The demand curve for labor, like that for virtually every other good or service, slopes down and to the right. That is a harsh fact that many of my fellow liberals have great difficulty accepting. In lay terms, it means…
Author: Ed Lotterman
Global integration hits snag
The process of global economic integration hit some speed bumps this past weekend. The World Trade Organization talks in Cancun, Mexico, collapsed in disarray. Swedish voters rejected joining the euro zone within the European Union. And, E.U. officials failed to…
Rules or discretion? Monetary policy debate persists
Economists have long disagreed whether central banks, such as the U.S. Federal Reserve, should be guided by rules or by discretion in formulating monetary policy. The world’s two most important central bankers both weighed in on the issue in recent…
China’s current currency condition needs an update
I owe U.S. Treasury Secretary John Snow big time. I’m teaching international economics right now and the news his recent remarks in China generated gave me material for weeks. For those who missed it, Snow went to Asia in late…
Raising reservations about reserve
At a time when consumers are paying high prices for gasoline, the federal government is refilling stocks. While the recent filling of the U.S. Strategic Petroleum Reserve has not become a major national issue yet, it is stirring controversy. Consumers…
Over time, economic rules will trump overtime rules
Economists have failed dismally to convince the public of the benefits of trade. Perhaps we should admit that and start from scratch. Labor Day speeches brought attention to the Bush administration’s proposed changes to rules implementing the Fair Labor Standards…
Population counts when analyzing economic issues
Population change affects societies in powerful ways, but even the most insightful economists frequently overlook this variable when they analyze economic issues. The size of a nation’s population and the rate and direction of population change are critical because labor…
Gas prices spark call for action
Economists have failed dismally to convince the public of the benefits of trade. Perhaps we should admit that and start from scratch. We need some serious discussions about energy policies. U.S. gasoline prices took their highest two-week jump in 50…
Despite abundance, humans look for more
Most people in the United States enjoy an abundance of useful goods and services — more than nearly any other human who ever lived on Earth. Unfortunately, human nature is such that we do not appreciate this, nor does abundance…
Incentives aren’t only motivators
People change their behavior in response to incentives. This is a central tenet of economics and one that policy makers ignore at their — or society’s — peril. But not all the incentives that people respond to are monetary, financial…