100 Years Of Inflation

The Bureau of Labor Statistics has records going back to 1913. See CPI Detailed Report: Data for January 2014. It is a PDF file and you need to find Table 24.

It might be easier to see all the data at this site.

The base year is 1982-84. The Consumer Price Index was closest to 100 in 1983 when it was 99.6. In 1913 it was 9.9 and in 2013 it was 232.957. That means it took $232.957 to buy what cost $100 in 1983.

The compound annual inflation rate from 1913-2013 is about 3.21%. But some years were much higher and we had years that were negative. The CPI was 9.9 in 1913. So what cost $1.00 back then would cost over $23.00 now.

The compound annual inflation rate from 1983-2013 is about 2.873%.

Prices fell about 20% from 1929-1932 with a fall of  9.9% in 1932. The table below shows how much prices changed in each 10 year period.

Period	CPI Change
1913-1923	72.73%
1923-1933	-23.98%
1933-1943	33.08%
1943-1953	54.34%
1953-1963	14.61%
1963-1973	45.10%
1973-1983	124.32%
1983-1993	45.08%
1993-2003	27.34%
2003-2013	26.61%

The chart below shows the annual inflation rate for each year since 1914. There are two methods. One that only looks at the CPI in December of each year and finds the percentage change (blue line). The other method averages the CPI for all 12 months in each year and then finds the percentage change. Notice that they tend to be pretty close. But not always. See a post from 2010 called What Was The Rate Of Inflation Last Year? Was It Positive Or Negative?

GDP Per Capita, 1929-2013

This is adjusted for inflation (using 2009 dollars). The second graph is GDP divided by number of people in the labor force (that starts in 1947 since that is when we started using age 16 and older). The third graph is GDP divided by the number of people with jobs. The fourth graph is GDP per capita from 1947-2013.

Widest earnings gap for college grads in 48 years

Click here to read the AP story by Hope Yen. Excerpts:

"Young adults with just a high-school diploma earned 62 percent of the typical salary of college graduates. That's down from 81 percent in 1965, the earliest year for which comparable data are available."

"... college graduates ages 25 to 32 who were working full time now typically earn about $17,500 more annually than employed young adults with just a high school diploma ($45,500 vs. $28,000); those with a two-year degree or some college training earned $30,000. In 1965, before globalization and automation wiped out many middle-class jobs in areas such as manufacturing, the inflation-adjusted gap was just $7,449.

Meanwhile, median earnings for high-school graduates have fallen more than $3,000, from $31,384 in 1965 to $28,000 last year.

Young adults with just high-school diplomas now are also much more likely to live in poverty, at 22 percent compared to 7 percent for their counterparts in 1979."

"About three-fourths of all college graduates say they regretted not doing more during school to better prepare themselves to find a job, such as getting more work experience, studying harder or looking for work sooner."

A Special Valentine's Message On Romantic Love

Below is a repeat of last year's Valentine's day post. I am not sure if the links are still working:

The first one is Researchers at AAAS Annual Meeting Explore the Science of Kissing . The following quote gives you an idea of what it is all about: "Kissing, it turns out, unleashes chemicals that ease stress hormones in both sexes and encourage bonding in men, though not so much in women." I guess economists call this "interdependent utility functions." Meaning that what brings one person pleasure brings brings the other person pleasure, and vice-versa.

The other is Cocoa Prices Create Chocolate Dilemma. The article opens with "Soaring cocoa prices are creating a Valentine's Day dilemma for chocolate makers. They don't want to raise retail prices when recession-weary consumers are trying to limit their spending." The problem is crop diseases in Ivory Coast and Ghana. You might need to be a WSJ subscriber to read the whole article.

Here is a new article from yesterday's San Antonio Express-News (2-13-2011). Romance in bloom at workplace: Survey indicates 59% have taken the risk-filled leap. It seems like many people admit to having a romance at work and/or meeting their spouse at work. So what starts out as economic activity leads to some other needs being met.

Now the economic definition of romantic love.

Abstract: "Romantic love is characterized by a preoccupation with a deliberately restricted set of perceived characteristics in the love object which are viewed as means to some ideal ends. In the process of selecting the set of perceived characteristics and the process of determining the ideal ends, there is also a systematic failure to assess the accuracy of the perceived characteristics and the feasibility of achieving the ideal ends given the selected set of means and other pre-existing ends.

