- Jim Hamilton
- Per Krusell and Tony Smith
- James Galbraith
- Update: Debraj Ray
- Update: Larry Kotlikoff
- Update: Jason Furman
by Greg Mankiw (noreply@blogger.com) at May 30, 2014 03:29 PM
Daron Acemoglu wrote what seemed like a surprising upbeat piece on Turkish democracy a few days ago. His argument seems to be that democracy required power to be wrested away from the secularists who had erected authoritarian structures, and Erdogan had achieved that. Even though, Erdogan’s recent turn to authoritarianism is “lamentable,” it was, Acemoglu claims, a predictable stage in Turkey’s democratic transition. Once Erdogan is gone, the article implies, democracy would be on a stronger footing than ever.
There were in fact many other paths that could have proved less costly. The more typical pattern is that the old elites reach a modus vivendi with the rising, popular forces that preserves some of their privileges in return for opening up (as happened in Spain and many of the Latin American examples). The Erdogan model of decapitating the secular old guard with a series of sham political trials served instead to deepen old divides and ended up erecting an alternative set of authoritarian structures.
In the early years of Erdogan’s rule, it was easy to mistake the loosening of old taboos associated with the Kemalist-secular elite as a process of democratization. But towards the end of the 2000s, anyone who looked closely could not have been under a similar illusion. The repression of the media and the jailing of opponents on bogus charges had become an unmistakable pattern. Saying this was an inevitable and necessary step towards democracy would be odd indeed.
The Acemoglu article prompted Erik Meyersson and me to write a riposte of sorts. It is called “Erdogan’s Coup,” and can be read here.
by Greg Mankiw (noreply@blogger.com) at May 23, 2014 05:52 PM
by Greg Mankiw (noreply@blogger.com) at May 23, 2014 11:49 AM
Q. You are focused on inequality among the so-called “99 percent,” not between the 1 percent and the 99 percent. Why?
A. There’s a real national debate about the significance and causes of inequality. This public debate is dominated by the discussion of the top 1 percent. And the top 1 percent is important, but focusing on the top 1 percent conveys the message that the game is all rigged, that if you’re not in the elite stratum, there’s nothing to shoot for. And that’s just not the case. The growth of skill differentials among the other 99 percent is arguably even more consequential than the rise of the 1 percent for the welfare of most citizens.
Here’s a concrete way to see it: The earnings gap between the median college-educated two-income family and the median high school-educated two-income family rose by $28,000 between 1979 and 2012. This [shift] — which excludes the top 1 percent, since we’re focusing on medians — is four times as large as the redistribution that has taken place from the bottom 99 percent to the top 1 percent of households in the same period.
by Greg Mankiw (noreply@blogger.com) at May 23, 2014 10:07 AM
by Greg Mankiw (noreply@blogger.com) at May 23, 2014 06:59 AM
In summary, we don't believe HFT profits are excessive or excessively consistent. We censure illegal front running as strongly as anyone, but it has near nothing to do with HFT per se. Canceling orders in the process of providing liquidity is key to any sort of market making, whether HFT or not. We support the right of HFTs, or anyone, to try to guess the direction of the market, using order flow or any other public information. We not only support the right, we celebrate the successful exercise of that right as it adds to public welfare by making markets more efficient and lowering the cost of investing. Lastly, we believe markets are "rigged" in favor of, not against, retail investors.
by Greg Mankiw (noreply@blogger.com) at May 22, 2014 07:33 AM
by Greg Mankiw (noreply@blogger.com) at May 20, 2014 05:46 PM
by Greg Mankiw (noreply@blogger.com) at May 11, 2014 05:01 PM
Would Piketty’s followers be nearly as enthusiastic about his proposed progressive global wealth tax if it were aimed at correcting the huge disparities between the richest countries and the poorest, instead of between those who are well off by global standards and the ultra-wealthy?
by Greg Mankiw (noreply@blogger.com) at May 11, 2014 06:31 AM
by Matt Welsh (noreply@blogger.com) at May 07, 2014 11:58 PM
How quickly and how well are developing countries transforming their economies and with what effects on inter-sectorial growth and distribution? A group of us studied structural transformation looking at evidence from 109 countries over 30 years covering a 1980 to 2009 period with a particular focus on China, India, Indonesia and Brazil. We later followed up on the five members of the East African community.
