Source: OECD StatExtract.
Some tax cuts for families! Average tax rates on married couple with one income, 2 kids in USA, UK, Australia and New Zealand since 2000
20 Aug 2015 Leave a comment
in economic history, labour economics, labour supply, politics - Australia, politics - New Zealand, politics - USA, public economics Tags: Australia, British economy, taxation and labour supply
More evidence of mass kidnappings of #occupywallstreet activists
20 Aug 2015 Leave a comment
in applied price theory, human capital, income redistribution, labour economics, labour supply, politics - USA, poverty and inequality, Public Choice, rentseeking, sports economics Tags: expressive voting, Left-wing hypocrisy, Leftover Left, mass kidnappings, Occupy Wall Street, rational ignorance, rational irrationality, superstar wages, superstars, top 0.1%, top 1%
Ratio of Median Salary of Top 25 Highest Paid MLB Player to Avg. Worker Pay Increased from 100:1 to 700:1 Since 1988 http://t.co/5zLktBXS3D—
Mark J. Perry (@Mark_J_Perry) August 18, 2015
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.
No tax cuts for you? Net personal average tax rate of single American, British, Australian and New Zealander on average earnings, no children, since 2000
19 Aug 2015 Leave a comment
in economic history, labour economics, labour supply, politics - Australia, politics - New Zealand, politics - USA Tags: Australia, British economy, taxation and labour supply
Trends in congressional political polarisation
19 Aug 2015 Leave a comment
in politics - USA Tags: political polarisation
Over-qualification rates in jobs in the USA, UK and Canada
19 Aug 2015 2 Comments
in economics of bureaucracy, economics of education, human capital, job search and matching, labour economics, labour supply, occupational choice, politics - USA, Public Choice Tags: British economy, Canada, compensating differentials, job shopping, offsetting behaviour, on-the-job training, search and matching, The fatal conceit, The pretense to knowledge
In the UK, foreign-born are much more likely to be over qualified than native born highly educated not in education with less difference between men and women. More men than women are overqualified for their jobs in the UK. Over qualification is less of a problem in the UK than in the USA and Canada.
Source: OECD (2015) Indicators of Immigrant Integration 2015: Settling In.
In the USA and Canada, there are few differences between native and foreign born men in over-qualification rates. Foreign-born women tend to be more over-qualified than native born women in the USA and more so in Canada. Many more workers are overqualified for their jobs in the USA and Canada as compared to the UK.
There are large differences in the percentage of people with tertiary degrees and the education premium between these three countries that are outside the scope of this blog post. These trends may explain differences in the degree of educational mismatch.
It goes without saying that the concept of over-qualification and over-education based mismatch in the labour market is ambiguous, if not misleading and a false construct.
To begin with, under human capital theories of labour market and job matching, what appears to be over-schooling substitutes for other components of human capital, such as training, experience and innate ability. Not surprisingly, over-schooling is more prominent among younger workers because they substitute schooling for on-the-job training. A younger worker of greater ability may start in a job below his ability level because he or she expects a higher probability to be promoted because of greater natural abilities. Sicherman and Galor (1990) found that:
overeducated workers are more likely to move to a higher-level occupation than workers with the required level of schooling
Investment in education is a form of signalling. Workers invest so much education that they appear to be overqualified in the eyes of officious bureaucrats. The reason for this apparent overinvestment is signalling superior quality as a candidate. Signalling seems to be an efficient way of sorting and sifting among candidates of different ability. The fact that signalling survives in market competition suggests that alternative measure ways of measuring candidate quality that a more reliable net of costs are yet to be discovered.
A thoroughly disheartening chart if you're a graduate in the UK i100.io/mpDbJAl http://t.co/mv9izA0mbc—
i100 (@thei100) August 20, 2015
Highly educated workers, like any other worker, must search for suitable job matches. Not surprisingly, the first 5 to 10 years in the workforce are spent in half a dozen jobs as people seek out the most suitable match in terms of occupation, industry and employer. Some of these job seekers who are highly educated will take less suitable jobs while they search on-the-job for better matches. Nothing is free or instantly available in life including a good job match.
A more obvious reason for over qualification is some people like attending university and other forms of education for the sheer pleasure of it.
Anyone who encounters the words over-qualified and over-educated should immediately recall concepts such as the pretence to knowledge, the fatal conceit, and bureaucratic busybodies. As Edwin Leuven and Hessel Oosterbeek said recently:
The over-education/mismatch literature has for too long led a separate life of modern labour economics and the economics of education.
We conclude that the conceptional measurement of over-education has not been resolved, omitted variable bias and measurement error are too serious to be ignored, and that substantive economic questions have not been rigorously addressed.
The track record on banking on solar energy innovation becoming cost competitive
18 Aug 2015 Leave a comment
in economic history, energy economics, entrepreneurship, environmental economics, global warming, politics - USA, Public Choice, rentseeking Tags: Big Solar, creative destruction, green rent seeking, renewable energy, renewable resources, solar energy
John F. Kennedy’s speech in Berlin
17 Aug 2015 Leave a comment
in politics - USA, war and peace Tags: Berlin, Cold War, JFK, nuclear deterrence
Life expectancy by age and sex in New Zealand’s, 1990 to 2013
17 Aug 2015 Leave a comment
in health economics, politics - New Zealand, population economics Tags: capitalism and freedom, life expectancies, The Great Escape
The Canadians are coming! The Canadians are buying up our land! What has @NZGreens to say about that?
17 Aug 2015 Leave a comment
in economics of regulation, entrepreneurship, financial economics, politics - New Zealand Tags: Australia, Canada, China, FDI, Japan, Left-wing hypocrisy, left-wing popularism, New Zealand Greens, right-wing popularism
Canada was the largest source of foreign investment during the period, as its pension fund bought 18 properties in a portfolio from AMP and increased its stake in Kaingaroa Forest.
Only American political junkies remember the early poll leaders from previous presidential primaries season
17 Aug 2015 Leave a comment
in politics - USA Tags: 2016 presidential election
Can an early poll leader win the US election? ab.co/1W0vinm #GOPDebate http://t.co/JkVqEMluva—
ABC Fact Check (@ABCFactCheck) August 07, 2015
Do immigrants bring their politics with them?
17 Aug 2015 Leave a comment
in politics - USA, Public Choice Tags: economics of immigration, voter demographics
Based on this paper by @CatoInstitute's @AlexNowrasteh, immigrants barely differ politically object.cato.org/sites/cato.org… http://t.co/suwazCEcrU—
David Bier (@myfreesociety) February 24, 2015
Sanders, Trump and the median voter theorem
16 Aug 2015 Leave a comment
in politics - USA, Public Choice Tags: 2016 presidential election, expressive voting, left-wing populists, Leftover Left, median voter theorem, rational ignorance, rational irrationality, right-wing populists
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

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