Author Archives: wciecon
Flogging a Dead Horse: Research the Progressive Conservatives misinterpreted was flawed
This post was written by Mike Veall of the Department of Economics at McMaster University. David Reevely and Jim Stanford, followed up by Paul Boothe, Mike Moffat, the Globe and Mail and others have shown that the Ontario Progressive Conservative millions job plan does not follow from the research it is based on. For example, […]
Some Miscellaneous Thoughts on the Economics of Social Interaction
Economics is really all about incentives and their effect on behaviour at the micro and macro level. My training in economics emphasized the role of prices in communicating information about scarcity and opportunity cost and providing the incentives that affect economic behaviour. Yet, all of our economic behaviour is also rooted on an institutional framework […]
Countries as homes
I was up late last night for the results of the EU elections. In the UK, the UK Independence Party came first with 27.5% of the vote (Labour second with 25.5% and Conservatives third with 24%). In France, the Front National came first with 25%. Both UKIP and the FN want to withdraw from the […]
Is Health Care Reform Working?
Health care reform in Canada in the wake of the Romanow Royal Commission and the 2004 Health Accord has often been described as a story of missed opportunity with the increases in federal transfer spending not accompanied by desired results. As the review of the 2004 Health Accord by the Standing Senate Committee on Social Affairs, […]
Action bias and the political economy of penalty kicks
Most penalty kicks result in a goal; this is why soccer players go to such comical lengths to draw a penalty. The distance between the ball and the goal is so short that goaltenders don't have time to react; they have to commit to a strategy as the ball is being kicked. The usual strategy […]
How long is the short run? The macroeconomics of “doing nothing” revisited
The answer we normally give, when teaching intro macro, is: "It depends on price stickiness; if prices are very flexible it will be short, and if prices are very sticky it will be long." A better answer would be: "It depends on monetary policy; if monetary policy is very good it will be short, and […]
Interest, capital, MRScc=(1+r)=1+(MPK/MRTci)+(dMRTci/dt)/MRTci
That's the equilibrium condition for the real rate of interest in a competitive economy. I will explain what it means a little later. This is intended as a simple "teaching" post, and because I have a strange feeling that the theory of interest and capital is becoming topical again in the blogosphere, and that a […]
Gary Becker: The Father of Economics Imperialism
This was written by the University of Toronto's Aloysius Siow: Gary Becker, an American economist, died on May 3 at the age of 83. His major contribution was the systematic application of economics to the analysis of social issues. Before his work, economists primarily studied how markets and market economies worked. He used economics to study […]
The New Keynesian conspiracy
New Keynesians believe that Say's Law is false. But they want the central bank to try to make Say's Law look true. New Keynesians believe that real business cycle theory is false. But they want the central bank to try to make real buiness cycle theory look true. New Keynesians believe that the loanable funds […]
The Economist on WCI
The Economist has a story on the state of the Canadian economy and it features an appearance by Livio Di Matteo: Yet luck played a large, unacknowledged part, says Livio Di Matteo, an academic and contributor to Worthwhile Canadian Initiative, the world’s best-named economics blog. It's official: WCI is now the best-named economic blog. Take […]
Worthwhile Canadian Initiative 
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