Archive
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News
Schularick, Taylor & Jorda’s INET funded research is featured in the FT
Apr 7, 2021
“The economists Òscar Jordà, Moritz Schularick, and Alan Taylor studied the sensitivity of house prices to interest rates across 14 countries and 140 years of history. They found that a 1 per cent rise in interest rates reduces the ratio of house prices to incomes by about 4 per cent. In New Zealand, for example, that ratio has risen by about half in a decade, implying a double-digit rise in interest rates to stabilise it.” — Robin Harding, FT
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News
Lynn Parramore appeared on Ian Masters to discuss her latest INET articles
Apr 6, 2021
Lynn Parramore appeared on Ian Masters to discuss Biden’s stimulus package and the “New Koch Brothers” wrecking America’s green new deal.
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Article
Wikipedia’s Deep Ties to Big Tech
Apr 5, 2021
Contrary to its image as a cash-strapped, transparent public service, Wikipedia is a wealthy NGO with close ties to big tech companies that it tries to obscure
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News
Appelbaum & Batt’s INET funded research is cited in the Boston Globe
Apr 5, 2021
“In “Private Equity’s Engagement With Health Care: Cause for Concern?” a report to the Institute for New Economic Thinking, researchers Eileen Applebaum and Rosemary Batt found that wages dropped at urgent care centers after acquisitions by private equity companies. They were 9 to 12 percent lower than hospital wages. More consolidation and Amazon’s relentless drive to suppress costs bode more of the same.” — Brian Alexander, Boston Globe
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Webinars and Events
Indian Development History and New Horizons for Asia
WebinarWith Montek S. Ahluwalia, A. Michael Spence. Chaired by Rob Johnson
Apr 1, 2021
The discussants will illuminate the findings and wisdom in Montek S. Ahluwalia’s book BackStage: The Story Behind India’s High Growth Years (2019) and then explore the challenges for the developing world and Asian geopolitics.
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Video
This Is Your Wake-Up Call
Mar 31, 2021
The world has changed, and we need to adapt. Andrew Sheng calls for a more human economics to drive us toward a sustainable future.
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Article
Chicago School Economists Got it Wrong. Strong Antitrust Policy Boosts the Economy.
Mar 29, 2021
History shows robust antitrust enforcement helps promote a prosperous, fair, and balanced economy. Antitrust expert Mark Glick explains how the U.S. went astray during the 1980s, and how to get back on track.
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Article
Austerity Raises Covid Deaths
Mar 26, 2021
Mortality and economic data show how constraints to government spending and a skepticism of redistributive policies have made the pandemic far worse
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News
Diego Comin’s INET funded research is featured in Dartmouth News
Mar 26, 2021
“As consumers become richer, they spend more on services such as health and education, the demand for which is much more income elastic, and less on agriculture and manufactured goods, according to a recent study, co-led by Diego Comin, a professor of economics. The results are published in Econometrica. Until now, productivity has often been considered at least as important, if not more, than preferences, in shaping the sectoral composition of the economy. Politicians and business leaders often make claims about why certain sectors in the economy are shrinking, such as the decline in U.S. manufacturing is due to robotics or trade with China. Such assessments are flawed, as the sectoral composition of the economy is mostly driven by preferences and not by productivity, according to the study, which models long-run structural change in the economy.” — Amy Olsen, Darmouth News
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Working Paper
Working Paper SeriesLessons for the Age of Consequences: COVID-19 and the Macroeconomy
Mar 2021
Mortality and economic data show how constraints to government spending and a skepticism of redistributive policies have made the pandemic far worse
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News
Senator Baldwin cites INET's working paper on pharmaceutical funding in the HELP Committee meeting
Mar 24, 2021
“From 2010 to 2019 the FDA approved 356 drugs. Recent research from Bentley University finds that NIH funding contributed to every single new drug approved. At a cost to the tax payer of roughly $230 billion dollars. In spite of this contribution the NIH is listed on only 27 of those patents. This suggests that while tax payers provide funding for the bulk of the early stage research they do not get patent protections supposedly secured by the by dole act. In essence American tax payers are paying the highest prices in the world for drugs they already paid to help develop.” — Senator Tammy Baldwin
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News
William Lazonick’s INET funded research is cited in Counter Punch
Mar 22, 2021
“As William Lazonick and other analysts have pointed out, stock buybacks artificially inflate executive pay and drain capital that could be put to productive purpose. .[xxv] — Sarah Anderson, Counter Punch [xxv] William Lazonick, “Profits Without Prosperity,” Harvard Business Review, September 2014.”
