Economic Roundup

Economic Roundup

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A December 1 memo from the Progressive Policy Institute argues that antitrust policy is unnecessarily hindering innovation in the technology sector.

In a December 1 article, Stanford economist Kenneth Arrow argues that increasing income inequality is strongly driven by greed resulting from asymmetric information between consumers/clients and service providers in the medical and financial industries. The information necessary to make correct decisions is either unavailable or too complex for the former, thus allowing the latter to extract undeserved profits. Under such circumstances, Arrow believes that government must step in to level the playing field, which will reduce income inequality.

On November 30, the Federal Reserve Bank of Chicago published a working paper on black-white differences in intergenerational economic mobility. It finds less upward mobility and more downward mobility for blacks than for whites.

On November 30, the European Central Bank published a study showing that growth in the size of government generally reduces economic growth.

Also on November 30, the Justice Department issued a report on identity theft. It estimates that 7 percent of households had a member who suffered from it in 2010. They suffered a $13.3 billion economic loss.

On November 29, PWC published its annual global economic crime survey. It finds a significant increase in cybercrime worldwide.

Also on November 29, the Federal Reserve Bank of Cleveland posted a commentary on policy uncertainty and small business expansion.

And on November 29, Federal Reserve vice chair Janet Yellen gave a speech in which she said that a lack of aggregate demand is the economy’s key problem.

On November 25, the Federal Reserve Bank of New York posted a commentary on why it failed to properly forecast the Great Recession. Key reasons were misunderstanding the housing boom, new methods of mortgage finance, and feedback loops between the financial sector and real sector of the economy.

On November 1, the Peterson Institute published a study of the credit rating agencies. Their failure during the recent crisis argues in favor of tighter regulation and increased transparency, the study says.

Bruce Bartlett is an American historian and columnist who focuses on the intersection between politics and economics. He blogs daily and writes a weekly column for The Fiscal Times. Bartlett has written for Forbes Magazine and Creators Syndicate, and his work is informed by many years in government, including as a senior policy analyst in the Reagan White House. He is the author of seven books including his new book: The Benefit and the Burden .

 

Bruce Bartlett’s columns focus on the intersection of politics and economics. The author of seven books, he worked in government for many years and was senior policy analyst in the Reagan White House.