The study of romantic love can provide insight into the general process of introducing novelty into a system of interacting variables. Novelty, however, is functional only in an open system characterized by uncertainty where the variables have not all been functionally looped and system slacks are readily available to accommodate new things. In a closed system where all the objective functions and variables must be compatible to achieve stability and viability, adjustments in the value of some variables through romantic idealization may be dysfunctional if they represent merely residual responses to the creative combination of the variables in the open sub-system."

The author was K. K. Fung of the Department of Economics, Memphis State University, Memphis. It was from a journal article in 1979. More info on it is at this link. The entire article, which is not too long, can be found at this link.

Then there was this related article: Love really is blind, U.S. study finds. Here is an exerpt:

"Love really is blind, at least when it comes to looking at others, U.S. researchers reported on Tuesday.

College students who reported they were in love were less likely to take careful notice of other attractive men or women, the team at the University of California Los Angeles and dating Web site eHarmony found.

"Feeling love for your romantic partner appears to make everybody else less attractive, and the emotion appears to work in very specific ways in enabling you to push thoughts of that tempting other out of your mind," said Gian Gonzaga of eHarmony, whose study is published in the journal Evolution and Human Behavior.

"It's almost like love puts blinders on people," added Martie Haselton, an associate professor of psychology and communication studies at UCLA."

More links:

How to Be a Better Valentine, Through Economics by economist Paul Oyer.

Can Giving Up Money And Material Things Lead To More Love?

What Do Men In China Need To Get A Bride?

Adam Smith, Marriage Counselor

A Special Valentine's Message On Romantic Love

Can You Put A Price Tag On Love?

Do Opposites Attract? Not Usually, Except Maybe When It Comes To Money

Return of the Love Headhunters

eHarmony To Provide Personal Counselors To Help You Find Mr. Or Ms. Right

Economist Paul Zak, aka Dr. Love (he studies the brain with "neuroeconomics")

The San Antonio Express-News Printed An Article By Me

It was printed Feb. 1. Here is the link: False choice to separate work and passion. In the print edition it was titled "Passion not antithesis of hard toil." My article was a response to one by Esther Cepeda. Here is the link to her article: Esther Cepeda: The rewards of hard work.

"I think Esther J. Cepeda presents a false dichotomy between “following your bliss” and “grinding it out” (“Hard work trumps doing what you love,” Other Views, Jan. 24). She says we need more people who “grind it out” and work hard starting businesses instead of people doing what they love and that “love and passion” are no “substitutes for hard work.”

What if hard work and passion complement each other? This would erase the conflict she sees.

Anders Ericsson, a psychology professor at Florida State University, says “when it comes to choosing a life path, you should do what you love — because if you don't love it, you are unlikely to work hard enough to get very good.” And he advocates hard work — lots of it.

You will “grind it out” if you are doing something you love. Some neuroscience research says that when we do what we love, we form new connections in our brain that increase our skill. At the same time, the release of dopamine that gives us pleasure also helps form these connections.

Cepeda did not mention mythologist Joseph Campbell, who championed “following your bliss” in the 1980s. He wrote the book The Hero With a Thousand Faces (one of the inspirations for “Star Wars”).

It is not commonly known that Campbell said entrepreneurs, the grinders Cepeda lauds, were the real heroes in our society. Business can be a fulfilling adventure, like art or science.

Maybe our society does not have enough grinders starting new companies because of our negative attitudes toward business. Look at popular portrayals of capitalists such as J.R. Ewing and Gordon Gekko. This may be why young people are not likely to see business as a noble and worthy quest. Our national narrative needs to change.

Nobel Prize-winning economist Edmund Phelps has pointed out that we have lost our innovative spark, and certainly the images of capitalists in movies and TV do not help.

Calling entrepreneurs heroes does not mean we should exempt them from ethical behavior. It is not a license to defraud or harm the public. We cannot, however, completely avoid some negative effects of business, such as pollution. But that is something we can tax.

Educator Candace Allen has pointed out that if we do not honor entrepreneurial accomplishment, we will not get enough entrepreneurs.

As President Barack Obama has said, “No government program alone can take the place of a great entrepreneur.” Our national dialogue needs to include the vital role they play. Even those who start, as Cepeda says, boring businesses such as dry cleaner and fast-food franchises.

Those entrepreneurs may be the heroes on the front line of our economy. And who does not love being a hero? That might get people to do the hard work Cepeda wants done."

Click here to see the article with the quote from President Obama. It was in The Wall Street Journal, May 2, 2013. The article was titled "Billionaire Executive Pritzker Picked for Commerce Post."

Which Nation Just Voted To Impose Higher Taxes On Junk Foods?