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Article
New CDC Guidelines to Reopen Schools Could be Dangerous
Mar 19, 2021
School re-opening push based on outdated science is poorly timed in face of coronavirus resurgence
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Article
The Economics of the 2021 American Rescue Plan
Mar 18, 2021
How to Get Relief to Those Who Need It. Gosia Glinska in Conversation with Anton Korinek
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Article
The Full Case Against Ultra Low and Negative Interest Rates
Mar 17, 2021
There are several reasons why unprecedentedly low interest rates will probably not stimulate demand and may even threaten financial stability
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News
Schularick, Taylor, & Jorda’s INET funded research is cited in Bloomberg on the most stable investments
Mar 17, 2021
“The issue is important because it tends to conflict with a hugely influential study published in 2017, called The Rate of Return on Everything, by Oscar Jorda, Katharina Knoll, Dmitry Kuvshinov, Moritz Schularick, and Alan M. Taylor. This was a mightily ambitious piece of financial archaeology covering 17 countries, and it rendered the startling result that housing performed virtually as well as equities over time, but with much less volatility. The result held true for every country that Jorda and his colleagues examined.” — John Authers, Bloomberg
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Video
The Master Algorithm
Mar 16, 2021
What’s the Future and Why It’s Up to Us
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News
Steven Fazzari cites his INET article in an interview at Washington University
Mar 12, 2021
“I believe they mostly got this right. Just before President Biden took office, I presented some thoughts on what a rescue plan should include to deal with the macroeconomic challenges of the pandemic. I emphasized four broad areas: public health spending, enhanced unemployment benefits, assistance to state and local governments, and so-called “stimulus checks” to households. The legislation the president has signed does a pretty good job in all four areas.” — Sara Savat, Washington University News Room
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Working Paper
ReportThe Pandemic and the Economic Crisis: A Global Agenda for Urgent Action
Mar 2021
INET’s Commission on Global Economic Transformation - Interim Report on the Global Response to the Pandemic
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News
Lynn Parramore appeared on Wort 89.9 FM to discuss her latest INET article on the “New Koch Brothers”
Mar 11, 2021
“Hedge fund managers are torpedoing chances for a successful Green New Deal, according to Lynn Parramore, Senior Research Analyst for the Institute for New Economic Thinking. In her recent article “Meet the “New Koch Brothers” – the Hedge Fund Activists Wrecking America’s Green New Deal“, she talks about how corporate raiders are turning the direction of “green” corporate partners of battery development, software, wind turbines, and more away from long term energy conservation projects toward short-term money-making projects to increase the hedge fund shareholder returns.” — WORT 89.9 FM
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News
Lynn Parramore appeared on Wort 89.9 FM to discuss her latest INET article on the “New Koch Brothers”
Mar 11, 2021
“Hedge fund managers are torpedoing chances for a successful Green New Deal, according to Lynn Parramore, Senior Research Analyst for the Institute for New Economic Thinking. In her recent article “Meet the “New Koch Brothers” – the Hedge Fund Activists Wrecking America’s Green New Deal“, she talks about how corporate raiders are turning the direction of “green” corporate partners of battery development, software, wind turbines, and more away from long term energy conservation projects toward short-term money-making projects to increase the hedge fund shareholder returns.” — WORT 89.9 FM
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News
Tony Lawson’s INET conference paper was cited in Econopoly
Mar 10, 2021
It is an attitude typical of conventional economists that sees the claim to qualify as technicians who deal with “social engineering”, on the basis of a “true” economic theory. Disrespectful of the epistemological (i.e. research methods) and even ontological principles (concerning the conception of the world). — Riccardo D’Orsi, Econopoly …. Citation: Lawson, T. (2010). Really Reorienting Modern Economics . Institute for New Economic Thinking (INET), April 10.
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Video
America Has No Problems
Mar 10, 2021
…That Five Years of Full Employment Wouldn’t Fix
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News
William Lazonick’s INET funded research was cited in Crenshaw’s speech at the SEC
Mar 10, 2021
“And what if there is a stock buyback during the period the share price is inflated? Does that harm shareholders because the company is spending money to repurchase its stock, or does it actually further benefit them by potentially raising earnings per share (EPS)?” … Citation: William Lazonick, The Financialization of the U.S. Corporation: What Has Been Lost and How It Can Be Regained, 36 Seattle U. L. Rev. 857, 859 (2013) (noting that trillions of dollars are spent on share buybacks and that “corporate executives who make these decisions are themselves prime beneficiaries of this focus on rising stock prices as a the measure of corporate performance”)
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Article
The Standard Economic Paradigm is Based on Bad Modeling
Mar 8, 2021
The New Keynesian Dynamic Stochastic General Equilibrium (DSGE) is a straightjacket for macroeconomics
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Working Paper
Working Paper SeriesCordon of Conformity: Why DSGE models Are Not the Future of Macroeconomics
Mar 2021
The New Keynesian Dynamic Stochastic General Equilibrium (DSGE) is a straightjacket for macroeconomics
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News
Philip Mirowski’s INET working paper is suggested reading in the Daily Kos
Mar 7, 2021
The Political Movement That Dared Not Speak its Own Name: The Neoliberal Thought Collective Under Erasure Philip Mirowski [Institute for New Economic Thinking, August 2014] ….consider the question: how should we approach the construction of a reliable history of a group of intellectuals who have managed to turn their meditations into a political movement on a global scale? Of course this raises timeworn problems of the relationship between theory and practice; but the Neoliberal case sports a further thorny complication: while we can fairly comprehensively identify the roster of whom should be acknowledged as a part of the movement, at least from its beginnings in the 1930s until the recent past, we are confronted with the fact that, in public, they themselves roundly deny the existence of any such well-defined thought collective, and stridently denounce the label of Neoliberalism. Not only do they wash their hands of most of the documented activities of the Neoliberal Thought Collective – think of Hayek and Friedman and their denials concerning the Pinochet interlude in Chile— but their plaint is that their opponents the socialists have always gotten the better of them, and thus their political project has never enjoyed any real successes, ever, anywhere, contrary to all evidence brought to the table. They are forever the bridesmaid of conservative parties, never the bride, to hear them tell it. Given the sheer numbers of people involved, and the really astronomical sums of money, and the cultural dominance of the airwaves, this sad sack victimhood is really quite remarkable, and itself calls for serious examination. Perhaps it has something to do with the fact that a political movement that dare not speak its own name has intellectual contradictions that it dare not air openly.
