Some Links

by Don Boudreaux on September 10, 2017

Writing in the Wall Street Journal, Martin Feldstein busts the myth that middle-class Americans are stagnating economically. A slice:

If there is no increase in the cost of production, the government concludes that there has been no increase in quality. And if the manufacturer reports an increase in the cost of production, the government assumes that the value of the product to consumers has increased in the same proportion.

That’s a very narrow—and incorrect—way to measure quality change. In reality companies improve products in ways that don’t cost more to produce and may even cost less. That’s been true over the years for familiar products like television sets and audio speakers. The government therefore doesn’t really measure the value to consumers of the improved product, only the cost of the increased inputs. The same approach, based on measuring the cost of inputs rather than the value of output, is also used for services.

The official estimates of quality change are therefore mislabeled and misinterpreted. When it comes to quality change, what is called the growth of real output is really the growth of real inputs. The result is a major underestimation of the increase in real output and in the growth of real incomes that occurs through quality improvements.

Hurricane haikus from Bob Higgs.

Randy Holcombe explains that “progressive” democracy works for the 1%.

On CNN, GMU Econ alum Steve Horwitz reveals the unseen damage unleashed by prohibitions on so-called “price gouging.”

Houston will be rebuilt faster and better because of the absence there of zoning.

My Mercatus Center colleague Veronique de Rugy laments the plethora of government obstacles to private means of dealing with problems.

Here’s Jeff Jacoby on DACA, Congress, and presidential overreach.

FIRE’s Samantha Harris reports on yet another instance of foolishness by members of the modern American academy.