Search

ABSTRACT: In this paper, we examine the convergence hypothesis using a long memory framework that allows for structural breaks and does not rely on a benchmark country using both univariate and multivariate estimates of the long memory parameter d. Using per capita GDP gaps, we confirm the findings of non‐stationarity and long memory behavior that have been found previously in the literature using univariate tests. However, the support for these findings is much weaker when using a multivariate framework, in which case we find more evidence of stationary behavior. Based on these results, we also investigate club formation, something that would suggest the presence of conditional convergence. We describe a club formation methodology using the sequential testing criteria that we have employed in our analysis as the basis for forming clusters or clubs of countries with similar convergence characteristics. [ABSTRACT FROM AUTHOR]

The Genuine Progress Indicator (GPI) was designed to reveal the economic, social, and environmental trade-offs associated with conventional economic growth as traditionally measured by Gross Domestic Product (GDP). Although originally designed for use at the national scale, an interest has developed in the United States in a state-level uptake of the GPI to inform and guide policy. This study presents the first fifty-state estimate for U.S. GPI in order to address questions over its design, implementation, and ultimate potential as a tool to guide state-level economic policy. Following a review of the current state of analysis and critique of GPI, we provide an overview of methodology and database development. Results are then presented, including discussion of lessons learned through a fifty-state application. The paper concludes with suggestions for further research and next steps to consolidating a consistent methodology. [ABSTRACT FROM AUTHOR]

The shrinking middle class and increasing income polarization in the United States are issues of concern to policy makers and others. Economic development incentives are a key policy tool used at the state and local levels to promote local economic growth, and, presumably, provide employment opportunities. However, these incentives may have unintended consequences that may be contributing to the decline of the middle class. The authors combine detailed industry-level detail on incentives with proprietary county-level industry employment data and two methods for defining middle-class industries. Using an instrumental variable approach, the authors estimate how differential economic development policies affect middle-class jobs. The authors find evidence that incentivizing creative-class and high-wage industries may be contributing to the hollowing out of the middle class. Without hurting employment in other industries, targeting working-class and middle-wage industries alleviates this trend, while reducing incentives on creative-class and high-wage industries could help increase working and middle-class employment. [ABSTRACT FROM AUTHOR]

The U.S. economy faces sizeable headwinds to keeping GDP growth even at 2% over the next decade. Demographics imply that labor force growth will be much slower than historical norms. The enormous twentieth century increase in average educational attainment is unlikely to be repeated. And the best guess for productivity growth is that it will continue to be modest-perhaps along the lines seen in the 1970s to early 1990s, or since 2004. There are no easy cures for low growth. We can hope for another wave of broadbased IT-linked innovation. But while there is enormous uncertainty, even worthwhile policy steps are unlikely to move the dial very much on their own. [ABSTRACT FROM AUTHOR]

The article focuses on the issues surrounding fiscal and economic policy in the U.S. Topics discussed include impact of fiscal policy on the economic development of the country; enactment of Patient Protection and Affordable Care Act for protecting the U.S. citizens; and analysis of Congressional Budget Office in outlining the federal budget of the country.

In the United States, total government spending, and especially government social spending, has increased greatly over the last 50 years. What effect this has had on economic growth is a subject of intense debate among politicians, policymakers, and economists. However, there has been less attention paid to the distributional effects of government spending even though economic inequality has grown greatly over the last generation and much social spending is at least indirectly intended to reduce inequality. The effects of government social spending in the United States on growth in family income at deciles of the income distribution were estimated. The results suggested that social spending but not non-social spending was likely to increase growth in family income per capita measured over 10-year intervals. The largest effects of social spending were for deciles below the median income. At no point in the distribution does social spending have a negative effect. [ABSTRACT FROM AUTHOR]

The article discusses how Americans at different periods of time have understood the distinction between private and the public. Topics discussed include constitutional conflicts of the New Deal era, series of domestic programs in the U.S., related to public/private distinction; private quality of economics; the decision of the U.S. Supreme Court case 'Meyer v. Nebraska.'

Recent research by Baker et al. (2013) has created a historical indicator of economic policy uncertainty in the United States, based on an index score derived from content analyses of major U.S. newspapers. Empirical work using this measure has primarily focused on the economic consequences of shifts in economic policy uncertainty. The purpose of this project is to make the first empirical attempt at assessing whether changes in economic policy uncertainty have any role on the tone the President of the United States adopts when speaking about general economic conditions. Using the economic policy uncertainty information devised by Baker et al. (2013), and contrasting this with information about presidential rhetorical tone about the economy developed by Wood (2007), the vector autoregression analysis indicates prior levels of economic policy uncertainty Granger-causes current presidential rhetorical optimism about the economy. The moving average representation analysis suggests that an increase in the economic policy uncertainty index results in a decrease in presidential rhetorical optimism about the general economy. [ABSTRACT FROM AUTHOR]

Increased turnover among legislators can make them short-sighted, affecting fiscal policy and economic growth. We exploit the exogenous variation in legislative turnover induced by term limit laws and by redistricting in the 50 U.S. states, finding that increased turnover increases capital spending by state governments, which may be designed to constrain future governments. The changes may cause long-run distortions in the economy, reducing long-term economic growth. ( JEL H72, H73, H76) [ABSTRACT FROM AUTHOR]