State government spending hits new heights

July 30, 2015

There is a large literature in macroeconomics that examines the extent to which federal spending “crowds out” investment in the private sector. Basic theory and common sense lead to the conclusion that government spending must replace some private sector spending. After all, dollars are scarce – if the government taxes Paul and uses his money […]

Read the full post →

Education, Innovation, and Urban Growth

July 20, 2015

One of the strongest predictors of urban growth since the start of the 20th century is the skill level of a city’s population. Cities that have a highly skilled population, usually measured as the share of the population with a bachelor’s degree or more, tend to grow faster than similar cities with less educated populations. […]

Read the full post →

Rent control: A bad policy that just won’t die

July 13, 2015

The city council of Richmond, CA is thinking about implementing rent control in their city. Richmond is located north of Berkeley and Oakland on the San Francisco Bay in an area that has some of the highest housing prices in the country. From the article: “Richmond is growing and becoming a more desirable place where […]

Read the full post →

Grants to Puerto Rico haven’t helped much

July 7, 2015

Greece’s monetary and fiscal issues have overshadowed a similar situation right in America’s own back yard: Puerto Rico. Puerto Rico’s governor recently called the commonwealth’s $72 billion in debt “unpayable” and this has made Puerto Rico’s bondholders more nervous than they already were. Puerto Rico’s bonds were previously downgraded to junk by the credit rating […]

Read the full post →

More reasons why intergovernmental grants are harmful

July 6, 2015

In a recent blog post I explained how intergovernmental grants subsidize some businesses at the expense of others. But that is just one of several negative features of intergovernmental grants. They also make local governments less accountable for their fiscal decisions by allowing them to increase spending without increasing taxes. The Community Development Blog Grant […]

Read the full post →

Intergovernmental grant to gelato maker distorts market competition

June 30, 2015

Intergovernmental grants are grants that are given to one level of government by another e.g. federal to state/local or state to local. In addition to being used on public works and services they also subsidize the development of private goods. The Community Development Block Grant Program (CDBG) is a federally funded grant program that distributes […]

Read the full post →

Local land-use restrictions harm everyone

June 26, 2015

In a recent NBER working paper, authors Enrico Moretti and Chang-Tai Hsieh analyze how the growth of cities determines the growth of nations. They use data on 220 MSAs from 1964 – 2009 to estimate the contribution of each city to US national GDP growth. They compare what they call the accounting estimate to the […]

Read the full post →

Why regulations that require cabs to be painted the same color are counterproductive

June 12, 2015

A few weeks ago, my colleagues Chris Koopman, Adam Thierer and I filed a comment with the FTC on the sharing economy. The comment coincided with a workshop that the FTC held at which Adam was invited to speak. Our comment, our earlier paper (forthcoming in the Pepperdine Journal of Business Entrepreneurship and the Law), […]

Read the full post →

Rent seeking, illustrated by dinosaur hunters

June 5, 2015

I just made my first LearnLiberty video. To be more precise, the stellar talent at The Institute for Humane Studies at George Mason University made the video and they let me tag along for the fun. It combines dinosaurs and rent-seeking. What could be more terrifying? Watch. Comment. And share!

Read the full post →

Institutions matter, state legislative committee edition

May 27, 2015

Last week, Mercatus published a new working paper that I coauthored with Pavel Yakovlev of Duquesne University. It addresses an understudied institutional difference between states. Some state legislative chambers allow one committee to write both spending and taxing bills while others separate these functions into two separate committees. This institutional difference first caught my eye […]

Read the full post →