Morning Must-Read: Richard Mayhew: Keeping It Like the Kaiser

Richard Mayhew: Keeping It Like the Kaiser: "The payer-provider model has been around US healthcare for a very long time... ...but the Kaiser twist on it is very wierd and as far as I know, no one else does it quite like Kaiser... a fully integrated payer provider with exclusive usage.... Almost all other non-governmental payer-providers are not exclusive walled gardens that systematically seek to minimize interaction with the entire US healthcare delivery ecosystem.... So what does this difference mean?... I think the Kaiser model... More >

Things to Read on the Afternoon of October 20, 2014

Must- and Shall-Reads: Katie McDonough: The right’s Lena Dunham delusion: Anger, misogyny and the dangers of business as usual Ha-Joon Chang: Why did Britain’s political class buy into the Tories’ economic fairytale? Wolfgang Münchau: Eurozone stagnation is a greater threat than debt   Daniel Drezner: Five Known Unknowns About the Future of the Global Economy: "Here are my top five known unknowns about the future of the global economy.... 1) The Summers/Gordon Question.... What if the elevated rates of economic growth that started with the... More >

Thomas Piketty, depreciation and the elasticity of substitution

When “Capital in the 21st Century” was published in English earlier this year, Thomas Piketty’s book was met with rapt attention and constant conversation. The book was lauded but also faced criticism, particularly from other economists who wanted to fit Piketty’s work into the models they knew well (Equitable Growth’s Marshall Steinbaum replied to many of those criticism here.) Now, a new working paper by the National Bureau of Economic Research shows how one of the more effective critiques of the book might not be... More >

Morning Must-Read: Daniel Drezner: Five Known Unknowns About the Future of the Global Economy

Daniel Drezner: Five Known Unknowns About the Future of the Global Economy: "Here are my top five known unknowns... ...about the future of the global economy.... 1) The Summers/Gordon Question.... What if the elevated rates of economic growth that started with the Industrial Revolution are now petering out in the developed world? What if all the low-hanging fruit that have kept growth high for the last two centuries have been exhausted? 2) The Eichengreen/Rodrik Question. The default assumption that most economists make is that the... More >

On the Proper Inflation Target: Monday Focus for October 20, 2014

In the 60 years since 1954, the Federal Reserve has been moved to cut the 3-Mo. T-Bill rate when a recession threatens by 2.0%-points or more 13 times--once every 4.6 years. There have been eight cuts of 4.0%-points or more--once every 7.5 years. There have been five cuts of 5.0%-points or more--once every 12 years. To me that suggests that the Greenspan-Bernanke policies--aim for 2.0%/year inflation, with a 300 basis-point "natural" short-term safe real interest rate on top of that when the economy is in... More >

Morning Must-Read: Paul Kasriel: The Monetary Base and the Money Multiplier: U.S. and Eurozone

Paul Kasriel: A Tale of Two Economies--It Was the Better of Times, It Was the Worst of Times: "As quantitative easing comes to an end (apparently)... ...by the Fed and is taken up by the European Central Bank (ECB), let’s compare the behavior of nominal domestic demand in each central bank’s economy and venture a reason for any differences. Plotted in Chart 1 are index values of the nominal Gross Domestic Purchases in the U.S. and the eurozone, respectively.... Now, let’s examine the behavior of... More >

Morning Must-Read: Daniel Davies: European Banking Stress Tests–Pour Encourager les Autres?

Daniel Davies: European Banking Stress Tests--Pour Encourager les Autres?: "It will turn out, I think... ...that a lot of banks will fail on the front cover, but pass at the back of the book--this would happen, for example, if a bank was made aware early in the year that it was at risk, and decided to do something about it. I think I can see the thinking behind this way of presenting the results. The Euroland supervisors are hoping that the headline news will be... More >

Morning Must-Read: Pascal Michaillat and Emmanuel Saez: Unemployment, and Product and Labour-Market Tightness

Pascal Michaillat and Emmanuel Saez: Unemployment, and product and labour-market tightness: "We do not have a model that is rich enough... ...and simple enough to lend itself to pencil-and-paper analysis.... Michaillat and Saez (2014)... retains the architecture of the Barro-Grossman model but replaces the disequilibrium framework on the product and labour markets with an equilibrium matching framework.... Both meal prices and product market tightness can adjust to equilibrate supply and demand for meals.... Both wages and labour market tightness adjust to equilibrate labour supply and... More >

Things to Read on the Morning of October 19, 2014

Must- and Shall-Reads: Jason Furman: Inclusive Growth: For Once, Some Good News Richard Pancost and Stephan Lewandowsky: Climate Uncertainty No Excuse for Inaction Izabella Kaminska: Market economics means more than just supply and demand: Tirole won a Nobel for crucial work on market dominance Reza Moghadam et al.: Euro Area — “Deflation” Versus “Lowflation”   Jeremy Hodges: Poker Pro Says He Didn’t Cheat in $12.4m Baccarat Haul: "Phil Ivey... 38, won the money playing a form of Baccarat called Punto Banco... using a technique known... More >