June 9, 2009

Economics Links (9 June 2009)

Angry Bear:
Untitled post on the Unemployment Report

Current Recession vs the 1980-82 Recession

DeGlobalization: Transitory or Persistent?

Not a Robust Recovery

James Pethokoukis: "An Improving Job Market"

Output, Employment and Industrial Production in the "1980-82 Recession"

More on Bank Lending Data

High Anxiety (about Interest and Inflation Rates)

Economist's View:
Too Big to be Restructured (The theme of this essay ties in very well with my post on Mikhail Gorbachev's essay from the other day, "We Had Our Perestroika. It's High Time for Yours.".)

Contributions to the Change in Nonfarm Payroll Employment

Shiller: Home Prices May Keep Falling

Uneven Unemployment Rates

"VAT Time?"

Bank Mergers

"Reducing Inequality: Put the Brakes on Globalization?"

Financial Times:
The ‘part-timezation’ of America

China influence to grow faster than most expect: Soros

Real Property Alpha:
California Home Prices in Ounces of Gold

NASCAR helped GM down its path of self-destruction ("Better equipped to compete? How ironic, given NASCAR’s role in helping the auto industry race down its path of self-destruction. Major auto companies used NASCAR for years to push cars and trucks with poor fuel economy numbers. The sport, in some ways, came to symbolize America’s embrace of consumption.")

Why is Japan so heavily affected by the global economic crisis? An analysis based on the Asian international input-output tables

Does climate change affect economic growth?

Washington Post:
Book Review: The Myth of the Rational Market: A History of Risk, Reward, and Delusion on Wall Street


Anonymous said...

Isn't America's problem with gas-guzzling vehicles caused fundamentally by its lack of universal healthcare? According to this blog posting, this imposed a crippling burden of $1,500 per car on American carmakers (when compared to their foreign rivals) which meant that they could only make a profit on very expensive cars.

Since they couldn't produce cars of sufficiently superior quality to warrant these high price tags, they only way they could go was in the direction of greater size...

JDsg said...

There is that, the so-called "legacy costs," such as health care costs and pension liabilities, but this is only part of the story.

Of course there's the historical legacy, of Americans loving big cars through the late 50s and early 60s, cars that people of my generation and older will easily remember; they were very spacious, much more so than today's cars. The American car companies made a half-hearted attempt in the mid 70s to build smaller cars in response to the oils shocks but, by the early 80s, when oil prices lowered and stabilized, there was a renewed emphasis on larger cars (with the Ford Taurus and Chrysler mini-vans leading the way).

Another factor is that American cities have ample space for cars, both on the roads and for storage. Visiting Switzerland eight years ago, I was rather shocked at how small the streets were (even the main thoroughfares) and how congested parking spaces were. I could see how there would be more of an emphasis on smaller cars in Europe (and would later see the same thing when I visited Japan later that year).

And last, but not least, you have to remember how large many Americans have become. (Watching some of the British TV shows that are broadcast here, it seems like the UK hasn't been immune to this problem either.) Larger cars are much easier to get into and out of for bigger people than smaller cars. (You should see me trying to get into and out of Malaysian taxis; those Protons can be really tiny.) I think this was a bigger factor in the re-birth of the bigger cars during the mid-80s, much more so than family size.