Economic Policy

The articles reporting on first quarter productivity told us that it was better than it expected, coming in at a 1.7 percent annual rate. Count me among the surprised. I was expecting a number close to 0.5 percent based on 1.4 percent growth in output and a 1.0 percent increase in hours worked. The Bureau […]

The Post editorial on a bill that would authorize drug reimportation suggests that they don’t. The Post tells readers that if people in the United States started importing more low priced drugs from Canada, the drug companies would stop selling their drugs to Canada at low prices. Perhaps, but is that the end of the […]

There’s a small group of people in the United States who follow house prices. According to an obscure discipline known as “economics,” an excess supply of an item usually leads to a reduction in price. A little known government agency, the “Commerce Department,” reported last week that the vacany rate for ownership units hit yet […]

The Post ran a good follow-up story today, telling readers about Circuit City’s latest business problems. It seems that its sales of big ticket items have plummeted. Undoubtedly part of the decline is attributable to a general weakening of the economy. But part of the falloff is likely attributable to factors specific to Circuit City, […]

Diane Rehm often has very good shows with guests who present clearly distinct political perspectives. However, when it comes to talking about the problem posed by the budget deficit, balance is thrown out the window. Yesterday, she had investment banker Robert Hormat present a diatribe about the need to eliminate the budget deficit. There were […]

Yeah, that would not be news to any economist, but why is the negative impact of military spending on the economy never raised in political debates? President Bush has said that he won’t do anything serious to reduce greenhouse gas emissions because it would hurt economic growth, and that was the end of his discussion. […]

I always ask for the impossible. Anne Applebaum had a column in the Washington Post celebrating the fact that Europeans are now freely moving across national borders. She sees this free movement of people as victory over French unions and Polish bureaucrats. The Europeans can decide for themselves how much freedom of movement across borders […]

The Friday Post had an article offering the discouraging news from a study from the Centers for Disease Control that baby boomers are suffering from arthritis at a much higher rate than their parents. If this trend continues, it certainly augers poorly for the health of the baby boomers, as well as the cost of […]

That’s what the Wall Street Journal told its readers today. That’s pretty good reporting if the the WSJ reporters can tell us what insurers really think. Most of us just have to rely on what they say. Of course, it is not surprising that insurers say that paying billions of extra dollars each year to […]

Paul Krugman notes (following Floyd Norris) that in spite of soaring profits, the investment share of GDP is falling. This is very bad news for the economy, although it is not the first time it has happened. Net investment as a share of output actually peaked in the 70s, when the profit share was at […]