This blog is on the move … Check out for regular updates from the world of economics


On a bit of well-reasoned whim, we have moved our economics blogging over to a separate site,

Today, we’re celebrating the first week birthday of, and it’s really come along in that first week.

  • We have new posts almost daily, covering some of the aspects of economics that are more interesting than, say, inflation and interest rates.
  • We have a weekly podcast, where we look at real world economics and the economics of the real world.
  • We have an awesome feed of job postings for economics. In fact, it may even be the best economics job posting site.
  • We even have links to other economics blogs, because the world of economics is just to big to do it alone.

So, set your RSS feed to Econ Minute or—even better—visit the site and sign up to get email alerts for each new post.

See you soon!

First podcast – Subsidies, smokes, and solar

Welcome to the Econ Minute. It’s more than a minute, and it’s about more than just economics.

This is our first podcast. This pilot podcast begins with a visit to a mixed up world where the homeless are arrested for stealing less than a penny’s worth of electricity while high end electric vehicle drivers get priority parking and the privilege of plugging in for free.

Next, we take a trip in the wacky world of healthcare where expanded Medicaid coverage may lead to increased smoking by pregnant mothers-to-be.

We end with the silly world of solar energy where you might find some of the lowest of low wage workers. And these workers really are trapped in their jobs.

For more information or to hire an economist to speak at your next event or provide expert testimony, please visit

The crazy mixed up world of “free” electricity where the homeless get arrested and Tesla owners get subsidies


In Portland, OR, Street Roots reports that a homeless former social worker with muscular dystrophy was hit with a misdemeanor theft charge for charging her phone from a plug on a planter-base on a sidewalk. She then spent a day in jail when she missed her arraignment.

The electricity she used to charge her phone was worth a fraction of a cent. Worried that a pleading guilty would put a black mark on her record that would interfere with her ability to get social housing, she pled innocent. After two court dates with two different public defenders, the DA finally dropped the charge.

Late last year, the Oregonian reported that the Portland mass transit agency, TriMet, cut off free electricity to battery-depleted commuters who discovered not-so-hidden power outlets tucked under its light rail schedule/map kiosks.

Now, the Portland Business Journal reports that the Oregon Legislature is considering House Bill 2092, which would award rebates to Oregonians who buy Nissan Leafs, Chevy Volts, Volkswagen e-Golfs and other all-electric vehicles now on the market, including the high-end Tesla Model S.

The legislation would provide a $3,000 rebate to buyers of electric cars and $1,500 to buyers of plug-in electric vehicles.

Already, in Portland, electric vehicles have priority parking and get to plug in to free electricity for the time that they are parked.

At the same time, on the other side of the country, the state of Georgia is pulling its electric vehicle subsidies. On top of that, Vice News reports that the state is about to get rid of its $5,000 tax credit and, on top of that, add a $200 a year electric vehicle tax to recoup the state’s drop in gasoline tax revenues.

Who would have thought that a few electrons would cause so many headaches?

How to get pregnant women to smoke, and smoke more: Put them on Medicaid


When Obamacare’s Medicaid expansion was being pushed, proponents argued that the increased insurance coverage would do wonderful things for pre-natal and newborn health.

But, a new working paper is questioning that promise.

The paper is called, “Does Medicaid Coverage for Pregnant Women Affect Prenatal Health Behaviors?” and is published by the National Bureau of Economic Research.

The researchers found that increased Medicaid eligibility is associated with a significant increase in prenatal smoking.

And, it’s worse than you think.

Not only is increased Medicaid eligibility associated with an increased probability of smoking while pregnant increased Medicaid eligibility is associated with an increased probability of smoking more than 5 cigarettes a day while pregnant.

What the heck is going on?

The researchers argue that two factors are at work.

First with Medicaid those covered pay little or nothing for the insurance, doctors visits, and many types of treatment. This frees up money to buy other things. The researchers estimated that the Medicaid expansion in their study amounted to an average of $700 a year in increased disposable income.

It’s well know that cigarettes are what economists call a normal good, meaning that, all other things equal, an increase in income would be associated with increased cigarette smoking.

So, some of the additional disposable income from Medicaid cover is spent on additional purchases of smokes.

The second factor is what economists call moral hazard. With Medicaid insurance coverage, treating any illness or pregnancy complication is virtually free. Because treatment is free, there is a reduced incentive to engage in healthier—but less enjoyable—activities. Why quit smoking, if the doctor can fix you for free?

It’s important to note that this study focuses on a very narrow issue, so we shouldn’t be too quick to draw broad conclusions.

Nevertheless, the researchers themselves suggest that their findings help explain the observation that increased Medicaid expansion seems to have no significant effect on newborns’ health.

U.S. home prices up 28 percent since the bottom of the market


Case-Shiller released the monthly Home Price Indices for January (“January” is a 3 month average of November, December and January prices).

Both the 10- and 20-city composites reported virtually flat month-over-month changes. The 20-city composite is up 28 percent since the bottom of the market in early 2012, remains down 15 percent since 2007 (the last year prior to the recession).

Red and Black Cafe closes: Lessons in capitalism from a socialist coffee shop

Portland’s Red and Black Cafe recently announced its closing via Facebook with a sad kitten photo.

Red and Black sounds like a coffee shop straight out of a Portlandia episode or an article in The Onion. It’s an all-organic, wheat-free, vegetarian coffee and food shop. It’s run as a collective, it’s employees are represented by the IWW union, and was once a popular hangout of the Socialist Party USA’s candidate for president.

So, naturally, there was a bit of schadenfreude at the news that an anti-capitalist business would fall victim to market forces.

But, instead of focusing on the cafe’s failure, let’s take a look at it’s success …

Red and Black Cafe stayed in business for 15 years.

In a world where 95 percent of small businesses fail in the first year, Red and Black’s 15 years in business is a major achievement.

And, that’s the lesson in capitalism from Red and Black Cafe. A free market has room for a wide range of businesses with a wide range of business models. Some succeed and some fail. In a world of Starbuck’s and Stumptown, Red and Black carved out a niche and succeeded for a decade and a half.

Another lesson in capitalism from Red and Black is that diversity rules—one size does not fit all. Just because one coffee shop has union employees doesn’t mean all coffee shops should have union employees. But we see this play out over and over: One business who offers generous paid sick leave will testify before politicians pushing a law saying all businesses should offer generous paid sick leave. But what if the employees want bigger paychecks with less-generous sick leave?

Next time you sip your non-fat soy latte, think about the amazing world of capitalism where a socialist cafe can survive for 15 years.

You can learn a lot from a one-dollar peanut

Every summer, Portland hosts MusicFest NW which is, believe it or not a big music festival.

This year the festival got bigger and the MBAs took over. They decided that the best way to extract dollars from concert goers was to forbid food vendors from selling water.

That’s right … Citing safety reasons (naturally), concert goers could not bring in their own water. Even worse, a vendor couldn’t sell you a Coke to go with your hot dog.

The only place they could buy water was by waiting in the long beer lines, and shelling out $2 for a little bottle of water.

But, the problem was solved by a $1 peanut.  And, it’s a lesson for businesses and policymakers—no matter how clever you think your policies are, someone else thinks they’re stupid and will work to get around them.