© Richwolf | Dreamstime.comPercent Tied A Chain Photo

Matthew Rognlie’s analysis of Thomas Piketty’s predictions of increasing inequality is to the point on both (1) the role of housing and (2) the poor substitutability of capital for labor. But it suffers from a neoclassical blindness to the existence of money and the role of the risk-free interest rate in determining the costs of (financial) capital for real investments.

The returns on capital can only diminish if the interest rate and hence discount rates for real investments fall further. Currently, this cannot happen, because of the zero lower bound (ZLB) of interest rates, which acts as a “minimum wage…


© Bear66 | Dreamstime.com | Time Is Money Photo

In the real world, we have an equation the cracking of which could save mankind.

*This text contains very minor spoilers regarding the movie Interstellar. Ones that should not destroy the movie experience.*

After not having gone to the movies in ages, I recently watched Interstellar with a bunch of friends. It sparked a lot of deep discussion, from physics and evolutionary biology to psychology and ethics.

But personally, the scene that touched me the most was the one where Murph, the daughter of the main character, visits the office of the theoretical physicist trying to crack the gravitation equation…


Photo: © Pixelrobot | Dreamstime.comClassifieds Jobs Headline Photo

Spending billions on answers is all in vain if the question is wrong. And job creation is not the only area where we have been asking terribly wrong questions for way too long.

WARNING: This text contains spoilers regarding The Hitchhiker’s Guide to the Galaxy.

Douglas Adams’s The Hitchhiker’s Guide to the Galaxy is a masterful work of art. But one often only starts seeing the ingenious satirical real world references and philosophical levels in such works, as one grows older. …


© Phillipminnis | Dreamstime.comNo Carbon Tax Rally, 23 March, Photo

If we now taxed fossil fuels out of use and later discovered that the climate change hypothesis was an error or a hoax, would we be angry at ourselves for quitting fossil fuels “too soon”? Even if we rejected anthropogenic climate change, there is only one standing argument for continuing the depletion of irreplaceable resources – and it is a fixable economic glitch.

A majority of environmental scientists now agree that human actions, most notably our greenhouse gas emissions, are having significant impacts on the climate. Governments and activist groups are looking for ways to cut annual emissions as fast…

Root Bug

I am a severe labor market imperfection, causing or preventing the solving of most of our economic, social and environmental problems, fed by outdated morals.

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