EFFICIENT INFORMATION PROCESSING IN OUTPUT MARKETS: TESTS AND IMPLICATIONS

If goods markets efficiently process information, much of received macro doctrine seems of little relevance. Neither unemployment nor the money stock should be leading indicators of inflation. Countercyclical monetary policy will have little effect on inflation. Restrictive monetary policy can have severe effects on real variables if the public is unconvinced the authorities are committed to reducing inflation. When proper account is taken of mean shifts in the stochastic process generating CPI inflation rates, there is little remaining autocorrelation indicative of inefficiency, and filter rule experiments similarly support the hypothesis of goods market efficiency.     

The Half Full or Half Empty Glass: The Views of the Economic Optimist vs Pessimist

This paper examines the economic beliefs andvalue correlates of adults either optimistic orpessimistic about their economic future. On the basis ofan internally reliable, 19-item scale, nearly 277British subjects were divided into economic pessimists,optimists, and status quo observers. These economicviews were then correlated with ratings on economicsocial comparisons, beliefs about work, job involvement, and economic values. Subjectswith Marxist-related work beliefs tended to be morepessimistic and those with leisure ethic beliefs tendedto be more optimistic. A multiple stepwise regressionshowed that nearly 45% of the variance could beaccounted for by five factors which indicated thatolder, less religious, richer people who stronglybelieved in the humanistic work-belief system, but notin the leisure ethic, tended to be more pessimisticabout the economic future of their country. The resultsare discussed in terms of the literature onpsychological and economic optimism andpessimism.     

THE STATE OF THE FEDERAL BUDGET AND THE STATE OF THE ECONOMY

This paper tests systematic responses of the Federal budget to forecasts of inflation and unemployment. Estimated coefficients from fiscal policy reaction functions are examined to determine whether there are such systematic responses. Additionally, the coefficients of these estimated fiscal policy reaction functions are used to test several hypotheses concerning fiscal policy which have been advanced in the political business cycle and public choice literatures.     

The inflation-unemployment trade-offs of union members

Social preference functions between inflation and unemployment are estimated for individuals classified by union status using Gallup Poll presidential popularity data. We expected union members to assign higher weights to unemployment and lower weights to inflation than those who are not union members, but we found the reverse. Union members weight unemployment relative to inflation less than nonunion members because they weight unemployment less. Given the emphasis that trade union leaders place on reducing unemployment rather than inflation, this suggests a divergence in views between union leaders and the rank and file. The authors are indebted to Jeff Moore and an anonymous referee for helpful comments on earlier versions of this paper. Any remaining errors are our own. Smyth’s research was aided by the LSU Foundation.     

Public social science in Norway: Migration research in the public debate

How do Norwegian migration and diversity researchers experience and maneuver participation in public debate? And do their experiences and strategies fit with Michael Burawoy's image of Norwegian social science and with his model of public sociology? In this article, the concept of public sociology is expanded to public social science, encompassing communication of research not just from sociology but social science in general. Semi-structured interviews with 31 Norwegian migration and diversity scholars from 10 academic institutions about their experiences of, and views on, public research communication constitute the empirical material. The article concludes that Burawoy is right about the relatively high participation in public debate among social scientists in Norway. And his ideal-typical distinction between four types of sociology is helpful in analyzing how researchers relate differently to the science-public interface. Yet the results indicate that his perspective on public sociology is overly optimistic and not sufficiently attuned to the normativity already attached to highly politicized issues in public debate.     

UNION POWER,COLLECTIVE BARGAINING,AND OPTIMAL MONETARY POLICY

We study Ramsey policies and optimal monetary policy rules in a dynamic New Keynesian model with unionized labor markets. Collective wage bargaining and unions' monopoly power amplify inefficient employment fluctuations. The optimal monetary policy must trade off between stabilizing inflation and reducing inefficient unemployment fluctuations induced by unions' monopoly power. In this context the monetary authority uses inflation as a tax on union rents and as a mean for indirect redistribution. Results are robust to the introduction of imperfect insurance on income shocks. The optimal monetary policy rule targets unemployment alongside inflation. (JEL E0, E4, E5, E6)     

Lay people’s models of the economy: A study based on surveys of consumer sentiments

The purpose of this paper is to use a large data set comprising individual’s responses to survey questions about future economic conditions, unemployment and prices to explore lay people’s models of the economy and specifically their understanding of the relationship between unemployment and economic activity and also between unemployment and prices. The data is taken from the questionnaires used to form monthly indexes of consumer sentiments in Australia. We ask if the implied bivariate relationships are rational in the sense used by Muth (1961) and if they are consistent with the good-begets-good heuristic proposed by Leiser and Aroch (2009). We also ask if they are consistent with the actual operation of economic – and especially monetary – policy in Australia. We find that the data does provide some support for these hypotheses and for recent work in behavioural macroeconomics utilising the good-begets-good heuristic.     

当前经济形势分析及相关政策建议

2014年中国经济增速将低于2013年,季度经济增速可能低于7%:经济依然处于下行周期中;全社会固定资产投资将结束年增长20%以上的历史;中国依然不会出现通货膨胀问题;地方政府债务泡沫、某些产能泡沫有可能破灭并引发短暂的阵痛,但这些小泡沫的破灭有利于经济长期发展、有利于大局。我国经济增速放慢是规律使然,是消化产能过剩的过程中必须经历的,是调整结构、转型升级的过程中必须经历的,是消化刺激政策后遗症的过程中必须经历的,也是深化改革的过程中必须经历的。     

UNCERTAINTY AND STICKY-DOWNWARD BUT UPWARD-MOBILE WAGES

The usual search models of unemployment hold that firms do not offer wage cuts to employees in time of slack demand because the employees have alternatives open to them at wages higher than the reduced wage that would be required to maintain full employment. This paper extends these models by considering employees as choosing in conditions of uncertainty and showing that refusal to accept a wage cut is often rational in the absence of a higher alternative wage. Additional implications are derived for union behavior and simultaneous inflation and unemployment.     

Television News, Real-World Cues, and Changes in the Public Agenda

This paper examines the interrelationships between real-worldcues, television news coverage, and public concern for the issuesof energy, inflation, and unemployment. On the basis of longitudinaldata, the authors show that media agenda setting is indeed unidirectional—televisionnews influences public concern and not vice versa. Lead storiesare significantly more powerful than ordinary stories in shapingthe public's agenda. Prevailing conditions and events affectpublic opinion both directly and indirectly, by determiningthe degree of news coverage accorded issues.     

The Effect of Tax Policy Choices on the Labor Market on the Perspective of Global Governance

Tax policy transition plays a very important part in global governance, not only for the public operation or social equity, but also for the labor market which is firmly related with social welfare. On the other hand, unemployment has become a serious problem in 2008. Our research focused on the influence of different tax policies on the adjustment of unemployment, and the transition between direct and indirect taxation. This paper starts with conceptual discussion of the theoretical mathematical model and empirical analysis, and finally policy suggestion. Our conclusion varies due to the initial tax policy, but briefly we suggest that direct tax is more beneficial in the job market than indirect tax.      

Evaluating the Economic Impact of Casino Liberalization in Macao

This paper aims to evaluate the economic impact after Macao decided to liberalize its gaming industry. By analysing both objective data of official statistics and subjective data of the perceptions of quality of life, we painted a picture of mixed blessings. Although objective indicators showed strong economic growth in terms of a rise in per capita GDP and public revenue as well as a decline in unemployment rate, subjective indicators revealed that local residents were less than optimistic about their own employment outlook and did not perceive any improvement in their overall economic situation. While casino liberalization brought forth tremendous economic gain, the general population did not subjectively feel the benefits. An integrative analysis of both objective and subjective indicators would therefore allow us to look closer how residents?? lives in the micro-level could have been adversely affected by the prosperous economic outlook at the macro-level.     

Service learning from the supply side: Community capacity to engage students

The rapid increase in the use of service learning raises important public policy questions about who is being served and whether partner agencies have the capacity to meet student demand for community‐based experiences. This article uses a large sample of nonprofit organizations and a comparative framework to examine the characteristics of partner agencies and the scope and nature of college student community involvement. Multivariate analysis tests these factors on a community agency's ability to engage more students, particularly service learners. The findings are generally optimistic about agency willingness to involve students, suggesting widespread community benefits from their involvement. While organizational size and capacity predict current student engagement, an agency's past experience with students and its perceptions of student benefits have the greatest impact on its willingness to take on future students.     

