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What Alan Krueger Taught Us

5 hours ago

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Princeton economics professor and former Obama adviser Alan Krueger died this past weekend at the age of 58. The cause of death was suicide. Krueger made enormous contributions to the field of economics and, more broadly, to policies that affect the lives of all Americans.

Getting a higher education degree — whether it's an Associate's, a Bachelor's, or something else — increases your earning potential over your life. But going to school is expensive, and Americans have more than $1.5 trillion worth of outstanding student debt. That debt isn't exclusively held by the students: people over 60 are the fastest-growing segment of student loan borrowers, as parents and grandparents are increasingly taking out loans to help their kids and grandkids go to college.

This week's news stories about corruption and cheating in the college admissions process is an eye-opening lesson in how much people value getting their children into certain schools.

Lori Loughlin, who played Aunt Becky on the TV sitcom Full House, paid $500,000 to get her two daughters into the University of Southern California. That seemed like a lot to us... and raised the question: is a slot at a top-tier university worth that kind of money?

Tim Demarais works for an American company called ABRO. The brand is a big deal in many foreign countries. They sell so much masking tape in places like Pakistan that when people there refer to a roll of masking tape, they'll often call it a roll of ABRO.

But back in 2002, ABRO's sales started to dip. Tim heard from a customer that counterfeit ABRO goods in China might be causing the problem. So, he flew over to investigate. What he discovered-- the extent of the fraud--was shocking. And even more surprising, the company posing as ABRO insisted they were the real ABRO.

Saying 'I Do' To Lab-Grown Diamonds

Mar 14, 2019

The global market for diamond jewelry is worth $80 billion dollars a year. Money is pouring into the industry, but why - when demand for diamonds isn't as sparkly as it once was?

There's a new player in the space that might change the market in the near future. It's a different kind of diamond – one grown in a lab. But man-made rocks come with some big marketing problems. Traditionally, luxury products are about scarcity – not accessibility. And, unlike other consumers, high end shoppers can be attracted to high prices.

Attention is a scarce resource. So are concentration and mental energy. But how do our brains decide which stimuli will attract these scarce resources? Enter cognitive economics. A new field in economics that borrows from neuroscience and psychology. Mathematician-turned-cognitive economist Leigh Caldwell joins to explain how it works.

Note: This episode originally ran in 2016.

Fred and Natasha Ruckel invented a cat toy called the Ripple Rug. It's like a scrunched up doormat with holes in it, and for cats it's like going to Disneyland. When the Ruckels put it up for sale on Amazon, it started selling well. It was a solid business. Then one day, Fred noticed that the Ripple Rug was also on sale on eBay--for twenty dollars more.

Dollar stores — they sell everything from holiday decorations to groceries to Skittles-scented candles. The business proposition: a grab bag of items for a dollar (or around a dollar). These stores thrived during the financial crisis, but their success in the post-Recession era has been a mixed bag.

Dollar General and Family Dollar (now owned by Dollar Tree), two of the dollar store titans, have been at the center of this. These companies each took a bet: whether they could grow their businesses by keeping everything priced at $1, or by leaving the dollar behind.

Are Doctors Overpaid?

Mar 12, 2019

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WATCH: There's No Such Thing As Fancy Vodka

Mar 12, 2019

If vodka is by definition colorless, odorless and tasteless, then why is some vodka much more expensive than others?
NPR / YouTube

Our video series is back with a ve

March Madness: Britain Leaving The EU

Mar 11, 2019

Britain's official deadline to leave the EU is on March 29. Tomorrow, there's another vote on Prime Minister Theresa May's plan to leave the EU. But if that doesn't pass, that puts the UK on a path for a "hard Brexit," where Britain leaves the EU with no special deal in place. In that case, Britain and the EU's trade would go back to the World Trade Organization's default rules governing all trade, without special agreements.

A Warning: This episode contains audio from a disturbing scene of a pipeline explosion.

Mexico's national oil company, Petróleos MexicanosPemexis one of the largest oil companies in the world, and its gas is really expensive. Working for the minimum wage, it takes a day to earn enough to buy a gallon of gas.

Gender segregation is the idea that jobs in some occupations are overwhelmingly done by men, while jobs in other occupations are overwhelmingly done by women. Today on The Indicator, our friend Martha Gimbel from the Indeed Hiring Lab tells us why that's a big deal for women, men, and the economy as a whole.

Some of the studies, articles, and research used for this episode:

From academic journals, think tanks, and other research groups:

Updated at 10:35 a.m. ET

The U.S. economy added only 20,000 jobs — far fewer than expected — last month, the Labor Department said Friday. But the unemployment rate fell to 3.8 percent from January's 4 percent, and earnings growth picked up.

The increase in jobs was below the 180,000 projected by private analysts and the smallest gain since September 2017. February's increase was dramatically smaller than January's revised gain of 311,000 and December's revised 227,000.

Technology has made globalization possible — it has brought the world closer together. But Raghuram Rajan, an economist at the University of Chicago's Booth School of Business, says it's also made inequality much worse in the U.S. Today on The Indicator, we talk inequality: How did we get here? What has the impact been? And how can we change the current situation?