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News
Cai & Baker’s INET working paper is discussed in News One
Mar 5, 2021
“With all of that said, The Institute for New Economic Thinking (INET) recently published a study casting doubt about the methodology BLS uses to tabulate its unemployment data, especially when it comes to Black people. INET suggested that BLS’ data is inaccurate and downplays Black unemployment. On average, Black men’s unemployment rate is 2.8 percentage points higher than BLS data shows,” according to INET’s study, entitled, “Masking Real Unemployment: The Overall and Racial Impact of Survey Non-Response on Measured Labor Market Outcomes.” The same was true for BLS’ unemployment rate for Black women, which INET found was, on average, about 2.4 percentage points lower than its actual rate. The differences grow for younger Black males from 16 to 34 years old. INET’s findings lend some credence to a tweet from the Center for American Progress after January’s jobs report was published that said Black women, in particular, “are still being left behind by the recovery.” — Bruce C.T. Wright, News One
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News
Yahoo Money features Cai & Baker’s INET working paper
Mar 5, 2021
“Making matters worse, the Black unemployment rate might be much higher, according to a new analysis by the Institute for New Economic Thinking. The unemployment rate is calculated using data from the Current Population Survey. But that survey has a much lower response rate from Blacks than from white Americans, leading to more misclassifications in the official unemployment rate. For Blacks, the response rate is 72%, while the response rate is 90% for whites. Factoring that in, the unemployment rate for Black workers could be at least 2.6 percentage points higher than the monthly rate by the BLS, leaving it at 12.5% in February, the analysis found. For whites, the increase is much smaller at 0.7 percentage point. “The Current Population Survey has been missing a larger share of the population over time, particularly among Blacks,” said Baker, who is also an author of the analysis. “You have to ask what’s the situation for the people they’re not talking to.” — Denitsa Tsekova, Yahoo Money
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Article
Meet the "New Koch Brothers" – the Hedge Fund Activists Wrecking America’s Green New Deal
Mar 4, 2021
Wealthy predators are playing stock market games with companies needed to develop and produce clean technology
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News
Institute for Public Accuracy summarized Lynn Parramore's article
Mar 4, 2021
“The piece gives a series of case studies. Parramore summarized the problem: “Players on Wall Street have been torpedoing our chances of averting environmental catastrophe for years. A group of billionaire financiers has made sure the companies the government must partner with to fight climate change are focused on one thing only – making these men (they all seem to be men) even richer. Instead of leading the world in climate change technology, firms like Apple, GE, and Intel have been pressured to become the personal piggy banks of powerful moneymen — known as hedge fund activists — who can’t see beyond the next quarterly report.” — Institute for Public Accuracy
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Article
Missing Voters and Missing Unemployed Black Workers
Mar 3, 2021
Like Republicans with political polls, unemployed Black workers are underrepresented in federal employment data because of non-response.
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News
Nina Banks INET article is cited in Nonprofit Quarterly
Mar 3, 2021
“Pressley’s resolution builds upon the academic intellectual framework developed by advocates like Dantas and Wray, as well as the ongoing civil rights demand for federally guaranteed jobs, which can be seen in the 1963 March on Washington for Jobs and Freedom (where the Rev. Dr. Martin Luther King, Jr. gave his “I have a dream” speech) and indeed long before that. It also draws on the work of Sadie Alexander, recognized as the nation’s first Black woman economist. Speaking at Florida Agricultural and Mechanical College in 1945 (as noted by Professor Nina Banks, blogging at the Institute for New Economic Thinking), Alexander described full employment as a way to address the nation’s economic and racial imperatives.” — Marin Levine, Nonprofit Quarterly
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Working Paper
Working Paper SeriesMasking Real Unemployment: The Overall and Racial Impact of Survey Non-Response on Measured Labor Market Outcomes
Mar 2021
A large and growing percentage of households are missed in the monthly Current Population Survey (CPS).
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Article
A Big Fiscal Push is Urgent, The Risk of Overheating Is Small
Mar 2, 2021
The $1.9 trillion stimulus should be large because the need is large
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News
Rob Johnson joined the Background Briefing with Ian Masters
Feb 25, 2021
Rob Johnson appeared on the Background Briefing with Ian Masters to discuss working with Trumpsters, the source of their anguish, and important pathways to healing
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Article
The Erroneous Foundations of Law and Economics
Feb 25, 2021
Conservative legal theory is based on a shoddy definition of what constitutes “efficiency”
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Working Paper
Working Paper SeriesThe Erroneous Foundations of Law and Economics
Feb 2021
Conservative legal theory is based on a shoddy definition of what constitutes “efficiency”
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News
INET funded research articles are cited in The Conversation
Feb 24, 2021
Two separate INET funded research articles are cited; first from Schularick, Jordà, & Taylor on leveraged bubbles followed by Bao, Hommes, & Makarewicz on bubble formation. “Since their inception, financial markets, and to a lesser extent some real markets, have been subject to bubbles. … More recently, stock prices, but also credit, real estate, commodities, bond markets, and famously, bitcoin, are all assets that have experienced bubble episodes. Regarding cryptocurrencies, many economists also defend a permanent bubble, their fundamental value being theoretically non-existent.” …. In fact, the presence of bubbles in the markets (financial and real) seems to stem from the persistent behavior of economic agents. Experimental studies, controlling exactly the actual value, showed that participants tended to set up a bubble-like operation, with price surges and collapses very similar to real economy situations, and in no way related to a change in the market.