STABILIZATION POLICY: A RECONSIDERATION

Should stabilization policy be a macroeconomic priority? Most central banks consider it a goal, but Robert Lucas has contended that policies to stabilize output, even if effective, yield negligible welfare gains. This article critiques Lucas's argument. Existing literature suggests nontrivial benefits from stabilization due to nonlinearity of the social welfare function and of the short‐run Phillips curve. Our analysis and examination of the evidence from periods of prolonged high unemployment also suggest further significant gains to stabilization since the “accelerationist” hypothesis does not seem to hold in times of very low inflation. (JEL E61, E63)     

Rational voters in a partisanship model

This paper examines a voter model for the US which is interconnected with the partisan theory. In our model, voters are rational and forward-looking. They are perfectly informed about the preferences of political parties and about the state of the economy. The predictions of our voter model differ from the predictions of conventional voter models, according to which the incumbent benefits from low unemployment and low inflation, irrespective of its political colour. In a partisan setting, the democratic party benefits from high unemployment and the republican party benefits from high inflation. Regressions of presidential approval rates indicate that the predictions of both the partisan voter model and the conventional model are consistent with the data.     

Political consumerism and the participation gap: are boycotting and ‘buycotting’ youth-based activities?

Does age predict political consumerism (boycotting or ‘buycotting’) among Canadian youth and adults? To what extent might political consumerism reduce inequities in civic participation? Using data from the 2008 Statistics Canada GSS on Social Networks, a multi-variate logistic regression analysis was conducted to investigate the relationship between age and politically motivated consumer behavior. Findings indicate that political consumerism is less likely among youth and the elderly than it is among middle-aged and young adults; however, education – rather than age – is found to be the strongest predictor. These results suggest that (a) popular beliefs/stereotypes about youths’ propensity toward non-traditional ‘consumer-activism’ may exaggerate the reality of the situation, and (b) notions that political consumerism can effectively narrow participatory inequalities among citizens may be overly optimistic. In evaluating two competing perspectives on youth political consumerism, this study argues that political consumerism does not by itself resolve issues of political marginalization faced by young Canadians; although consumer activism may offer an ‘alternative’ means of asserting political agency, it retains many of the same demographic ‘participation gaps’ as more traditional activist tactics.     

Back to the future: A continuity of dialogue on work and technology at the ILO

Concerns about technological unemployment are not new. Specifically, policy debates surrounding automation processes in the 1960s reflected both optimism and concerns about the job-destroying potential of technology. Studying the archives, and in particular the information collected by the Bureau of Automation, shows that many of today's policy proposals were originally raised at the ILO during that period, even though they were never translated into regulatory policy. This article thus suggests that reopening this past dialogue may reveal useful insights for addressing current challenges, and enable us to achieve the world of work we wish to see in the future.     

Family challenges created by unemployment

The detrimental effects of job loss and unemployment are not limited to the unemployed worker but ripple out to affect those closest to him or her. These ripple effects most notably impact the unemployed worker’s family, including a spouse or partner and/or children. Previous research related to the impacts on marital or partner relationships and families and the particular effects of unemployment on children is explored. Financial or economic stressors and strain brought about by job loss; the effects of stress and reduced mental health among unemployed workers and their spouses; and protective resources for coping with job loss are also discussed. The impact on children, in particular their mental health, development, and educational/human capital attainment are outlined. Implications for future interventions and unemployment policy are highlighted.     

Employment and labour productivity in high unemployment countries

Contemporary development strategies emphasize labour productivity growth because it has historically underpinned rising living standards. Today, however, poverty reduction and inclusive development in those developing countries with high unemployment require increasing the employment rate even if this means lower average labour productivity. We critique the International Labour Organization (ILO) for its overly universalizing advocacy of high‐productivity growth strategies and for failing to confront the trade‐off between more and better‐quality jobs. This is particularly problematic in high unemployment contexts in Southern Africa, where labour productivity growth between 2000 and 2013 came at the cost of a falling employment rate.     

On fatalistic long-term health behavior

Many adults have an overly pessimistic view of old age because they fail to correctly predict their ability to hedonically adapt to old-age health related problems. A standard utility model where the marginal utility of health is higher at a lower level of health predicts that this overly pessimist view raises the incentive for healthy behavior. But this is at odds with empirical research that indicates that people with more negative aging stereotypes tend to adopt less healthy practices, transforming this negative view into a self-fulfilling prophecy. The aim of this note is to show that this fatalistic behavior can be explained through prospect theory by modelling this overly pessimistic view of old age as a failure to predict the change in the reference point due to hedonic adaptation. Given the diminishing sensitivity in the loss domain, people undervalue the future marginal value of health investment and may therefore underinvest in health as long as loss aversion is not too strong.