Things have not gone as badly in the past two months as Jacob Robbins feared back in mid-July. But we still stand on the knife’s edge of an even deeper depression then we are currently in, with governments about to apply a large deflationary demand shock this fall: **Jacob Robbins**: _Sleepwalking into Depression: The Economic Response to COVID-19 in the United States_ : ‘The few green shoots of improved economic data belie the fact that the health and economic crises are far from over. In fact, we are in danger of sleepwalking into economic depression…. Thanks in large part to pandemic-related income support, spending recovered somewhat in May, rising 8.2 percent… I use real-time payment data from Earnest Research, a company that analyzes spending data from credit and debit cards, to study the latest on how consumer spending is responding to the pandemic… .#noted #2020-09-18 Continue reading

England has now lost control of the coronavirus plague again: **Faisal Islam**: _'The PHE surveillance report chart that I followed very closely in early March_ ... a leading indicator in showing the pandemic hitting care homes... Acute Respiratory Infections now back up to April levels, but this time fair chunk is in schools… .#noted #2020-09-18 Continue reading

I understood why professional Republican economists were opposed to expansionary fiscal policy from 2009 to 2013: they thought that multipliers were small, government debt was expensive, and that even extended spells of unemployment were salutory worker-discipline devices that boosted productivity (and made the income distribution more unequal and more just). And I understood why Republican politicians went along: Democratic President Obama owned the economy, it was not the job of the opposition to be constructive, and, anyway, all Democratic policy initiatives are probably bad ideas. But now it is a decade later, even the laggards among reality-based economists have learned a lot, and it is Republican President Trump who owns the economy. Thus it is the Republicans who have the incentive to try things. Yet those economists who are professional Republicans first and analysts second are being with absolutely no help. And Claudia Sahm is extremely alarmed: **Claudia Sahm**: _GET MORE MONEY OUT: IT IS AN AND / BOTH MOMENT!!!_ : ‘Not holding my breath disappointed many times already... don’t think we are closing in. most important: $3 trillion is bare minimum we need, other smaller proposals are an insult to our crisis!! I am a broken record. NO REGRETS.... Continue reading

The spring and summer of 2020 were exactly the wrong time to have an economy that places a very low weight on the quality of eldercare: **Krista Ruffini**: _Worker Earnings, Service Quality, & Firm Profitability: Evidence from Nursing Homes & Minimum Wage Reform_ : ‘A ten percent increase in the minimum wage raises low-skilled nursing home workers’ earnings one to two percent, reduces separations, and increases stable hires. These earnings gains and increases in firm-specific human capital translate into marked improvements in patient health and safety. A ten percent increase in the minimum wage would prevent at least 15,000 deaths, lower the number of inspection violations by one to two percent, and reduce the cost of preventable care… .#noted #2020-09-18 Continue reading

It was decades ago that my ex-roommate Andrei Shleifer asked me: why are there Keynesians and monetarists and Hayekians and institutionalists in economics, but no Galbraithians? I did not have a good answer for him then. But I believe that now I do. It is: we are all Galbraithians now: **Kate Bahn, Mark Stelzner, & Emilie Openchowski**: _Wage Discrimination & þe Exploitation of Workers in þe U.S. Labor Market_ : ‘Characteristics specific to race and gender, such as the lower levels of wealth... increased household responsibilities... make workers of color and women more susceptible to exploitation.... Government support for workers to act collectively boosts worker power, reducing employers’ monopsony power—their ability to set and lower wages—and thus decreasing worker exploitation and wage differences that replicate discriminatory biases against these groups of workers… .#noted #2020-09-18 Continue reading

