Amazon offers a discount on Prime for lower-income shoppers-but is it just a form of price discrimination?

See Amazon is going after Walmart with a 45 percent discount on Prime for lower-income shoppers by Jason Del Rey of recode. Excerpt:

"Amazon already owns the high-income shopper segment in the U.S. Now it’s making a bid to court those who have less income at their disposal.

On Tuesday, Amazon announced that it is offering a 45 percent discount on Prime memberships — $5.99 a month instead of $10.99 month — to U.S. residents receiving government assistance.

Shoppers with an Electronic Benefits Transfer card — used for benefits like the Women, Infants, and Children Nutrition Program — are eligible for the lower price but they also have to re-qualify every year for up to four years.

The move comes a little over a year after Amazon first introduced the $10.99 monthly payment option for Prime, which was previously only available for an annual fee of $99.

The monthly option comes with the same perks like free two-day shipping on tens of millions of items and access to a large selection of online movies and TV shows for no extra charge."

Charging different prices to different groups of customers based on their ability and willingness to pay (a discount) is price discrimination.

Why price discrimination raises profits

1. If a firm can get a higher price from some customers than others they increase their profits.
2. If a firm can lower the price for others who might not have bought the product to begin with, they also increase their profits.

Necessary Conditions for Price Discrimination

1. The firm must face a downward sloping demand. Monopolies do but firms in perfect competition do not (their demand, also their MR line, is flat).

2. The firm must be able to readily (and cheaply) identify buyers or groups of buyers with predictably different elasticities of demand (senior citizens have a more elastic demand and will shop around more since they have more time so restaurants might give them a discount). The more elastic the demand, the greater the change in quantity demanded for a given change in price.

3. The firm must be able to prevent resale of the product or service. If a student can buy a movie ticket for $6 while everyone else pays $8, the firm will lose money if the students turn around and sell their tickets for $7. So the theater can prevent resale by checking student IDs to make sure people holding the lower price ticket really are students.

#2 might be the key here for Amazon. The lower income customers will be spending a bigger share of their budgets on Amazon products and services. One of the determinants of elasticity is how much of your budget you spend on the item. As this goes up, your demand becomes more elastic (that is, quantity will change more for a given change in price). You are affected alot more by a change in the price of cars than a change in the price of donuts. So if the price of cars doubles, the quantity demanded will fall much more than if the price of donuts doubles.

And when firms can price discriminate, as explained above, they will charge lower prices (offer discounts) to those groups with higher elasticities. The number of substitute goods and the amount of time consumes have to adjust to price changes also affect elasticity.

The Diminishing Returns of a College Degree

In the mid-1970s, far less than 1% of taxi drivers were graduates. By 2010 more than 15% were

 By Richard Vedder and Justin Strehle in the WSJ. Mr. Vedder is director of the Center for College Affordability and Productivity and teaches at Ohio University, where Mr. Strehle studies economics. Excerpts:

"The cost of college attendance is rising while the financial benefits of a degree are falling."

"From 2000 to 2016, the tuition-and-fees component of the Consumer Price Index rose 3.54% annually (74.5% over the entire period), adjusting for overall inflation. With sluggish business investment, a slowdown in income growth has aggravated the rising burden of paying for higher education. American families have taken on more than $1.3 trillion in student-loan debt—more than what they borrow with credit cards or to buy cars."

"the earnings advantage associated with a bachelor’s degree compared with a high school diploma is no longer growing like it once did. Census data show that the average annual earnings differential between high school and four-year college graduates rose sharply, to $32,900 in 2000 (expressed in 2015 dollars) from $19,776 in 1975—only to fall to $29,867 by 2015." 

"about 40% of recent college graduates are “underemployed,” often for a long time."

"recent attendees of Stanford University earn on average far more than twice as much as those attending Northern Kentucky University ($86,000 vs. $36,000). Electrical engineers typically earn twice as much as psychology majors."

"In recent years, male college graduates’ earning power has decreased significantly, as it has for whites and Asians. Not so for women, Hispanics and blacks, for whom the financial payoff to a college education has continued to rise. College graduates traditionally earn more than high school graduates in part because their degrees act as signaling devices in the job market."

"As the proportion of adult Americans with college degrees grows beyond one-third, being a college graduate no longer necessarily denotes exceptional vocational promise. The bachelor’s degree is not the reliable signaling device it once was."

Trade on the Streets, and Off the Books, Keeps Zimbabwe Afloat

By NORIMITSU ONISHI and JEFFREY MOYO of the NY Times. Excerpts:

"From 2011 to 2014, the percentage of Zimbabweans scrambling to make a living in the informal economy shot up to an astonishing 95 percent of the work force from 84 percent, according to the government. And of that small number of salaried workers, about half are employed by the government, including patronage beneficiaries with few real duties."

"An acute cash shortage persists despite the introduction of a surrogate currency in November. The government, unable to pay its workers their Christmas bonuses, has offered them land instead."

"As long lines keep forming outside banks, the continuing decline of the formal economy has raised fears of a repeat of the 2008 hyperinflation crisis, which was fueled by the unrestrained printing of the old Zimbabwean dollar, including a $100 trillion note."

"The government has occasionally cracked down — sometimes violently — on the street vendors, who are not licensed, describing their activities, near the seat of government and businesses, as an eyesore."

"According to an unspoken rule, the street vendors are allowed to operate only after dark on weekdays and starting in late afternoon on weekends."

"Zimbabwe’s per capita gross national income peaked with independence in 1980, when Mr. Mugabe seized power, and bottomed out with the hyperinflation crisis of 2008."

"Mr. Mugabe’s violent seizure of white-owned farms starting in 2000 precipitated a decline in manufacturing and a process of deindustrialization. Manufacturing peaked in 1992, accounting for about 30 percent of the gross domestic product. Now it is 11 percent and declining."

