Category Inequality
The Beer IneQuality Index
The conventional Canadian view is that American beer is bad; watery and weak. Yet American breweries produce some of the world's best beers – superb brews coming out of microbreweries across the country. What is striking about the United States is the country's level of inequality – or, to be more precise, the beer quality […]
Does capital income exist?
[Ages ago, as a graduate student, I "wasted" my time (when I should have been finishing my thesis) reading capital theory, including the more "heterodox" stuff. My memory is pretty hazy, but I still think about the old questions occasionally. There's nothing really new here for economists familiar with "dated goods".] 1. Suppose I know […]
A short history of the Canadian one per cent
Any sensible policy designed to address the concentration of income at the top of the Canadian income distribution over the past thirty years or so has to be based on a working model that explains how and why it happened in the first place. And we still don't have one. We still don't even have […]
Reverse Regression and the Great Gatsby Curve
[Update: I'm getting an awful feeling this post may be totally wrong. Does (1/b)/[1+Var(V(i))/Var(Y(i))] = b if the Lamarck model is true? If so, my proposal won't work. Wish I could do math.] [Update2. Nope, I think it will work. But Majromax in comments has come up with a simpler way to do the same […]
Dumb questions about econometrics and GAI/NIT
I've been meaning to write this post for some time. Scott Sumner's post spurs me to write it now. First let me ask my dumb econometrics question. It's a very simple question, and I really ought to know the answer. But I don't. Q1. If you estimate a linear regression, using Least Squares or whatever, […]
Interest rates, asset prices, and the rich
Does anybody here remember 1982? When interest rates went very high, and so asset prices went very low. Just the opposite of today. What were people saying back then? 1. Were they saying: "Central banks are setting high interest rates and making asset prices low, which is bad for the rich, who own all the […]
Dutch Inequality Theory
Last night I dreamt of Nick van Rowe again. I asked my Dutch ancestor what he thought would happen to the distribution of wealth in the future. According to Dutch Capital Theory, "capital" is just the name we give to land that we have made ourselves in the past. The rent on an acre of […]
Is The Big Problem r g?
Two different memes about secular stagnation seem to be circulating in the econoblogosphere recently. The first says that r < g, or will be in future, therefore the economy is dynamically inefficient, and we need government to fix this problem. The second says that r > g, or will be in future, therefore inequality is […]
Meritocracy, mobility, and optimal taxation
What would a perfect meritocracy look like? Suppose we could all agree on a definition of "merit" as "ability to contribute to the common good". Suppose that each individual was born with a certain quantity of "merit", and that we could observe and measure each individual's "merit" perfectly. It's indelibly stamped on their foreheads. Suppose […]
Capital income in a recession
Profits and income from capital are not the same thing, though they are mixed together in the national accounts. (Paul Krugman has made this point before.) I work through some simple examples with sticky prices and/or sticky wages, where income from capital always falls in a recession caused by tight monetary policy. [I add an […]
Worthwhile Canadian Initiative 
Recent Comments