayed up above 50% until 2014; and
- to 33% for single earners with no children in 2004 because income growth pushed them into the next tax rate bracket which then dropped down to 30% in 2011.
Sources: OECD StatExtract.and OECD Taxing Wages.
Net personal marginal income tax rates increased:
- to 33% in 2004 for two earner couples with the second earner earning 33% of average earnings and then increased to 53% in 2006 and stayed high thereafter;
- to 33% in 2004 for a two earner couple with the second earner earning 67% of average earnings and then increased further to 53% in 2006 and stayed high until 2014 when their marginal income tax rate dropped to 30%; and
Sources: OECD StatExtract.and OECD Taxing Wages.
These large increases in marginal tax rates on single earners and families coincided with a slowing of the economy in about 2005. The economy started to pick up again when there were tax cuts introduced by the incoming National Party Government. Is that more than a coincidence?
Sources: Computed from OECD StatExtract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/.
A flat line in the above figure is growth at the trend growth rate of 1.9% of the USA in the 20th century. A rising line is above trend growth for that year while a falling lined is below trend rate in GDP per working age person.
In the lost decades of New Zealand growth between 1974 In 1992, New Zealand lost 34% against trend growth which was never recovered. There was about 13 years of sustained growth at about the trend rate or slightly above that between 1992 and 2005. The entire income gap between Australia and New Zealand open up during these lost decades of growth between 1974 and 1992.
Sources: Computed from OECD StatExtract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/.
Australia grew pretty much in its trend rate of growth since the 1950s. The so-called resources boom is not visible such as showing up as above trend rate growth.
The benefits and costs of the @NZSuperFund since its inception
17 Aug 2015 Leave a comment
in applied price theory, applied welfare economics, economic growth, economic history, entrepreneurship, financial economics, fiscal policy, industrial organisation, labour economics, labour supply, macroeconomics, politics - New Zealand, public economics Tags: ageing society, company tax rate, deadweight cost of taxes, demographic crisis, efficient markets hypothesis, laffer curve, New Zealand superannuation fund, old age pensions, retirement savings, social insurance, sovereign wealth funds, taxation and entrepreneurship, taxation and investment, taxation and labour supply
Most mutual funds still can't beat their benchmark read.bi/1GkTig1 http://t.co/r7ezoDGJbV—
BI Chart of the Day (@chartoftheday) June 03, 2015
The New Zealand Superannuation Fund, the sovereign wealth fund part funding New Zealand’s old-age pension from 2029/2030 onwards, has been a bit of a wild ride. Sometimes the earnings of the Fund were well below and sometimes earning well above the long-term bond rate.
![image_thumb[3]](https://utopiayouarestandinginit.com/wp-content/uploads/2015/08/image_thumb310.png "image_thumb[3]")
Source: New Zealand Superannuation Fund Annual Report 2014.
Since its inception, the Fund earned an average annual return of 9.78%, which was 5.06% above the long-term bond rate, and 1.03% above its reference portfolio.
No information was given in the annual report of the New Zealand Superannuation Fund on the marginal dead weight cost of the taxes raised to fund the New Zealand Superannuation Fund to see whether there is any net benefit to taxpayers from its establishment and continued operation.
The New Zealand Government has contributed $14.88 billion to the fund from prior its inception in 2001 to the suspension of contributions in 2009 by the incoming National Party Government.
Source: New Zealand Treasury.
Over the nine years in which contributions were made, the company tax rate of 28% could have easily been up to 10 percentage points lower.
The New Zealand Treasury estimates that a one percentage point cut in the company tax costs about $220 million in forgone revenue if there are no other changes to the tax system. These are static estimates that do not include any feedback from greater investment and higher growth.
The New Zealand Superannuation Fund must beat the market every single year to make up for the deadweight cost of its funding, a premium for the investment risk added to the Crown’s portfolio and the cost to New Zealand’s growth rate of higher than otherwise taxes on income, entrepreneurship and investment.
Source: Abolish the Corporate Income Tax – The New York Times.
Incidence of long-term unemployment in the PIGS since 1983
17 Aug 2015 Leave a comment
in business cycles, currency unions, economic growth, economic history, Euro crisis, job search and matching, labour economics, labour supply, macroeconomics, occupational choice, unemployment, unions, welfare reform Tags: employment law, equilibrium unemployment, Greece, Italy, labour market regulation, natural unemployment rate, Portugal, Spain, unemployment duration
The boom that preceded the bust in the Greek economy did nothing for the rate of long-term unemployment among Greeks. Long-term unemployment had been pretty stable prior to the economic boom after joining the euro currency union.
Source: OECD StatExtract.
Nothing much happened to long-term unemployment in Italy or Portugal in recent decades. Spanish long-term unemployment fell in line with the economic boom in Spain over the 1980s and 1990s up until the global financial crisis.
UK has the lowest company tax rate in the G20
16 Aug 2015 Leave a comment
in applied price theory, economic growth, fiscal policy, macroeconomics, politics - Australia, politics - New Zealand, politics - USA, Public Choice, public economics Tags: British economy, company tax rate, company taxation, optimal tax theory, race to the top, tax competition
IFS Friday Figure: UK has the lowest corporate tax rate in the G20 #Budget2015 announced a 2% cut by 2020 #IFSFriFig http://t.co/T4Oq6ZXYd4—
IFS (@TheIFS) July 24, 2015
Utopia, you are standing in it! 
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