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You may have thought of finance professors at business schools as likely to be a fairly conservative lot, or at least to include a good number of them. You might think finance would be an exception to the growing political monoculture in US academia. You would be mostly wrong.   Emre Kuvvet tracked down the party affiliation of finance professors in the top 20 US departments, and wrote up the results in " Even Finance Professors Lean Left .  Berkeley has more Republicans than Chicago? I think numbers are low because so many faculty are not US citizens. It's initially striking  how many finance faculty are not even registered to vote, but I suspect that this reflects the large number of non-US citizens in finance departments.  Here come the millennials... Or, maybe Churchill was right about hearts and brains.  Journal editors:  Not even the JFE can manifest many Republicans!  Of course this is a striking amount of political diversity by the standards of...

Luis Garicano has just posted a very interesting free e-book, " Capitalism after covid: Conversations with 21 economists. " I was honored to be one of his interviewees, video here . Luis has a VoxEU column summarizing conversations, and twitter thread if you like reading such things. Luis is a great interviewer.  This is not an endorsement of all the ideas! Luis found a wide spectrum of ideas, and I think that is the strong thing about the project. You can see how really smart people, on top of the latest academic research, come to still widely different conclusions about the current state of affairs and directions we should go. Though Luis is a pretty free-market Chicago guy, he did not impose that view which I find admirable.  In particular, referring to the VoxEU column, I would take issue with  The bulk of the shock was absorbed by the public sector budget.  That the world could produce such a massive, coherent, and rapid economic response to the pandemic had a...

Adrian Woolridge wrote a thought-provoking essay titled "Meritocracy, Not Democracy, Is the Golden Ticket to Growth ," advertising a forthcoming book.  Meritocracy, the secret sauce of growth?   To Woolridge, meritocracy is the secret sauce of prosperity:  The surest sign that a country will be economically successful is not the health of its democracy, as some liberals like to think, or the leanness of its government, as some free-marketers imagine, but its commitment to meritocracy. Singapore is a soft authoritarian power. But it has transformed itself in a few decades from a poverty-stricken swamp into one of the world’s most prosperous countries, with a higher standard of living and a longer life expectancy than its old colonial master, because it is perhaps the world’s leading practitioner of meritocracy. The Scandinavian countries have some of the world’s largest governments and most generous welfare states. But they retain their positions at the top of internationa...

I just got the program for the upcoming NBER summer institute monetary economics conference program .  Who says academics aren't up to the minute on policy issues? This will be interesting.   

Senator Ted Cruz wrote a blistering Wall Street Journal Op-Ed decrying CEOs who pander to Democrats by making profoundly uninformed public statements. He announced that he will no longer take money from their corporate political action committees. And, he states This time, we won’t look the other way on Coca-Cola’s $12 billion in back taxes owed. This time, when Major League Baseball lobbies to preserve its multibillion-dollar antitrust exception, we’ll say no thank you. This time, when Boeing asks for billions in corporate welfare, we’ll simply let the Export-Import Bank expire. Cruz' statement is unintentionally devastating. So what about last time?   So there it is in front of us, in writing, from a major politician. Political support, and campaign cash bought $12 billion tax breaks, antitrust exemptions, and Ex-Im subsidies. From Republicans. So much for any public policy pretense. And if those CEOs just figured out who has the power to hand out goodies now, and the Democrat...

I learned something from the New York Times lead editorial on Sunday. Why are we not shipping mega quantities of vaccines to countries like India?  ... as the vaccines came to market, some vaccine makers insisted on sweeping liability protections that further imperiled access for poorer countries. The United States, for example, is prohibited from selling or donating its unused doses, as Vanity Fair has reported, because the strong liability protections that drugmakers enjoy here don’t extend to other countries... Pfizer has reportedly not only sought liability protection against all civil claims — even those that could result from the company’s own negligence — but has asked governments to put up sovereign assets, including their bank reserves, embassy buildings and military bases, as collateral against lawsuits.  Well, you can sort of see the problem. You're a drug company. You sell a billion units of a brand new drug -- still on emergency use authorization in the US -- to,...

In one of their series of excellent WSJ essays, Phil Gramm and John Early notice  that conventional income inequality numbers report the distribution of income before taxes and transfers.  After taxes and transfers, income inequality is flat or decreasing, depending on your starting point.  Source: Phil Gramm and John Early in the Wall Street Journal If your game is to argue for more taxes and transfers to fix income inequality, that is a dandy subterfuge as no amount of taxing and transferring can ever improve the measured problem!  Now facts are facts, and this one has a good progressive interpretation: But for our sharply progressive tax system and  benefits, untrammeled capitalism would have led to sharply increased inequality. The numbers don't argue for more redistribution, but they are consistent with a narrative that only our current large redistribution saved us from the top two lines.  Gramm and Early offer a sentence on this worth pausing to th...

    Source  Stephan Schubert Source: Chad Jones "straight out of the Penn World Tables, and I first learned about it from Lee Ohanian and Jesus Fernandez-Villaverde" In the top graph you get the impression that German and French workers are using up to date technology, including both machines, firm organization,  opportunities to trade in a wide market, etc. but that they simply choose to, are incented to, or forced to work fewer hours than US workers. Italy and UK are still plodding along 20% or so inside the frontier. The bottom graph points a bleaker picture. I'm not an expert, but if labor productivity is high and total productivity is low, that means that the productivity of other inputs must be atrocious.  Chad (amazing expert on all things growth) "It is stunning to me that Spain and Italy have had negative TFP growth for 20 years."  I remember when real business cycles came out, and many were incredulous at the idea of negative productivity shocks. ...