Archive for May 2008
Employer contribution and Kiwisaver
Posted by: Matt Nolan on: May 30, 2008
Tracy Watkins indicated that the National is in a pickle surrounding compulsory employer contributions in Kiwisaver. One way of keeping these contributions and regaining the support of business would be for National to allow wage cuts on the basis of entry into Kiwisaver (with its compulsory employer contribution). The Standard laments such a move, however [...]
OCR review preview – June 2008
Posted by: Matt Nolan on: May 29, 2008
Well we have had an action packed quarter haven’t we – bad employment numbers, bad retail numbers, bad inflation numbers, and tax cuts. Of course I’ve stated that all these things imply more inflation, but its not what I think thats important – its what the Reserve Bank thinks that matters. On June 5th we [...]
Collusion, multiple equilibrium, and petrol prices
Posted by: Matt Nolan on: May 29, 2008
Conjecture is rife regarding why petrol prices have risen so strongly. There are a number of common explanations: Rising demand for oil, The weak US dollar, increasing the US$ price, Peak Oil (Infometrics article requires a subscription), Negative real interest rates in the US (as not mining the oil is the same as investing in [...]
What is this savings problem?
Posted by: Matt Nolan on: May 28, 2008
So far we have discussed Kiwisaver and national savings in fairly loose terms. We know that (part of) the purpose of Kiwisaver was to increase national savings and that our interest in national savings stems from the fact that we want New Zealand to have more productive capital. So before we can discuss the myriad [...]
Why do we care about national savings?
Posted by: Matt Nolan on: May 27, 2008
In another of our warm up posts for discussing productivity we are going to discuss why national savings are important. As Fred states in this comment, savings are effectively deferred consumption. The incentive to defer consumption is based on individuals wish to “smooth consumption” over time (which relies on their time discount rate and expectations [...]
The currency market – small menu costs matter
Posted by: Matt Nolan on: May 26, 2008
Immediately following the release of the overseas merchandise trade data today the dollar slumped by about 20 basis points, however it didn’t stay down for long, more than recovering from this low point: Source NBNZ You might wonder why this fall and rise is even interesting – but the reasons behind it imply that issues [...]
Kiwisaver and aggregate savings: A question for our readers
Posted by: Matt Nolan on: May 26, 2008
Over at the NBR comment page Trinh Le from NZIER discusses the research by John Gibson and herself into Kiwisaver and aggregate savings (here and research). The idea that Kiwisaver can actually reduce national savings is an important one – and something that one of us will post on soon, either before or during our [...]
New Zealand Budget 2008: Tax cut calculator 2
Posted by: Matt Nolan on: May 23, 2008
In a previous post we mentioned the Infometrics and Labour tax cut calculator. Now NZIER have updated their tax cut calculator that compares Australia and New Zealand – the excel model can be found on their front page (or here in the future): http://www.nzier.co.nz/ I also talked to Dr Nolan about the set of tax [...]
Tax cuts and interest rates
Posted by: Matt Nolan on: May 23, 2008
Given my belief that these tax cuts, without corresponding cuts in (unproductive types of) government spending, will lead to greater inflationary outcomes I’ve decided it is important to argue the complete opposite case – namely that tax cuts will not impact on inflationary pressures and interest rates. The common view I work off when stating [...]
New Zealand Budget 2008: Tax cut calculator
Posted by: Matt Nolan on: May 22, 2008
Chris Worthington at Infometrics Ltd just created a tax cut calculator, it can be found here: http://www.infometrics.co.nz/taxcutcalculator.asp Enter your personal income and see what the Budget will do to it in October 2008, April 2010, and April 2011 (as there is no tax cut in April 2009 – likely a result of inflation concerns). This [...]
New Zealand Budget 2008: Tax cuts
Posted by: Matt Nolan on: May 22, 2008
Both Kiwiblog (more on budget) and the Standard (more) have already mentioned tax cuts – giving us two different views about their situability. Instead of looking at this, I’m going to have a quick look at the Macro-economic concerns stemming from this tax policy. First lets ask Mr Market what he/she thinks: Source NBNZ That [...]
GST rates and inflation: Why Mr Peters is actually wrong
Posted by: Matt Nolan on: May 22, 2008
At his rates blog and his blog on stuff Bernard Hickey often has a number of insightful things to say. Sadly this piece where he forces himself to agree with Winston Peters is not one of them. Specifically he states: In fact, a GST cut is the perfect tax cut right now. It is a [...]
Should the government reward effort?
Posted by: Matt Nolan on: May 22, 2008
Recent posts by two of the most prominent New Zealand left wing blogs (the Standard and New Z Blog) lament the fact that the wage people are paid does not necessarily relate to the effort they put into their work. As a policy solution to this inequitable result of the free market both blogs suggest [...]
Utilitarianism again and again
Posted by: Matt Nolan on: May 21, 2008
- In: Methodology | Philosophy
- 1 Comment
Terence at LAANTA has replied to my reply on his post on the problems with utilitarianism. In this reply he states two issues that he sees with my view of utilitarianism, namely: The assumption that utilitarianism doesn’t involve assumptions between what is right and wrong is plainly false, Justice and efficiency concerns are incomparable because [...]
Tax cut issues
Posted by: Matt Nolan on: May 20, 2008
No right turn and the Standard are concerned about Nationals mention of a $50 a week tax cut, that mainly goes to the well off. The fundamental concern seems to be redistribution. I/S expresses it succinctly by stating that he sees the elections choice as between: a party who distributes wealth for the benefit of [...]
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