This episode originally ran in 2017.

When Stephon Marbury was eight years old, the Nike Air Jordan sneakers came out. These were basketball shoes endorsed by Michael Jordan, one of the greatest NBA players of all time. Stephon, like lots of other kids, wanted them. But the shoes were pricey. So pricey, his mother couldn't afford them. For years after this, he wondered whether there was a different way to sell quality basketball sneakers.

Tampons: That Bloody Sales Tax

Mar 6, 2019

In 35 U.S. states, women have to pay sales tax for menstrual hygiene products. That extra cost adds up over time and it especially affects low-income women. Some people believe those taxes are unfair to women, and some states have eliminated them. Research based on New Jersey's Tampon Tax repeal in 2005 showed that tax breaks on menstrual products helped women across the board by making products cheaper and more accessible.

Today, the U.S. confirmed it will hold off on a new round of tariffs on imports from China that was supposed to be put in place this month. There's also word that President Donald Trump and Chinese President Xi Jinping are getting close to completing a trade deal, which would mean both countries getting rid of many of the tariffs and trade restrictions that have been put in place. Today on the show, Stacey talks to Chad Bown of the Peterson Institute for International Economics about the trade war with China and asks, 'Is a trade truce on the horizon?'

The Return of Rent Control

Mar 5, 2019

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5 Misconceptions About The Chinese Economy

Mar 4, 2019

China's economy is changing fast and it's tough to keep up. We look at five common misconceptions about the world's second largest economy, with the help of China expert Nicholas R. Lardy from the Peterson Institute for International Economics. Understanding how China's economy has shifted since the financial crisis and why it's slowing down may help shed light on what's going on in the current trade negotiations between China and the U.S..

In the years before 1951, the Federal Reserve took orders from the Treasury, and by extension, from the President. The President would request that interest rates remain low, and the Fed would oblige.

But this became a problem. Low interest rates are great for people to borrow money to buy stuff, and for businesses to grow and hire people. But low interest rates also drive up inflation. And a big part of the Federal Reserve's job is to keep inflation low.

Who Is The Neoliberal Shill Of The Year?

Mar 1, 2019

"Neoliberalism." At its root, it's the belief when national and international institutions support free trade — of goods, ideas, and capital — it'll lead to prosperity. This ideology started in the 1930s, but hit its stride in the 1970s.

Lately, "neoliberalism" has become a loaded term. Some say neoliberalism has made the world more free and interconnected. Others argue neoliberalism has done a lot of damage, like exacerbating inequality.

Today on the show, we ask: what does "neoliberalism" really mean?

The periodic requirement for Congress to vote on raising the debt ceiling has become a reliable piece of political theater. The vote usually follows the passage of a budget by the Congress, and a hike in the debt ceiling rarely gets a green light without some drama.

It's a little like a person who orders up a five course dinner and drinks and then threatens not to pay when the bill arrives. But, this political theater invariably ends the same way: Congress raises the debt ceiling. Treasury pays the bills. Everyone moves on.

Episode 897: New Orleans Vs. Airbnb

Feb 28, 2019

Charlene Griffith has spent her life in New Orleans. She grew up there, and worked one of her first jobs in a hotel there. When Airbnb came to town, she launched her business there. She fixed up a blighted home in the historic neighborhood of Treme, invested a lot in it, and started renting it out to tourists for good money.

It was a great homegrown success story.

But lots of other people also got in on Airbnb. So many homes have become mini-hotels that whole blocks --whole neighborhoods-- are losing the thing that makes New Orleans, New Orleans: its residents.

More Debt, Less Problems

Feb 27, 2019

A recent report from the investment management firm C.J. Lawrence says the total amount of consumer debt on U.S. household balance sheets has been rising steadily since 2012. Yet the overall health of American households is improving. How can that be? Chris Thornberg of Beacon Economics helped us solve the mystery.

The CEO of the streaming service Netflix recently told the company's shareholders something surprising: that Netflix faces more competition from Fortnite, the online video game, than from HBO, the television channel. So are movies, TV shows and streaming videos really in competition with video games? And if so, who's winning?

NOTE: This is an excerpt of Planet Money's newsletter. You can sign up here.

Millions of Americans have used payday loans. These are small, short-term loans known for charging staggering interest rates — sometimes in the 300 to 400% range.

This is the third episode in our series on antitrust law in America. Our first episode told the story of Ida Tarbell and how her reporting on John D. Rockefeller and Standard Oil changed antitrust law in the early 1900s. Our second episode followed the turn that took place in the 1970s in response to Robert Bork's Antitrust Paradox.

In 1921, Sadie Alexander became the first African-American to earn a Ph.D. in economics. A few years later, she went to law school and became a celebrated civil rights attorney. But she never abandoned her focus on economic issues. In speech after speech, she argued that full employment — when everyone who wants a job can get one — was absolutely necessary to achieve racial equality. Today on The Indicator, Episode 1 in our multipart series about overlooked economists from the past.

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