Economics

Small businesses have an increasingly pessimistic outlook about the economy and where it’s heading, according to the Job Creators Network Foundation (JCNF)’s latest Small Business IQ poll. According to the poll, 72 percent rate the U.S. economy as either fair or poor, but among companies in the South, that percentage is 80 percent. Also, 55 percent say the direction of the economy is getting worse, with 64 percent in the South saying so. JCNF has been polling small businesses monthly since May 2021. In November, JCNF contacted 500 small businesses

Last week, I gave my annual economic forecast for 2023 at Augusta University. For those who were unable to attend, I discussed three indicators of recessions. First, the yield curve is indicating a national recession. Interest rates on long-term government securities are currently lower than on short-term securities. As shown in the graph below, the yield curve has inverted prior to each of the last four recessions. An inverted yield curve means that investors are expecting lower short-term rates as a policy response to recessionary pressures. Second, the availability of

I was first introduced to Brewdog’s Nanny State alcohol-free beer by my brother four years ago. Since then, I have enjoyed their Hellcat IPA, a collaboration with Iron Maiden lead singer, Bruce Dickinson. I recently tried their Lost Planet First beer, which they claim is the first carbon-negative beer. They take more carbon from the air than they emit by using wind turbines and a bio plant to power their brewery and by planting trees. They have invested 15 million pounds (about $18 million U.S. dollars) in more than 9,000

Several months ago, I received an alarming text message: $699 had been charged to my PayPal account for a Pixel 6 phone! It was alarming for several reasons: I had purchased a Pixel 6 phone earlier in the year, and I only use PayPal to receive payments and knew I only had about $3 in the account. The text provided a phone number to call, purportedly to PayPal, if I questioned the purchase. I called, but after several minutes of the person at the other insisting I go online to

Income inequality, whether measured before or after taxes has been rising over the last 40 years in the U.S. as shown below. The wealthiest 1 percent have seen their share of income increase to 21 percent pretax and 16 percent post-tax. Europe has also seen an increase in inequality however, the increase is less, and income inequality remains way below U.S. levels. Traditional explanations have suggested that Europe redistributes a greater share of income to the poorest citizens. However, a new paper by economists Blanchet, Chancel, and Gethin (https://www.aeaweb.org/articles?id=10.1257/app.20200703) turns

“Father Christmas, give us the money Don’t mess around with those silly toys” The Kinks, Father Christmas At this time of gift giving, it is worth considering whether the exchange of presents is efficient. Well at least to an economist it is! Famously, if only in economic circles, Joel Waldfogel in 1993 suggested gift giving was inefficient because it destroyed about 10 percent to a third of the value of the gift. Think of the aunt or uncle that gave you that wonderful (read terrible) sweater last year. They bought

Universities and K-12 schools are in the business of human capital development. Human capital is education, training, and other forms of learning. Human capital is seen as an investment, just like physical capital, where the costs are paid upfront and the returns are received later. A recent paper by David Deming in the Journal of Economic Perspectives reviews our knowledge of human capital. An extra year of schooling increases earnings by about 10 percent. Given that the share of the world’s population that has at least some secondary school education