I confess that back in March I grossly misjudged the situation. I thought back then that one of two things would happen: (1) We would fail to knock the virus’s R[current] below 1, and the virus would rip through the population in a spring or spring and summer of horror, but it would be largely over by the fall. (2) We would knock the virus’s R[current] below one, and the virus would become a minor annoyance. I completely did not expect what we have now: a seriously depressed economy, with substantial but inadequate social-distancing, mask-wearing, and other measures, keeping the virus‘s R[current] around one, but with every prospect of this plague raging for years until policy somehow changes. Here the very sharp Joshua Gans says: We are economists. We are trained to look for equilibrium positions. So we should have expected this. Yes, I take his point. But I would never have imagined that the equilibrium caseload would be this high, and cause this big an ongoing depression: **Joshua Gans**: _Reproduction Numbers Tend to 1 & þe Reason Could Be Behavioural_ : ‘Standard epidemiological models that show how infection rates in the population rise and then fall assume that people... Continue reading

**Prefatory note**: In addition to chapter 6—Imperialism & Colonized—of the DeLong draft, the assigned reading this week contains two short pieces, selections from books. The first reading is 19 pages from **W. Arthur Lewis's** 1977 book _The Evolution of the International Economic Order_. The 19 pages assigned cover Lewis's story of: * the division of the world as a result of 1870 to 1914 globalization into middle class farmers in the global north and poor farmers in the global south, * how cumulative processes amplified this difference by concentrating manufacturing with its powerful positive externalities for growth in the global north, * how global market fluctuations and depressions further hindered the prospects for growth of countries that were not lucky enough to find themselves in or elbow themselves into the charmed circle, * and Lewis’s one-page postscript that provides—from his late 1970s perspective—his list of practical and politically feasible action items to boost global south development. Focus on Lewis’s major point: that it did not take bad will or large-scale theft and violence (although large-theft and violence there was) for the globalization that brought world trade and colonial rule to serve as a global inequality amplifier: the simple competitive workings... Continue reading

**Charles Steindel**: _Comment on Modigliani (1944): Liquidity Preference_ : ‘Modigliani '44--a grand vintage! (connoisseurs also should try the '63). Seriously, after 2008 I started musing on the concept of "rigid wages." We vaguely thought of that as essentially an ordinal variable. If wages were less rigid, the economy is more responsive to the real factors, less so to the monetary factors. Now a think it's a lot less linear. Flexible wages and prices (of goods and services) would, it seems, need to be a lot more like asset market prices to be in that blissful non-Keynesian world. But one could hardly live in it; it is convenient to know what a quart of milk will cost in dollars when setting out to the grocery store... .#commentoftheday #2020-09-17 Continue reading

George Orwell was very insightful. He focused on the fact that at the core of fascism, in both its right-wing and its left-wing versions and in whatever future versions may emerge, is the ability to tell public lies with impunity—and for supporters to then glory in the facts of the leaders were clever enough to tell them: Hannah Arendt: The Origins of Totalitarianism https://twitter.com/WindsorMann/status/1265793327884046336: ‘Instead of deserting the leaders... they would protest that they had known all along that the statement was a lie and would admire the leaders for their superior tactical cleverness…’ **Media Matters**: : ‘Rush Limbaugh praises the president for being "clever" in sharing conspiracy theories: “Trump is just throwing gasoline on a fire here, and he’s having fun watching the flames... I think the very sharp Angus Deaton is wrong here. America’s federalism has not been an insuperable obstacle to united national action in the past. Of course, that required presidential leadership and an opposition party willing to buy in and except a share of credit for national action, rather than regarding its primary mission as making the president of the other party appear to be a failure. Perhaps that America that could have reacted properly... Continue reading

