Further evidence on the relationship between economic freedom and economic growth

Much of the literature on the power of elected officials and bureaucratic agencies argues, from an empirical perspective, that bureaus appears to exercise autonomy. In this paper, a theoretical model sets out the conditions under which the Congress, the President, and one agency (we use the U.S. Federal Reserve as an extended example) can dictate policy outcomes. The results of the paper include the “Congressional Dominance” theorem: If more than 2/3 of House members, and more than 2/3 of Senate members, agree on something, they get it. The theorem is obvious (the “proof” is in the U.S. Constitution), but often forgotten in the substantive literature. More realistic results are derived for situations where the preferences of members of Congress are more diverse. Powers of the President to influence policy with, and without, appointments are also analyzed.     

Brief lives: economic life and political life in the history of economic thought

This paper considers the relationship between economic life and political life as it has been articulated in four contexts in the history of economics: the ancient, the mercantilist, the classical and the neoclassical. It examines the changing ways in which these aspects of behaviour have been seen to be related, and how that relationship has taken on different forms in different epochs of economic thought. The analysis seeks to reveal some of the remaining questions that arise in the question of the relationship between economic man and political man.     

The economic status of the aged.

This article discusses what is known about the economic status of the aged. Numerous complexities involved in the assessment of their status are discussed. Compared with most other recent assessments, this study finds a less favorable status for the aged relative to other age groups. The focus is on an examination of detailed age groups, rather than summary aged and nonaged groups--thus providing a more complete picture of age differences. More than most other assessments, this study stresses uncertainty about the relative status of the aged and emphasizes what we do not know. It stresses that better adjustments for differences in needs among age groups and other subgroups of the population are necessary. It emphasizes that consistency between the definition of resources and the specification of needs is essential. Also discussed is the vulnerability of the aged to economic risks. Major findings include: Median cash income is highest for middle-aged family units and lowest for the oldest and youngest units. The poverty rate for aged persons is above the rates for other adult age groups, but below the rate for children. When noncash income is considered in addition to cash income, the income of the aged tends to improve relative to that of the nonaged, but serious measurement problems exist. When wealth is considered in addition to cash income, the economic status of the aged improves relative to that of the nonaged.     

Korea and the global economic crisis

Abstract Korean policy-makers constructed the global economic crisis as a purely external threat to the domestic economy. This understanding of the crisis supported a selective retreat from neo-liberalism. More problematically, the construction of the crisis as an exogenous phenomenon allowed policy-makers to focus on maintaining short-term growth without seriously addressing the structural weaknesses of the economy that the crisis should have drawn attention to. Levels of household debt in Korea have risen since the crisis and are considerably higher than in the USA. Equally, the economy remains over reliant on exports as a source of growth.     

论经济自由与政府调控的关系——由美国经济危机引发的思考

美国次贷危机引发了如何正确处理经济自由与政府调控的关系的深入讨论.相当长一个时期以来,大多数西方学者和政要过分地夸大市场这只.看不见的手"在经济生活中的作用,抑或说强调极端的经济自由.19世纪中叶以后,由于西方国家过分推崇强调经济自由,完全依赖市场这只"看不见的手"的弊端开始暴露.20世纪初的凯恩斯主义和罗斯福新政引导西方资本主义国家度过了经济危机,为资本主义的重新发展奠定了基础.在现代市场经济中,金融及其衍生工具是刺激经济发展的重要因素之一,但是,证券、期货等金融衍生工具本身就带有强烈的投机性和风险性,如果缺乏必要的监管,任凭其随心所欲地自由泛滥,就不可避免地出现问题.西方资本主义制度建立以来的历史证明,什么时候把自由规范在一个合理的限度内,经济和社会发展就健康有序,什么时候自由离开了必要的限制,就会引发灾难.     

The economic impacts of the tobacco settlement.