The Navajo Nation. See Navajos Vote to Try Junk-Food Tax in Fight Against Obesity by Ana Campoy of The Wall Street Journal.

This week two of my classes picked a chapter on obesity to read from the book The Economics of Public Issues. Rising obesity rates are partly a result of food getting cheaper and people leading more sedentary lives (which in turn is a result of rising relative pay for jobs that don't require as much physical exertion).

Here are excerpts from the WSJ article:

"Leaders of the Navajo Nation, whose people are struggling with obesity, along with those of numerous other Native American tribes, voted to impose higher taxes on junk foods while eliminating taxes on healthier alternatives.

The changes, passed Thursday by the Navajo Nation's tribal council, represent the latest attempt by U.S. communities to use legislation to encourage people to eat more healthily.

Under the proposed laws, which require approval by the tribe's president, taxes on soda and fatty snacks will go up to 7% from the current 5%, while fresh fruits, vegetables and nuts won't be taxed at all."

"Opponents, including some Navajo lawmakers, said members of the impoverished tribe couldn't afford higher taxes on anything. They predicted the tax changes would drive some to purchase items such as soda and potato chips at stores outside the reservation."

"Supporters of the Navajo junk-food tax said it was necessary given the rate of obesity and diabetes on Indian reservations. Roughly one in three Navajos is diabetic or pre-diabetic, and anywhere between 23% and 60% are obese, according to data presented to the tribal lawmakers.

Native Americans in general are 60% more likely to be obese than non-Hispanic whites, and more than twice as likely to be diagnosed with diabetes, according to the U.S. Department of Health and Human Services."

 Another thing  about obesity is that it seems like if you are obese as a very young child, you tend to stay that way. See Obesity Is Found to Gain Its Hold in Earliest Years by GINA KOLATA of The New York Times. Excerpt:

"For many obese adults, the die was cast by the time they were 5 years old. A major new study of more than 7,000 children has found that a third of children who were overweight in kindergarten were obese by eighth grade. And almost every child who was very obese remained that way.

Some obese or overweight kindergartners lost their excess weight, and some children of normal weight got fat over the years. But every year, the chances that a child would slide into or out of being overweight or obese diminished. By age 11, there were few additional changes: Those who were obese or overweight stayed that way, and those whose weight was normal did not become fat."

Do Good Looking People Get Better Loan Terms?

See Love & Loans: The Effect of Beauty and Personal Characteristics in Credit Markets by Enrichetta Ravina of Columbia University (this is a technical paper). Here is the abstract or summary:

"I examine whether easily observable variables such as beauty, race, and the way a loan applicant presents himself affect lenders’ decisions, once hard financial information about credit scores, employment history, homeownership, and other financial information are taken into account. I use data from Prosper.com, a 150 million dollars online lending market in which borrowers post loan requests that include verifiable financial information, photos, an offered interest rate, and related context. Borrowers whose beauty is rated above average are 1.41 percentage points more likely to get a loan and, given a loan, pay 81 basis points less than an average-looking borrower with the same credentials. Black borrowers pay between 139 and 146 basis points more than otherwise similar White borrowers, although they are not more likely to become delinquent. Similarity between borrowers and lenders has also a powerful impact on lenders’ decisions. In my sample personal characteristics are not, all else equal, significantly related to subsequent delinquency rates - with the exception of beauty, which is associated with substantially higher delinquency probability. The findings are consistent with personal characteristics affecting loan supply through lenders’ preferences (taste-based discrimination a la Becker) and perception, rather than statistical discrimination based on inferences from their previous experience."

81 basis points means that if the average looking person gets a loan for 5.81%, the good looking person would get it for 5%. If your loan is for $100,000, it means if you paid it back in a year, the good looking person would get to pay $810 less.

For a non-technical article about how peer-to-peer lending works, see It's Like eBay Meets Match.com: Does peer-to-peer lending work? by Ray Fisman of Slate. Very entertaining.

Here are some earlier posts on the money value of looking good:

Do looks matter? 

Do Looks Help In The Job Market? 
 
From The Life Is Not Fair Category: Better Looking, Tall, Thin People Make More Money

Another Semester Has Started

Welcome to any new students. I usually post something three times a week. The next post should be next Wed. The entries usually have something to do with a basic economic principle that is related to a recent news story. If you want to learn more about me go to Why is college so hard?

That link may not be working. So here is the article, which was from my college news paper in 2011.

