economics

I have no idea if this is original, but I was thinking about the Keynesian theory of investment while doing something else and it occurred to me that you can explain it in terms of pre-funding or post-funding. The Modern Monetary Theory people think this distinction, applied to banks, has really important consequences for monetary…

Read More Pre-funding and post-funding investments

A quick thought after this twitter conversation: Important point: if your product is information, your productivity is definitionally proportional to demand https://t.co/oulNUf2oNS — Alex Harrowell (@yorksranter) October 15, 2017 There is quite a large set of firms for which productivity is fundamentally demand-driven. This is a distinct point from Verdoorn’s law, the argument that productivity…

Read More Demand-determined productivity

It’s fairly well known that a lot of the productivity gap between the UK and other industrial countries is accounted for by a long tail of unusually unproductive small businesses (see ONS data here). This fascinating piece in the FT covers a project to do something about that by getting them management advice. An interesting…

Read More Where do UK SMEs get technology advice?

So this chart happened. It looks like the Fistful of Euros model of the labour market has a serious problem, in that I can’t replicate JW Mason’s original results. The compositionally weighted ECI measure of earnings is more strongly correlated with the output gap, i.e. more cyclical, than the constant-weighted ECEC, at least for 2002-2014.…

Read More Science, dammit.

I was saying that nobody seemed to bother to check the claim that defined-contribution pensions were cheaper. Nobody but weirdos like me ever suggested the following until now: Once you account for falling wages among young workers—if you must: “the Millennials”—many mysteries of the economic behavior of young people cease to be mysterious, such as…

Read More They don’t have any money.