Archive for July 2007
Creative destruction
Posted by: Matt Nolan on: July 31, 2007
I’ve always had a soft spot for the idea of creative destruction, even though my understanding of the it is well below par. I found the following article interesting, in the way it used the idea of job creation and destruction to describe the process of changing unemployment. It gives us a good idea about [...]
What is the RBNZ talking about
Posted by: Matt Nolan on: July 30, 2007
“New Zealanders have been showing early signs of moderating their borrowing.” Does anyone know what these early signs are. From what I can tell, the growth in household borrowing is at record highs, in fact todays M3 data confirms that. If anything, household borrowing seems to be accelerating, I’m sure it will slow eventually, but [...]
A little bit of risk is a dangerous thing
Posted by: Matt Nolan on: July 30, 2007
So, our dollar has fallen 5% against the US, and 8% against the yen in the last few days. While some people may think that the prospect of no more interest-rate hikes is the driver, the truth is that market participants have become a bit more risk-averse. A little bit of wobblying in the US [...]
GST as a neutral tax?
Posted by: Matt Nolan on: July 30, 2007
I was reading a quick little post on Econlog. In it they say that you should not tax income, you should tax consumption. Ergo we should remove income taxes and replace them with a higher rate of GST. The main criticism I often hear about this is that GST is regressive. Now I used to [...]
Artificial environmental goodness
Posted by: rauparaha on: July 27, 2007
Arnold Kling at EconLog isn’t impressed by Planktos who claim to …restore damaged habitats in the ocean and on land. Through iron-stimulated plankton blooms in the oceans and afforestation projects in Europe, we are able to generate carbon credits. We then sell these offsets to individuals and businesses that are looking to reduce their carbon [...]
Carbon taxes for all
Posted by: rauparaha on: July 27, 2007
Well, I don’t always agree with Gary Becker but he has a nice post on carbon taxes and why they could be George W Bush’s friend. He says A tax on carbon emissions from business and household production would not only help reduce global warming–by how much is still controversial–but it would also lower the [...]
The week in numbers
Posted by: Matt Nolan on: July 27, 2007
An increase in the OCR to 8.25%, on the back of increases in food and oil prices The year end merchandise trade balance worsened to -$6,230m The exchange rate broke through $0.81US this week, just to fall back to $0.78US now. As most analysts expected, the RBNZ lifted interest rates. They also said they were [...]
Spending on government employees
Posted by: Matt Nolan on: July 27, 2007
An interesting new blog on stuff tells us why interest rates had to rise. Now I agree that people in the public service are being paid too much (as I don’t work there ). However, I’m not sure that public sector core wages are the main reason for inflationary pressure (although they do play some [...]
Fast food and health standards
Posted by: Matt Nolan on: July 27, 2007
As I was waiting in line to grab some McDonalds before going to see the latest Harry Potter movie I got to thinking about why the line was so long. In fact, I got to thinking about why, when there are other perfectly good foods around the food court, was half the place lining up [...]
The Economist writes well
Posted by: Matt Nolan on: July 27, 2007
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On the economist blog they decide to talk about carbon emissions. Everything they said was simple 1st year economics, I completely agree with them. But they say it so well, and in so few words. Now they might make the odd mistake (such as inverting the exchange rate and saying we are 72% over-valued against [...]
You don’t mess with the Guv’nor
Posted by: stevedoogue on: July 26, 2007
Bollard has shown who wears the pants. In raising the OCR today, he has shown his disregard for Dr Cullen’s mischievous feints at invoking his powers to override the price stability objective. He has also shown the market that he’s willing to back up his tough talk on the housing market – now on its [...]
A Strict Application of “Kiwi Made” Actually Hurts Our Exporters
Posted by: agnitio on: July 26, 2007
While I am all for supporting the domestic economy, I think that a strict interpretation of the requirements for a good to be labelled “Made in New Zealand” actually harms our exporters. People get upset when they find out that something that is “Made in New Zealand” is manufactured using inputs purchased from another country. [...]
One hike too far
Posted by: Matt Nolan on: July 26, 2007
So the RBNZ lifted rates. However, they said this is the end, no more hikes this year. I’m can understand why Bollard wanted to lift now, Cullen threatened his manhood and Bollard had to show he had some balls. I still think this lift is unnecessary, house sales are easing and firm profit margins have [...]
There’s taxation and then there’s taxation
Posted by: rauparaha on: July 26, 2007
Matt posted recently about environmental taxes on petrol. The comments section contains some discussion about whether taxation is a good idea or whether it’s just bureaucratic meddling. This sort of politico-vs-economist tax argument inevitably involves people talking straight past each other so perhaps this is a good time to discuss what we mean when we [...]
Economics fiction writing
Posted by: rauparaha on: July 26, 2007
It’s about a virtual world, similar to our own but slightly removed from it. It purports to have a set of rules that are internally consistent but has to constantly resort to ad hoc explanations for unusual behaviour. Yet, still, there is a lot of stuff that happens that is inexplicable within the rules of [...]
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