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Jodi Beggs

Economics

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Some More Evidence on the Effects of Minimum-Wage Increases...

Monday April 14, 2014
In econ 101, we are taught that a minimum wage is a price floor on labor, and, as such, a binding minimum wage will increase unemployment and decrease employment. It's important to note, however, that in econ 101 we assume that both the labor market and the market for whatever the firms are selling are perfectly competitive, when in reality this need not be the case. When those assumptions are taken away, the theoretical conclusions regarding a minimum wage increase are much less clear, so empirical evidence becomes very important. The latest on this front is from San Jose, CA, and it shows that the effect of a minimum wage increase is certainly not always obvious.

An Economist's Take on the Gender Pay Gap

Monday April 14, 2014
The differential in compensation for men and for women in the U.S. is getting a lot of attention right now, largely due to the fact that President Obama has made gender pay equality a priority and issued two executive orders aimed at bringing gender wage parity to government employees. (A similar bill failed to reach the Senate floor for discussion, however.) In order to assess what actions should be taken, it's important to understand what the wage gap looks like in the first place. Luckily, economist Claudia Goldin has as much data and analysis on the topic as you could possibly want.

The Latest on High-Frequency Trading...

Monday April 14, 2014
In case you haven't heard, Michael Lewis has a new book out entitled Flash Boys: A Wall Street Revolt that gives a fascinating narrative inside the world of high-frequency trading. As expected, the book has reignited discussions about the social value (or cost) of high-frequency trading. This article gives a nice overview of what a variety of experts have to say on the matter.

Some Labor Market Trends to Watch Out For...

Monday April 14, 2014

If you read this site regularly, you likely know that jobs numbers are posted by the Bureau of Labor Statistics each month. While those numbers are a useful snapshot, it's also important to look at longer term trends in order to understand the overall employment picture. Economist Jared Bernstein says that there are three trends worth noting:

  • Reversing the shrinking labor force
  • Increasing job growth
  • Raising wages

Larry Summers on Business Cycles...

Monday April 7, 2014
Former Treasury Secretary, former Harvard University President, and former Obama economist Larry Summers has some views on the dynamics of business cycles. His talk is part of a larger panel on full employment put together by the Center on Budget, and there is commentary from a few other well-known economists as well.

An Inside Opinion on the State of Monetary Policy...

Monday April 7, 2014
The (favorable) March jobs report has gotten some people wondering about what the Federal Reserve is going to do in terms of its future course of monetary policy- does the economy seem like it still needs help or is it healthy enough to continue tapering the current asset purchase program? A related question is whether the Fed's past policies have been sufficiently aggressive to combat unemployment and further economic downturn. The Federal Reserve of St. Louis' James Bullard argues that that answer is yes.

The March Jobs Report...

Monday April 7, 2014
The Bureau of Labor Statistics released the March jobs report on Friday. The good news is mainly in the fact that 192,000 jobs were added in March, which means that the total number of jobs in the U.S. is officially above where it was in January 2008, before the financial crisis and recession hit. The bad news is that there has been population growth in the last 6 years, and an economy whose growth is stagnant for 6 years isn't particularly impressive. Baby steps, I suppose. In related news, the unemployment rate is holding steady at 6.7 percent, mainly because more people are entering the labor force as of late.

The Latest from the Federal Open Market Committee...

Monday March 24, 2014
Newly instated Federal Reserve chair Janet Yellen held her first Federal Open Market Committee press conference last week. Here is the accompanying statement, which summarizes the Fed's updated monetary policy strategy, along with some helpful annotations.

A Nice Economic Primer on Ukraine...

Monday March 17, 2014
In reading about the events unfolding in Ukraine, I was somewhat shocked to learn that per-capita GDP in Ukraine is only about a third of what it is in neighboring Russia, especially considering that, until fairly recently in the grand scheme of things, the two countries were part of the same political entity. this article gives some insight into why that might be the case, and it provides a useful context from which to view what is happening in that part of the world.

Wages as a Signal of Value...or Not?

Monday March 17, 2014
Since wages are usually determined by some sort of market interaction, it is often asserted that the wage a person earns is a valid measure of how much that individual contributes to society. There are, of course, philosophical arguments against this principle, but it's important to keep in mind that there are economic reasons why this relationship might not hold as well. Just another reminder that many of the models taught in Econ 101 represent "well behaved" competitive markets that may diverge pretty sharply from the labor markets actually encountered by many workers.

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