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News
Counterpunch cites James Galbraith’s INET article on the Texas Freeze
Feb 23, 2021
“Texas’ leaders knew as of 2011 … when the state went through a short severe freeze, that the system was radically unstable in extreme weather,” wrote James K. Galbraith, of the University of Texas at Austin, in the Institute for New Economic Thinking. “But they did nothing,” he wrote. “To do something, they would have had to regulate the system. And they didn’t want to regulate the system, because the providers, a rich source of campaign funding, didn’t want to be regulated and to have to spend on weatherization that was not needed – most of the time.” That’s what happens when the private sector calls the shots. Money first.” — Richard Gross, Counterpunch
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News
The Coastal Review cites INET's Working Paper on the economic history of African Americans
Feb 23, 2021
“Economic opportunity was further restricted by individual and institutionalized racism and political disenfranchisement. Discrimination in hiring by employers and intimidation of black workers through violence placed black workers at a direct disadvantage in the labor market,” Trevon Logan Peter Temin wrote in “Inclusive American Economic History: Containing Slaves, Freedmen, Jim Crow Laws, and the Great Migration,” a working paper written for the Institute for New Economic Thinking.” — Coastal Review
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Article
Housing and the American Dream: Is A House Still a Home?
Feb 23, 2021
Single-family home-ownership—elusive for many today—is an aspiration we ought to abandon
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Webinars and Events
Debt Talks Episode 6 | Who’s Afraid of European Banks?
Webinarwith Martin Arnold, Elena Carletti and Richard Vague; moderated by Thomas Fricke and Moritz Schularick
Hosted by Private Debt
Feb 23, 2021
Does the COVID recession still have the potential to turn into a broader financial meltdown?
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Article
To Fight Climate Change, Save Energy and Reduce Inequality
Feb 22, 2021
The IPCC was correct in emphasizing the need for early mitigation, but their analysis of possible growth trajectories appears to be faulty.
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Article
Mayor Yvonne Aki-Sawyerr, OBE, Freetown City Council, Sierra Leone
Feb 22, 2021
“We’re building a data system, because you can’t really manage a city if you don’t know who’s there and what’s in it.”
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Article
Google’s Dominance of Online Ads is a Big Deal. Here’s How to Fix It.
Feb 19, 2021
Legal scholar Dina Srinivasan talks to INET’s Lynn Parramore about restoring fairness to a regulatory Wild West.
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Article
Cold Truth: The Texas Freeze is a Catastrophe of the Free Market
Feb 18, 2021
Texas’s electricity market “reforms” made the current crisis inevitable
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Article
Artificial Intelligence Could Mean Large Increases in Prosperity—But Only for a Privileged Few
Feb 18, 2021
Labor-saving advances in AI may undo the gains from globalization and pose new challenges for economic development
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Working Paper
Working Paper SeriesArtificial Intelligence, Globalization, and Strategies for Economic Development
Feb 2021
Labor-saving advances in AI may undo the gains from globalization and pose new challenges for economic development
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Article
George Soros and Rob Johnson Endorse an Appeal to the EU: Build a Green, Fully Employed, Resilient Economy
Feb 17, 2021
Revival of failed austerity policies of the past is simply not an option
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News
Makronom cites Servass Storm’s INET working paper, Lost in Deflation
Feb 16, 2021
“That Italy is “lazy to reform” is probably one of the most widespread myths - and has little to do with reality. In 2015, for example, the OECD rated Italy’s reform efforts as significantly higher than those of Germany and France. The Dutch economist Servaas Storm takes the same line. In an in-depth study, he found that Italian politics as a whole adhered much more closely to the (market-liberal) economic policy guidelines of the EU than Germany and France.” — Phillip Heimberger & Nikolaus Kowall, Makronom
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Article
CBO Not Competent to Assess Economics of Minimum Wage
Feb 16, 2021
James K. Galbraith slams “unreliable” report claiming that raising the minimum wage would reduce jobs
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News
Project Syndicate features Joseph Stiglitz INET funded research
Feb 15, 2021
“The Biden administration must put a high enough price on carbon pollution to encourage the scale and urgency of action needed to meet the commitments it has made to Americans and the rest of the world. The future of our planet depends on it” — Nicholas Stern & Joseph Stiglitz, Project Syndicate
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News
William Janeway joined the European Straits podcast to discuss YSI and his work on venture capital.
Feb 12, 2021
— European
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News
Brad Delong recommends William Janeway’s INET Video Series: Venture Capital in the 21st Century
Feb 12, 2021
William Janeway: Venture Capital in the 21st Century: ‘In this eight-part lecture series, Bill Janeway investigates the relationship between venture capital and technological innovation, and the interdependent roles of entrepreneurial firms, the mission-driven State and financial speculation in the overall innovation system… LINK: https://www.ineteconomics.org/perspectives/videos/venture-capital>
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Article
The Big Squeeze
Feb 12, 2021
Is r/wallstreetbets really leading a financial revolution?
