Author Archives: wciecon
Organic Milk and Japanese Cars
In the Spring of 2009, the Dairy Farmers of Canada launched the "100% Canadian milk campaign." Products displaying the logo shown on the right are guaranteed to be made with 100% Canadian milk. I'll admit it. As someone who lived through the British BSE outbreak of the 1980s, I'm slightly paranoid about milk safety. I'm […]
Excess demands for apples, bonds, and money in a representative agent economy
1. Assume a representative agent model in which everyone has exactly the same supply and demand for apples. No apples get traded in equilibrium. A law which lowers the price of apples will create an excess demand for apples, but will have no effect on anything else. People will now want to buy apples, but […]
Retirement savings plans: brilliant economics, lousy psychology
The US has 401(k)s and IRAs. The UK has personal pension schemes. Canada has Registered Retirement Savings Plans or RRSPs. Economists typically support such plans because of their effects on savings. The plans also make the tax system fairer, granting all taxpayers access to the tax advantages enjoyed by employer pension plans. But the truly brilliant part […]
Videogames and the sexual division of labour
Consider a model in which individuals have a fixed amount of time to allocate between three activities: paid work, household production, and gaming. Each one of these activities requires an investment of effort and human capital, and each provides rewards, either monetary or non-monetary.
The Politician’s Syllogism, the minimum wage and the welfare effects of random redistributions of income
We're all familiar with the concept, but for those who weren't aware that it had been formalised, given a title and a Wikipedia entry, the Politician's Syllogism goes like this: We must do something. This is something. Therefore, we must do this. And so it is with the minimum wage. Poverty and inequality are problems […]
Popular support for increased inequality?
One part of Canada's tax-transfer system increases inequality of wealth. That's not an unfortunate side-effect of the policy; it is deliberately designed that way. It would be very easy to design it differently so that it did not increase inequality.
“But where will the demand come from?” In praise of older Keynesians
It gets asked in every recession. Recovery requires an increase in demand. "But where will the demand come from?" When I was young and foolish I would answer "housing". Which was actually a fairly good guess in the past. But when I got older and more devious I would refuse to answer. "If an armchair […]
“I’m a corporation and so’s my wife.”
"Women are persons in matters of pains and penalties, but are not persons in matters of rights and privileges." Traditional British common law held that women and men were inherently unequal. Today, the equality of men and women is enshrined in the Canadian constitution, and we face a different legal challenge: Corporations are persons in […]
The Waiting Until We Can Afford It Argument – Part II
This more of an argument you hear for a one-time expense such as building new schools or buying new military aircraft, that goes something along the lines of: "We already have a deficit, so this policy will just increase the deficit and we'll pay even more in interest. But if we wait until we have […]
CIT Cuts: The Waiting Until We Can Afford It Argument
One common argument against a CIT (corporate income tax) cut is along the lines of "we've already got a deficit and a CIT cut will just make the deficit worse. Why don't we wait until we've got a surplus before we even consider cutting rates? Let's wait for the economy to get better, revenues to […]
Worthwhile Canadian Initiative 
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