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Earlier this week, Goldman Sachs published a modstly upbeat research note suggesting the US economy is doing better than we think because we are mismeasuring productivity. The bank argues that “potential biases in the GDP statistics resulting from the growth of software and digital content” means “we would be skeptical of confident pronouncements that the standard of living is growing much more slowly than in the past.”
But JPMorgan, in a new note from economist Michael Feroli, “Welcome to life in the slow lane,” takes the other side of the trade. Feroli: “In mid-2013, we estimated that the economy’s potential GDP growth rate was a well-below-consensus 1.75%. We may have been too optimistic.”
And here is core of argument, which centers around productivity: […]
“The Great Decoupling: An Interview with Erik Brynjolfsson and Andrew McAfee” is a must-read Q&A from Harvard Business Review. I’ve written often about the two MIT academics and their work on labor markets and the impact of technological change. Two things from the HBR interview that I want to highlight. First, their explanation of the above “decoupling” chart is noteworthy in that they point out the macro-nature of the forces driving that chart. In other words, it’s not just the lack of “worker voice” in the US: […]
So the US economy went and did a very bad thing. Instead of growing during the first three months of this year — government’s first estimate was a 0.2% increase — it shrank. Now positive is sure better than negative, especially when many speculated/hoped/prayed/wished 2015 would see a marked acceleration in growth. But there’s a caveat in play here. A couple, actually. […]
The Atlanta Fed notes that your mileage may vary when it comes to inflation, depending on your age, income, family size, and other factors. To figure out whether your personal inflation rate is broadly similar to the national inflation rate (an annualized 1.2% last month), the bank has created an online calculator, myCPI. Here’s how I did: […]
In many ways, the UK achieved its recent decline in child poverty by borrowing US welfare reform policies. The UK learned from us and now we can learn from them; lawmakers should focus on the anti-poverty programs that are working, like the EITC. By contrast, the recently-introduced HR 2408’s new federal agency working group seems unnecessary.
In my new The Week column, I look at the Bernie Sanders charge — one also leveled by Elizabeth Warren — that the US economy is an immoral, rigged game. (A funny thing to say, I think, about an economy that produces more billionaire entrepreneurs than any other large, advanced economy.) Another stellar effort by me, of course. Yet on second thought, I sort of wish I had focused on this bit of weird economic analysis by socialist Sanders:
A few weeks ago, NAEP released the 2014 national results of eighth-graders’ tests in Civics, Geography, and US History. In absolute terms, these test results are not encouraging. However if you dig a little deeper, and look at progress over time by student race and poverty, you’ll find some arguably good news. If you dig even deeper, to find the rapid and huge changes in the racial and poverty composition of US students, you may see the ground shifting.