**Robert Bates**: Markets & States Duology: _Markets & States in Tropical Africa: The Political Economy of Agricultural Policies_ || _When Things Fell Apart: State Failure in Late-Century Africa_ ... **Chinua Achebe**: _Pentalogy_: _Things Fall Apart || _No Longer at Ease_ || _The Arrow of God_ || _A Man of the People_ || _Anthills of the Savannah_ ... **Colin Leys** (1982): _Samuel Huntington & the End of Classical Modernization Theory_ ... **Keri Leigh Merritt**: _Merrittocracy_ … **Joseph Schumpeter** (1947): _The History of Economic Analysis_ ... **David Glasner**: _Schumpeterian Enigmas_ : ‘Schumpeter exhibited a generosity of spirit in his assessments of the work of other economists in... _The History of Economic Analysis_.... Schumpeter’s own tragic and largely unrealized ambition to achieve the technical analytical breakthroughs to which he accorded highest honors in his assessments of the work of other economists, notably, Quesnay, Cournot and Walras… **Paul Krugman** (1989): _History vs. Expectations_ || (1990) _Increasing Returns & Economic Geography) || (1992): _A Dynamic Spatial Model_ || (1995): _Globalization & the Inequality of Nations_ || (2010): _The New Economic Geography: Now Middle-Aged_ ... ### Plus **Stefan Gerlach**: _Crunch Time for Central Banks_ : ‘In little more than a decade, the global financial crisis, climate... Continue reading

Brilliant: **Austin City Limits** (2014): _Celebrating 40 Years_ : ‘An all-star lineup celebrating four decades of Austin City Limits culminates in Buddy Holly's classic "Not Fade Away"... Tasty: **Imperial Tea Court**: _Our Berkeley Teahouse_ … Something that has been bugging me for a while that I did not know. why is this office different **Wikipedia**: _[The Gentleman Usher of the Black Rod](https://en.wikipedia.org/wiki/Black_Rod)_: 'The office was created in 1350 by royal letters patent.... The title is derived from the staff of office.... Black Rod is principally responsible for controlling access to and maintaining order within the House of Lords and its precincts.... Black Rod's official duties also include responsibility as the usher and doorkeeper at meetings of the Most Noble Order of the Garter... I confess I have not seen this "certification trust" taking shape. Where is it? Who controls the keys to it? How does it become a social fact: **Mihnea Moldoveanu**: _How Our Response to COVID-19 Will Remake Higher Ed_ : ‘A decisive change is afoot: a digital higher education “certification trust” has taken shape over the past two years. This digital ledger will allow students to certifiably, verifiably, and securely guarantee their range of educational credentials to their... Continue reading

**Nancy LeTourneau**: _Biden Has a Plan to Reopen Schools. Trump Does Not_ : ‘The safety of this country’s children is on the ballot.... The first step of Biden’s plan, released over a month ago, includes something the Trump administration has failed to do: get the virus under control via actions such as implementation of nationwide testing-and-tracing. Take a look at how Biden’s message is totally different from Trump’s nonsense… **Doris Goodwin**: _þe Way We Won: America's Economic Breakthrough During World War II_ : 'High growth needn’t require a war.... It is no exaggeration to say that America won the war abroad and the peace at home at the same time. No doubt the historical conditions of America's economic surge during World War II were singular. But we have much to learn... **Itamar Drechsler & _al._**: _þe Financial Origins of þe Rise & Fall of American Inflation_ : ‘We argue that its rise was due to the imposition of binding deposit rate ceilings under the law known as Regulation Q, and that its fall was due to the removal of these ceilings.... The degree to which Regulation Q was binding has a large impact on local inflation.... In the presence of... Continue reading

**Five Books Expert Recommendations**: _Books on the Classical Economists_ : Recommended by Brad DeLong. They were an eclectic bunch, including, among others, a stock market speculator, a moral philosopher, a cleric, a lawyer and a journalist. From the late-18th to the mid-19th century, they provided the first systematic explanations of how economies work, where they fail and how they might be made to work better. Here, Brad DeLong, a professor of economics at UC Berkeley, introduces the classical economists, and suggests books to read to learn more about them and what they were trying to achieve. Interview by Benedict King: * _The Passions and the Interests_, by **Albert Hirschman** * _The Worldly Philosophers_, by **Robert L Heilbroner** * _The Classical Economists Revisited_, by **D. P. O'Brien** * _Economic Sentiments: Adam Smith, Condorcet & the Enlightenment_, **by Emma Rothschild** * _Karl Marx: A Nineteenth-Century Life_, by **Jonathan Sperber** **Q: Before we get into the books, could you just set the scene by telling us who the classical economists were, individually speaking. There was Adam Smith, Thomas Malthus, David Ricardo, and Jean-Baptiste Say in France. Are there other obvious ones that you would include in that list?** I would say that Smith,... Continue reading

