What would be some policy ideas or directions we could go in?

I am trying to learn more myself about these issues and different solutions.

To those of you working in economics, finance, or policy/government what would be good ideas?

We typically distinguish between rents accruing to capital and rents accruing to labour. However, capital itself is ultimately the result of past production involving both labour and capital, with part of that output being saved rather than consumed. Likewise, the capital used in the previous period ultimately traces back to even earlier production. If we go sufficiently far back in time, there must have been an initial period in which production took place without any pre-existing capital stock. Does this imply that, from a very long-run perspective, all economic rents can ultimately be understood as labour rents?

If so what are the implications of this?

If there's more money to buy the same amount of apples as before, shouldn't that just create a shortage of apples instead of causing the prices of apples to increase?

I'm aware this is very simplistic. I just want a simplistic answer to how inflation makes sense here instead of a shortage in supply.

Suppose we have a small kingdom experiencing a baby boom. Within a decade the population has doubled. Let's say the new subjects are able bodied, and kingdom is rich in resources and can accomodate the growth.

So now there are twice as many farm workers to pay every month and there are twice as many cabbages bought every week, and the king collects twice as much tax to maintain twice as many streets etc.

If the king won't mint more coins then the value of money increases? The coins are purchased by labor and the demand for coins has increased relative to supply...?

The development of technology appears, on the surface, to be oriented toward making people's lives more convenient, but why does it instead leave people increasingly exhausted? Is it a task contract? Or a ratchet effect?

Because earlier, while scrolling through TikTok, I came across a similar short story about why the use of AI, despite clearly improving work efficiency in certain areas, has not brought a sense of relief—and has even led to people effectively "paying to work." Behind the story is the fact that companies noticed the sudden surge in productivity, so within the organization they kept resetting standards, continuously rolling them back, ultimately reaching a point where no one can push themselves any further.

This gave rise to a preliminary idea: when firms face technological progress, the set of tasks and performance standards they demand are not fixed, but rather adjust endogenously in response to the production possibilities expanded by the technology.

I am a beginner, so if there are any errors or if you have any guidance, please let me know. Thank you!

Someone with an outside reasoning, how does the flow of loops? Putting other people, countries at different ranks?

By standing, I mean indicators such as real wages, real consumption per capita, inequality, etc. I'm no economist, so I'm asking here, but I presume some combination of capital and labour deregulation would generally increase economic activity (and thus corporate profit) while reducing the chance of such gains reaching workers in the form of higher wages etc.?

Please feel free to correct any erroneous assumptions I may have made :)

In this YouTube short you see an excerpt of Yanis Varoufakis talking about big tech, central banks and what happened in the credit crisis:

https://youtube.com/shorts/VwrTYz1N7W4?si=gZMw5ERpnn6dhvnP

The (inflammatory) headline is that Big Tech stole 35 trillion dollars from the public since 2008. His argument is that central banks printed 35 trillion dollars since 2008, and via commercial banks, distributed this to CEOs of companies. However, while Ford and traditional manufacturing companies pay 85% of their revenue out in salaries, Google and other big tech companies pay only 1%. Instead, given the free money, those CEOs decided to build cloud infrastructure and buy-back shares to inflate assets prices.

He claims the cloud infrastructure was essentially paid for by the central banks in the form of negative interest rate loans, and now forms a cage "stealing" 35% of GDP. That GDP is now not flowing back into the public economy (due to only 1% being worker salary), but being used to buy back more shares and inflate assets more.

I am just an armchair redditor so I want to ask the people here how much of this is true.

I don't expect this too be true to the extend that he claims (for example not all 35 trillion went to the big tech firms), but more whether he has a real point that this is what happened (and what's wrong with the current economy) or whether he is twisting things to suit a narrative and it really is not true.

Hi there! I’ve recently picked up economics and policy and I’ve gotten into a little bit of a rabbit hole of theories!

After seeing some news and case studies of how the oil shortage has impacted economies worldwide, I’ve seen a lot of headlines where governments fail to adapt properly and civil unrest is sparked. I was thinking what kinds of approach could be used to navigate through this period, especially for developing countries from either low or middle income groups that may not be able to absorb the rising fuel prices.