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Article
Big Money Drove the Congressional Elections—Again
Feb 11, 2021
The Straight Truth
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Article
Dr Matshidiso Moeti, WHO Regional Director for Africa
Feb 10, 2021
“Equitable COVID19 vaccine distribution is a very important issue of global solidarity”
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News
Daily Kos lists Sheila Dow's INET article on the Future of Macroeconomics as suggested reading
Feb 9, 2021
The Future of Macroeconomics Institute for New Economic Thinking, via Naked Capitalism 2-2-21]
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News
Taylor and Barbosa’s response to Krugman's inflation argument is summarized in Daily Kos
Feb 9, 2021
RSS PUBLISHED TO eState4Column5©2013 Political Economy Group DK PEG Anti-Capitalist Chat TAGS Culture Economy Employment Media MMT PoliticalEconomy publicpolicy stagflation WhiteHouse Share this article Let real wages (of $15+/hour) grow faster than labor productivity for some years, undoing the wage repression of the last decades. We have been misled by neoliberal economics for now many decades, it’s time to turn many things around in what is becoming a second-rated US economy, recently crippled by the malevolent and narcissistic “king of debt”. In economics, stagflation or recession-inflation is a situation in which the inflation rate is high, the economic growth rate slows, and unemployment remains steadily high. It presents a dilemma for economic policy, since actions intended to lower inflation may exacerbate unemployment. The biggest risk for the stock market in 2021 is inflation, according to Morgan Stanley. Unprecedented radical spending by the federal government and the Federal Reserve, to stave off a panic-induced market crash, helped artificially drive stocks to temporary new highs last year. www.laloftblog.com/… For some, the math bore out the possibility that exuberance was rational even if the economy is always more irrational than its math. “The Lucas fantasy of costless disinflation from credible commitments in an ergodic world of rational agents was decisively falsified long ago.” The underlying problems of supply shocks related to Trumpian idiocy atop bailing out the banksters may have made the economy much worse. The pandemic has only made a bad situation worse, or made more of us myopic in our isolation. Paul Krugman has now taken the time to question the orthodoxy of stagflation. Darn economic orthodoxy being wrong since the 1970s. Let me start with the inflation story the way most economists, myself included, have been telling. In the beginning was the Phillips curve: the apparent tradeoff, fairly visible in the data, between unemployment and inflation. In the 1960s many people looked at that tradeoff, considered the mild costs of inflation versus the benefits of lower unemployment, and argued for monetary and fiscal policies aimed at running the economy hot. But in a hugely influential speech Milton Friedman made an argument also independently made by Columbia’s Edmund Phelps: the unemployment-inflation tradeoff wasn’t real, because any sustained effort to keep unemployment low would lead not just to high inflation but to ever-accelerating inflation. They claimed, specifically, that people setting wages and prices would begin marking them up to anticipate future inflation, so that the inflation rate associated with any given unemployment rate would keep rising. They predicted, in particular, that the course of the economy over time would look something like this: https___bucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com_public_images_81db75c8-59f2-4b95-a60a-fe404a50c119_914x5331.png First, a government would push unemployment down; but this would lead to ever-rising inflation, which would stay high even as the economy cooled. So it would take a sustained period of high unemployment to get inflation down again, until finally unemployment could be brought back to a sustainable level. So their analysis predicted “clockwise spirals” in unemployment and inflation. Then came the 1970s: https___bucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com_public_images_1d91277a-44fe-422b-b0c3-f1dfa8fb7428_933x5501.png This sure looked like a dramatically successful out-of-sample prediction — sort of an economics version of “Light bends!” Almost everyone in the economics profession took the Friedman-Phelps analysis as confirmed. This in turn had big practical and intellectual consequences. First, governments and central banks stopped pursuing low unemployment, believing that excessively ambitious stimulus caused the stagflation of the 1970s. They began aiming for stable unemployment around the NAIRU —non-accelerating-inflation rate of unemployment — instead. Second, since the Friedman/Phelps prediction was based on trying to assess what rational price-setters would do, their apparent success gave a big boost to the notion that all economics should be based on maximizing behavior. Friedman always had too strong a reality sense to personally go down the rational-expectations rabbit hole that swallowed much of macroeconomics, but given the law of diminishing disciples it was bound to happen. Third, the whole affair gave a boost to conservative ideology. We had seemingly seem a demonstration of the limits to government action; also, the Chicago boys had seemingly been proved right about something big. (I remember classmates in grad school saying “They were right about this. Why don’t you think they’re right about the rest?”) Finally, the Volcker disinflation of the 1980s — using high unemployment to end high inflation — became, in many minds, the model of what responsible policymakers should do: make tough choices for the sake of the future. BUT WHAT IF WE’VE BEEN TELLING THE WRONG STORY ALL ALONG? […] But suppose something like this is true. In that case, the narrative that saw stagflation both as the cost of excessively ambitious macroeconomic policy and as a vindication of conservative economic ideas was mostly wrong. And that matters not just for history but for policy right now, which is still to some extent constrained by the fear of a 70s repeat. How do you ask someone to be the last worker to be unemployed for a mistake? paulkrugman.substack.com/… The reality in a response by Lance Taylor and Nelson Henrique Barbosa Filho is that “For practical purposes, the results mean that, for the Fed to meet its inflation target, it would be necessary to let real wages grow faster than labor productivity for some years, undoing the wage repression of the last decades. Biden’s $15 minimum-wage proposal is a correct step in that direction.” This is despite so many economists taking an opposite, more cautious position. — Daily Kos
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Article
Mass Producing Covid-19 Vaccine
Feb 9, 2021
Capacity, Scale, and Control
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News
Lynn Parramore joined the This is Hell! podcast to discuss her recent article on the surge in deaths of despair amid the pandemic
Feb 9, 2021
“Cultural theorist Lynn Parramore on the deep social effects of economic precarity, and her article “Epidemic of Despair Could Haunt America Long After COVID” at the Institute for New Economic Thinking. https://www.ineteconomics.org/perspectives/blog/epidemic-of-despair-could-haunt-america-long-after-covid” — Chuck Mertz,This is Hell!