"With manufacturing’s sharp decline, as well as the resulting drop in exports and spike in imports, Zimbabwe suffers from a steep trade imbalance. That imbalance’s effect on the economy is exacerbated by the American dollar, which Zimbabwe adopted in 2009 to combat hyperinflation."

"Zimbabwe has experienced a crippling shortage of dollars since last March. Efforts to encourage the use of plastic money — and the introduction, so far, of nearly $100 million into the market of a surrogate currency called bond notes — have helped, though not enough. Customers still stand for hours in long lines outside banks to try to withdraw the few dollars available.

With the government now strictly controlling the transfer of dollars outside Zimbabwe, companies dependent on trade are finding it increasingly difficult to import critical goods."

"At a small auto parts shop in central Harare, called Track Board, Prince Mapira, 23, said American dollars had vanished from the marketplace. Customers now pay only in bond notes, which are recognized only inside Zimbabwe, creating a problem for his business."

"The auto shop needs American dollars to import parts from South Africa or Japan. So Mr. Mapira takes the bond notes, which are supposed to be the equivalent of the American dollar, to exchange on the black market.

“If you go there with 100 dollars in bond notes, they give you $70 or $80,” he said. “It’s not equal on the black market.”"

Getting paid to wake other people up was once a real job

See That was then, this is now at Marginal Revolution.

The percentage of 25-54 year-olds employed fell in May

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates college age people who might not be looking for work)

The percentage of 25-54 year olds employed is 78.4% for May. It was 78.6% in April. It is still below the 79.7% in December 2007 when the recession started.  Click here to see the BLS data. The unemployment rate was 4.3% in May. Click here to go to that data.

Here is a good graph from the St. Louis Fed. It shows that there are about 125 million people in the 25-54 year old group. So since we are 1.3 percentage points below the 79.7% of December 2007, that is still 1.6 million fewer jobs (Hat tip: Vance Ginn of the Texas Public Policy Foundation).

Here is the timeline graph of the percentage of 25-54 year olds employed since 2007. 


Here it is going all the way back to 1948

Startups Remain Stuck: Job Creation From New Establishments Lags

Some economists think a decline in dynamism is contributing to low productivity growth

By Jeffrey Sparshott of the WSJ. The monthly employment report comes out tomorrow and although unemployment is low, the percentage of 25-54 year-olds employed is still below what it was in December 2007, when the last recession began. I will post something on this tomorrow after the report is out.

So this article discusses why that might be the case. It also mentions "allocative efficiency," something I cover in both micro and macro. When the quantity of a good makes the marginal benefit equal to the marginal cost, we have allocative efficiency. This article suggests not enough resources are being put into new businesses, that is, the quantity of startups is too low.

Here are excerpts from the article:

"During the latest expansion, new establishments have accounted for a little more than 11% of all new private-sector jobs created in the U.S. During the 1990s, the figure was 15%, according to Labor Department data released Wednesday.

That may seem a small shift, but those few percentage points add up to nearly 300,000 jobs a quarter.

The startup slowdown also suggests a loss of dynamism across the broader U.S. economy, with Americans either less willing or less able to launch a new venture, and a decline in the kind of churn that leads to greater opportunity for workers and rising productivity.

“The evidence suggests that the decline in dynamism is reason for concern and sheds light on debates about the causes of slowing productivity growth,” economists Ryan Decker, John Haltiwanger, Ron Jarmin and Javier Miranda wrote in a February 2017 discussion paper for the Federal Reserve.

The latest Labor Department report tracks job creation from existing and new establishments. It shows that establishment “births” accounted for about 866,000 new jobs in the third quarter of 2016. That works out to about 11.3% of all jobs created during the period."

"Separate data from the Commerce Department show the trend goes back even further. The share of private firms less than a year old has dropped from more than 12% during much of the 1980s to only about 8% since 2010.

Why would that hurt productivity? Mr. Decker and his colleagues focus on allocative efficiency, or “the continual movement of resources to their most productive uses.” A decline in startups suggests that capital and labor aren’t getting moved to enough fast-growing young companies.

“Our findings imply that…declining business dynamism since 2000 is likely a drag on American living standards,” the paper said. “Moreover, our findings suggest a reevaluation of the productivity slowdown debate, which has until now focused on technological versus measurement explanations.”

Not everyone buys that explanation.  A San Francisco Fed paper by economist Huiyu Li finds that incumbent firms contribute significantly to growth.

“In sum, focusing on the detrimental effects from fewer new businesses on aggregate productivity growth may undervalue the strong innovation that existing firms contribute to the economy,” Ms. Li wrote.

Even so, a decline in startups raises other red flags for the economy, including the possible effects of regulations, an aging population, a growing divide between cities and rural areas, outsourcing or simply a loss of entrepreneurial spirit."Fits and StartsShare of job gains from new establishments

Why It Is Hard To Raise The Rate Of Economic Growth

See Why Trump can’t be Reagan: Economic plan of reviving a 1980s style boom in America is pie in the sky Ruchir Sharma.

"The potential growth rate of an economy is roughly determined by two factors: population and productivity. An economy can grow steadily only by adding more workers, or by increasing output per worker. During the Reagan years, both population and productivity were growing at around 1.7% a year, so the potential US growth rate was close to 3.5%. In short, Reagan did not push the nation’s economic engine to run faster than it could handle." [I would add that more capital or better technology can also increase the output per worker-CM]

"America’s population and productivity growth have fallen to around 0.75% each, generously measured, so potential economic growth is roughly 1.5%. Any policy package that aims to push an economy beyond its potential could easily backfire – in the form of higher deficits and inflation.

