Econ201

How about this for an argument to raise the retirement age: If you don't keep working, your community could die off.  That's the threat posed by an intersection of biology and economics which could finally make some famous two-hundred-year-old predictions come true.  As the world's population grows ... Read More

Credit-rating agencies were among the bogeymen of the global financial crisis, and for good reason. Moody's, Standard and Poor's, Fitch, and others failed to appraise the real risks of billions of dollars in securities that eventually went bad.  Now, they're trying to act responsible by jumping on ... Read More

An interesting thing happened yesterday in American politics.  Mitt Romney, a former governor of Massachusetts, beat Rick Santorum, a former senator from Pennsylvania, by just eight votes in the Iowa caucuses.  But the really interesting thing was how the people who tried to forecast the result ... Read More

Americans are unhappy with inequality.  Americans are unhappy with campaign financing. Americans are unhappy with differences in pay and unemployment.  And more than anything, Americans are unhappy that the American dream - going from rags to riches - seems to be fading away. Actually, Americans are ... Read More

Economic growth is a tough thing to control if the tools you’re using only deal with one part of the economy.  The problem is that when you push on one end of an economy, you might be pulling on the other, and vice versa.  It’s a lesson that people who work in international development are finally ... Read More

In recent weeks members of Congress have again moved to punish China for keeping its currency at a low value relative to the dollar.  It’s fashionable and easy to blame vast, mysterious, authoritarian China for our economic problems.  It’s also not quite fair.  In fact, China’s currency policy ... Read More

What’s the Big Idea? How many drachmas do you want to bet that Europe’s not out of the woods yet? Faced with the prospect of a Greek default with dire repercussions for European markets, EU leaders Merkel and Sarkozy scrambled in October to craft a complex rescue package. Then at the 11th hour ... Read More

Markets shuddered when George Papandreou, Greece’s prime minister, said he would call a referendum on the latest bailout package being offered by Europe’s economic powers.  What scared the markets most was apparently the possibility that the Greeks would choose according to their own interests ... Read More

While countries in North America and Europe suffer through a downturn that has people questioning the very foundations of their economies, something far more positive is happening in South America.  Countries that swung for decades between left-wing populism and right-wing authoritarianism have ... Read More

Though the Bush administration never admitted it, its tax cuts would almost certainly push the incomes of rich and poor further apart.  As incomes became more widely dispersed, the gap in wealth between rich and poor would quickly grow as well.  Even to a non-economist, the reason was easy to see ... Read More

  When a country’s politicians can’t get their economic policies right, what’s a central banker to do?  Though central banks are supposed to control inflation, that’s not always their only job.  The Federal Reserve Act, for example, gives America’s central bank a mandate of “maximum employment ... Read More

Peaceful protests against an economic elite. A violent reaction from authorities.  Political polarization and growing unrest. Some months ago, these words could have described Tunisia on the verge of the Arab Spring. Today, they describe the United States. Just like the Tunisians, the Americans ... Read More