Recent litigation against the major tobacco companies culminated in a master settlement agreement (MSA) under which the participating companies agreed to compensate most states for Medicaid expenses. Here the terms of the settlement are outlined and its economic implications analyzed using data from Massachusetts. The financial compensation to Massachusetts (and other states) under the MSA is substantial. However, this compensation is dwarfed by the value of the health impacts induced by the settlement. Specifically, Medicaid spending will fall, but only by a modest amount. More importantly, the value of health benefits ($65 billion through 2025 in 1999 dollars) from increased longevity is an order of magnitude greater than any other impacts or payments. The net efficiency implications of the settlement turn mainly on a comparison of the value of these health benefits relative to a valuation of the foregone pleasure of smoking. To the extent that the value of the health benefits is not offset by the value of the pleasure foregone, the economic impacts of the MSA will include a share of these health benefits.     

Estimating the local economic impacts of HOPE VI

This study identifies and measures the demonstrable changes to local political economies that can be reasonably attributed to HOPE VI redevelopments. It examines the extent to which the developments have contributed to increases in surrounding property values, decreases in serious crimes, additional regional economic activity, and changes in local tax revenues. It weighs these benefits against the public costs associated with the program.

Despite the expenses associated with HOPE VI, the redevelopments generate significant net social welfare benefits. In most cases, the collective tenant and neighborhood benefits exceed the net public costs of redevelopment. In addition, the redevelopments spark additional regional economic activity and contribute to an increase in the local tax base. HOPE VI's effects are far from uniform, however, and depend on the location of the redeveloped property, the characteristics of project funding, the strength of the local real estate market, and the presence of other development pressures.     

The economic tradition and the constitution of science

There has been an institutional turn in the philosophy of science, which has led the discipline to become more concerned with understanding how the scientific process actually works. This paper argues that such a philosophy of science, which lies beyond only proposing a logic of science, has something to learn from economics. Economic thinking can be instrumental in understanding the actual scientific process, and in proposing proper institutions guiding scientific competition. It is, however, also argued that economics would benefit from overcoming the pure logic of choice inherent to the neoclassical approach, by further developing the institutional approach to economics.     

Elite economic forecasts,economic news,mass economic expectations,and voting intentions in Great Britain

Abstract In order to test the notion that the electorate relies, derivatively, on professional economic forecasts, we consider the entire chain between elite economic expectations, economic news, mass economic expectations, and voter preferences. We find that while elite expectations are based on the objective economy, they are politically biased in the neighborhood of elections. Reports of economic news, while based on the objective economy and on elite expectations, have their own political rhythm in the form of election–related cycles. The pattern in news coverage, in turn, is mirrored by election–related cycles in personal and general expectations formed by the mass public. While the relevance of each of the linkages from elite expectations to news coverage to mass expectations is thus confirmed, our findings challenge the view that the link between mass expectations and voting intentions can be attributed mainly to the dissemination of elite forecasts to the general public. We conclude by discussing the implications of our findings for an understanding of the ability and functioning of mass electorates.     

Elite economic forecasts, economic news, mass economic expectations, and voting intentions in great britain

In order to test the notion that the electorate relies, derivatively, on professional economic forecasts, we consider the entire chain between elite economic expectations, economic news, mass economic expectations, and voter preferences. We find that while elite expectations are based on the objective economy, they are politically biased in the neighborhood of elections. Reports of economic news, while based on the objective economy and on elite expectations, have their own political rhythm in the form of election–related cycles. The pattern in news coverage, in turn, is mirrored by election–related cycles in personal and general expectations formed by the mass public. While the relevance of each of the linkages from elite expectations to news coverage to mass expectations is thus confirmed, our findings challenge the view that the link between mass expectations and voting intentions can be attributed mainly to the dissemination of elite forecasts to the general public. We conclude by discussing the implications of our findings for an understanding of the ability and functioning of mass electorates.     

On the economic incentives for taking bribes

This paper presents an empirical analysis of the factors affecting bribe taking by public officials. Factors influencing the acceptance of bribes include: the probability of being convicted, severity of punishment, government salary relative to private sector income, the demonstration effect, and the unemployment rate. Our results indicate that higher probability of being convicted discourages the acceptance of bribes as does more severe punishment. Low relative earnings, high unemployment, and the demonstration effect of aggregate advertising all lead to increased bribe taking.     