In the last 1,000 years, no economy has ever broken free of the limits imposed by population growth. Before 1870, global population growth did not exceed 0.5%, and global economic growth did not exceed 1% for any sustained period. Before World War II population growth increased to 1%, and economic growth accelerated to about 2%. After the war, the baby boom pushed population growth towards 2%, and economic growth rose to nearly 4% for the first and only time."

"global population growth has fallen to about 1%. The baby boom has gone bust. With the US population growth rate falling – last year to the slowest rate recorded since the 1930s – it is unlikely that any president could juice the economy to grow at 3.5% or more over the next decade."

"let’s assume Trump can more than double US productivity growth to the rate achieved in the Reagan era, 1.7%. Given the slowdown in population growth, that productivity miracle would raise the potential GDP growth rate to around 2.5%. If that doesn’t sound so different from 3.5%, consider that every percentage point of growth in the domestic economy is worth more than $100 billion"

"Not every country with rapid population growth enjoyed a steady economic boom, but few economies boomed without it. And for most countries, the era of population growth is now over."

"Comparing growth in the US unfavourably to China and India, as Trump has, makes little sense because poorer countries always tend to grow faster. If your starting income is lower, it’s easier to double it."

How Cell-Phone Plans With Unlimited Data Limited Inflation

Economist traces almost half of the U.S. core-inflation slowdown this year to wireless services

By Ben Leubsdorf of the WSJ. Excerpt:

"A slowdown in inflation over the last couple of months seems to be coming from Americans’ smartphones.

Many private economists and Federal Reserve policy makers expected price growth would pick up this year, with unemployment low and the job market tightening. But core inflation—prices excluding the volatile categories of food and energy—rose just 1.9% in April from a year earlier, decelerating from 2.3% growth in January, as measured by the Labor Department’s consumer-price index. Core prices actually fell in March from the prior month, the first time that had happened in more than seven years.

Multiple forces are at work, including a glut of used cars pushing down vehicle prices and a deceleration in medical inflation. But Paul Ashworth, chief U.S. economist at Capital Economics, said in a research note this week that nearly half of the decline in core CPI inflation this year can be traced to a single item: wireless telephone services.

Cell-plan prices dropped 7% in March and fell an additional 1.7% in April, according to Labor Department data. From April last year, wireless service prices were down 12.9%, the largest decline in 16 years.

Mr. Ashworth attributed the drop to “the price war that has broken out among cell-phone service providers, with all the big providers now offering unlimited data plans at cheaper rates.”

Intense competition among cell-service providers like Verizon Communications Inc., Sprint Corp., T-Mobile US Inc. and AT&T Inc. has driven down prices for years and Verizon, the nation’s largest wireless carrier, in February followed its rivals in reintroducing unlimited-data plans.

As it happens, government statisticians in January had changed how they adjust available prices for cell-phone plans to account for features that improve quality. “In March, these procedures resulted in downward adjustments for many quotes based on changes in plans, largely in changes in data limits,” Bureau of Labor Statistics economist Steve Reed said in an email."

What Is The Full-Employment Unemployment Rate According To The Fed?

A recent article says 4.7%. See Fed Likely to Go Ahead With Rate Hikes Despite Trump Turmoil by Rich Miller of Bloomberg. Excerpts:

"Officials in March projected that the economy would grow 2.1 percent both this year and next, above their 1.8 percent estimate of its long-run cruising speed. They also reckoned that a 4.7 percent jobless rate was equivalent to full employment. Unemployment in April was 4.4 percent."

"Michael Feroli, chief U.S. economist at JPMorgan Chase & Co., said the course of inflation over the coming months will be more important in shaping the Fed’s plans than the political tumult in Washington.

Consumer-price inflation has slowed more than forecast in the last couple of months, raising questions about whether the Fed remains on track to achieve its 2 percent inflation target.

Feroli said the fundamentals point to inflation resuming its upward trend, with import and unit labor costs rising and the dollar falling.

As a result, he expects the Fed “to look past” the recent weakness in prices and raise interest rates again next month."

Here is some more information to help explain this issue.

We can see how this works in the following graph:



A GDP of $9 trillion is the "full-employment" GDP (QF). That gives us the lowest rate of unemployment compatible with "price stability" (price stability is an an annual inflation rate of 3% or less-although the article says 2% since that is what the Fed seems to be using these days). As GDP increases, more workers are hired, so unemployment falls. But if GDP is below QF, firms cannot raise prices. There is slack or "excess capacity" in the economy. That means that there will be very little pressure on prices. Resources are not very scarce and product prices don't have to be increased (or increased very much) to call them back into service.

But as GDP increases, resources become more scarce as more bidders want them. The more GDP increases, the faster prices increase. Also, less efficient resources get called into service and less efficiency means greater cost. The higher costs get passed along to the consumer in higher prices.

So, if there is a danger of AD going past QF the FED will raise interest rates to slow down private spending (both consumption and investment) to keep AD from moving too far to the right and prevent the higher rates of inflation.

Interesting New Book On Trade And Tariffs By Marc-William Palen

See The 'Conspiracy' of Free Trade: The Anglo-American Struggle over Empire and Economic Globalisation, 1846-1896. Here is the Amazon description:

"Following the Second World War, the United States would become the leading 'neoliberal' proponent of international trade liberalization. Yet for nearly a century before, American foreign trade policy was dominated by extreme economic nationalism. What brought about this pronounced ideological, political, and economic about-face? How did it affect Anglo-American imperialism? What were the repercussions for the global capitalist order? In answering these questions, The 'Conspiracy' of Free Trade offers the first detailed account of the controversial Anglo-American struggle over empire and economic globalization in the mid- to late-nineteenth century. The book reinterprets Anglo-American imperialism through the global interplay between Victorian free-trade cosmopolitanism and economic nationalism, uncovering how imperial expansion and economic integration were mired in political and ideological conflict. Beginning in the 1840s, this conspiratorial struggle over political economy would rip apart the Republican Party, reshape the Democratic Party, and redirect Anglo-American imperial expansion for decades to come."

