Formerly known as our research roundup.
- In this paper Richard Freeman condemns the “virtues of labor market flexibility” because of the severe increase in, and persistence in, unemployment in the U.S. during the “Great Recession.” First, seeing a paper from Freeman drawing this conclusion is about as surprising as Milton Friedman suggest that free-markets work better. Second, one might wish to compare the U.S. experience with other countries, and at least throw a bone at folks who understand that other institutions contravene labor market progress in pretty significant ways. His conclusion is snarkily suggesting that strong labor institutions are more important than labor market flexibility. Which may or may not be true. But, true strong labor market institutions are themselves free-market institutions. The modern labor movement has of course moved far astray from this by needing the NLRA and other support mechanisms institute something close to a thugocracy. And we can of course just dismiss any political institutions that cripple labor market flexibility, right? Employment mandates, taxes, health insurance mandates, anti-discrimination policies on both race and disability, minimum wage rhetoric and changes, zoning, and on and on and on. No, those shouldn’t b e expected to make labor markets more rigid. I can assure you that I am not in any way going to try to employ someone else these days. Here, perhaps, is a start at a more complete analysis.
- Is research funding important for reducing mortality? It seems to be, and strongly so – and it seems to take time. Of course, this doesn’t imply that the private sector cannot do it, but it does suggest that while we waste trillions of dollars on disastrously bad government programs, there are plenty of less expensive, high-value things we can be doing collectively. Not gonna happen in my lifetime.
- Economists refuse to abandon their fetish with the Phillips Curve, a creature strangely resembling my favorite animal.
- More dispatches from unicorn world. When you ban something, it doesn’t go away. And it may even get “worse.” The case of child labor.
- I am sure findings like this are relied upon heavily by the wizards in the IPCC to estimate just how severe the costs of global warming are going to be. Remember, one of the major costs was supposed to be the serious negative impact of expanding malaria ranges in Africa. Sciency goodness abounds.
- Former U of R economist Gordahn Dahl and colleagues finished up a major study of paid maternity leave expansions in Norway. You are probably not going to be surprised by their findings:
“Taken together, our findings suggest the generous extensions to paid leave were costly, had no measurable effect on outcomes and regressive redistribution properties. In a time of harsh budget realities, our findings have important implications for countries that are considering future expansions or contractions in the duration of paid leave.”
Many thanks to WC for doing all the reading and culling, to give us raw meat. As Wintercow’s senior Senator Chuckles might say, I ask the Chairlady to expand and extend my remarks, once I have checked with the Phillips Curve Oberfuher.
Regarding that abstract on the Phillips Curve:
1) Is English a second language for him because he has a first language , or because he has been taught to write so poorly to discourage his reader from reading further? I tried to follow him until he got to the Myth of the Great Recession, the biggest recession since….Jimmy Carter.
2) What if we go another ten or so years until the unemployment rate does not respond as advertised by printing money to stimulate demand enough to stimulate employment? Do we accelerate government spending? Every time I read Paul Krugman, this has been his answer.
As Cicero might say, Quo usque tandem abutere Crughomine patienta nostra?
So what is the revised schedule? For another year we print another trillion or so and borrow another few trillion to bring down the unemployment rate to what? Six and a half percent? Is that the goal? What happens if that does not happen? Self-immolation of the Princeton economics department preceded by, ”
We’re sorry, have a nice day.”?
I’ll never cease to be impressed by NBER working papers. They’re consistently insightful and relevant. I know that’s kind of the point of the NBER, but it’s still nice to see one after another like that.
What seems strange to me, from an allocation standpoint, is how rising unemployment persistence seems to be happening at the same time as more people are working two full-time jobs. The labor literature has also documented a small but rising mismatch between hours worked and hours desired, as well as an increase in “precarious” work. This is on top of existing stratification in the distribution of incomes. I so far haven’t seen any research on how these fit together, even pairwise.
Greg, good observations. This sort of gets to the heart of the idea of the zero-marginal product worker that is the starting point for discussions on the current growth malaise … I’m not sure I can get my mind around what is really happening myself …
Thanks for the links! I appreciate your open opposition to the Phillips curve – it’s hard to believe that the Phillips curve is taught as a science. Macro voodoo. It’s frustrating that instead of acknowledging that attempting to predict, and ultimately arrange, the complex orders of society with magical models, proponents of this approach insist that the models have but to be perfected, and require only additional factors to be accurate, or maybe a small tweak.
Here is an interesting analysis of the Phillips Curve:
http://www.hussman.net/wmc/wmc131104.htm
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