UMass Amherst Department of Economics professors and researchers at the Political Economy Research Institute (PERI), Michael Ash and James Boyce, release the fifth edition of Toxic 100 Air Polluters, an index ranking corporations by the pollutants they release, the toxicity of those releases, and the number of people exposed.
With Massachusetts legislators considering increasing the Commonwealth’s minimum wage, the economics is emerging as a point of contention. Professor Arindrajit Dube is the lead author of a study published by Harvard’s Review of Economics and Statistics regarding the effect of minimum wage increases on employment, which finds that workers would not be fired if the minimum wage rose.
Yet such a review would also have to include research finding no evidence that increases in minimum wage lead to job losses. Arindrajit Dube, an economics professor at the University of Massachusetts Amherst, is the lead author of a study published in 2010 by Harvard’s ”Review of Economics and Statistics” that found no evidence that minimum wage increases between 1990 and 2006 caused job losses among teens or restaurant and retail workers.
Dube said that unlike Neumark’s research, his analysis took into account regional and state differences in unemployment, minimum wage requirements, and other factors to track restaurant and retail employment.
”It doesn’t reduce the number of jobs and workers stick around their jobs longer,” he said.
Dube said he supports minimum wage increases in Massachusetts because the gap between rich and poor has been widening for decades and because such increases can play a small but important role in raising wages at the bottom.
UMass Amherst professor of economics and director of the Center for Public Policy and Administration M.V. Lee Badgett commented on National Public Radio’s Tell Me Moreabout a new study that finds the poverty rate for same-sex couples is higher than for straight couples. She was also interviewed by Yahoo! Finance regarding DOMA’s health care implications for same-sex couples, which may contribute to the higher-than-average LGBT poverty rate. (Tell Me More, 6/10/13; Yahoo! Finance, 6/11/13).
The evolution of the global human capital market has momentous political implications. Like many Democrats, President Obama is bullish on human capital. He favors increased public investment in education, ranging from early childhood to post-secondary programs. The assertion that such spending will generate a high individual and social rate of return is based on the optimistic expectation that demand for better-educated workers will remain strong.
On the other hand, many critics of public-education subsidies are bearish on human capital. The economist Richard Vedder, for instance, warns against both private and public overinvestment in education, pointing to the growing tendency for college graduates to land in jobs that don’t actually require the credential they hold.
If the bears are right, we may be moving toward a stage of capitalism less dependent on a growing supply of home-grown human capital. In that case, many of those bullish on higher education investments in the United States could end up as red meat.
Those who believe, as I do, that education has intrinsic value both to individuals and to society as a whole should reconsider their habit of relying on market-based private rate-of-return rhetoric.
Rather than bowing to market forces, an intelligent, well-educated citizenry would bend those forces toward better ends, including the best possible development of human capabilities.
Folbre’s post was also mentioned by Felix Salmon of Reuters opinion blog Counterparties:
Current and prospective college students are receiving real-world instruction in the dismal political economy of public finance.
Unless Congress can overcome its partisan differences, interest rates on federally guaranteed Stafford loans, an important means of paying for college, will double to 6.8 percent in July.
With the Bank on Students Loan Fairness Act, Senator Elizabeth Warren, Democrat of Massachusetts, proposes to reduce this interest rate to the same level that large banks pay for loans from the Federal Reserve Bank — 0.75 percent — for at least one year, during which longer-term remedies could be explored.
The bill, one of many aimed at addressing the scheduled interest-rate increase, seems unlikely to win passage. But it highlights the double standard that puts the interests of banks and other businesses well ahead of those of students and ordinary people when it comes to debt relief.
As Robert Kuttner explains (both in The New York Review of Books and in his new book “Debtors’ Prison”), bailouts and bankruptcy proceedings both provide a means for businesses to get out from under bad debt. The obligations of a college loan, by contrast, “follow a borrower to the grave.”
The rolling thunder of accumulating student debt sounds a lot like the perfect storm of mortgage liabilities that threatened major financial institutions and precipitated the Great Recession in 2007.
According to a recent study by the Federal Reserve Bank of New York (nicely summarized in a publication by the Federal Reserve Bank of St. Louis), the dollar value of college loan debt in the United States now surpasses both auto loan and credit card debt. Read more…