Here is the author's bio

"Dr. Marc-William Palen is a historian at the University of Exeter. He specialises in the intersection of British and American imperialism within the broader history of globalisation since c. 1800. His commentary on historical and contemporary global affairs has appeared in the New York Times, the Australian, History Today, Time Magazine, Newsweek, the Globalist Magazine, the History News Network, History & Policy, Foreign Policy in Focus, and Common Dreams, among others. He is co-founder of History & Policy's Global Economics and History Forum. He is also the founding editor of the Imperial & Global Forum, the blog of the Centre for Imperial & Global History at the University of Exeter. You can follow him on Twitter @MWPalen"

Dr. Palen is from San Antonio. Here is a related post from a few months ago:

Mark Twain, Economist?

Adam Smith On Jeopardy

Here is the clue for Final Jeopardy on April 28:

Category: HISTORIC WORKS' FIRST LINES

Clue: "The annual labour of every nation is the fund which originally supplies it with all the necessaries and conveniences of life"

On Jeopardy, they give you the answer. So your response has to be in the form of a question.

The correct question: What is the Wealth of Nations?

Two of the three players got it right. One said Das Kapital (which was by Karl Marx)

Go to

Jeopardy, April 28, 2017. Scroll down to the bottom for Final Jeopardy.

Why Did The Value Of The Dollar Rise More Than 20% From July 2014 To March 2015?

On June 30, 2014 , the Trade Weighted U.S. Dollar Index: Major Currencies (DTWEXM) was 75.7 (the index starts in 1973 at 100, so the dollar was lower in value compared to other major currencies in 2014 than it was in 1973).

See Trade Weighted U.S. Dollar Index: Major Currencies (DTWEXM) from the St. Louis Federal Reserve Bank.

But by March 16, 2015, it was at 93.1, just about a 23% increase in value.

Why did the dollar rise? Here is what The Economist magazine said:

"The principal reasons for the greenback’s rapid strengthening are simple to grasp. With Europe and Japan stuck in the doldrums, and China and other emerging markets slowing, America’s economy looks relatively strong. The IMF expects it to grow by 3.6% this year. The Federal Reserve has already begun to tighten monetary policy, by stopping its programme of asset purchases, and is now preparing the ground to go further. This week the Fed altered the wording it uses to describe its plans (see article), giving itself room to raise interest rates later this year—the first rise since 2006. With American monetary policy tightening, and other central banks still loosening, investors can make higher returns from dollar-denominated assets. In capital floods, and up the dollar goes."

See Mismatch point: The rise of the dollar will punish borrowers in emerging markets.

Here is another view from Andrew Hecht. He is an international commodity trader, an options expert and analyst.

"There are many reasons that the dollar has appreciated over recent months. The U.S. economy is still the largest in the world. Despite demographics, the U.S. remains the strongest economic nation in the world. The U.S. remains a powerful nation even though less than five percent of the world's population live within U.S. borders. The dollar is the reserve currency of the world. Many other nations hold dollars as a key part of their reserves due to the political and economic stability in the United States. Dollar strength has been the result of moderate growth in the U.S. economy. While European growth remains lethargic, the nation that experienced the highest degree of growth in recent years, China, has seen its growth rate slow. The Chinese economic has shifted from heavy manufacturing to a consumer based economy. As the size of the Chinese economy swells, it becomes harder to grow on a percentage basis as it has in the past.

Think of it this way, it is easier to make a seven percent return on one million dollars than it is to make a commensurate return on one trillion dollars. The sheer size of the Chinese economy makes the percentage growth rate seen in years past almost impossible to sustain. Therefore, Chinese economic growth has slowed on a percentage basis.

Relative strength of the U.S. economy, when compared to those of Europe and China, is a positive factor for the dollar.

A bear market in commodity prices has also been supportive for the dollar. The U.S. is a major consumer of raw materials and lower prices amount to stimulus for the American economy. At the same time, the currencies of nations that depend on commodity revenues have suffered because of lower prices. Canada, Australia, Brazil, Russia, South Africa as well as other commodity producing nations have seen their currency values depreciate alongside raw material prices.

Another positive influence for the dollar is the relative rate of interest paid on the U.S. currency when compared to other currencies. For the first time in nine years, the U.S. central bank raised short-term interest rates in the United States in December 2015. The Federal Reserve also stated their intention that rates will continue to head higher in the months and years ahead. Short-term interest rates in the U.S. went to zero in the aftermath of the housing and global financial crisis in 2008. Growth in the U.S. economy no longer supports such accommodative monetary policy. As the dollar has offered the opportunity for capital growth, in terms of its appreciation versus other currencies since May 2014, higher interest rates add additional support in that they increase the yield on the currency for holders."

Is There Economic And Political Meaning In "The Wizard of Oz?"

We covered international trade in my micro class recently and the text book has something about this in that chapter.

To get a handle on this, you can read Money and Politics in the Land of Oz By Quentin P. Taylor. Also, for my students, there is an article in chapter 15 of the micro book by Tucker and in chapter 18 in the macro book.Below is an excerpt from the Taylor paper:

"Dorothy, the protagonist of the story, represents an individualized ideal of the American people. She is each of us at our best-kind but self-respecting, guileless but levelheaded, wholesome but plucky. She is akin to Everyman, or, in modern parlance, “the girl next door.” Dorothy lives in Kansas, where virtually everything-the treeless prairie, the sun-beaten grass, the paint-stripped house, even Aunt Em and Uncle Henry-is a dull, drab, lifeless gray. This grim depiction reflects the forlorn condition of Kansas in the late 1880s and early 1890s, when a combination of scorching droughts, severe winters, and an invasion of grasshoppers reduced the prairie to an uninhabitable wasteland. The result for farmers and all who depended on agriculture for their livelihood was devastating. Many ascribed their misfortune to the natural elements, called it quits, and moved on. Others blamed the hard times on bankers, the railroads, and various middlemen who seemed to profit at the farmers’ expense. Angry victims of the Kansas calamity also took aim at the politicians, who often appeared indifferent to their plight. Around these economic and political grievances, the Populist movement coalesced.

In the late 1880s and early 1890s, Populism spread rapidly throughout the Midwest and into the South, but Kansas was always the site of its most popular and radical elements. In 1890, Populist candidates began winning seats in state legislatures and Congress, and two years later Populists in Kansas gained control of the lower house of the state assembly, elected a Populist governor, and sent a Populist to the U.S. Senate. The twister that carries Dorothy to Oz symbolizes the Populist cyclone that swept across Kansas in the early 1890s. Baum was not the first to use the metaphor. Mary E. Lease, a fire-breathing Populist orator, was often referred to as the “Kansas Cyclone,” and the free-silver movement was often likened to a political whirlwind that had taken the nation by storm. Although Dorothy does not stand for Lease, Baum did give her (in the stage version) the last name “Gale”-a further pun on the cyclone metaphor.

The name of Dorothy’s canine companion, Toto, is also a pun, a play on teetotaler. Prohibitionists were among the Populists’ most faithful allies, and the Populist hope William Jennings Bryan was himself a “dry.” As Dorothy embarks on the Yellow Brick Road, Toto trots “soberly” behind her, just as the Prohibitionists soberly followed the Populists.

When Dorothy’s twister-tossed house comes to rest in Oz, it lands squarely on the wicked Witch of the East, killing her instantly. The startled girl emerges from the abode to find herself in a strange land of remarkable beauty, whose inhabitants, the diminutive Munchkins, rejoice at the death of the Witch. The Witch represents eastern financial-industrial interests and their gold-standard political allies, the main targets of Populist venom. Midwestern farmers often blamed their woes on the nefarious practices of Wall Street bankers and the captains of industry, whom they believed were engaged in a conspiracy to “enslave” the “little people,” just as the Witch of the East had enslaved the Munchkins. Populists viewed establishment politicians, including presidents, as helpless pawns or willing accomplices. Had not President Cleveland bowed to eastern bankers by repealing the Silver Purchase Act in 1893, thus further restricting much-needed credit? Had not McKinley (prompted by the wealthy industrialist Mark Hanna) made the gold standard the centerpiece of his campaign against Bryan and free silver?"

Now an excerpt from Tucker:

"Gold is always a fascinating story: The Wonderful Wizard of Oz was first published in 1900 and this children's tale has been interpreted as an allegory for political and economic events of the 1890s. For example, the Yellow Brick Road represents the gold standard, Oz in the title is an abbreviation for ounce, Dorothy is the naive public, Emerald City symbolizes Washington, D.C., the Tin Woodman represents the industrial worker, the Scarecrow is the farmer, and the Cyclone is a metaphor for a political revolution. In the end, Dorothy discovers magical powers in her silver shoes (changed to ruby in the 1939 film) to find her way home and not the fallacy of the Yellow Brick Road. Although the author of the story, L. Frank Baum, never stated it was his intention, it can be argued that the issue of the story concerns the election of 1896. Democratic presidential nominee William Jennings Bryan (the Cowardly Lion) supported fixing the value of the dollar to both gold and silver (bimetallism), but Republican William McKinley (the Wicked Witch) advocated using only the gold standard. Since McKinley won, the United States remained on the Yellow Brick Road."

But not everyone agrees with this. Economist Bradley Hansen wrote an article titled The Fable of the Allegory: The Wizard of Oz in Economics in the Journal of Economic Education in 2002. Here is his conclusion:

"Rockoff noted that the empirical evidence that Baum wrote The Wonderful Wizard of Oz as an allegory was slim, but he compared an allegorical interpretation to a model and suggested that “economists should not have any difficulty accepting, at least provisionally, an elegant but controversial model” (Rockoff 1990, 757). He was right—we did not have any difficulty accepting it. Despite Rockoff’s warning, we appear to have accepted the story wholeheartedly rather than provisionally, simply because of its elegance. It is as difficult to prove that The Wonderful Wizard of Oz was not a monetary allegory as it is to prove that it was. In the end, we will never know for certain what Baum was thinking when he wrote the book. I suggest that the vast majority of the evidence weighs heavily against the allegorical interpretation. It should be remembered that no record exists that Baum ever acknowledged any political meanings in the story and that no one even suggested such an interpretation until the 1960s. There certainly does not seem to be sufficient evidence to overwhelm Baum’s explicit statement in the introduction of The Wonderful Wizard of Oz that his sole purpose was to entertain children and not to impress upon them some moral. The Wonderful Wizard of Oz is a great story. Telling students that the Populist movement was like The Wonderful Wizard of Oz does seem to catch their attention. It may be a useful pedagogical tool to illuminate the debate on bimetallism, but we should stop telling our students that it was written for that purpose."

I found a review of the book in the NY Times from 1900 and it does not mention anything about OZ having political or economic meaning. The book was also made into a musical a few years later and none of the reviews of the musical mention any political or economic meaning.

How Odysseus Started The Industrial Revolution

Factory work may have been a commitment device to get everyone to work hard. Odysseus tying himself to the mast was also a commitment device. Dean Karlan, Yale economics professor explains how commitment devices work:

"This idea of forcing one’s own future behavior dates back in our culture at least to Odysseus, who had his crew tie him to the ship’s mast so he wouldn’t be tempted by the sirens; and Cortes, who burned his ships to show his army that there would be no going back.