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News
Osservatorio cites INET Working Paper on Carbon Pricing
Feb 8, 2021
“A recent study by the Institute for New Economic Thinking, painting a wider picture, shows that the effective reduction in emissions due to carbon pricing policy comes to between just 1 and 2.5 percent of the total.” — Ornaldo Gjergji, Osservatorio
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News
MIT News features Baron and Verner’s INET funded research into banking crises
Feb 8, 2021
“Panics are not needed for banking crises to have severe economic consequences,” says Emil Verner, the MIT professor who helped lead the study. “But when panics do occur, those tend to be the most severe episodes. Panics are an important amplification mechanism for banking crises, but not a necessary condition.” Indeed, in an ambitious piece of research, spanning 46 countries and going back to 1870, the study surveys banking crises that occurred with and without panics. When there is a panic and bank run, the research finds, a 30 percent decline in banking-sector equity predicts a 3.4 percent drop in real GDP (gross domestic product adjusted for inflation) after three years. But even without any creditor panic, a 30 percent decline in bank equity predicts a 2.7 percent drop in real GDP after three years.” — Peter Dizikes, MIT News
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News
Rob Johnson s quoted in Jacobin on why cable networks are hostile toward Medicare for All
Feb 8, 2021
“Consider the following point made by Institute for New Economic Thinking executive director Rob Johnson during a recent interview when asked about Medicare for All: “Public opinion polls show more than 70 percent of the population is in favor of Medicare for All. It’s not the population that doesn’t want it, and they’re the ultimate voters. It’s vested interests and the struggle that has to do with the relationship between money-raising campaign war chests and the probability of re-election and what you might call the refractory influence of the mainstream media, where pharmaceutical companies in particular and insurance companies as well are very big advertisers.” — Luke Savage, Jacobin
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Article
Mainstream Economists Have Been Using a Misleading Inflation Model for 60 Years
Feb 8, 2021
Comment on Paul Krugman’s recent observations on US inflation
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Article
Epidemic of Despair Could Haunt America Long After COVID
Feb 3, 2021
Researchers worry the pandemic may have severe after-effects, with deaths of despair impacting more distressed and newly-vulnerable populations
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Video
Black Women's 'Double Gap' in Wages
Feb 3, 2021
Black women are forfeiting $50 billion/year in the US due to the combined gender and racial wage gap.
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Collection
Economics Has A Race Problem
Traditional economics, like the ethos of the “American Dream,” tells us that our individual talents and efforts determine whether or not we succeed in life. Yet, an overwhelming body of evidence shows that people of color have been denied the same opportunities to succeed in America. Race is not only a defining feature of social identity and an arbiter of access to power and privilege; for far too many Americans, race - a social construction - is a fundamental determinant of their economic destiny.
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Article
The Future of Macroeconomics
Feb 1, 2021
Developments in the real economy have persistently challenged central tenets of older economic thinking, such as the supposed close connection between the money supply and inflation.
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Video
Prison for the Poor
Jan 27, 2021
Rethinking Crime and Inequality with Stratification Economics
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News
Lazonick and Shin's INET funded research is cited in Naked Capitalism
Jan 26, 2021
“In taking over industrial companies, financial managers focus on the short run, because their salary and bonuses are based on current year’s performance. The “performance” in question is stock market performance. Stock prices have largely become independent from sales volume and profits, now that they are enhanced by corporations typically paying out some 92 percent of their revenue in dividends and stock buybacks.[6]” — Michael Hudson, Naked Capitalism [6]William Lazonick, “Profits Without Prosperity:Stock Buybacks Manipulate the Market and Leave Most Americans Worse Off,”Harvard Business Review, September 2014. And more recently, Lazonick and Jang-Sup Shin, Predatory Value Extraction: How the Looting of the Business Corporation Became the U.S. Norm and How Sustainable Prosperity Can Be Restored(Oxford: 2020).
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Webinars and Events
The Future of Work | Economic and Social Policies for the Digital Era
Webinarmoderated by Steve Clemons with Dani Rodrik, Pavlina Tcherneva and Laura Tyson
Jan 26, 2021
Given the mounting need to create good jobs, effect structural change, and transform the economy, what should policy priorities be in the digital era? Is there a role for industrial policy? What new policy options do we need to achieve inclusive prosperity?
