by Roger Koppl I do not understand why so many pro-market commenters are opposed to extending unemployment relief. The supposedly killer, knockdown, unanswerable argument is that unemployment relief encourages unemployment. Hospital emergency rooms encourage drunk driving. Should we therefore close hospital emergency rooms? Those of us in the Austrian school of economics keep saying, and … Continue reading Emergency Rooms Just Encourage Drunk Driving
by Mario Rizzo There seems to be broad agreement among economists that the current recovery from the recession will be characterized by a slowly falling unemployment rate. This makes a good deal of sense since the problem that created the recession was a misdirection of resources into a number of sectors including housing construction and … Continue reading The Fed’s Coming Indiscretion?
by Mario Rizzo Greg Mankiw juxtaposes opinion pieces by Paul Krugman and Gary Becker on dealing with the cyclical unemployment problem (aka “how to create jobs”). Becker’s blog post is especially worth reading. Whatever the political benefits of appearing to stimulate the employment of labor, the economic problem really shouldn't be stated that way. We … Continue reading Stimulating The Employment Of Labor: Wrong
by Mario Rizzo There has been some important discussion emanating from Paul Krugman’s unoriginal question implicitly about the Austrian Business Cycle Theory (as well as other sectoral theories of employment shifts both during and outside of business cycles). (See Econbrowser, Marginal Revolution, Econlog, Angry Bear, for examples.) His question, as Tyler Cowen states it: “…[W]hy, … Continue reading Understanding The “Sectoral Problem” In Business Cycles: A Note
by Mario Rizzo At the outset of the Obama Administration, as Greg Mankiw reminds us, their economists laid out a series of predictions about where the unemployment rate would be with the stimulus package and without it. Currently, the economy is doing worse than their predictions of unemployment without the stimulus and, of course, much worse … Continue reading The Effects Of Fiscal Stimulus: A Magical Analysis
by Mario Rizzo Paul Krugman continues to say on his blog that the fiscal stimulus was too small. After all, unemployment is rising quickly: “[I]t’s rapidly becoming clear that yes, the plan was too small.” Brad DeLong has also added his voice to the call for bigger stimulus, again largely because … Continue reading Inappropriate Stimulation
by Young Back Choi Modern politicians of all strips promise to create jobs; in this time of economic downturn, the promises of job-creation are with growing urgency. But can government create jobs? If by jobs one means any scheme by which people are paid money wages, the answer is, of course, “yes”. But there are … Continue reading Can Government Create Jobs?