Students might wonder why college, and SAC in particular, is hard. This might sound trite, but I think the faculty at SAC want students to achieve success in life and that means that classes have to be hard if you are going to learn and understand the concepts which provide a foundation for that success.

I think my own experience as a community college student over 30 years ago helps me understand this. My teachers took their subjects seriously and maintained high academic standards. They got me excited because of the expertise they brought to their teaching. Now that I have been a teacher for over 20 years, I can see how important that was.

After finishing my A.S. degree at Moraine Valley Community College (MVCC) in Palos Hills, Ill., I transferred to and graduated from the University of Chicago with a degree in economics. But it was my community college teachers prepared me to handle the rigors of the U. of C.

Later, I got a Ph. D. in economics from Washington State University. But I've accomplished some other things I never could have dreamed of when I began taking classes at MVCC and I think my teachers there paved the way for me.

In 2005, I had a letter to the editor published in The Wall Street Journal (I have now had five published there, three in The New York Times and three op-eds in the Express-News). This one was several paragraphs long, nearly as long as some of their op-ed pieces. It was the first letter in the letters section that day, and I got the top headline. It dealt with NAFTA and trade agreements.

As nice as that was, I got a big shock a few days later when I got a letter in the mail, on official stationery, from Richard Fisher, the president of the Federal Reserve Bank of Dallas. He complimented me on my letter and said it was superb. I had never even met him or ever tried to contact him before.

Wow. I graduated from high school with a 2.7 GPA, and when I started at MVCC, I had no idea what I would do with my life. If you had told me then that someday I would have a letter in the WSJ and get that kind of compliment, I doubt I would have believed you.

Then an adjunct professor at the business school at the University of Chicago contacted me a few years ago and wanted to know if it was OK for her to assign a paper I wrote on entrepreneurs for a class she was teaching on innovation. (Of course, I said yes).

That professor was Nancy Tennant Snyder. She has a Ph. D. from George Washington University and is a vice president at Whirlpool. Business Week magazine has called her one of the leading innovators in the world. She also cited two of my papers in one of her books.

Then I got an email from John Joseph, a professor at the University of Edinburgh. He is an expert on language and politics. He wanted to know if he could include an essay I wrote in a four-volume work he was planning. I again said yes and it was published last year (and it is called Language and Politics).

It is a collection of essays. Mine is titled "The Intersection of Economic Signals and Mythic Symbols." Other contributors include Jeremy Bentham and George Orwell. When I was a community college student, I never imagined being included along with the likes of those great thinkers.

The co-authors of the book The Economics of Public Issues have thanked me in each of the last three editions for my helpful suggestions. Almost all of the people they thank are from big universities. One of the co-authors of this book, Douglass North, is a Nobel Prize winner. Never imagined someone like that would value my input when I started out as a community college student.

Getting such recognition in cases like this gives me a sense of achievement. I know I have made a scholarly contribution to the world. And I want all SAC students to have a chance for this same kind of success (as an academic or any in line of work). I think all SAC faculty do. That is why school is hard, and that is why I'm thankful that my community college teachers were experts who maintained high academic standards.

How Firms’ Reaction To An Excise Tax Determines The Market Outcome

We usually assume that firms must collect an excise tax. Then we shift the supply curve up by the amount of the tax to illustrate the effect on the market. A student once asked what the individual firms did to end up with this result. This was my attempt at an explanation. Click here to read the pdf file

Mindfulness Practices And Learning Economics

That is the title of an article by David R. Borker who teaches at Manhattanville College. It was published in the American Journal of Business Education in 2013. Click here to find out more about it and a link to a pdf file of the entire article. Here is the abstract:

"There is a growing interest among educators in teaching and learning practices based on mindfulness, a concept derived from eastern meditative traditions.  This paper describes how mindfulness practices and concepts can be used to enhance the student’s learning experience in beginning economics courses. Specific areas with a high potential for learning enhancement are identified: grasping abstract economic concepts, seeing beyond obvious economic consequences, and finding one’s own ethical framework in economic analysis.  Current research linking mindfulness practices to student development in these areas is examined and practical methods are offered to integrate mindfulness into the economics classroom."

Full disclosure: A post from this blog in 2006 gets mentioned in the paper. It was Good Economics is Good Story Telling.

Update 1-19-14: The NY Times has an article on mindfulness, meditation and their effect on cognitive ability and creativity. It may help cognition but hinder creativity. Click here to read it

What Do Bonanza, Charles Dickens And Copyright Laws Have In Common?

In an episode of the TV show from 1963, Dickens came visited Virginia City and discovered his copyrights were being violated. So he protested and complained. Click here to go to the IMDB page for this episode. Click here to watch it on You Tube. Here is the summary from IMDB

"At Ben's invitation, Charles Dickens comes to Virginia City to give a reading from "Oliver Twist" while on a reading / lecture tour in America. While there, he stays at the Ponderosa. He becomes enraged by the townsfolk's casual attitude toward distribution of copies of his stories published without protection of copyright laws. After confronting the local newspaper publisher, the newspaper's office is destroyed. Already having lost the esteem of the townsfolk, Dickens now finds that the townsfolk blame him for the violence."

Here are some links with historical information:

Struggles For Copyright Laws

When Charles Dickens fell out with America (from BBC)

Bootlegging Dickens: Author Looks At 'Bookaneers' (from NPR)

Trade Weighted U.S. Dollar Index: Major Currencies (TWEXM)

This is from the St. Louis Federal Reserve Bank. Click here to go the site

2013-12-11: 76.248 Index March 1973=100 Last 5 Observations

2013-12-04:	76.626
2013-11-27:	76.466
2013-11-20:	76.159
2013-11-13:	76.293

Weekly, Ending Wednesday, Not Seasonally Adjusted, Updated: 2013-12-16 4:51 PM CST 

Notes:

Averages of daily figures. A weighted average of the foreign exchange value of the U.S. dollar against a subset of the broad index currencies that circulate widely outside the country of issue.
Major currency index includes the Euro Area, Canada, Japan, United Kingdom, Switzerland, Australia, and Sweden. For more information about trade-weighted indexes see http://www.federalreserve.gov/pubs/bulletin/2005/winter05_index.pdf.

Why Economics Is Really Called 'the Dismal Science'

Click here to read this great article by Derek Thompson in The Atlantic. The real reason is not the one which has been traditionally taught. Economics was first called the dismal science because it "couldn't find a justification for slavery." Economists considered slaves to be equal to other human beings.

Students March In The Streets, Demanding That Deadweight Loss Be Eliminated!!

I sometimes joke in class that students are marching in the streets and shouting "What do we want? Maximized Social Welfare! When do we want it? Now!"One of my students this semester, Charissa Fenton, made up this fake newspaper because of what I said. I think it is pretty funny.

Social welfare is the sum of consumer surplus and producer surplus. It is the total net gain we get from consuming and producing goods. It is one way to judge different policy outcomes. Deadweight loss is the loss of social welfare when we have monopoly instead of competition (or if we have negative externalities like pollution). There is no deadweight loss when P = MC. Here are some links

consumer-surplus-and-producer-surplus
 
Economic_surplus
 
Consumer-and-Producer-Surplus-Graphing-and-Calculating

The Pyschology & Economics Of Decision Making Under Uncertainty (With Snoopy's Version From 1966)

See You’re So Self-Controlling by MARIA KONNIKOVA. From the 11-16 NY Times. She has a Ph. D. in psychology from Columbia University and is the author of the book Mastermind: How to Think Like Sherlock Holmes.

Also see A Talk With Lars Peter Hansen, Nobel Laureate. Also from the 11-16 NY Times. He won the economics prize for "contributing to the study of asset prices." It is related to the debate on theory of efficient markets. The idea is that stock prices make sense based on publicly available information. They won't be priced too high or too low.

Here is what Hansen says about "Decision Making Under Uncertainty."

"Yes, people struggle with how to cope with uncertainty; it’s not so easy for them to build probability models about the future in very complicated environments. That’s not realistic. We’re very much interested in rational agents who are coping with uncertainty.

What do you want to call behavior under those conditions? Well, you can call that irrational. I’m not sure that I want to do that; maybe it’s a useful term, maybe it’s not, I’m not quite sure.

How to cope with the uncertainties under complexity is a very important question that we’ve just scratched the surface of."

"Yes, the key thing there, too, is we were driven by empirical evidence, about how people behave. We were driven partly by that and partly by other insights coming out of decision theory — broadly conceived in terms of how people might cope with uncertainty. One thing I loved about rational expectations was that it said, to what extent is public policy grounded on being able to fool people systematically?"

The first article, discusses some recent research from psychology on "Decision Making Under Uncertainty." It looks into how people make decisions in the short-run based on expectations of the long-run. We might eat a slice of chocolate cake because that is great in the short-run but if we have a long-run goal to lose weight, it might seem like it is irrational or a case of low willpower if we eat the cake.

