Month: December 2019

A month to month recap of the US economy in 2019! January Federal Open Market Committee voted to hold interest rates steady February US economy grew by 2.4% in the fourth quarter. Trump plans to spend $6.7 billion spent for border security. March President Trump nominated campaign adviser Stephen Moore and  former GOP presidential candidate Herman Cain to the Federal Reserve’s board of governors. April Unemployment dropped from 3.8% to 3.6%. May US begins increasing tariffs on Chinese goods. US announces ending waivers for Iran and other oil supplying countries. June China and US come to an agreement and resume trade. July Boris Johnson was confirmed Continue reading 2019 Economic Recap→

The holidays aren’t over yet! New Years Eve is just around the corner which means more consumer spending on… you guessed it, Champagne! For New Years celebrations alone more than 39.8 million bottles of Champagne will be purchased in the U.S. But why champagne? How has that become our nation’s and most of the worlds drink of choice for celebration? Champagne is a symbol of luxury in our world today and as we know, luxury goods as opposed to normal goods do not behave the same as far as consumption goes. Some Champagne may even be considered a Veblen good (a good Continue reading New Year, Old Tradition: the history and economics of Champagne→

Gross Domestic Product (GDP) is the most commonly used tool to refer to the size of an economy. It is, in effect, assumed to indicate the well-being of any given country. Born in the manufacturing age, the tool’s failure to count for environmental costs, unpaid work, technology benefits, and the informal economy, have conceded economists’ widespread debate around the dethronement of GDP as an indicator of economic and social success. To understand how this tool fails to paint a comprehensive picture of a country’s well-being, an explanation of GDP as a concept is first necessary. GDP measures the aggregate value Continue reading Gross Domestic Product, Explained→

Financial markets often operate under gender biases that further conditions of credit scarcity among women in low- and middle-income countries. Highly gendered decision making in the governance of these banks diminishes the flow of capital into women’s projects and to women’s enterprises. This restricted access to credit services particularly hurts women-headed households. With women borrowers also being generally associated with lower portfolio-at-risk, lower write-offs, and lower credit-loss provisions, development organizations have, over the last decades, focused on extending credit to women to lift them and their families out of poverty. Microcredit refers to the practice of giving a small loan Continue reading Gender, Microcredit, and Climate Change→

‘Twas the night before Christmas and all through the house, Not a creature was stirring, not even a mouse Children asleep lying under their covers Hoping for money from their rich grandmothers.   As good economists they know the costs That presents only bring deadweight loss.   Alas when they woke, they found under the tree Something that noone should ever see. Gift boxes wrapped up with ribbon and bow The little economists thought no, no, no, no.   This will never do, the little economist said in his head While holding the sweater with too itchy of thread. Smiling Continue reading Dec the Halls With Dead Weight Loss: An Economist’s Christmas Story→

The early opening of Mexico’s economy under the North American Free Trade Agreement (NAFTA) widely encouraged foreign investment in the maquiladora industry. Organized shortly before the Border Industrialization Program (BIP) in 1965, maquiladoras are foreign-owned transnational assembly plants that operate mostly tariff-free at the northern Mexican border. Per the free-trade zone established by NAFTA, maquiladoras incur a value-added tax when re-exporting the final goods to the United States. A value-added tax is a duty on the value of the finished product minus the total cost of the parts that had been imported to make it. Economists refer to this model Continue reading The Economics of Maquiladoras→

A year ago, the Intergovernmental Panel on Climate Change released a report. Pooling more than 6,000 scientific publications and drawing contributions from 133 authors, a group of over a thousand scientists found that humankind has less than eleven years to stop massive and irreversible climate change. In order to avoid the risk of a global emergency, governments must limit warming to 1.5°C above pre-industrial levels. For the planet to meet or stay below the threshold, fast and far-reaching changes to the traditional models of resource usage need to occur – and for the most part, attempts to assign responsibility have Continue reading Ecological Debt, Explained→