The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. – F.A. Hayek
Posted in Economic Illiteracy, You Can't Have it Both Ways on Feb 6th, 2012
In a self-described balanced political treatment of the history of health care policy, Paul Starr delivers us this: What finally broke the grip of the hospitals (and later the doctors) on the methods of Medicare payment was the acute fiscal crisis that developed after Reagan cut taxes and increased military spending in 1981 and the [...]
Posted in Economic Illiteracy, Economics Problems, Market Failures, You Can't Have it Both Ways on Feb 2nd, 2012
I cannot even begin to tell you how many times I am told, “yeah, supply and demand and prices work and all that, but if we allow them to run wild, the environment will inevitably be destroyed.” These arguments are often levied far more vehemently in the presence of classical liberals than in more mainstream [...]
Posted in You Can't Have it Both Ways on Jan 30th, 2012
To make sure we don’t get billed for late fees without being notified that something is going to be late, right? Yet why should there have to be a next time? Why should keeping an ordinary driver’s license up to date oblige anyone to deal with a government agency, in person or online? I hadn’t even [...]
Posted in Methodology, You Can't Have it Both Ways on Jan 30th, 2012
I am sure those of you who defend markets based on the logic of supply and demand or on the logic of trade and comparative advantage have encountered this reaction. I get this regularly of course, even after I move from the models to dramatic illustrations of how they have worked in practice and even [...]
Posted in Environment, You Can't Have it Both Ways on Jan 21st, 2012
Def: (noun): Someone who built his mountain cabin last year. HT to William Tucker, writing recently in reference to anti-energy crusades. I used to reject this characterization. Not any more.
Posted in Economic Illiteracy, Economics Problems, You Can't Have it Both Ways on Jan 19th, 2012
About twice a year I end up writing a post screaming at people for not understanding what the term adverse selection means as it pertains to the health insurance market. I can almost understand if the popular press gets it wrong (not really, it is the job of real reporters to understand what they are [...]
Posted in Environment, Methodology, You Can't Have it Both Ways on Jan 18th, 2012
Tensions between the US and Iran are increasing. I see the threat of a nuclear Iran as a serious one, far more serious than the Iraq threat may have been. Reflect for a moment on the plea by folks to use the Precautionary Principle when it comes to environmental matters. Why, too, is this Principle [...]
Posted in Economics Problems, You Can't Have it Both Ways on Jan 4th, 2012
One justification for progressive income taxation is that a dollar of additional income to someone earning $600,000 per year in income is not valued nearly as much as a dollar of additional income to someone earning $18,000 per year. I’d like to point out three implications/observations based on this justification. If you use this as [...]
Posted in You Can't Have it Both Ways, labor markets on Jan 2nd, 2012
Last Friday’s post may have been uninteresting, but thinking about the grading process reminded me of another “argument” that is presented to me as counter-evidence to some labor market information I present at times. A surprisingly small share of Americans earn the minimum wage or less. When I query students about this, I routinely get [...]
Posted in You Can't Have it Both Ways on Dec 30th, 2011
When we grade our students each semester, inevitably there will be students who fall a very miniscule percentage point below some grade cutoff. For example, I award an A to students scoring a 94% or better, an A- to students scoring from 90% up to and not including 94% and so on. There is always [...]
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