Some #tax cuts produce more growth than others: https://t.co/oncO22g3Hs @ScottElliotG pic.twitter.com/VlkMz93wUy
— Tax Foundation (@TaxFoundation) December 19, 2015
Some #tax cuts produce more growth than others
12 Jan 2016 Leave a comment
in applied price theory, labour economics, politics - USA, public economics Tags: laffer curve
Why are Russians more trusting of government than New Zealanders? Maybe they do not trust the interviewer?
12 Jan 2016 Leave a comment
in comparative institutional analysis, politics - New Zealand, Public Choice
It is the 1960s hippies who are letting marijuana decriminalisation down at the ballot box
11 Jan 2016 Leave a comment
in economic history, politics - Australia, politics - New Zealand, politics - USA Tags: baby boomers, marijuana decriminalisation, rational irrationality, voter demographics
Dave Armstrong food banks existed in NZ since the 19th century
11 Jan 2016 Leave a comment
in economic history, politics - New Zealand, poverty and inequality
Source: Donna Wynd, Hard to Swallow Foodbank Use in New Zealand (2005).
David Armstrong claimed incorrectly that there have been no food banks in New Zealand until recently:
That’s how it used to be here not so long ago, when foodbanks didn’t exist and the number of homeless was tiny. I remember when we had few cases of “poverty” diseases such as rheumatic fever or rickets.
What else explains the increased popularity of food banks, which have been long-standing in New Zealand, it is not falling wages.
The main economic development over the last 25 years is the return of real wage growth after decades of wage stagnation in the boys own good old days of David Armstrong.
Source: Low Wage Economy | New Zealand Council of Trade Unions – Te Kauae Kaimahi.
As for the number of homeless being tiny in the good old days of New Zealand, a New Zealand Parliamentary Library 2014 paper on homeless started its historical narrative in 1850 and spent a lot of time discussing housing deprivation in the early and mid-20th century:
A 1936 national survey found nearly a third of the total urban housing stock was unsatisfactory and 15% of this only fit for demolition. [5] Māori in particular experienced poor housing conditions. The first Labour Government loaned money for private house purchases and built state housing to rent.
During the 1950s, the National Government moved to reduce the waiting list for state housing and promoted home ownership, but lengthy waits for some people were reported. Likewise, concern was expressed over severe overcrowding, especially among Māori. By the late 1950s, Wellington’s housing needs were identified as ‘particularly acute.
In the 1960s voluntary organisations recorded a gradual increase in some groups experiencing housing difficulties. The Christchurch Methodist Church night shelter found that their main users were employed people who could not afford other accommodation, unmarried women with children, and those leaving homes because of domestic violence also increasingly sought shelter
Not even a self-described liberal elitist of the left can be forgiven for forgetting some of the key achievements of the first Labour government in social housing. The idea was to improve the quality of New Zealand housing for the poor.
Source: The first state house – State housing | NZHistory, New Zealand history online.
In common with Max Rashbrooke, David Armstrong’s recollection of his boys own childhood does not include Maori as they drifted to the city. Prior to the middle of the 20th century about 85% of Maori lived in rural areas, often lacking electricity, running water and living on dirt floors as the Encyclopaedia of New Zealand explains:
Attracted by work opportunities and the ‘bright lights’ of city life, rural Māori began to move to Auckland and Wellington in the 1920s. However, many faced problems finding accommodation. The reputation Māori had among Pākehā for overcrowding and taking poor care of their homes meant few landlords were prepared to have them as tenants. As attendee James Rukutoki told a Māori leaders conference in 1939, ‘the only dwellings open to the Maori are the ramshackle discards of the Pākehā’.
New study indicates there are 8 Conservative Social Psychologists
11 Jan 2016 Leave a comment
in economics of education, politics - USA, Public Choice
Source: New Study Indicates Existence of Eight Conservative Social Psychologists | HeterodoxAcademy.org.
