Blogging, sticky wages, relationships
In case you were worried, I have not been intimidated by Kartik Athreya's " Economics is Hard " into closing down my blog. I've just been so busy doing stuff and going to things that I haven't had time to write any of it up. Soon, though. Tomorrow, I hope. Meanwhile, a couple of thoughts here and in the next posting: There's an interesting discussion on nominal wage stickiness between Scott Sumner and Bryan Caplan. Scott, as usual, has some good insights into the question: are sticky wages the primary cause of recessions? To save you reading it all, the answer is yes. This debate exposes a question of economic modelling which I've considered recently. Is the individual transaction the best level to model economic exchange? As a rational agent with no mental processing costs, it is more economically efficient to treat each single exchange as a new decision and re-optimise your choices. But it's not very realistic. Agents who require time to...