Economists call this method of pushing your future self into some behavior a “commitment device.” [Related: a Freakonomics podcast on the topic is called "Save Me From Myself."] From my WSJ op-ed:

Most of us don’t have crews and soldiers at our disposal, but many people still find ways to influence their future selves. Some compulsive shoppers will freeze their credit cards in blocks of ice to make sure they can’t get at them too readily when tempted. Some who are particularly prone to the siren song of their pillows in the morning place their alarm clock far from their bed, on the other side of the room, forcing their future self out of bed to shut it off. When MIT graduate student Guri Nanda developed an alarm clock, Clocky, that rolls off a night stand and hides when it goes off, the market beat a path to her door."

 See What Can We Learn From Congress and African Farmers About Losing Weight?

Something like this came up recently in the New York Times, in reference to factory work and the Industrial Revolution. See Looking at Productivity as a State of Mind. From the NY Times, 9-27. By SENDHIL MULLAINATHAN, a professor of economics at Harvard. Excerpts:

"Greg Clark, a professor of economics at the University of California, Davis, has gone so far as to argue that the Industrial Revolution was in part a self-control revolution. Many economists, beginning with Adam Smith, have argued that factories — an important innovation of the Industrial Revolution — blossomed because they allowed workers to specialize and be more productive.

Professor Clark argues that work rules truly differentiated the factory. People working at home could start and finish when they wanted, a very appealing sort of flexibility, but it had a major drawback, he said. People ended up doing less work that way.

Factories imposed discipline. They enforced strict work hours. There were rules for when you could go home and for when you had to show up at the beginning of your shift. If you arrived late you could be locked out for the day. For workers being paid piece rates, this certainly got them up and at work on time. You can even see something similar with the assembly line. Those operations dictate a certain pace of work. Like a running partner, an assembly line enforces a certain speed.

As Professor Clark provocatively puts it: “Workers effectively hired capitalists to make them work harder. They lacked the self-control to achieve higher earnings on their own.”

The data entry workers in our study, centuries later, might have agreed with that statement. In fact, 73 percent of them did agree to this statement: “It would be good if there were rules against being absent because it would help me come to work more often.”"

The workers, like Odyssues, tied themselves to the mast to resist the temptation of slacking. This made it possible for factories to generate the large output of the Industrial Revolution.

Joseph Schumpeter And Me

Jeffery S. McMullen of Indiana University just published an article in the academic journal "Business Horizons." It is titled

"Are we confounding heroism and individualism? Entrepreneurs may not be lone rangers, but they are heroic nonetheless."

I have some information below on how to access this article.

McMullen cites a paper I wrote in the 1990s and mentions my name in the same sentence as Joseph Schumpeter, an important economist from the 20th century.

Click here to read a short bio of him

A few years ago I wrote a post called "My Favorite Economist Is Joseph Schumpeter."  Here it is

""Why is this blog called The Dangerous Economist? Back in the early 1990s, I wrote a paper called "The Creative-Destroyers: Are Entrepreneurs Mythological Heroes?" It compares the entrepreneur in capitalism to the hero in mythology. I was never able to get it published in an academic journal. One referee even said the idea was dangerous. I doubt much harm would have befallen the U.S. economy had this paper been published. It is now online at

Creative Destroyers

A shorter version is at

Shorter Version

If you clicked on the link about why I chose this name for my blog and then these articles and read them you would have discovered some of the things that I list below and they would have pointed you to Schumpeter.

The process whereby innovations occur was called "Creative Destruction" by Schumpeter in his book Capitalism, Socialism, and Democracy. "Creative Destruction" was

"The opening of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U. S. Steel illustrate the same process of industrial mutation if I may use that biological term-that incessantly revolutionizes the economic structure from with in, incessantly destroying the old one, incessantly creating the new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in" (p. 83).

In his book The Hero with a Thousand Faces, Joseph Campbell described the action of the hero with

"The standard path of the mythological adventure of the hero is a magnification of the formula represented in the rites of passage: separation-initiation-return: which might be named the nuclear unit of the monomyth. A hero ventures forth from the world of common day into a region of supernatural wonder: fabulous forces are there encountered and a decisive victory is won: the hero comes back from this mysterious adventure with the power to bestow boons on his fellow man. "(p. 30)

Campbell (1968) also has a section called "The Cosmogonic Cycle" which "unrolls the great vision of the creation and destruction of the world which is vouchsafed as revelation to the successful hero" (p. 38). The connection to Schumpeter's theory of creative destruction is clear. A successful entrepreneur simultaneously destroys and creates a new world, or at least a new way of life. Henry Ford, for example, destroyed the horse and buggy age while creating the age of the automobile. But even more to the point is the fact that the hero finds that the world "suffers from a symbolical deficiency" (p. 37) and that "the hero appears on the scene in various forms according to the changing needs of the race" (p. 38). The changing needs and the deficiency may directly correspond to the changing market conditions or the changing desires for products. The entrepreneur IS the first person to perceive the need or opportunity for market profits.

Joseph Campbell's book inspired George Lucas to make the Star Wars movies."

Now here is the info on how to access the McMullen article.

The first link below is just some general info about the article. But the article itself is not readable online (unless you want to pay $35). If you go to the second link at ResearchGate, you can see his article listed. If you sign up for the service (it is free) you can request that the author send you a copy (that is how I got mine).

General info about the McMullen article

The second link at ResearchGate to request the article

How Long Have Economists Known About The Shortcomings Of GDP?

I occasionally hear about people who say we need a better measure of our economic welfare than GDP. But economists are not blind to its shortcomings. The textbook I use for my macro class includes a discussion of these issues. For example, GDP does not take into account how the quality of goods changes over time or how much leisure time we have and how that has changed over time.

There is also production that takes place outside of the market place. Economists have been aware of this since GDP was first created.

