What is the policy of the party in Government?

Something to give both Labor and Liberals something to be both happy and sad about

Evidence from both the science of happiness and behavioral economics point to some strange conclusions.

The End of Multiculturalism in the Age of Austerity

I pose the question whether the pain of economic stagnation is leading to the revival of anti-immigration sentiment in Britain following PM David Cameron's pronouncements that multiculturalism is dead.

Counter-factual evidence to support that link between economic and social policies comes from Australia where the economy is set to continue its upward trajectory and where multiculturalism is alive and well; this according to former Victorian premier Jeff Kennet as reported here.

The impact of North-East flooding on coal exports

With all the news coverage of the flooding in Queensland tending to look editorially at the "human tragedy" created by the situation, it's easy to forget that an event of this magnitude casn have far reaching impacts on the Australian economy and on those of it's trade partners.

This is something that hasn't been lost on overseas commentators. This short video-blog report from STRATFOR (time 2:47) puts the effect of the floods on the country's coal exports in a regional and global contex.

PIIGS* might...

Welcome all to THE CONVERSATION for another year!

To kick things off, The Economist has an interesting sidebar on the IMF's outlook for  Ireland and the other hard-up Euro-nations in 2011. Worth a look. And if you're thinking about your holidays, Dublin is beautiful in the northern Spring (and probably very economical).

* If you're wondering (as I was) PIIGS is an acronym used by pundits and other acronym-philes to describe Portugal, Italy, Ireland (a more recent inclusion), Greece and Spain; those countries which, as adopters of the Euro, were hard hit by the GFC due (at least in part) to their inability to use independent monetary policy as a tool to combat the economic downturn (thankyou Investopedia).

Funny man Austan Goolsbee is Obama's Top Economic Adviser

Take a look at US Pres Barrack Obama's new top economic adviser. The Chair of the Council of Economic Advisers is "funniest celebrity" and "stand-up economist" Austan Goolsbee of the University of Chicago.

This weekend, he did an interview with the ABC's Christiane Amanpour which you can watch here.

And here he is on Jon Stewart's Daily Show explaining the theory behind Obama's policies.

He performed reasonably well, even better than most in the Colbert Report.

Now here he is courtesy of Politico.com doing his stand-up routine awhile back. With poverty in America set to hit 15% (the same as in the 1960s when LBJ launched the "War on Poverty" or the "Fair Deal" and with unemployment still above 9% and with appetite for new stimulus gone sour in the US Congress, perhaps injecting some humour and laughter into the debate would be the best medicine for policymakers and the public at large.

The Price of Happiness

1. The Wealth Report  says that $75,000 is the minimum income threshold that produces happiness in the US based on a study principally led by Daniel Kahneman, a Nobel winning behavioural economist.
2. Real Time Economics goes further by translating this figure on a city-by-city basis.
3. While we are on the subject, this article from Time tells us why drinkers live longer.
4. Finally, this post from Slate shows how inequality has grown in the US over the past 30 years.

Could Austerity Be the Key to Growth?

David Brooks takes his cue from developments in Germany and Great Britain to highlight the merits of austerity which in his terms is the "adult" way of managing the economy. He draws most of his insights from a blog called e21 which posted this editorial on the German economic recovery. Some analysts warn that the below-trend growth that is expected from the US in the coming years is an even worse outcome than a double dip recession that lasts for a few quarters followed by a return to normal growth immediately after. The reason for such stagnancy is the expectation of firms and households that government indebtedness will affect the hip pocket in the coming years. Although the US in all likelihood will avoid a double dip because of its stimulus, is now the time to be thinking about austerity given the seeming ineffectual nature of fiscal spending?