Tall People Earn More??

Again, found this on Mankiw's blog. This guy (together with Brad DeLong and Gary Becker/Richard Posner) just got some very interesting posts!!

Earthquake in Riderville

I want to know what you Riders fans think of this.

Friedman TV

Thanks to Mankiw for these links.

I watched "How to Cure Inflation". You couldn't learn the subject in a better way than from Milton Friedman!!

In this video, Friedman not only touched on the Quantity Theory of Money, but also topics included the Philip's Curve (the cost of controlling inflation is to have short term spike of unemployment - think of John Crow's zero-inflation policy and the high unemployment rate in Canada in the early 90s), and Rational Expectation.

The best quote from Friedman, in this video:

"There is only one way to ease the pain of curing inflation, and that way is not available - and that way is to make it credible to the American people that you [politicians] are going to follow the policy you say you're going to follow" (i.e. control inflation by cutting government expenditure and stop financing government spending by printing money.)

Reducing the Basic Personal Amount

Below are some more results from my project. The policy this analysis simulates is the reduction of Basic Personal Amount by $400 (from $9192.20 to $8792.20). Also, cutting the spouse & wholly dependent amount by $340 is included as well (from $7805.07 to $ 7465.07).

Again, simulations are performed by the SPSD/M (Version 14.1).

Total	Increase in	Average	Increase in	Average	Number
Income	Average	Total Tax	Average	Income Tax	of
Group	Total	Per Year	Income	Per Year	Households
	Tax	Before Change	Tax	Before Change	In Canada
$ thousands	$	$	$	$	thousands
Min-10	4	1,919	4	155	418.2
10-20	14	2,389	15	195	1477.6
20-30	36	4,590	40	1,072	1506.9
30-40	63	7,636	70	2,600	1380.7
40-50	77	11,237	86	4,732	1265.7
50-60	86	14,968	96	7,079	1120.0
60-70	94	18,320	105	9,304	980.3
70-80	100	21,553	110	11,679	896.3
80-90	106	24,994	117	13,849	792.7
90-100	107	28,493	118	16,242	680.8
100-110	115	31,718	127	18,539	546.3
110-120	120	35,254	132	21,052	441.9
120-130	123	38,512	135	23,644	361.3
130-140	122	41,932	134	26,742	270.4
140-150	128	45,278	141	28,964	225.7
150-160	127	50,220	142	31,710	183.3
160-170	133	54,306	146	36,207	154.9
170-180	134	56,533	148	37,758	104.4
180-190	135	60,191	147	41,753	77.7
190-200	146	62,151	158	43,862	58.3
200-210	138	67,598	150	48,105	49.8
210-220	138	70,376	149	50,840	42.3
220-230	126	75,371	137	56,229	29.9
230-240	133	80,428	146	59,226	26.0
240-250	144	85,039	157	62,490	27.2
250-260	121	89,021	134	64,754	18.8
260-270	117	92,791	128	69,293	15.6
270-280	117	96,545	129	73,029	15.9
280-290	129	102,497	141	78,292	15.7
290-300	120	108,261	132	82,545	13.0
300-350	118	119,609	130	92,578	45.8
350-Max	114	289,159	124	244,873	108.6
All	78	21,496	87	12,737	13351.9

Bombed Back into the Stone Age!!

Got this via "The Hack" from the New York Times. If this is not what you call being bombed back into the Stone Age, I don't know what it is.

Oh Boy!!!

I think Mankiw just opened himself a can of worm on his blog:

"The reason I am a Republican is that, compared to Democrats, the Republicans tend to favor smaller government, lower taxes, and greater reliance on free markets. On many social issues, I find myself agreeing with the Democrats more than the Republicans, and I know that the Republicans are far from perfect on the economic issues."

Now, the question is if the Republicans have been trimming the size of the government? Apparently not with the Bush administration. Neither with the Reagan administration in the 80s. Government expenditure were up with both administrations. For the Bush administration, a huge chunk of expenditure increases is due to the war in Iraq.

Personally, I favour smaller government, lower taxes, and greater reliance on free markets, but the current administration in the States is not holding these principles.

Now, let's get back to the North of the border. I AM a Conservative, and let's hope that the Harper government will hold on to these principles. Like Mankiw, I am more with the Liberals (Democrats) on social issues. However, I strongly believe that a government cannot afford any decent social programs if the financial books are not in order (aka only spend what you can afford.)

At least I know that the current Harper government is in favour of lower taxes, from Budget 2006 (distribution of the tax cut is another topic that I don't fully agree with the Budget, but I will leave that discussion for another time.)

One of my professors once said: "Economists offend people from the left, right, and centre." I found that very true from time to time.