Ghouls. Ghouls all the way down: **Xeni Jardin**: _Herman Cain, Who Died of Covid-19, Tweets 'þe Virus Is Not as Deadly' as Believed_ : ‘@THEHermanCain: "It looks like the virus is not as deadly as the mainstream media first made it out to be. 08:49 8/31/20..." Herman Cain died of COVID-19. That's it. That's the blog post... _The StoryGraph Beta_ **Wikipedia**: _Henry Bartle Frere_ … **Wikipedia**: _Annette Gordon-Reed_ … **Wikipedia**: _History of Grand Central Terminal_ … **Fire in California**: _Fire Activity Map_ … _All Turtles_ … **Economic History Association**: _Conference Program and Papers_ … ### Plus: **Buce**: _The Luckiest Horse in the Fifth Millennium BCE_ : ‘David W. Anthony... _The Horse, the Wheel, and Language_.... he date is about 4800 BCE; the place is in what he chooses to call “the Pontic-Caspian steppes,” just above the Caspian Sea. The “why” is interesting: apparently not for riding, but for food—horses were big and meaty and could live over the winter in cold climates (riding came later). AS to “how,” the flip answer is “it wasn’t easy,” which is not surprising when you stop to think of it: horses—or, more precisely, stallions—are a notoriously tricky lot and they wouldn’t take kindly to... Continue reading

**Tracy Lightcap**: _Sokrates vs. Machiavelli on the Educational Process | Lecture_ : ‘The great book _How Learning Works_ has a typology that I like to use in explaining what I'm trying to do and what education is about. It has four categories of expertise... >1. **Ignorant and Unconscious:** This is a way to describe a good part of the population. They don't know much and they are unconsicious of how little they know. Of course, this can apply to even highly educated people in fields where they don't know anything, if they are unwilling to admit their ignorance. This is important thing to keep in mind as you learn more. >2. **Ignorant and Conscious:** This is where. most freshmen and sophomores are in college. They have learned just how little they know and they are being forced to deal with it. Usually, they do. Some drop out instead. Some do only what is necessary to pass in subjects that don't require much development of expertise. It's easy to fail on this. 3. **Expert and Conscious:** This is where we want juniors and seniors to be. It is where you have expertise and you can apply it if you are careful... Continue reading

This, from Jonathan Horn, is the best thing I have ever read on the road that led Robert E Lee and George Pickett's division to Pennsylvania—where they grabbed American citizens and shipped them south to be sold as slaves—and then to the disastrous charge up Cemetery Ridge. The Pickett division soldiers dead at Gettysburg could have kept the American Civil War going for one or two months more. At war's end Ulysses S. Grant "felt like anything rather than rejoicing at the downfall of a foe who had fought so long and valiantly, and had suffered so much for a cause, though that cause was, I believe, one of the worst for which a people ever fought, and one for which there was the least excuse": **Jonathan Horn** _The Man Who Would Not be Washington_ : 'Winning a major battle on Northern soil might end the war, and that, as Lee would later say, was his chief purpose. “I went into Maryland to give battle.”... Lee intended to isolate Washington, DC, from the west. He would not let reinforcements from the mountains and beyond rescue the eastern cities. He would destroy the B&O Railroad and, once more, that pesky Potomac... Continue reading

This has surfaced again in my feed. Please, people stop ending it to me! It leads me down rabbit-holes—what a loon Samuel P. Huntington was, and how favorably citing him is a powerful sign that you are a loon unmoored from reality yourself—that I don't have time for today! Anyone who thinks—as Gregory Mitrovich apparently does—that Great Britain in 1920 had intrinsic strengths then that enabled it to thereafter retain its global dominance is truly a total idiot. When did Britain dominate _anything_ after 1920? **Gregory Mitrovich**: _Beware Declinism: America Remains Poised for Greatness_ : ‘There can be no doubting that America’s international standing has been undermined by ill-considered wars and the deadly failures of Trump’s pandemic response. However, the intrinsic strength of the United States will, like that of Britain a century ago, enable America to retain its dominance... Maybe I am just overly annoyed by people who favorably quote Sam Huntington, in this case his "observ[ation] that in the post-World War II era there had been five occasions when U.S. leaders were convinced the end was nigh—each time to be proven wrong..." Huntington should be remembered for his idiocy and his psychopathy, here clearly shown in his claim... Continue reading

