Economic Perspectives

Minimum Wage & Consumer Borrowing


Over at VoxEU, economists Daniel Aronson and Eric French have a discussion about the their research of the effects of a minimum wage hike.


EU Update (And FI Reality)


If you've been tuning out the Euro situation, despite Gelpern's periodic updates, today's Times magazine has a since summary of where things stand.

I also think the end of this bit nicely captures the extant cynicism regarding financial institutions.


Why Don't Economists Read the Legal Literature?


When I read economics articles, I'm often struck by the absence of citations to the legal literature. Citations to legal works, even when very much on point, are frequently missing from literature reviews and citation lists. There are exceptions to be sure.  Some notable articles and scholars are cited routinely, and I've also noticed that economists will cite articles in some of the law & economics journals (like JLE and JLEO), but then economists also publish in those journals.


Reputational Sanctions in an Age of Internet Manipulation?


A major argument against substantive regulation of industries (including consumer finance) is that the market self-regulates. Bad actors get bad reputations and lose business.  Therefore, there's no need for government to intervene.  


The Permanent Foreclosure Crisis and Obama's Refinancing Obsession


For the umpteenth time, President Obama has announced that his solution to the foreclosure crisis is to encourage "responsible" homeowners to refinance at lower interest rates.  Adopting the Tea Party rhetoric and blaming home buyers who got houses in 2006 for their inability to foresee what few economists foresaw, Obama has steadfastly refused to push for principal reductions and payment suspensions for homeowners behind in payments, lest their luckier neighbors who bought at lower prices become resentful.  As a result, he continues to offer help t


The Value(s) of Foreclosure Law Reform?


As Alan White reported recently, the Uniform Law Commission in the U.S. has named a committee to consider the need for and feasibility of proposing a uniform foreclosure act and to report back to the ULC by early 2012.


Robbing Peter to Pay Paul: US Economy Edition


The Administration seems to have cut a deal to extend the payroll tax cut, which is a smart economic move in terms of trying to support demand. But it's being paid for by an increase in the "G-fee" (guarantee fee) charged by FHA and Fannie Mae and Freddie Mac on the loans they purchase. In other words, anyone refinancing or taking out a mortgage now will be subsidizing reduced payroll taxes.


Oh, Just Stop!


Many have chided the financial press for the need to write entirely speculative articles about the prior day's market movements. But at least the financial press can be (somewhat) forgiven for their sins on the basis of tradition.