But what if it is uncertain as to how long it will take for a person to reach their weight loss goal? Once you are not sure when the payoff will come, you might think it will never come. So it is better, and perhaps rational, to at least have the cake now and get some pleasure because the weight loss may never come. Excerpt:

"A failure of self-control, suggest the University of Pennsylvania neuroscientists Joseph W. Kable and Joseph T. McGuire, may not be a failure so much as a reasoned response to the uncertainty of time: If we’re not quite sure when the train will get there, why invest precious time in continuing to wait?

Mr. Kable, who has been working on the psychology and neuroscience of decision making for more than a decade, argues that the truth is that in real life, as opposed to the lab, we aren’t nearly as sure we’ll get our promised reward, or if we do, of when it will come. 

“The timing of real-world events is not always so predictable,” he and Mr. McGuire write. “Decision makers routinely wait for buses, job offers, weight loss and other outcomes characterized by significant temporal uncertainty.” Sometimes everything comes just when we expect it to, but sometimes even a usually punctual bus breaks down or an all-but-certain job offer falls through. 

When we set a self-control goal for ourselves, we often have specific time frames in mind: I’ll lose a pound a week; a month from now, I’ll no longer get cravings for that cigarette; the bus or train will come in 10 minutes (and I’ve committed to taking public transportation as part of lessening my carbon footprint, thank you very much). 

But what happens if our initial estimate is off? The more time passes without the expected reward — it’s been 20 minutes and still nothing; I’ve been dieting for a week and a half now and still weigh the same — the more uncertain the end becomes. Will I ever get my reward? Ever lose weight? Ever get on that stupid train?

In this situation, giving up can be a natural — indeed, a rational — response to a time frame that wasn’t properly framed to begin with, according to a series of new studies conducted by Mr. Kable’s decision neuroscience lab at the University of Pennsylvania and published in Cognition and Psychological Review. 

“There are lots of situations, probably the majority of situations, in the real world,” Mr. Kable told me, “where waiting longer is actually a valid cue that the reward is getting further and further away.""

They have also done some experiments that back this up. Now here is the Peanuts comic which was originally from 1966, although it appeared again on 11-23. I think what Snoopy does and says is what the article was all about.

Oil-rich Midland, TX is nation’s fastest growing metro area, with highest per-capita income in the country at $83,000

Great post from economist Mark Perry (his blog is called "Carpe Diem")

"The Bureau of Economic Analysis (BEA) released data today on “Local Area Personal Income” with new estimates for personal income in 2012 for the nation’s 381 metropolitan statistical areas (MSAs). Here are a few highlights:

1. Midland, Texas is clearly America’s “economic miracle city.” For the third year in a row, Midland was the nation’s fastest growing MSA, with growth in personal income in 2012 of 12.1%. Midland also led the country as the MSA with the highest per capita personal income in 2012 at $83,049, followed by Bridgeport-Stamford-Norwalk, CT ($81,068), San Francisco ($66,591), the Silicon Valley MSA of San Jose-Santa Clara-Sunnvale ($65,679) and Washington, DC ($61,743).

2. Following Midland’s income growth of 12.1% in 2012 were nearby No. 2 Odessa, TX (11.5%), No. 3 Grand Forks, ND (11.5%) and No. 4 Bismarck, ND (10.1%), which are all benefiting from America’s Shale Revolution that has made Texas and North Dakota the shining stars of the Great American Energy Boom. Other Texas and North Dakota MSAs that experienced strong personal income growth in 2012 were No. 7 Fargo, ND (8.3%), No. 14 Victoria, TX (7.1%), No. 16 Houston (6.7%) and No. 22 Austin (6.1%). Of the top 22 fastest growing metro areas in 2012, eight were either in Texas or North Dakota.

3. On a per-capita basis, the Grand Forks MSA led the country in 2012 with personal income growth of 9.5%, followed by No. 2 Odessa (7.9%), No. 3 Elkhart, IN (7.8%), No. 4 Bismarck (7.6%), No. 5 Columbus, IN (7.4%) and No. 6 Midland (7.2%). Of the six MSAs with the highest per-capita income growth in 2012, four were either in North Dakota and Texas.

MP: More evidence from today’s BEA report that America’s Shale Revolution is creating shale-based wealth, income, jobs and prosperity, especially in the states of Texas and North Dakota, the two shining stars of the Great American Energy Boom. And Midland, Texas has emerged as America’s “economic miracle city” with the highest per-capita income in the country ($83,049), higher even than average incomes in Silicon Valley ($65,679) by 26.4% and Washington, DC ($61,743) by 34.5%."