Ask an Economist
Welcome to Ask an Economist, a public service of the Department of Economics at Iowa State University, designed to answer your economic questions.
Our talented faculty and alumni can answer questions on a variety of economic topics to help you make more informed choices about your day-to-day decisions--or to just add a more reasoned voice when talk of the economy comes up around the dinner table.
Questions & Answers
Increases in the minimum wage tend to cause firms to raise wages for those whose wages were initially above the new minimum in order to maintain the former pay hierarchy. The biggest effect is on workers closest to the minimum wage.
Florida is putting a minimum wage to a referendum of voters. The proposed minimum wage policy would raise the minimum wage from its current $8.86 to $10.00 per hour effective September 30th, 2021.
Economists are said to know the price of everything and the value of nothing. I actually think that's backward. Figuring out the price is tough.
The easiest way to respond to this question is to answer in the context of custom feedyards that are included in the ISU Beef Feedlot Monitor - ...
Continue Reading AnswerChina mainly cuts corporate tax and fees (no tax cut for individuals) during the COVID-19 epidemic period so that firms could have incentive to increase the production compared to the scenario without tax and fee cuts.
1. A mainstream neoclassical synthesis economist would say that this system can be doable but it has what we would call a lot of incentive compatibility problems.
If the principle has a name, I suppose it would be DIVERSIFICATION.
Individual consumers have different preferences and information, which guide those individuals to choose what is best for themselves.
The idea underlying diversification is to achieve a desired expected rate of return at the smallest possible risk.
Traditional economics tells us that price ceilings lead to shortages. A lower price encourages sellers to reduce the quantity they supply to the market. A lower price also encourages buyers to increase the quantity they demand.
I think you are using the term "nationalize" to mean the US government buying US farm products. The US is a major exporter of meat and grains and these products are typically more expensive in other countries than they are in the US.
It seems there are two markets for condominiums: units that allow dogs (Market Dog) and units that do not (Market Sad). My black lab mentioned that the latter group are probably sad folks. OK – my econ jokes in class aren’t any better.
I think the basic mechanism you describe could well be part of the complex story of how the H1-B visa affects domestic workers in IT.
I will try to answer the questions as I interpret them, but first, it is important to explain what the facts are.
Iowa has updated the soil productivity system from Corn Suitability Rating (CSR) to Corn Suitability Rating 2 (CSR2) in 2013, and the USDA NRCS Web Soil Survey tool allows you to compute the new CSR2 for your farm (Google ISU Extension Ag...
Continue Reading AnswerArtificial Intelligence is likely to impact all of our jobs, just to varying degrees. Specific tasks that we need to perform in our jobs, skills required, wages, and hours will all likely be adjusted.
Auto repair is an example of a "credence good," which is a type of product or service where an expert knows more about the quality the consumers need than the consumers themselves.
Economists generally agree with Henry George that land value taxes promote efficient use of land. A small country with a tourism-based economy seems like an excellent case for the efficiency of a land value tax.
You have asked a very interesting question. Without more specific information, it would take volumes to answer this general question appropriately; however, I can point you to a few resources that may be useful.
In short, there are probably many ways that you could get a rough estimate of this and they are all likely flawed in some way or another which makes this a really tough question to answer.
Here are several resources that begin to address many of your questions.
Beef Marketing Margins - http://jaysonlusk.com/blog/2020/5/4/beef-marketing-margins
Ours is called a consumer economy because consumption is nearly 70% of our GDP. Countries like China, are more investment-driven with investment (often by the public sector) at nearly 50% of GDP.
Continue Reading AnswerEconomists measure the economic health of a country by its G.D.P per capita. They see low unemployment as good because it means labor resources are not sitting idle. They also consider whether income disparities are good or bad.
In short, we do not know, especially so because nothing like this has hit the US in modern times. The Great Depression was a massive disrupter and devastator but caused ultimately by economic forces from within.
The most relevant reports to track the evolution of the financial situation of well-managed mid-size commercial farms in Iowa are: