Monthly Archives: November 2012

The Market for Lemons — and Financial Products

Elizabeth Warren recently won the Massachusetts Senate election against incumbent Scott Brown, receiving about 54% of the vote. One of the key issues in the race was how the federal government should regulate the finance industry, specifically with regard to … Continue reading

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Maslow’s Hierarchy of Needs and Economic Growth

Note: This post was motivated by the comedian Rob Delaney’s twitter comment that Obamacare will help satisfy the base of Maslow’s hierarchy of needs, which will lead to a stronger economy. This idea has an intuitive appeal, so I decided … Continue reading

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A Twist on the Misery Index

The Misery Index, which is simply the sum of the inflation rate and the unemployment rate, was first created by economist Arthur Okun in the 1960’s while he was an adviser to President Lyndon Johnson. The index is intended to measure … Continue reading

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How to Cure Baumol’s Cost Disease: Turn Services into Goods

Baumol’s Cost Disease is a phenomenon that was formally observed by William J. Baumol and William G. Bowen (history snubs poor Mr. Bowen) in their 1965 paper, On the Performing Arts: The Anatomy of their Economic Problems. Baumol and Bowen point out … Continue reading

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The Future of Banking Will Come from an Unlikely Place: Africa

New York City is widely considered to be the financial services capital of the world. It is home to many of the world’s largest banks and the world’s largest stock exchange, NYSE Euronext. Therefore it would be natural to assume … Continue reading

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Monopolies, Human Needs, and Hobson’s Choice: A New Approach to Antitrust Regulation

“There is a widespread conviction in the minds of the American people that the great corporations known as trusts are in certain of their features and tendencies hurtful to the general welfare. This springs from no spirit of envy or uncharitableness, nor … Continue reading

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