See What's the Value of US Household Production? by Timothy Taylor, Managing editor of the Journal of Economic Perspectives. He presents some comments made by economist Simon Kuznets in 1934. Kuznets was the author of the 1934 report to Congress "National Income, 1929-1932." He also won a Nobel Prize in Economics in 1971.

Here is one part of that report, from Mr Taylor's post:

"Kuznets wrote in 1934:

"The volume of services rendered by housewives and other members of the  household toward the satisfaction of wants must be imposing indeed,  when totaled for the 30 million families comprising the population of  this country; and the item is thus large enough to affect materially any estimate of national income. But the organization of these services  render them an integral part of family life at large, rather than of the specifically business life of the nation. Such services are, therefore, quite removed from those which gainfully occupied groups undertake to perform in return for wages, salaries, or profits. It was considered  best to omit this large group of services from national income, especially  since no reliable basis is available for estimating their value. This  omission, unavoidable though it is, lowers the value of national income  measurements as indexes of the nation's productivity in conditions  of recent years when the contraction of the market economy was accompanied by an expansion of activity within the family. ... Thus, the estimates submitted in the present study define income in such a way as to cover primarily only  efforts whose results appear on the market place of our economy.  A student of social affairs who is interested in the total productivity  of the nation, including those efforts which, like housewives' services,  do not appear on the market, can therefore use our measures only with some qualifications.""

Taylor also mentions "The value of household services was equal to about 37% of GDP in 1965, but is currently equal to about 23% of GDP."

Click here to learn more about Kuznets' contributions to economics

The percentage of 25-54 year-olds employed increased in February

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates college age people who might not be looking for work)

The percentage of 25-54 year-olds employed is 78.3% for February. It was 78.2% in January. It is still below the 79.7% in December 2007 when the recession started.  Click here to see the BLS data. The unemployment rate was 4.7% in February. Click here to go to that data.

Here is the timeline graph of the percentage of 25-54 year-olds employed since 2007. Notice how we had been rising before 2016 but it seems to be flattening out.



Here it is going all the way back to 1948

What Industries Have The Highest Profit Rates?

See The Most Profitable Industries in 2016 by Mary Ellen Biery of Forbes. A student asked about profit rates in class recently since this comes up when we cover market structures. For example, we expect firms in perfect competition to earn an average profit rate or rate of return because, if they are above average, more firms enter, driving prices and the profit rate back down. When there is not enough competition, firms can stay above average. Excerpts:

"Which U.S. industries are the most lucrative? The answer depends on how it’s measured, but based on pre-tax net profit margin, the top money-makers include specialty service providers in accounting, law, health care and real estate, according to the latest ranking from Sageworks, a financial information company.

Accounting-related companies (accounting, tax preparation, bookkeeping and payroll service companies) are the most profitable, with net profit amounting to 18.3 percent of sales, on average, based on a financial-statement analysis for privately held companies for the 12 months ended June 30.  Legal services firms and real-estate leasing companies are tied for second and third in profitability, with average net profit margins of 17.4 percent. These industries often make the cut for Sageworks’ annual ranking.


“Some businesses tend to have healthier bottom lines by the very nature of the industries that they operate in,” said Sageworks analyst James Noe. Many of the most profitable industries sell services rather than products, he noted, so their operations don’t require raw materials or other up-front costs that would wind up in the middle of their income statements and eat into the bottom line. “They don’t sell or produce finished goods,” he said. “They don’t make the tractors to sell to farmers or they don’t buy groceries to sell to consumers. In other words, you don’t need plastic to provide an audit for a company; it’s just mostly human capital that’s being utilized, and that lends to a high margin generally.”

Among privately held companies across all industries, the average net profit margin for the 12 months ended June 30 was 7.7 percent. Through its cooperative data model, Sageworks collects and aggregates private-company financial statements from accounting firms, banks and credit unions. Net profit margin has been adjusted to exclude taxes and include owner compensation in excess of their market-rate salaries. These adjustments are commonly made to private-company financials in order to provide a more accurate picture of the companies’ operational performance."

Here is the 2015 list

Here is another good link on profit rates

Is it okay to propose to your sweetheart with a diamond that was made in some drab office park?

See Forget the ring: Lab-grown diamonds are a scientist’s best friend by Sarah Kaplan of The Washington Post. It provides not just some of the economics of the industry but also some insights on the techniques of the process and the scientific uses of these lab created diamonds.

One of my classes this week read a chapter about cartels in the book The Economics of Public Issues. It included a short discussion about De Beers and what has happened to their monopoly power in the diamond market. It declined over time as more countries started mining diamonds (they once had a 90% market share and it is now 31%). They also faced anti-trust issues for the ways they tried to control the market (see additional link at the end).

But now lab-grown diamonds are starting to have an impact as well. Here are excerpts from the The Washington Post article:

"At a drab office park in a Washington suburb, in an unmarked building's windowless lab, Yarden Tsach is growing diamonds.

Not rhinestones or cubic zirconia. Diamonds. Real ones. In a matter of eight weeks, inside a gas-filled chamber, he replicates a process that usually takes billions of years in the bowels of the planet. Carbon atom by carbon atom, he creates nature's hardest, most brilliant and — if decades of advertisements are to be believed — most romantic stone."

"Until the middle of the past century, all of the world's diamonds originated more than 1 billion years ago in the Earth's hot, dark interior. Tremendous temperatures and pressures forced the carbon atoms there to link up in a flawless, three-dimensional lattice that would prove incredibly strong and equally effective at bending and bouncing light. The result was a crystal — a gem in the rough that, once cut and polished, would dazzle with unmatched radiance.