Source: New Study Indicates Existence of Eight Conservative Social Psychologists | HeterodoxAcademy.org.
Source: New Study Indicates Existence of Eight Conservative Social Psychologists | HeterodoxAcademy.org.
HT: Rafe Champion
What does the poverty rate tell us? @keith_ng @EricCrampton @geoffsimmonz @apdrmabsc @bryce_edwards
11 Jan 2016 Leave a comment
in applied welfare economics, politics - New Zealand, poverty and inequality
Keith Ng stumbled onto an interesting point in a Twitter feud yesterday before he muted me about what is the poverty rate for. Are we interested in the poverty rate before government transfers and other social assistance or after them? Why?
If you are making the case for more assistance to the poor, the correct poverty rate measure is after the existing government assistance. Interestingly, most of those making the case for greater assistance to the poor use the before government transfer measures of poverty rates.
The reason why the correct measure is after government assistance is you are attempting to measure whether the assistance to date has provided people with an adequate standard of living. The before government assistance poverty rate provides no insight into that question.
The recent calculation by the Treasury of inequality based on income and consumption illustrates this. Most people are concerned about what people have to spend rather than how much they earn when thinking about topping them up with government social assistance.
Source: Inequality in New Zealand 1983/84 to 2013/14 (WP 15/06) — The Treasury – New Zealand
As the above chart shows, consumption inequality in New Zealand has not changed much since 1984 while income inequality has. Which is more important how much people have to spend or how much they are? Growing inequality is not a reason for more government assistance to the poor in New Zealand because it simply has not got worse for 30 years.
The reason that the before government assistance poverty rate is used is this rate is a relative measure that does not fall by that much. It therefore helps dramatise the politics of poverty and perhaps strengthen your case in the eyes of low information voters.
The better guide is the poverty rate after government assistance because that tells you how much extra you really need to top up the incomes of the poor to ensure they have an adequate minimum standard of living. The before government assistance poverty rate provides no insight into the success of social insurance and the welfare state regarding the adequacy of income support for the poor.
The poverty rate is not a reliable policy statistic @HelenKellyUnion @apdrmabsc @keith_ng
10 Jan 2016 Leave a comment
in applied welfare economics, economic history, politics - New Zealand, politics - USA, poverty and inequality
The official poverty rate in the USA missed poverty falling to near zero by the eve of the Global Financial Crisis in 2007 as shown in the chart below. That is no small oversight. It calls into question whether the official poverty rate which is based on a percentage of the median income is a useful guide to the magnitude of social problems before us.
Source: Meyer and Sullivan (2012), p. 153.
Meyer and Sullivan calculated a consumption based measure of poverty and found that the poverty rate fell much faster than previously single digits.
People worry about poor not have enough, not how much income they have before taxes and social insurance. The official poverty rate is before tax and social insurance and therefore before how much the poor actually have to get by with after receiving social assistance of all types and sources.
Interestingly, the divergence between consumption-based poverty and income-based poverty started with the election of Reagan and picked up the US federal welfare reforms in 1996. The number of children in poverty in deep poverty fell immediately after those 1996 US welfare reforms. There is a lesson in that for New Zealand.
It is widely agreed that the official poverty rate is flawed. Measuring poverty as a percentage of median income, usually 60% of the median income, means that poverty may not fall despite incomes doubling every generation and more.
Indeed, increases in the median income can increase poverty without anyone being poorer. This is because the gap between the median income earners and the poor increased such as the New Zealand in 2014 without any of the poor experiencing a fall in income and social support.
The reason why the median is pulling away from the bottom – the reason why income distribution is fanning out – is more people going to university and securing the associated wage premium and the greater rewards for talent in a globalised world.
The forces behind greater educational attainment and the globalisation of markets benefit all and in particular those of bottom of the income distribution through a more prosperous, dynamic, innovative society.
More on the reversing gender pay gap or men getting their comeuppances?
