69
votes
Why do some European governments still consider price capping despite the fact that price caps lead to shortages?
First of all, this is one of the many situations where we have to remember that the Econ101-explanations are based on assumptions that are never going to be satisfied in reality. There rarely is an &...
- 12.7k
46
votes
Why do some European governments still consider price capping despite the fact that price caps lead to shortages?
You may be confused by the economics definition of a "shortage", which is when "the quantity demanded exceeds the quantity supplied" which means people would like to spend more ...
- 1,965
40
votes
What are possible explanations for why Democratic states appear to have higher homeless rates per capita than Republican states?
This is just one thing, maybe not the most important. The homeless population is tough to estimate, and it's much easier to count in places with more and better shelters and less hostility.
That 2020 ...
- 3,321
39
votes
Why does the US still maintain so many military facilities in Western Europe?
There's an important word you're missing: logistics.
The US has to project its power. To do that, you need to be able to move not just troops, but equipment and supplies. But you don't just move those ...
- 46.1k
37
votes
Accepted
How does the World Economic Forum seem to have so much influence?
The Forum itself doesn't have any significant power, per se, nor any real specific agenda.
The people who attend the forum have power, and are induced to do so to be around other powerful people for ...
- 73.9k
35
votes
What is the theory behind using the 14th Amendment to ignore the debt ceiling?
The debt ceiling fight is about funding and permitting the government to pay for costs and debts that have already been incurred by prior duly passed legislation. It is not, intrinsically, a fight ...
- 16.5k
34
votes
Accepted
What prevents foreign companies from setting up business in Russia so as to not pay any compensation to patent owners from the West?
It depends where the sales market is. Certainly, it would be good business for a foreign producer to move production into Russia in order to sell the output in Russia.
But you wouldn't be able to ...
- 4,760
33
votes
What are possible explanations for why Democratic states appear to have higher homeless rates per capita than Republican states?
All of those states have expensive housing. For example, looking at median home prices Vermont is 21st and the rest are in the top 12. Housing costs are 56% lower in Dallas compared to Boston.
The ...
- 439
25
votes
Accepted
Why do small African island nations perform better than African continental nations, considering democracy and human development?
Overview
You don't really need anything more than random chance and the statistical anomaly that flows from specifying that the island nations be "small" to explain the pattern observed, ...
- 73.9k
24
votes
If only people with at least $1,000,000 annual income were taxed, what would their tax rate have to be to avoid a drop in income tax revenue?
Disclaimer: These are very rough estimates and I'm not an expert on taxes. And there can be relevant hidden variables like tax deductions, reduction of income and income that is not subject to income ...
- 3,629
24
votes
Does Japan have any reason to ever repay its debt?
You can't go into debt when there is nobody who is willing to lend you money.
When a country doesn't repay its debts, then the bag-holders are the organizations and private people who lent money to ...
- 74.8k
22
votes
Why does the US still maintain so many military facilities in Western Europe?
@Machavity rightly notes that logistics are one reason.
As another example of that, wounded U.S. soldiers in the Iraq, Afghanistan, and the Balkans were frequently transported to U.S. military bases ...
- 73.9k
21
votes
What are possible explanations for why Democratic states appear to have higher homeless rates per capita than Republican states?
I believe the existing answers; that democratic states are able to more accurately count homeless populations than states with harsher laws and the high urbanization expected in democratic states, ...
- 8,973
20
votes
What are possible explanations for why Democratic states appear to have higher homeless rates per capita than Republican states?
There's a wide variety of reasons, but some recent shifts in thinking on this are instructive as to what exacerbates the problem
Arrest vs social services
San Francisco (deep blue city in a deep blue ...
- 46.1k
20
votes
What prevents foreign companies from setting up business in Russia so as to not pay any compensation to patent owners from the West?
Suppose I want to sell widgets in my country, but my widget design infringes a patent held by someone else. Because of this, I cannot manufacture these widgets in my country, but I also cannot sell ...
- 17.5k
18
votes
Accepted
How does having minority stakes and board seats give the Chinese government effective control over companies?
It's probably talking about "golden shares", more officially called "special management shares":
The move to take stakes in the local operations of Alibaba and Tencent, which ...
- 146k
18
votes
Is there a way to measure how technologically and economically independent a country is?
No, or at least not easily.
Dependency could be dependency on a source of imports, dependency on a market for exports, dependency on transshipment, dependency on foreign investment or experts, or more....
- 106k
16
votes
What are possible explanations for why Democratic states appear to have higher homeless rates per capita than Republican states?
My initial thought was that blue states would have more urban areas so I decided to compare cities. If you bring that down to the city level - Dallas has the largest homeless population in Texas and ...
- 467
16
votes
Why do some European governments still consider price capping despite the fact that price caps lead to shortages?
In addition to other answers:
First, "Economics 101" does not speak about times. If Hungary imports all of its oil through a single pipeline and the pipeline is shut, increasing prices will ...
- 31.2k
16
votes
What has changed in the last decade that causes tent cities to spring up?
The answer is already in your question: "[rising prices] affect the economic tiers above them, the poor and average working class".
Basically, inflation and shortages have lead to a ...
- 24k
16
votes
Why does Australia export so much raw materials instead of steel and other value added products?
only considering that part of steel production that is exported back to Australia
Because China (where most of the Australian ore goes, and from where China imports most (2/3) of its ore for that ...
- 146k
15
votes
Why is the US government not worried about high deficit?
Many reasons.
If the economy grows faster than the deficit, then the burden becomes actually lighter over time. And indeed the US economy grew a lot in 2012-2020. So display deficit rather as ...
- 9,604
15
votes
Accepted
What is the theory behind using the 14th Amendment to ignore the debt ceiling?
zibadawa timmy's answer is basically correct, that is the theory. To add some quotes from someone detailing it (in NYT):
The theory builds on Section 4 of the 14th Amendment to argue that Congress, ...
- 146k
14
votes
Accepted
Why do some European governments still consider price capping despite the fact that price caps lead to shortages?
There is a multitude of reasons why politicians may argue for price caps:
Populism
Plain and simple: politicians want to be re-elected. Giving the impression of caring about common people is much more ...
- 2,595
13
votes
Accepted
How did the UK race ahead of France in GDP
This is probably mostly an effect of exchange rates. First note that all figures are in US dollars whereas the UK uses pounds and France uses Euros. The IMF uses conversion rates in the years they are ...
- 7,055
13
votes
How does the World Economic Forum seem to have so much influence?
What is the nature of this organization that seems to give them influence?
There was obviously a need for such a forum, and preferably one not quite as scandalous as the Bohemian Grove meeting. If ...
- 12.6k
13
votes
How do these contradictory claims about the US national debt square against each other?
Debt and deficit are two different things. The deficit is the amount by which the national expenditure exceeded its revenue, each year. The debt is the total amount owed to other parties, accumulated ...
- 1,877
13
votes
Is this communist-like economic ideology already a thing?
It is emphatically not the case that "Everyone knows what communism is". The term "communism" does not have a particular and precise definition that is universally accepted. The ...
- 73.9k
12
votes
Who described creative destruction as a process that will eventually balance the jobs created and destroyed?
Schumpeter is indeed the primary source of the concept of "creative destruction."
The supplementary notion that this is a process that will eventually balance the jobs created and destroyed, ...
- 73.9k
12
votes
Accepted
Is this communist-like economic ideology already a thing?
I guess this for a form of Fabian socialism. This form of socialism called for a notion of socialism where property and funds were given (in addition to jobs) through a group of enlightened experts ...
- 6,264
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