Yet getting those stones up to the surface has required an enormous — and sometimes bloody — effort. The environmental impact of diamond mines is so sprawling that it can be seen from space. The humanitarian cost of some gems is also staggering: children forced to work in mines, “blood diamonds” sold to finance wars. The Kimberley Process, which certifies diamonds as “conflict free,” was established in 2003 to stem the flow of these stones into the global market."

"Traditional diamond producers say only a small fraction of diamonds are suspect these days because of steps they've taken to ensure that mines are socially and environmentally responsible. They push back against the appeal of lab-grown stones, suggesting the man-made versions aren't on par with those dug out of the ground. The most recent ad campaign from the Diamond Producers Association, which features hipster couples frolicking amid gorgeous nature scenes, is called “Real is Rare.”

Their argument is unspoken but clear: No one should propose to a sweetheart with a gem that was made in some drab office park."

"Scientists have been creating diamonds since the 1950s, mimicking the conditions deep within the Earth by heating carbon to extreme temperatures while squeezing it in a hydraulic press. But it took them several decades more to cultivate large gem-quality stones. These were still not as large or as clear as the best traditional diamonds, and most were colored yellow or brown from the nitrogen required to stabilize the growing process. Still, the traditional diamond companies were on edge.
“Unless they can be detected,” a Belgian diamond dealer told Wired in 2003, “these stones will bankrupt the industry.”

Today, nearly a dozen companies worldwide produce diamonds that are all but indistinguishable from mined stones"

"Sales of lab-grown stones make up about 1 percent of the global commercial diamond market, but a 2016 report from investment firm Morgan Stanley suggested that proportion could jump to 7.5 percent by the end of the decade. In one unlikely scenario, analysts said, lab diamonds might become so ubiquitous that the entire traditional market collapses.

After all, that market depends on sentiment and scarcity. The combination is what made De Beers's famous “a diamond is forever” campaign so potent. It turned diamonds into the ultimate symbol of eternal love, stones that were to be treasured and never — perish the thought — resold. The genius strategy has helped to ensure diamond companies control supply.

But lab-grown jewels shatter the illusion. They can be made on demand, in a matter of weeks, and they cost an estimated 10 percent to 40 percent less than a gem that comes out of the ground. Technology being what it is, it's likely they'll get even cheaper."

Here is the additional link:

De Beers – Rulers of the Diamond Industry:The Rise and Fall of a Monopoly by William Yu of The University of California at Berkeley

San Antonio cracks top 25 on U.S. News and World Report's "Best Places to Live"

Click here to read the article. Excerpts:

"San Antonio is considered the 23rd best place to live in the United States, according to U.S. News and World Report.

The Alamo City cracked the top 25 in the magazine's 2017 edition of its Best Places to Live in the U.S. list, which ranks major metro areas on a number of factors including unemployment, annual household income, cost of living, education, health care and migration.

The magazine said the nation's seventh-largest city is "as comfortable as an old pair of jeans. It offers big-city amenities and world-renowned attractions coupled with a relaxed and inviting atmosphere." It also said that San Antonio residents benefit from living in a destination city in that they have year-round access to attractions such as Six Flags Fiesta Texas and SeaWorld San Antonio, while also being complimentary of its arts and culture, citing the Majestic Theater, the Tobin Center for the Performing Arts and the McNay Art Museum, along with the Alamo and the rest of the historic Spanish missions. The report on San Antonio also noted that the missions have been designated a World Heritage Site by UNESCO."

"Here are the top 10 cities on this year's list:

1. Austin
2. Denver
3. San Jose, California
4. Washington, D.C.
5. Fayetteville, Arkansas
6. Seattle
7. Raleigh-Durham, North Carolina
8. Boston
9. Des Moines, Iowa
10. Salt Lake City"

I'm usually skeptical of any "best places" lists because if those places are so great, more people will move there, driving up the cost of living. Then it might not be such a great place.

Suppose that San Francisco is 6 times better to live in than Omaha, Nebraska (as of 2015). That is about how many times higher the median home price is in San Francisco. There is definitely more to do and more great sights in San Francisco, but it costs alot more to live there.

If SF were so great, everyone would leave Omaha and head to SF. But they don't. This is where  the "Indifference Principle"comes in.

If people really believe that SF is better many of them go there, but things won't be very fun due to the crowds (which reminds me of something that Yogi Berra said about a restaurant: "nobody goes there anymore, it's too crowded").

Prices of everything will be bid up. This also illustrates what economist Steven Landsburg calls the "Indifference Principle." "Except when people have unusual tastes or unusual talents, all activities must be equally desirable."

This applies to SF. Once everyone sees it as a good deal or great place, they start going there. Only people with unusual tastes will really enjoy it. That is, you will have to like what that SF has to offer alot more than the average person or the crowds and congestion and high prices will erode your enjoyment. It won't be any better than anywhere else to live. Other places will be just as desirable.

If home prices were only twice as high in SF, then lots of people will move there because it is such a great place. But then that drives up the home prices and eventually there is no advantage to moving to SF. All of its extra benefits are eaten up in higher costs of living. 

A Special Valentine's Message On Romantic Love

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.

Here’s what science says is the secret ingredient to making your love spark 

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")

This is your brain on love   (brain scans and biology seem to confirm the economic definition given above)

Dollars & Sex: The Blog of Economist Marina Adshade

Do Women Really Value Income over Looks in a Mate? by Marina Adshade

The percentage of 25-54 year-olds employed was unchanged in January

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates college age people who might not be looking for work)

The percentage of 25-54 year-olds employed is 78.2% for January. It was also 78.2% in December. It is still below the 79.7% in December 2007 when the recession started. . Click here to see the BLS data. The unemployment rate was 4.8% in January. Click here to go to that data.

Here is the timeline graph of the percentage of 25-54 year-olds employed since 2007. Notice how we had been rising before 2016 but it seems to be flattening out.


Here it is going all the way back to 1948