**Om Malik**: _How I Stay Sane in 2020_ : ‘Twitter: no alerts, view in latest tweets mode, never use it between 7 pm and 7 am. Forget about using Twitter on the weekends. Liberally mute accounts and mute words. Block accounts that exceed the boundaries of propriety. Set your trends location to a place where you don’t know the language or is sparsely populated. I also use the Nuzzel app.... Instead, I want to read a whodunnit. And drink some great coffee.... Download a couple of albums from Bandcamp. On the first Friday of every month, all money goes to the artists. Given the persistent smoky conditions, and my desire to not be outside as much, I also have some shows I want to watch this weekend: Young Wallander: If you were a fan of Kurt Wallander, a fictional detective created by Swedish writer Henning Mankell, then this one would be an excellent series to watch on Netflix. Enola Holmes: Wait, Sherlock Holmes has a sister? Enough said—more goodness on Netflix. Sadly it is not launching till September 23rd. But for now, the trailer will do!… .#noted #2020-09-12 Continue reading

**Pairograph**: _Is America in Decline?_ : Life expectancy at birth in the United States today is 78.6 years. Life expectancy at birth in Japan today is 84.5; in Singapore, 85.1; in Switzerland, 84.3; France, 83.1; in Germany, 80.9. U.S. life expectancy is on a par with Poland, Tunisia, Cuba, Nicaragua, and Albania; below Peru, Columbia, Chile, Jordan, and Sri Lanka; and only a year greater than China. The United States currently has ~300 deaths per hundred million people per day from the coronavirus plague. The United Kingdom, Japan, Italy, Germany, and Canada each have less than 10... ,,,The United States has the amazing spectacle not just of Donald Trump as president, but of a huge number of American worthies—from Mitch McConnell in the Senate and Kevin McCarthy in the House, from Paul Ryan to Chris Christie, from Dean Baquet and Maureen Dowd and James Bennet to James Comey, all of them deciding that rather than **do their proper jobs** they would work to raise the odds that Trump would obtain and maintain power and increase the likelihood that he would do major damage in order to boost their personal positions in various ways. As one of my friends from a... Continue reading

**Barry Eichengreen**: _The Pandemic’s Most Treacherous Phase_ : ‘The more dangerous phase of the crisis in the US may actually be now.... Fatalities are still running at roughly a thousand per day... matches levels at the beginning of April.... Many surviving COVID-19 patients continue to suffer chronic cardiovascular problems and impaired mental function.... [This] new normal['s]... implications for morbidity–and for human health and economic welfare–are truly dire.... Americans[']... current leaders are willing to accept 40,000 new cases and 1,000 deaths a day... inured to the numbers... impatient with lockdowns. They have politicized masks.... Congress seems incapable of replicating the bipartisanship that enabled passage of the CARES Act at the end of March.... If the economy falters a second time, whether because of inadequate fiscal stimulus or flu season and a second COVID-19 wave, it will not receive the additional monetary and fiscal support that protected it in the spring.... If steps are not taken to reassure the public of the independence and integrity of the scientific process, we will be left only with the alternative of “herd immunity,” which, given COVID-19’s many known and suspected comorbidities, is no alternative at all… .#covid #noted #orangehairedbaboons #2020-09-10 Continue reading