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Article
Inflation, Import Prices, and the Labor Share
Jan 25, 2021
The Challenge to Bidenomics
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News
Antonella Stirati’s INET funded book in Sinistrainrete
Jan 25, 2021
“in addition to the author’s interpretations, there will also be a considerable list of texts and contributions that can be useful for approaching and deepening the economic debate and the developments of the alternative and post-Keynesian theoretical approach, even in its various currents. . The not obvious presence in the public debate of these topics makes the book an important reading in order to interpret the recent economic history of our country starting from the questions that the crisis triggered by the outbreak of the pandemic and the recipes prepared by the European and national institutions pose us. , of which however no shadow is seen in political decisions, having an interpretative key that escapes the mainstream logic is, even more so in this context, of crucial importance.” — Davide Romaniello, Sinistrainrete
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News
Noam Chomsky discusses INET research into money and politics on Jacobin
Jan 25, 2021
“One place to look always is where’s the money? Who funds congress? Actually, there’s a very fine careful study of this by the leading scholar who deals with funding issues in politics, Thomas Ferguson. He and his colleagues did a study about a year ago a careful study in which they investigated a simple question, “what’s the correlation over the years many years between campaign funding and electability to congress?” It’s almost a straight line, it’s the kind of close correlation that you barely get in the social sciences. The greater the funding, the higher the electability. You can find a few cases here and there that aren’t right on the line, but from the standpoint of social science it’s a remarkable correlation.” — Noam Chomsky, Jacobin
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News
Arjun Jayadev appeared on Bloomberg to discuss the 2021 budget and widening inequality in India
Jan 25, 2021
“What I’d really like to see going forward is some sort of vision which is inclusive and forward-looking in the medium and long term about all these kinds of aspects welfare; health, education, environment. In the past, we’ve had a situation when we’ve looked at other countries which have made this transition to more advanced economies. They have always had some element of industrial policy thinking through how they actually going to shift their populations from low-productivity to high-productivity. Currently, I think we’re doing things with a hope and a prayer. Our growth models have fizzled out so far. What we’re looking for is something in the next three to five years which will be aimed at re-opening new markets, more inclusion, and really ensuring the wealth of a much much larger fraction of the population than we are currently doing.” — Arjun Jayadev, Bloomberg “Jayadev, a professor of economics at Azim Premji University, said India has returned home this year after decades of failure in providing access to quality health care for a large part of the population. If there is a silver lining, then the crisis will give the country a chance to “build better,” in the words of Jaydev. This includes at least three elements – an environment that is closely linked to health outcomes, with a medium-term plan to keep health and education spending at a consistently high level. – aimed at improving the quality of the environment and, finally, committed to support. one-third of these elements are something similar to a city employment program. The budget could also help immediately by universalizing the PDS and supporting revenues through direct remittances, Jayadev said. “Overall, short-term relief and long-term structural focus will help transition to a more inclusive and vital growth strategy that is missing in the current vision.” — Pallavi Nahata, Bloomberg
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News
Storm’s INET funded research is discussed in Naked Capitalism
Jan 25, 2021
“One of the main reasons Italy’s economy is in such dire straits is its strict adherence to the EMU’s macroeconomic rule book — in particular the rules on fiscal austerity and structural reforms — as Dutch economist Servaas Storm painstakingly details in his article ‘Italy: How to Ruin a Country in Three Decades’” — Nick Corbishley, Naked Capitalism
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News
Comin's INET funded research into the drivers of technology adoption and its consequences is discussed in the Conversation
Jan 25, 2021
“The gap between the “technology haves and have nots” in the corporate world is widening. A recent study also found that this gap is widening between rich countries and poor countries. When few companies have access to 3D printers, robots, or cutting-edge AI, there are fewer actors to leverage such technologies to the point at which productivity will increase across the board.” — Wim Naudé, The Conversation
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News
Anatole Kaletsky discusses INET research in an interview with Project Syndicate
Jan 25, 2021
“INET has supported a lot of brilliant academic work in areas such as Imperfect Knowledge Economics, financial regulation, human development, and environmental economics. Such research has helped to discredit the ideas – such as “perfect” competition, “efficient” markets, and “rational” expectations – that formed the ideological foundations for laissez-faire microeconomics, monetarist central banking, and irrational pre-Keynesian fiscal policy, especially in Europe. As such, it has done as much as INET’s other work – including policy research, academic community-building, and deepening collaboration with the International Monetary Fund, the OECD, and other official institutions – to end market fundamentalism’s intellectual monopoly.” — Anatole Kaletsky, Project Syndicate
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News
Bofinger's INET article is listed on Daily Kos’s Week-end recommended reading list.
Jan 25, 2021
“Best of Mankiw: Errors and Tangles in the World’s Best-Selling Economics Textbooks Peter Bofinger, former member of the German Council of Economic Experts [Naked Capitalism January 4, 2021] Mankiw has been lambasted a number of times by Adbusters, the Canadian group which originated the call for mass protests that became Occupy Wall Street. Also see Toxic Textbooks: “Mankiw’s textbook seems an ideal place to look for clues as to how both the economics profession and the public which it educates became so ignorant, misinformed and unobservant of how economies work in the real world.” The problem with the leadership of the Democratic Party at the state and national levels is not the caricature of maliciousness that the Trumpists believe, and which the Republicans have used to “feed red meat to their base,” but merely that the leadership has been taught, and believes and swills, the snake oil Mankiw peddles. Below, just a small sample of Bofinger’s detailed take-down of Mankiw.” — NB Books Community, Daily Kos
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News
Economics & Beyond episode is cited as suggested listening in Bloomberg
Jan 25, 2021
“To get into the mood for their [Charles Goodhart and Manoj Pradhan] ideas, you can listen to the authors talk about them to my colleague Stephanie Flanders on the Stephanomics podcast, or this podcast from the Institute for New Economic Thinking, or this episode of The Sound of Economics podcast from the Bruegel Institute.” — John Authers, Bloomberg
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Working Paper
Working Paper SeriesInflation? It’s Import Prices and the Labor Share!
Jan 2021
Recognizing that inflation of the value of output and its costs of production must be equal, we focus on a cost-based macroeconomic structuralist approach in contrast to micro-oriented monetarist analysis.