The economic metric

This essay is about a money wage subsidy intended to reduce unemployment in regions with high unemployment and increase net exports. The genre of the essay is an idealised narrative of the historical development of the Regional Employment Premium, a money wage subsidy proposed by Nicholas Kaldor when he was fiscal adviser to the British Chancellor of the Exchequer and enacted by the labour Government in 1967. The article takes up the story of REP both as an innovative Keynesian instrument of intervention at the regional level and an illustration of the scientific coherence with which economic policies may be designed.     

An economic explanation of the nationalization of electoral politics

The literature on the nationalization of electoral politics focuses on the institutional characteristics of political regimes and the structure and organization of social cleavages. We argue that the nationalization of electoral politics is also driven by economic performance. Economic perturbations increase vote transfers from large (and highly nationalized) parties to small (and weakly nationalized) parties. Permissive electoral systems exacerbate the influence of economic performance on nationalization. Pooled cross-sectional time-series regression analysis is conducted on data from 43 countries and 475 elections between 1950 and 2012. The party-level mechanisms are shown through a closer look at Austria, Portugal and Ireland.     

Innovations, externalities and the problem of economic progress

In modern industrial societies innovativeness is seen as a source of economic growth and welfare increases. Following this assessment economic research presently focusses almost exclusively on the question of how to elicit innovations. Yet innovative economic activities have always also meant losses, sometimes even hardship, to some members of society, and incalculable risks. The present paper tries to develop a more balanced picture by acknowledging these less pleasant implications. Whether, and under what conditions, the permissive regime which modern societies have adopted towards innovations can be justified is discussed within the framework of a contractarian approach.     

Extending the economic theory of regulation to the form of policy

The mutually beneficial connection between industries and the governments that regulate them is the subject of a large literature led by Stigler (1971). What has not been studied is how firms choose their desired policies from the set including entry barriers, price floors, subsidies, and demand stimulation. We take as given that government and incumbents from the supply and demand for regulation and explore the choice of political product.     

“That’s not how it works”: economic indicators and the construction of partisan economic narratives

This study examines the processes through which partisans update their (biased) economic judgments during periods of mixed and asymmetric economic performance. I show evidence that citizens express relatively unbiased perceptions of the movement of the stock market, suggesting that partisans do not engage in processes of motivated reasoning when reporting judgments of widely available economic data. Instead, partisans respond to fluctuations in stock market performance by revising their assumptions about the way the economy works: in response to positive or negative developments, the stock market is perceived to be more or less important for the health of the broader US economy depending upon Americans’ partisan worldviews. This form of biased narrative construction has substantial importance in light of a “two-speed” post-Great Recession economy.     

The problems of economic adjustment

Unkept Promises, Unclear Consequences: US Economic Policy and the Japanese Response, edited by Ryuzo Sato and John A. Rizzo. Cambridge University Press, Cambridge, 1988. viii+200 pp. £25, ISBN 0-521-35201-0.Beyond Trade Friction; Japan-US Economic Relations, edited by Ryuzo Sato and Julianne Nelson. Cambridge University Press, Cambridge, 1989. xiii+201 pp. £25. ISBN 0-521-36467-1.Global Adjustment and the Future of Asian-Pacific Economy, edited by Miyohei Shinohara and Fu-chen Lo. Institute of Developing Economies, Tokyo, and Asian and Pacific Development Centre, Kuala Lumpur, 1989. xxi+585 pp. $80. ISBN 4-258-54009-9.Asia-Pacific Economies: Promises and Challenges (part B), edited by M. Dutta. JAI Press, London, 1987. xxi+308 pp. £95 (for two volume set). ISBN 0-89232-647-6.Politics and Productivity: How Japan's development strategy works, edited by Chalmers Johnson, Laura D'Andrea Tyson and John Zysman. Ballinger Publishing Company, Cambridge, Ma., 1989. xxi+332 pp. $34.95. ISBN 0-88730-350-1.Between MITI and the Market: Japanese Industrial Policy for High Technology, by Daniel Okimoto. Stanford University Press, Stanford, 1989. xv + 267 pp. $26.50. ISBN 0-8047-1298-0.