NEF – Somewhere Between Ignorant And Insane

It was Giles Wilkes who pointed out that the New Economics Foundation is really Not Economics Frankly. A contention nicely proven by the latest screed from the CEO of NEF.

The government’s fiscal rules, in effect, have been shot to pieces: rules that have been a centrepiece of successive budgets that have driven cuts in public spending for nearly a decade.

Tax as a percentage of GDP is higher now than it was under the Brown Terror.…

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Tautology Alert – The Balance Of Payments Balances

It was Adam Smith who pointed out that there is nothing so ridiculous as worrying about the balance of trade. Because we buy more traded goods from foreigners than they buy from us? And? All that then happens is that foreigners must buy more capital items from us than we sell them. Simply because the balance of payments does balance.

As the Office for National Statistics tells us:

1.Main points
The UK current account deficit widened to 4.3% of nominal gross domestic product (GDP) in 2018, from a deficit of 3.5% of GDP in 2017, and remains high by historical standards.

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Unpaid Careers Aren’t Worth £762.75 A Week, Nothing Like. £300 Mebbe

The Social Market Foundation wants us to know that an unpaid carer is actually producing economic value of £762.75 a week. This is nonsense. But then it’s from the SMF so who is surprised?

In a report shared exclusively with Money, the Social Market Foundation (SMF) said a man or woman who works for 37 hours a week as an unpaid carer — such as full-time mothers — has an economic value of £762.75 a week.

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The EU Are Much Too Modest About Their Products

Clear product labelling is so important – consumers need information in order to be able to make rational decisions about the products they buy and consume.

The origins of products is particularly important, and as a proud European I feel that the Soviet European Union has for too long been overlooked in the vital role it plays in bringing to our supermarket shelves some of the best products in the world. Commonly, wine labels will say “Produce of France” or Produce of Spain” with no mention of the Soviet European Union at all – this is scandalously nationalist.…

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Amazon, Whole Foods And Conflicts Of Interest

Robert Kuttner seems not to know about how retailing works. Then again, this is Robert Kuttner and business so who is surprised here?

The underlying claim is that Amazon – through Whole Foods – is throwing it’s monopolistic weight around. By not stocking the type of tea that Mr. Kuttner likes. This is, apparently, a conflict of interest:

There is a Whole Foods in my neighborhood. I shop there as little as possible, but once in a while, it can’t be helped.

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Tesla Shows Why Keynesian Demand Stimulus Through Infrastructure Doesn’t Work

Let us, just for the sake of argument, agree with Keynesian economists. It is possible for the economy to get stuck at a non-optimal equilibrium. Government can then – should then – shock the economy to an optimal equilibrium through intervention.

The underlying method here being to stimulate demand in the economy. This involves increasing the budget deficit (for MMT types, print more money and spend it) by either spending more money or cutting taxes. The usual preference is to go build infrastructure because multipliers.…

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How we know that the minimum wage causes job losses

So, yes, obviously, it’s just great that employers have to pay a decent wage, can’t be allowed to exploit labour, Well, not too much that is.

Except, obviously, raise the price of something and people will buy less of it. At which point we’ve rafts of studies telling us that, well, really, a higher minimum wage doesn’t cause job losses. To which there are a couple of responses.

  1. Tell that to the South Africans. For that’s what we think we will get if that minimum wage is “too high”.
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Why CEOs Get Paid A Lot – The Quality Of Management Really Matters

This isn’t quite what this paper was asking but it is rather what has been answered. Why is it that managers and CEOs get paid a lot? Because the quality of management matters rather a lot</a>:

Managerial quality and productivity dynamics
Achyuta Adhvaryu, Sadish D, Anant Nyshadham, Jorge Tamayo 19 August 2019

Managerial quality remains low in firms in developing countries. In the context of the Indian garment industry, this column shows that manager characteristics matter for productivity.…

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How Can Anyone Actually Be This Stupid?

A certain American professor – of sociology, naturally – called Matthew Desmond has decided to pleasure us with the ignorance of his knowledge of the subject under discussion, economics. I’m not the first to note this and doubt I shall be the last. But in his introductory paragraphs in the New York Times Magazine – a place where the editors clearly don’t know enough to catch such errors – he tells us that:

“Low-road capitalism,” the University of Wisconsin-Madison sociologist Joel Rogers has called it.

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China Should Slap Down Hong Kong Because Economic Liberty

The latest from British academia is that China should slap down on the freedoms of Hong Kong because of the economic liberty the place enjoys.

This is not a joke by the way, nor is it an unkind reading of the point being made. It is the point being made:

Protests in Hong Kong have captured the world’s attention in recent weeks, with demonstrators closing streets and the airport, and Chinese forces amassing near the border with a none too subtle threat of violent reprisal.

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