29 Jun 2013

FDL Book Salon Welcomes David Stuckler and Sanjay Basu, The Body Economic: Why Austerity Kills: Recessions, Budget Battles, and the Politics of Life and Death

David Stuckler and Sanjay Basu’s new book The Body Economic: Why Austerity Kills is a thorough examination of the toll that recessions take on people’s health. They show, convincingly, that there are many, many channels through which health outcomes can deteriorate when the economy goes into a deep recession. They also show that the manner in which the government reacts to an economic downturn is a critical factor in determining health outcomes. Deterioration in health in a recession, though common, is far from inevitable.

When economists examine these types of questions, they are not able to conduct laboratory experiments to test their theories in the way that a chemist or physicist would do. Instead, economists must rely upon historical data and hope that “natural experiments” – historical episodes that have laboratory experiment like features – allow them to discriminate between different theories about the macroeconomy.

18 Dec 2011

FDL Book Salon Welcomes Robert H. Frank, The Darwin Economy: Liberty, Competition, and the Common Good

Whenever the rewards for an action – profits, reproductive success, whatever – depend upon the relative performance of individuals within a group the problem of a divergence between the interests of individuals and the interest of the larger society is likely to be present. The book gives example after example of this “arms race” for positional goods, and details the waste of resources that this causes.

18 Dec 2011

FDL Book Salon Welcomes Robert H. Frank, The Darwin Economy: Liberty, Competition, and the Common Good

The case for government intervention in the private economy is often based upon the need to correct market failures. When problems such as monopoly power, asymmetric information, or adverse selection cause significant departures from the purely competitive ideal markets found in textbooks – departures that cause these markets to deviate in important ways from the outcomes society would prefer – government intervention can correct the problems and improve social welfare. Thus, when consumers are vulnerable to exploitation because, say, they lack information on the value of medical treatments, the government can stop shady characters from selling them snake oil through regulations that require claims to be justified by reliable evidence.

10 Jul 2010

FDL Book Salon Welcomes Robert Kuttner, A Presidency in Peril: The Inside Story of Obama’s Promise, Wall Street’s Power, and the Struggle to Control our Economic Future

It’s possible to give two very different interpretations of the Obama presidency so far. The first is a relatively positive interpretation. Proponents of this view argue that even though Obama has faced a united GOP willing and able to use filibusters to thwart initiatives, and even though he has had opposition within his own party to progressive initiatives, he has still managed to rack up an impressive list of achievements. Take health care as an example. The health care legislation wasn’t all that progressives wanted, not by a long shot. But the legislation is an impressive start and, importantly, it leaves the door open to further change. Though people forget, programs such as Social Security or Medicare weren’t perfect at first, but were improved substantially over time.

13 Sep 2009

FDL Book Salon Welcomes Robert H. Frank, The Economic Naturalist’s Field Guide: Common Sense Principles for Troubled Times

Economics attempts to understand how societies solve a very basic problem. Because our resources are limited, people cannot have everything that they desire. Given that reality, how do we decide what to produce, how to produce it, and how to distribute the output? Economics strives to understand how societies and individuals make choices about how to allocate their scarce resources over the nearly unlimited wants of individuals within the society.