Jun 10, 2023

The benefits of immigration

Idrees Kahloon reviews the literature in The New Yorker:

Although the dismal science is rife with disagreement on many topics—from microeconomists butting heads about the irrationality of human preferences to macroeconomists arguing about how to quell inflation—there is a broad consensus that immigration is largely beneficial to migrants and their hosts alike. In 2017, the National Academies of Science, Engineering, and Medicine released a mammoth report titled “The Economic and Fiscal Consequences of Immigration.” It found that, although immigrants tend to earn less than native-born workers and are therefore a bit more costly to governments, their children exhibit unusually high levels of upward mobility and “are among the strongest economic and fiscal contributors in the population.”

Read more here.

May 29, 2023

Firefighters conference afraid to mention water

Rutger Bregman calls out the hypocrisy of ultra-rich “philanthropists” in Davos:

Read about it here.

May 25, 2023


This isn’t “wage push” inflation – it’s pushed by profiteering. The Wall Street Journal reports:

Inflation has proved more stubborn than central banks bargained for when prices started surging two years ago. Now some economists think they know why: Businesses are using a rare opportunity to boost their profit margins….

Usually, economists would expect any business that raised its prices to lose customers to competitors that don’t, or not by as much. But these aren’t normal times. In rare situations—such as an economy’s reopening after a pandemic—widespread knowledge that costs are rising allows businesses to raise their prices knowing that their competitors will act in the same way, according to a paper by Isabella Weber, assistant professor of economics at the University of Massachusetts, Amherst, and her colleague, Evan Wasner.

Read more here (if you can get past the WSJ paywall). The paper by Weber and Wasner is here.

May 15, 2023

Pandemic inequalities

As the pandemic lifts, its unequal costs become ever clearer: the kids suffered in the name of protecting grown-ups, and – as usual – the poor were hit far harder than the rich:

Read the sad and infuriating story here.

May 8, 2023

Best books on the political economy of the environment

Recommendations from Econ4’s James K. Boyce:

Read about them here: Shepherd’s Best Books.

May 6, 2023


Time for some good news:

On a warm late winter morning, Antonio Lancellotta, a 35-year-old farmer, shows me around one of his family’s unorthodox 1.8-acre (7,280 square metre) greenhouse in Scalea, southern Italy. Rows of lush citron trees (Citrus medica), heavy with white flowers fill the space. Yet, above the trees, at about 12.5ft (3.8m) above the ground, alternating lines of transparent plastic sheets and photovoltaic panels roofed the field. The Lancellotta family was one of the first in Italy to experiment with “agrivoltaics”, where crops are grown underneath solar panels.

“Look at the quality of this citron,” Lancellotta says, holding a large heart-shaped yellow fruit. “Perfect.”

Read more here.

Apr 30, 2023

Land for whom?

Brazil’s Landless Workers Movement has an answer:

They arrived just before midnight, carrying machetes and hoes, hammers and sickles, with plans to seize the land.

When the 200 activists and farm workers got there, the ranch was vacant, overgrown with weeds, and the farm headquarters empty, except for a stray cow.

Now, three months later, it is a bustling village. On a recent Sunday, children rode bicycles on new dirt paths, women tilled soil for gardens and men pulled tarps onto shelters. About 530 families live at the encampment in Itabela, a town in northeast Brazil, and they have already joined together to plow and plant the field with beans, corn and cassava.

Read more here.

Apr 22, 2023

Debunking the case for fossil-fueled development

An excellent new myth-buster from Drilled:

The reality is that addressing poverty and the climate crisis don’t have to be
mutually exclusive, and the climate movement in particular needs to stop
believing that they are.

Source: S8 Discussion Guide: Debunking the “Moral Case” for Fossil Fuels.

Apr 3, 2023

Fighting inflation, or workers?

For the Fed, “balance” in the labor market means maintaining the imbalance of power:

Jerome Powell, the chairman of the Fed, has made one thing crystal clear: He is not going to let up on his war on inflation. American workers are the inevitable casualty.

“Demand for workers far exceeds the supply of available workers, and nominal wages have been growing at a pace well above what would be consistent with 2 percent inflation over time,” Mr. Powell said in a speech late last year. For that reason, the Fed wants to see “the restoration of balance between supply and demand in the labor market” before it stops fighting inflation. In layman’s terms, that means a restoration of the power imbalance in favor of employers over their workers.

On March 7, Mr. Powell sounded a similar note, declaring that in order to get inflation down to where he thinks it should be, “there will very likely be some softening in labor market conditions.” There’s nothing soft about what he means: less demand for American employees, which leads to fewer raises and more people out of work.

Read more here. Meanwhile, in Europe it is dawning on the central bankers that something else is going on: see here.

Mar 22, 2023

More on the SVB collapse

Econ4’s Gerald Epstein interviewed on the latest financial crisis:

There are five main causes of the SVB collapse and the subsequent knock-on problems facing the U.S. and global financial system: the Federal Reserve’s anti-inflation obsession causing it to raise interest rates too high and too fast; the inherent fragility of banking, which for centuries has periodically erupted in crises; inadequate regulation of this fragile system, which often leads to high profits that accrue to banks and their wealthy owners; the corruption and self-dealing that often result from banks’ insufficient supervision; and the lack of public alternatives for financial institutions and services that could perform many of the key functions of banking and finance with less risk and without the private financiers taking their cut. Some of the huge profits financiers make from this system are funneled to buy support from politicians to prevent adequate regulation, and to secure bailouts when the system crashes.

Read more here.