Economists following Kuznets, Chennery and Syrquin, Johnston, Mellor and Timmer have described structural transformation (ST) as consisting of: (1) declining share of agriculture in Gross domestic product (GDP), (2) declining share of agriculture in employment, (3) rural-urban migration, (4) growth of the service and manufacturing sectors and (5) a demographic transition with reduction in the population growth rates and have noted that India’s transformation is stalled.
The turning point is reached when the share of employment in agriculture declines at a faster rate than the share of agriculture in GDP. Differences in labor productivity between the agricultural and non-agricultural sectors disappear in the final stages of structural transformation. Before labor productivities among sectors converge a huge and often even a widening gap occurs between labor productivities in the agricultural and non-agricultural sectors. Those differences explain inter-sectoral income inequalities and concentration of poverty in the agricultural sector.
Timmer and Akkus, noted in their earlier analysis of 86 countries that turning point for today’s developing Asian countries is taking longer and occuring at a higher income than was the case for the industrial countries because of the sheer sizes of the Asian labor forces in agriculture. Kuznets had explained the narrowing of income inequality at the later stages of industrial development in advanced countries in terms of their gradually increasing progressive policies, increased saving and investment in the new enpreneurial class and technological change which uses skilled labor. All these factors today explain the growing income inequalities in developed countries. We developed some new insights.
Ratio of Value added per worker in Non-Agriculture relative to Agriculture, in the World 1980-2009
Terms of Trade (Deflator for Agriculture/Deflator for Non-Agriculture [Industry + Service])(in US$) by Region (1980-2009)
[1]Based on a paper by Uma Lele, Manmohan Agarwal, Peter Timmer, and Sambuddha Goswami. Uma Lele is a Former Senior Advisor, the World Bank.
by Greg Mankiw (noreply@blogger.com) at May 05, 2014 07:27 AM
by Greg Mankiw (noreply@blogger.com) at May 03, 2014 03:18 PM
that brings me to Mitt Romney’s latest really bad idea, unveiled on Veterans Day: to partially privatize the Veterans Health Administration (V.H.A.). What Mr. Romney and everyone else should know is that the V.H.A. is a huge policy success story, which offers important lessons for future health reform.So this story from CNN (hardly a right-wing news source) caught my eye:
At least 40 U.S. veterans died waiting for appointments at the Phoenix Veterans Affairs Health Care system, many of whom were placed on a secret waiting list. The secret list was part of an elaborate scheme designed by Veterans Affairs managers in Phoenix who were trying to hide that 1,400 to 1,600 sick veterans were forced to wait months to see a doctor, according to a recently retired top VA doctor and several high-level sources. For six months, CNN has been reporting on extended delays in health care appointments suffered by veterans across the country and who died while waiting for appointments and care.Maybe privatization would solve the problem. If veterans had vouchers that they could take to competing healthcare providers, they would likely not have had to wait as long.
by Greg Mankiw (noreply@blogger.com) at May 03, 2014 07:21 AM
by Matt Welsh (noreply@blogger.com) at May 01, 2014 09:38 PM
by Greg Mankiw (noreply@blogger.com) at May 01, 2014 05:44 PM
by Greg Mankiw (noreply@blogger.com) at May 01, 2014 10:15 AM
by Greg Mankiw (noreply@blogger.com) at April 29, 2014 04:52 PM
We find that students in the traditional format scored 2.3 percentage points more on a 100-point scale on the combined midterm and final. There were no differences between formats in non-cognitive effort (attendance, time spent with online materials) nor in withdrawal from the class.
by Greg Mankiw (noreply@blogger.com) at April 29, 2014 03:19 PM
by Greg Mankiw (noreply@blogger.com) at April 28, 2014 09:58 AM
by Greg Mankiw (noreply@blogger.com) at April 25, 2014 11:31 AM