.#acceleration #democratization #economicgrowth #economichistgory #globalization #highlighted #growth #watershed #1870-1914 ---- 2020-09-06-econ-115-module-2-intro-post-1870-growth-globalization-political-economy 10:59 As of 1870, smart money might still bet, that while the British Industrial Revolution had produced marvels of science and technology, it had not or had not yet become the permanent and decisive watershed in human destiny. Had it lightened the toil of the overwhelming majority of humanity—even in Britain, the country at the leading edge? Doubtful. Had it materially raised the living standards of the overwhelming majority—even in Britain? By a little. Worldwide, the 1770-1870 British Industrial Revolution had been a big deal compared to everything that had come before. Steam power and iron-making and spinning jennies and power looms and telegraph wires had provided comforts for many and made fortunes for a few. But how humans lived had not been transformed. And there were legitimate fears. What if there were to be a slowdown of invention, a disruption of societal institutions regulating fertility, or an exhaustion of key natural resources that supported industry? Then the pressure of higher population on resources via smaller farm sizes and fewer high-quality materials per worker might resume. It might well return humanity to the Malthusian stasis that Thomas Robert Malthus... Continue reading

David Brooks says: "American democracy is in trouble because my journamalistic colleagues and I will not do our jobs on November 3": **Steve M.**: _Just Do Your Damn Jobs_ : ‘David Brooks writes: "On the evening of Nov. 3... Donald Trump seems to be having an excellent night. Counting the votes cast at polling places, Trump is winning Pennsylvania, Wisconsin and Michigan.... Trump quickly declares victory. So do many other Republican candidates. The media complains that it’s premature, but Trumpworld is ecstatic. Democrats know that as many as 40 percent of the ballots are mail-in and still being counted... but they can’t control the emotions of that night. It’s a gut punch." Why? Why should what's happening be a gut punch? Why should it be perceived that Donald Trump is having an excellent night?... What happens on TV on election nights? On MSNBC, to take one example, Steve Kornacki stands at a digital map and discusses not just the current vote totals but the nature of the votes that haven't been counted... that the untallied votes come from precincts or counties that are stronger for one party than another. He'd give us a sense of what it would take for... Continue reading

**Franco Modigliani** (1944): _Liquidity Preference and the Theory of Interest and Money_ : ‘As long as wages are flexible, the long-run equilibrium rate of interest is determined exclusively by real factors... the propensity to save and the marginal efficiency of investment. The condition, money saving = money investment, determines the price level and not the rate of interest. If wages are rigid... the propensities to save and to invest but the situation is now more complicated; for these propensities depend also on money income and therefore on the quantity of active money which in turn depends itself on the level of the rate of interest.... In a system with rigid wages not only interest but also almost every economic variable depends on the quantity of money.... [In] the "Keynesian [liquidity trap] case"... the long-run equilibrium rate of interest is the rate which makes the demand for money to hold infinitely elastic... [and] the rate of interest is determined exclusively by institutional factors. .#noted #2020-08-31 Continue reading

**Irwin Collier**: _Harvard. Advanced Economic Theory, Second Term. 1948_ : ‘Joseph Schumpeter: "Economics 103b. Spring Term 1947-48. Plan of Course and Suggestions for Reading. The plan of the course is to start from and to build upon Professor Haberler’s lectures in the Fall Term (103a). We shall start from the statics of equilibrium and then discuss at some lengths the use and limitations of the method of Comparative Statics. After this, we shall survey various Dynamic Models. These models will be made the starting points of excursions... >...into relevant fields of pure and applied theory. Professor Haberler’s reading list remains in force. Wicksell’s Lectures I being particularly recommended. In addition, perusal of the following items will prove helpful. The more important ones are marked by an asterisk. The list is intended to cover also suggestions for the reading period: >J. Tinbergen*, Suggestions on Quantitative Business Cycle Theory, Econometrica, July 1935. F. Modigliani, Liquidity Preference, Interest, and Money, Econometrica, January 1944. N. Kaldor, Stability and Full Employment, Economic Journal, December 1938. F. Lavington, Approach to a Theory of Business Risks, Economic Journal, June 1925. L. Metzler, Factors Governing the Length of Inventory Cycles, Review of Economic Statistics, February 1947. M. V.... Continue reading