Links for 2011-03-27 [del.icio.us]
- Wages and Employment, Yet Again – NYTimes.com
But when you cut the price of everything — which is more or less what happens when wages fall across the board — there’s nothing else to substitute away from.Yes, economics textbooks typically show a downward-sloping “aggregate demand curve”. But the reasons for that curve’s downward slope aren’t the same as for your ordinary demand curve. It’s a process that works like this: lower prices -> lower demand for money -> lower interest rates -> higher spending. And that process doesn’t operate when, as is currently the case, short-term interest rates (which are the ones that matter for money demand) are zero.
- Super-Economy: The “Mystery” of Child Poverty in Sweden.
Tino looks at child poverty in Sweden. - Cowen on Moral Intuitionism, Bryan Caplan | EconLog | Library of Economics and Liberty
Our intuition against theft creates a moral presumption against taxation. To defend taxation, you’ve got to point to differences between taxation and ordinary theft that are strong enough to overcome that presumption. Plenty are on the table, from “Society could not otherwise survive” to “People should pay for what benefits them” to “Taxation solves a mild free rider problem.” Once someone advances one or more of these arguments, we can then both (a) intuit whether they would be strong enough to justify ordinary theft, and (b) see how empirically plausible they are.
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