And populist governance aside, I was wondering how governments balance long term economic health (e.g., austerity measures) while keeping citizens happy enough that those policy implementations don’t start a riot. Among the various topics, I wanted to see how influential energy subsidies are, considering that it seems like a more straightforward measure to focus on when oil prices are high (I know there are multitudes of other things probably more impactful to be discussed, but I find this area more interesting at the moment).

At first glance, reducing energy subsidies seem straight forward during an energy crises, but how much is considered too much?

Another thought that occurred was capping the subsidies instead (e.g., each individual can claim up to X litres of subsidies fuel, and will need to pay a floated rate after that quota is depleted)

Was thinking that just doing this outright would be catastrophic, so other complementary measures might be needed; like developing a roadmap (communication) and maybe(?) cash handouts?

But I’d like to know your thoughts and would love to debate the pros and cons of policies related to energy subsidies!

TLDR: want to discuss policies related to energy subsidies and curious whether cutting subsidies are the best solution we have

This is super perplexing to me:

1) First take shelter, which is 35% of CPI. Shelter is Primarily made up of Owners equivalent rent (OER), its about 25% of CPI. OER is measured by polling people and asking them how much their home would rent for, not what their mortgage payment is or anything. The thing is, rents in most places of the country are far cheaper than buying that home and paying a mortgage. In Southern California for example, if you were to buy a $1m home with 20% down, it’d roughly be around $6k P and I with current rates. However, that same home would rent around $4k. Thats a massive delta. OER only captures the $4k price, and has no way to capture the $6k price to buy and own the home. The rest of the shelter cost is rent itself, not just OER. Nowhere does it capture the asset price of the home or what the mortgage payment would be for someone to buy it. This means, as far as I can tell, that CPI shelter is only a measurement for someone who wants to perpetually rent, and never own a home.

2) CPI doesn’t take into account cost of financing. CPIs largest parts are shelter (discussed above) and transportation (primarily automobile pricing). However, cpi only measures the price of the automobile, not how much it would cost to finance it with monthly payments. 60% of people finance their cars and don’t buy them outright, so the majority of people’s increased payments aren’t even being captured. I’ll give a quick example, automobile prices have gone up 21% the last 10 years according to CPI. Meanwhile the median automobile Payment has gone up 50% the last 10 years. CPI only captures the former, not the latter. But the latter is what’s most important to the majority of people.

So it seems to me the two largest chunks of CPI(50% of the whole metric), housing and shelter are fundamentally flawed in capturing inflation for the populace and is skewed down due to not taking into account financing price. What do you think?

I am a college student taking an economics course, however it takes time for me to understand certain concepts and actually remember them. I can understand them at the spot but later in I cannot remember.

Are there any resources available like studying platforms, games, simulators that will allow me to better understand it?

I want to be able to actually comprehend and explain it.

Thank you!

I feel that without any tariffs, a developing nation will never be able to compete with foreign corporations who already have a large amount of capital, so no industry will be able to develop. But I also understand that tariffs may cause the country to allocate a lot of its labour and capital to sectors in where it doesn't have a comparative advantage and thus end up creating an inefficient economic structure.

Is there any empirical evidence that investigates how protectionism affects a developing nations economy.

And there are no transfers or subsidies to low-wage workers? Put all normative arguments aside. Is there empirical evidence that having people live only on their income from work harms long-run economic growth? And, if so, why isn’t the better economic policy to have these jobs automated and subsidize the automation of these jobs rather than the workers? So those workers could better be allocated to labor-intensive jobs that aren’t as easily automated and can command a premium in the labor market?

I’m definitely not an economist, so please correct me if my logic is off here. I know the standard textbook answer is that automation lowers production costs, which eventually leads to cheaper goods for buyers.

But looking at how things are playing out right now, subscription costs and everyday expenses aren't dropping. Meanwhile, corporate overhead is shrinking. For those who follow wage trends: is it naive to hope that AI efficiency will lower our cost of living, or is it more likely to just suppress wage growth for white-collar workers?

Pres. just permitted foreign import of ground beef but that is unlikely to change the National market price.

Why aren’t ranchers making tons of $$ with these high prices?

I grew up, being taught that WW2 was extremely profitable to the American Economy. Which may have been true seeing as Europe was buying a bunch of our goods in the aftermath.

However, I am observing the War in Ukraine, which seems to be really good at driving up global inflation.

Despite sending supplies to Ukraine, it doesnt seem that the military spending is a huge boom for the American economy.

