Raising the minimum wage seems to all economists to, at the very least, fail to 'raise' employment, and we'd all like to see better inclusion of low-skilled workers into good-paying jobs.
Edmund Phelps
The need to encourage entrepreneurship and ensure that young people have the opportunity to start new businesses is acute.
America's peak years of indigenous innovation ran from the 1820s to the 1960s. There were a few financial panics and two depressions, to be sure. But in this period, a frenzy of creative activity, economic competition and rapid growth in national income provided widening economic inclusion, rising wages for all, and engaging careers for most.
I started to think about what drives innovation and what its social significance might be. The next step was to think innovators are taking a leap into the unknown. That led me to the thought that it is also a source of fun and employee engagement.
In societies where one sees a higher prevalence of 'modern values' - individualism, vitalism and self-expression - there's also higher reported job satisfaction.
Without being aware, I think I was being indoctrinated into what was called Vitalism, the idea that what makes life worth living, the good life, consists of accepting challenges, solving problems, discovery, personal growth, personal change.
The level of dynamism is a matter of how fertile the country is in coming up with innovative ideas having prospects of profitability, how adept it is at identifying and nourishing the ideas with the best prospects, and how prepared it is in evaluating and trying out the new products and methods that are launched onto the market.
I do think from time to time that conceptual questions arise: What do we mean by equilibrium? What do we mean by this concept and that concept?
Everybody feels better about himself, his community, and his country if employers are paying workers well. Economics, though, teaches that if every employer is pressured to raise wages, some labor will be priced out of the market.
The good life, as it is popularly conceived, typically involves acquiring mastery in one's work, thus gaining for oneself better terms - or means to rewards, whether material, like wealth, or nonmaterial - an experience we may call 'prospering.'
Entrepreneurs have only the murkiest picture of the future in which they are making their bets, and also there is ambiguity: they don't know when they push this lever or that lever that the outcome is going to be what they think it is going to be - there is the law of unanticipated consequences.
There's such a preoccupation with liquidity and such an unwillingness to invest beyond the horizon of the next quarter and making sure that the CEOs hit their quarterly earnings.
I would like to see people dreaming of striking out on their own into some other country or their own, wherever they feel the action is, in the hope of an exciting and rewarding career.
A healthy economics has got to have both conceptual, theoretical research and applied, empirical research.
The epic story of the West is the development in the 19th century of a mass prosperity the world had never seen and its near-disappearance in one nation after another in the 20th.
I'm hoping that the administration and other thought leaders will succeed eventually in bringing the country back to the older idea that the American dream is having a career, getting a job, and getting involved in it, and doing well. That was the core of the good life.
I'm old enough to remember in the 1930s and the 1940s when thrift, frugality, was considered an important virtue.
I'm not attacking the idea that people live in conglomerations of houses in proximity to one another, sharing the same water mains and the same newspaper delivery boy and so forth. I'm not objecting to that. That could happen with or without homeownership.
In the 1960s, and stretching back to the 1930s, it was felt by many economists that easy money is a reliable way to increase employment.
Corporatist attitudes against capitalism came to the fore in the 1920s. Corporatists, with their conservative values, hated the invasion of towns and regions by new businesses, upsetting traditional ways, wealth and status.
The celebration of homeownership seems to be part of a countermovement against popular owning of shares in corporations.
My view is that innovation has declined in the everyday processes that businesses tinker with incrementally as they try to become more productive over time.
Economists of a classical bent lay a large part of the decline of employment, and thus lagging output, to a contraction of labour supply.
If every effect of any new products or methods were required to be known before they could be produced and marketed, they would not be true innovations - and thus not represent new knowledge of what people would like, if offered.
To prosper and advance, the American business sector is going to need a financial system oriented toward business, not 'home ownership.'
I think the 19th century is an extraordinary period with a welling up of creativity and all kinds of experimentation and exploration going on at least until 1940.
You have little representation of young black men in the business sector, so you have children growing up in disadvantaged neighborhoods who don't hear discussions at the dinner table about what goes on in business. It's almost as if we have two nations.
Capitalist systems function less well without state protection of investors, lenders, and companies against monopoly, deception, and fraud.
Statistical studies are all over the lot about the pluses and minuses of raising the minimum wage.
Disciples of Keynes, who focus on aggregate demand, view any increase in household wealth as raising employment because they say it adds to consumer demand.
I could try to incorporate or reflect in my models what it is that an employee, manager, or entrepreneur does: to recognize that most are engaged in their work, form expectations and evolve beliefs, solve problems, and have ideas. Trying to put these people into economic models became my project.
If you rent, that's it. You don't have to pay any interest to anybody. You don't have to pay any maintenance costs to anybody. You don't have to worry about whether the boiler is going to break down. While if you own your own home, you have a hundred aggravations.
Those of us born into vitalist and expressionist cultures must hope that governments will draw back from shutting down the modernist project of exploring, experimenting, and imagining - of voyaging into the unknown - that has been essential for rewarding lives.
My thinking has always been that the worst problem we have with regard to lack of inclusion is the terribly low labor force participation rates and terribly high unemployment rates of young men, especially young men in ethnic minority groups and, in particular, young black men.
What brought mass innovation to a nation was not scientific advances - its own or others' - but 'economic dynamism': the desire and the space to innovate.
Well into the 20th century, scholars viewed economic advances as resulting from commercial innovations enabled by the discoveries of scientists - discoveries that come from outside the economy and out of the blue.
It was gradually learned that acceptance of a somewhat higher inflation rate would not really bring somewhat higher employment.
With less competition to fear, companies are emboldened to raise their mark-ups and profits. That lifts share prices and thus the wealth of already wealthy shareholders.
Most of the big banks were shot through with short-termism, deceptive practices and self-dealing. We must institute basic changes in corporate governance and in management practice to restore responsibility and honesty for the sake of the economy and for the self-respect of the country.
The best part of the high school in Hastings must have been the Music Department. Its orchestra and concert band did well in county competitions, and the dance band formed by its students was the best in the region. I played lead trumpet in all of them.
At the simplest level, economics can better show us the consequences of our actions. Less simple are cases in which we don't have the knowledge to predict the full consequences. Global warming and climate change are examples.
No amount of debt restructuring, even debt forgiveness, will help the Greeks achieve real prosperity. What they need is not short-term relief but, rather, a long-term cure.
In America, black urban teenagers have long been lacking in inclusion. In France, there is a comparable lack of inclusion among North Africans. In much of Europe, there has been little attempt to include the Roma.
Workers in decent jobs view the economy as unjust if they or their children have virtually no chance of climbing to a higher rung in the socioeconomic ladder.
Companies like Google and Facebook may offer jobs allowing or requiring imagination and creativity, but the whole of Silicon Valley accounts for only 3 percent of national income and a smaller percentage of national employment.
As a grandson of farmers in downstate Illinois, I have long admired the dedication of farmers to their work and have written about the role of agriculture in American innovation.
The 1920s and 1930s were a period of sensational productivity growth: new products were springing up all over the place, and most of those new products and new methods were developed by people who started their own companies.
For decades, my research was driven by outstanding problems in macroeconomics: mainly growth theory and employment theory.
I attended Amherst College from 1951 to 1955. The first two years were a revelation. There were innumerable exchanges with brilliant classmates, among them the playwright Ralph Allen, the classics scholar Robert Fagles, and the composer Michael Sahl.
A nation's economy is more than its markets, tastes, technologies and property rights.