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Article
The American Rescue Act: Do Whatever It Takes
Jan 19, 2021
The economy is likely to be crippled for months and fiscal rescue on a large scale, once again, is very much necessary.
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Webinars and Events
The Future of Work | Making Technologies Work for All
Webinarmoderated by Katya Klinova with Antonio Andreoni, Tess Posner and Martin Reeves
Jan 19, 2021
What are the choices we must make to ensure technology empowers, augments, rewards, and respects the majority, not the few, given its increasing defining role in future economies and societies?
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Article
Local David Versus Global Goliath
Jan 15, 2021
Populist parties and the decline of progressive politics in Italy
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Working Paper
Working Paper SeriesLocal David Versus Global Goliath: Populist Parties and the Decline of Progressive Politics in Italy
Jan 2021
This paper analyzes the role of local spending, particularly on social welfare, and local inequality as factors in the Italian political crisis following the adoption in 2011 of more radical national austerity measures.
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Article
Paper: Structural Transformation, Economic Development and Industrialization in Post-Covid-19 Africa
Jan 14, 2021
While Africa’s “premature deindustrialization” appears to be the dominant global narrative, recent analysis of the data suggests that de-industrialization is not the common experience for the majority of African countries
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Article
4 Charts Explain Why You Should Worry About the New U.K. Covid Strain
Jan 13, 2021
Expert warns that it could be a race against the clock as the fast-spreading B117 variant picks up steam in the U.S.
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Webinars and Events
The Future of Work | Are Redistribution Policies Enough?
WebinarModerated by Rana Foroohar with Gordon Hanson and Laura Tyson
Jan 12, 2021
Traditional welfare systems have emphasized the need for redistribution post-production. Are these policies sufficient in the future?
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Article
New Covid “Super Strain” is a Game-Changer for Schools and More
Jan 8, 2021
Expert warns that without more robust abatement measures and testing, the virus could rage until mid-2022.
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Article
Carlos Lopes: The COVID-19 Crisis Presents Major Opportunities for Africa’s Structural Transformation
Jan 6, 2021
In this interview, Camilla Toulmin and Folashadé Soulé speak with Carlos Lopes, Professor at the Nelson Mandela School of Public Governance, University of Cape Town, Visiting Professor at Sciences Po, Paris and an Associate Fellow at Chatham House, London
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Article
"Build Back Better" Needs an Agenda for Upward Mobility
Jan 5, 2021
How the dream of a middle class existence collapsed, first for Blacks, then for more and more white American workers and what the Biden administration could do to retrieve the situation.
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News
Appelbaum and Batt’s research into Private Equity buyouts is cited in Emergency Medical News
Jan 5, 2021
“The landscape of EM has consolidated into a few corporate conglomerates, which are oligarchies with iron grips on contracts through noncompetitive or illegal collusions with large hospital systems in the form of kickbacks. (Institute for New Economic Thinking. March 15, 2020; https://bit.ly/34fLeMD.) This has effectively castrated any hope for independent practices to thrive and injected many wrongful consequences into EM.” — Rizvi, Saba MD, Emergency Medical News
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News
The Gainesville Sun featured Peter Temin's INET-funded book
Jan 5, 2021
“But to my surprise, The Atlantic article explained that MIT economist Peter Temin, in his book “The Vanishing Middle Class: Prejudice and Power in a Dual Economy,” not only delved into the contributing factors to poverty and economic inequality, he offered systemic solutions. This approach made the piece a must-read for me because at Gainesville for All, we’re all about finding systemic solutions to problems linked to race and poverty. Temin offered five proposals he believes can help tip the scales favorably for those stuck in the lower class.”— James F. Lawrence, Gainsville Sun
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News
Dina Srinivasan's INET funded research into Google's advertising monopoly is featured in the NY Times
Jan 5, 2021
“When Texas and nine other states filed an antitrust lawsuit against Google last week, the complaint identified many of the same conflicts of interest as Ms. Srinivasan’s paper, Why Google Dominates Advertising Markets” in the Stanford Technology Law Review. The lawsuit said Google controlled every part of the digital advertising pipeline and used it to give priority to its own services, acting as “pitcher, batter and umpire, all at the same time.” … “Marshall Steinbaum, an assistant professor at the University of Utah’s economics department, wrote on Twitter that Ms. Srinivasan’s articles on Google and Facebook had a greater influence on the recently filed antitrust cases than all the other research about those companies or tech in general by traditional economists focused on competition policy.” — Daisuke Wakabayashi, New York Times
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Working Paper
Working Paper SeriesEmployment Mobility and the Belated Emergence of the Black Middle Class
Jan 2021
“Build back” means restoring the government and business investments in the productive capabilities of the U.S. labor force that created a growing middle class in the three decades after World War II
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Article
Best of Mankiw: Errors and Tangles in the World's Best-Selling Economics Textbooks
Jan 3, 2021
On the occasion of the ASSA 2021 Virtual Annual Meeting (Jan. 3-5), Peter Bofinger presents a “10 Best of” Mankiw list
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Video
Dr Anthony Fauci: ‘We Will End This Outbreak' | The Bottom Line
Dec 31, 2020
Dr. Anthony Fauci tells host Steve Clemons that the United States can go back to “normal” in the autumn, which starts in September 2021, if 70-85 percent of Americans get vaccinated by the summer.
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Article
4 Burning Questions on the Global Vaccine Rollout
Dec 29, 2020
Warnings of “corruption and incompetence coming together,” as economists William Lazonick and Öner Tulum study the race to end the pandemic.