10 Jan 2016 Leave a comment
in discrimination, economic history, gender, human capital, labour economics, labour supply, occupational choice, politics - USA Tags: gender wage gap, middle class stagnation, reversing gender gap, wage stagnation
What the key voting blocs think of Obama’s gun-control proposals
09 Jan 2016 Leave a comment
in economics of regulation, politics - USA Tags: gun control, median voter theorem
Did the rich get richer under Rogernomics? New Zealand top income shares since 1921
09 Jan 2016 Leave a comment
in applied welfare economics, economic history, human capital, labour economics, politics - New Zealand, poverty and inequality Tags: Leftover Left, superstar wages, superstars, top incomes
Apart from a bump in the late 80s, the top income earners in New Zealand really are not doing much better than they were in the 1950s or 1920s. The rich are not getting richer in New Zealand. They are just holding their own.
Source: The World Wealth and Income Database.
Current US, British and French public and private expenditures on health per capita, PPP since 1960
09 Jan 2016 Leave a comment
in economic history, health economics, politics - USA Tags: 2016 presidential election, Health spending
https://twitter.com/PolitiFact/status/678444166016335872/photo/1
Source: OECD Health Statistics 2015.
The erosion of Jim Crow laws by the market process in the southern states of America in the 1940s and 1950s
09 Jan 2016 2 Comments
in discrimination, economic history, politics - USA
The heat maps showing the density of the listings, first in 1947 and then in 1956 in the Green Book.
Source: The forgotten way African Americans stayed safe in a racist America – The Washington Post.
According to the Washington Post article today:
in 1936, a postal worker named Victor Green began publishing a guide to help African American travellers find friendly restaurants, auto shops and accommodations in far-off places. Green dubbed the guide after himself – the “Green Book” – and published it for decades. Green says he was inspired by the Jewish press, which had long published information on restricted places…
The Green Book included listings for hotels, restaurants, gas stations, bars and beauty salons across the U.S., as well as travel articles, paid advertisements, and stories about local attractions.
The rise of car ownership among the black middle class made it more and more costly for businesses to turn away their trade despite threats of local lawlessness sanctioned by the police and local and state governments.
The rise of the working rich in Australia – top income compositions since 1954
08 Jan 2016 Leave a comment
in economic history, human capital, labour economics, politics - Australia, poverty and inequality Tags: Australia, superstar wages, superstars, top incomes, working rich
Over the course of the post-war period top incomes in Australia turned into top wage earners. It is unfortunate that information is not available on the extent to which business incomes make up the balance of top incomes as distinct from dividend incomes.
Source: The World Wealth and Income Database.
The New Zealand top 1% is still bone lazy – top 1% income shares USA, New Zealand and Australia since 1913
08 Jan 2016 2 Comments
in applied price theory, economic history, politics - Australia, politics - New Zealand, politics - USA, poverty and inequality Tags: Australia, Leftover Left, top 1%
What slackers. Despite 30 years of neoliberalism oppressing the unions and working class, the top 1% in New Zealand (and Australia) are unable to do any better in terms of their share of national income than in the good old days of pre-1984 New Zealand looked upon with such fondness by the the Leftover Left.
Source: The World Wealth and Income Database.
@fightfor15 College unemployment rates doubling to 2% is not a problem
08 Jan 2016 Leave a comment
in economics of education, politics - USA, unemployment
Fight for 15 want to argue that long-term unemployment and unemployment in general is a common problem for the skilled and unskilled. Unemployment and long-term unemployment are principally a problem of the low skilled – get over it.
Unemployment of 1-2% is not a problem, just turnover and job search.
June jobless rate for people 25+ with
B.A. or more 2.5%
High school diploma 5.4%
No H.S. 8.2%
on.wsj.com/1LG1B6z http://t.co/luUUuw9h1V—
Sudeep Reddy (@Reddy) July 02, 2015
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