The final draft of the GOP tax plan transfers even more wealth to the 1%: now they get 83%

The GOP tax plan is a thousand-plus-page dog's breakfast of last-minute additions, giveaways, and complexity larded upon complexity, making it nearly impossible to parse out (so much for simplifying the tax code!), but the nonpartisan, Brookings-backed Tax Policy Center's new analysis goes a long way to untangling this ugly mess. Read the rest

Piketty and 100 researchers: inequality is getting worse, and will continue to worsen

The World Inequality Lab -- led by Thomas "Capital in the 21st Century" Piketty -- has published its 2018 World Inequality Report, summarizing the research of 100 academics around the world who investigate and document capital flows from 1980 onward. Read the rest

The point of Patreon isn't how many people earn a full-time living, it's how much of the money from art goes to artists

This week's Patreon PR fumble (the company changed what kinds of support are permissible and the way fees are paid and then said it was good for creators, when it clearly wasn't) prompted people to take a closer look at Patreon and its business. Read the rest

Share of national wealth held by America's 1% hits 50-year high

In Household Wealth Trends in the United States, 1962 to 2016: Has Middle Class Wealth Recovered?, an NBER working paper by NYU economics professor Edward N. Wolff, we get an analysis of the annual US governmental Survey of Consumer Finances, revealing that the share of national wealth owned by the richest one percent of Americans has risen by three points since 2013, to more than 90%, the highest level in half a century. Read the rest

Tim O'Reilly's WTF? A book that tells us how to keep the technology baby and throw out the Big Tech bathwater

Tim O'Reilly has his finger on the pulse of technology and the people who make it in a way that is unmatched by anyone in the world; the publisher of the world's best-loved computer books, the host of technology's best-loved conferences, the convenor of the most important conversations about tech and its people, O'Reilly is literally uniquely situated to understand the arc, trajectory, and possible destinations of technology and its impact on real people, which is what separates his breakout business book, WTF?: What's the Future and Why It's Up to Us, from rest of the field.

How an influential economics paper used imaginary environmental overregulation to spur low-density luxury housing

Why Do Cities Matter? Local Growth and Aggregate Growth is a 2015 paper written by University of Chicago and UC Berkeley economists Chang-Tai Hsieh and Enrico Moretti, which purports to show that the reasons cities are so expensive is that bourgeois NIMBYism drives affluent people to raise spurious environmental challenges to new developments, stalling growth. Read the rest

The 0.2% of Americans exempted by the GOP estate-tax plan (including the Trump cabinet) have never paid tax on their millions and never will

The Republican tax plan will exempt the 0.2% of Americans who pass on estates of $5.49 million (each) to their heirs, a tiny elite that includes most of the Trump cabinet of one-percenter plutocrats; under the Senate proposal, that exemption would double. Read the rest

The price of a latte around the world

Switzerland and Singapore are among the most expensive places in the world to grab a mug of coffee—overpriced as it already is in the United States. But there's more to the matter than mere inconvenience for tourists. The Wall Street Journal reports on Starbucks becoming an indicator of currency trouble.

The financial community uses dozens of metrics to determine how much a currency should be worth—and which currencies to buy and sell. These often tell starkly different stories. One measure created by the Council on Foreign Relations shows the U.S. dollar is 11% overvalued.

A rival to the Starbucks index is the Big Mac index, as devised by The Economist. Finding it inadequate, the Council on Foreign Relations came up with a Mini Mac index, with the international prices of Apple gadgets as the benchmark: "Minis are a global product that, unlike Big Macs, can move quickly and cheaply around the world."

Photo: Camila Tamara Silva Sepúlveda (cc) Read the rest

Great video primer on the mathematics of auctions

What's the difference between a tulip auction, an English auction, a sealed bid auction, and a Vickrey second-bid auction? Preston McAfee, Chief Economist at Microsoft explains auction types.

Bonus video: America's contribution to the English auction:

The Ideal Auction (YouTube / Numberphile) Read the rest

Record-breaking number of billionaires signals a second "Gilded Age" with inequality hitting 1905 levels

The total wealth controlled by the world's billionaires has reached $6,000,000,000,000, up nearly 20% from last year. There are now 1,542 dollar-denominated billionaires on earth. Read the rest

How the Chicago School's extremist ideology destroyed the American economy with unchecked monopolies

There was a time when monopolistic control over sectors of the US economy was vigorously checked through antitrust enforcement, but the neoliberal ideology of the Chicago economists (Milton Friedman et al) has eroded competition in America by convincing regulators that monopolies only need to be policed under very specific (and almost unheard-of) circumstances. Read the rest

Stephen Fry's lecture on a hopeful, cautious, excited vision of a better technological world

Stephen Fry's hour-long Shannon Luminary Lecture at Bell Labs tries to bridge the despair of a world where technology enables bullying, greed and surveillance; the optimism of the early hopes for the internet, and a hopeful vision of how we can minimize the former and maximize the latter. Read the rest

China's massive property bubble creates mad scramble to take on decades of debt

Massive infusions of cash by way of the central bank, combined with runaway mass panic-buying has stampeded Chinese people into buying into the property markets in boomtowns like Shenzhen, despite the insane prices that almost guarantee that they will default on their mortgages -- because they fear that rising property prices will shut them out forever if they don't buy now, and the new rentiers who've speculated on all that property are cranking up rents so fast that renting is worse than buying. Read the rest

Better education doesn't correlate strongly to economic mobility (but union membership does)

America's great stagnation includes a hardening of class divisions, with fewer and fewer poor and working class people raising children who rise to the middle class or even the one percent -- a fact that strikes at the heart of the cherished American notion of rags-to-riches meritocracy where you rise to prominence on the basis of your contributions to society, not the accident of your birth. Read the rest

Chinese economists say Big Data can replace markets in planned economies

In a paper in the World Review of Political Economy, economists from Sichuan University propose a model for an efficient planned economy that uses a hybrid of managed, two-sided "platform" markets (modeled on Ebay, Alibaba and various app stores) and central planning informed by machine learning and big data to fairly and efficiently regulate production in a system in which all substantial assets are owned by the state. Read the rest

Tim Harford's bite-sized "Fifty Inventions That Shaped the Modern Economy"

Tim Harford (previously) is an economist with a gift for explaining complex subjects in simple, accessible terms: his latest book, Fifty Inventions That Shaped the Modern Economy, uses 50 short essays about technologies as varied as Ikea's Billy Bookcase, the plow, and AI to illustrate the ways that the human race has transformed itself, its relations, and the planet.

Russian inequality is worse than imagined; worse than other post-Soviet states

The World Wealth and Inequality project's latest white-paper, co-authored by Thomas "Capital in the 21st Century" Piketty, painstaking pieces together fragmentary data-sources to build up a detailed picture of wealth inequality in Russia in the pre-revolutionary period; during phases of the Soviet era; on the eve of the collapse of the USSR; and ever since. Read the rest

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