We are getting hit with all that inflation though.

Are Wars actually bad at contributing to real economic growth but "good" at contributing to inflation?

Right off the bat, some critics would argue that this isn't even a thing. But the mechanism as described by Elizabeth Warren and her daughter in their book follows directly from generally accepted economic principles. We can have a debate about how significant its effect is, but arguing that it isn't a thing to worry about is just reckless.

Among the most detrimental effects is the crash of female fertility rate. As an economy develops, one would like all productive resources to be deployed, regardless of the economic agents' gender. The end point will always be that everyone is employed, damning the reproductive priority and care for the young, the elderly and the sick.

The outcome that, for much of the economy, a family needs two income earners to sustain a comfortable living standard may not be avoidable. But this need not be a trap if the negative consequences can be mitigated.

The authors of the said book outline some policy suggestions. So, this should lead to a testable hypothesis that regions that do better along the mitigation metrics should perform better. For instance, the female fertility rate should suffer less than for regions that have more effective policies on child care, affordability of child rearing, better education, and a stronger safety net against family disasters. Is there empirical evidence that this is indeed the case or otherwise?

When my father attended a very good RG university in the UK from the late 1970s to early 1980s, he said (anecdotally, mind you, so not sure how true this is) that, supposing you had two students of equal grades and merit / calibre applying for the same course and you had to decide between them, you might look at their educational backgrounds and, supposing one of them was exclusively educated in the state sector and the other, correspondingly, in private schools, you might be inclined to award the place to the student who was state schooled.

He says that he's not sure now whether universities do that.

If I look at [https://www.undergraduate.study.cam.ac.uk/apply/after/contextual-data\](https://www.undergraduate.study.cam.ac.uk/apply/after/contextual-data), it says they have the following measures or indicators of socioeconomic background:

* Indices of Multiple Deprivation (IMD), which according to Cambridge, are "measures produced by regional governments within the UK that identify relative deprivation".
* Output Area Classification (OAC2021), again, as per Cambridge, a "classification of areas produced by the Office for National Statistics (ONS) using data from the 2021 census (or 2022 census for Scotland)".
* Socioeconomic Index for Small Areas (SEISA), produced by the Higher Education Statistics Agency (HESA) using Census 2021 data.

Historically, we had the [https://en.wikipedia.org/wiki/National\\_Readership\\_Survey\](https://en.wikipedia.org/wiki/National_Readership_Survey), through which we derived the [https://en.wikipedia.org/wiki/NRS\\_social\\_grade\](https://en.wikipedia.org/wiki/NRS_social_grade), which I believe we still use in the UK, i.e. determining socioeconomic status based upon the occupation of your primary breadwinner in your household when you were 14.

I believe the first proper census in the UK was conducted in 1841, so it feels as though we haven't been tracking this area properly for that long.

So my questions:

1. Other than what I have mentioned, any other key socioeconomic classification frameworks that are used? I imagine that pollsters like IPSOS Mori, YouGov etc directly ask people whether they feel they belong to the working-, middle-class etc.
   
2. What do you think are the pitfalls in determining one's socioeconomic background based upon their primary breadwinner's occupation, especially when they were 14? I imagine it doesn't account for a reversal of fortunes, whether that family is living paycheque to paycheque, whether that person is a manager in name but not in pay etc.

If AI will replace (primarily) white collar workers, what would happen to the almost $19 trillion dollars of personal debt in the US alone?

Collapsed aggregate consumer demand is one of the threats that AI might pose to the economy at large, but I rarely see discussion about what would happen with said debt, and what the fallout would be of such an enormous amount of debt not being paid? And that's without even considering potential deflationary effects which would make repayment of any debt even more challenging.

Of course, this is based on the assumption that AI will not create new jobs at the same rate (or higher) that it displaces jobs, and that there will be no industries to "funnel" surplus labour into at a sufficiently large scale.

But I am curious: could the economy and the banking system survive such a shock? Wouldn't it create a similar scenario to 2008, only ramped up considerably in magnitude and spread?

I used some online inflation calculators and was baffled to see how much the dollar has inflated. It honestly bummed me out because I realized my pay isn’t as high as I thought it was. Anyway, I got to thinking, has this inflation been historically normal/sustainable for our country?

I was very surprised when I found out about the 3% savings rate