Monthly Archives: October 2010
Historical Voting Trends – The West
Like Stephen Gordon I am constantly frustrated with the backwards fiscal policies peddled by political parties. My frustration comes from a slightly different source – I believe they're unnecessary not just from an economic point of view, but also a political point of view . I don't believe policy affects voting behaviour in a significant way (with […]
“Canada’s Budget Triumph” – some additional context for the US
David Henderson* of GMU has a working paper (h/t Tyler Cowen) on the story of how Canada's federal government solved its budget balance woes during the latter half of the 1990's, with almost no apparent ill effects. Much of the paper sets out the political context that made this possible, and is very useful in […]
Firefighting is not a public good
In economics, public goods are ones that are (a) non-excludable and (b) non-rival. Non-excludable means that it is impossible to stop someone from enjoying the public good. For example, radio broadcasts can be picked up by anyone with a receiver. Non-rival means that one person's consumption of the good does not limit the amount available […]
Was Milton Friedman right after all???
Milton Friedman said a lot of things that were very controversial 40 years ago, but are now part of the economics mainstream. The natural rate hypothesis, and the view that monetary policy should have prime responsibility for aggregate demand and inflation, are now part of the New Keynesian orthodoxy. This shows how much Milton Friedman […]
Economy Lab: Why economic forecasting goes awry
My first post at the Globe and Mail's new Economy Lab site is now up.
This is why we can’t have nice things
A disconcerting trend is establishing itself in Canadian politics. Political parties are showing essentially no interest in the merits of a policy proposal beyond its potential as an element of some shrewd communications strategy.
Britain’s proposed child benefit taxback is inefficient
Today the BBC reports that child benefit is to be axed for higher-rate taxpayers. Some background: ideally, a person's tax liabilities reflect his or her ability to pay taxes. Most tax systems recognize that having children reduces ability to pay, so provide parents with some kind of tax relief. In the late 1970s, the British […]
Should we teach supply and demand in French?
A simple post, mainly aimed at people like me who teach Intro Economics. For decades I've been puzzling over the problem of how best to explain to first year students exactly what "quantity demanded" and "quantity supplied" mean. Then it suddenly struck me: it must be so much easier in French! (Can anybody who teaches […]
The paradox of thrift vs the paradox of hoarding
Would a sudden fad for antique furniture cause a recession? If, like Paul Krugman, you believe in the paradox of thrift, and if you follow the remorseless logic of your mistaken model, you should answer "yes". I don't believe in the paradox of thrift, and would answer "no". There is no paradox of thrift. There […]
Worthwhile Canadian Initiative 
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