I am distrustful of international economic comparisons, especially when only two countries are compared, in this instance the United States and Germany. Countries differ in a large number of respects that bear on economic performance; in a large sample, many of those differences may cancel, but a sample of two is tiny.
Becker provides a plausible explanation of Germany’s lower unemployment rate, but is it correct? According to the Bureau of Labor Statistics, Germany’s unemployment rate is not the lowest current unemployment rate of ten major countries that the BLS has compared after adjusting the unemployment rates in those countries to correspond to U.S. concepts of unemployment. France has the highest unemployment rate—9.6 percent—followed by the United States at 9.5 percent. The German rate is 7.5 percent. Australia, Canada, Japan, and the Netherlands have substantially lower unemployment rates. The U.K. unemployment rate, surprisingly, is only slightly above the German rate. Sweden and Italy complete the picture, with unemployment rates roughly halfway between the German and the American. Given European labor laws, it is surprising that the unemployment rate in France is only trivially higher than the U.S. rate and that the unemployment rates in Italy, the Netherlands, and Sweden are significantly below the U.S. rate, though Swedish labor laws, at least, are fairly loose, and the Italian unemployment rate is believed to be underestimated. But why should Canada and Japan have unemployment rates substantially below the U.S. level?
I venture the following guess. All these countries except Australia had before the economic crisis a higher personal savings rate than the United States. And all without exception derived a much higher fraction of their national income from exports than the United States. Because of our very low personal savings rate, and the (related) fact that most savings were in the form of home equity and (directly or indirectly) common stock, the crash of 2008 ushered in a protracted period of stagnant consumption spending as frightened American consumers increased their personal savings rate from 1.7 percent three years ago to 6.4 percent today. Producers and distributors in the third quarter of 2008 and in 2009 could foresee a sustained period of subpar demand, and so laid off many workers and have been slow to rehire them, anticipating that demand for goods and services will not increase substantially for some time.
In other advanced economies, higher personal savings and greater reliance on export earnings created expectations of more rapid economic recovery. Consumers would have less incentive to increase their savings further and thus reduce consumption; so businessmen could expect demand to revive sooner than in the United States. They could also expect their export markets to rebound soon, knowing that major importers of technologically advanced manufactured goods, such as China, India, and Brazil and other Latin American countries, had been hit less hard by the economic crisis. The quicker a solid economic recovery is expected to occur, the less prone employers are to lay off workers, because laying off and rehiring are costly, and the costs may well exceed a short period in which employees are not busy because demand for the employer’s product is weak.
I agree with Becker that the Obama Administration’s overly ambitious legislative program and intermittent outbursts of hostility to business are hurting our economic recovery. But I would be inclined to give greater weight, in explaining our stubbornly high unemployment, to the other factors that I have mentioned.
Du tonnes de commentaires dans vos articles, je suppose que je ne suis pas le seul réel que possède tout le plaisir ici! Merci!
Posted by: tablette android | 06/27/2011 at 09:58 PM
I’ve been reading your blog all along, I simply don’t have the words. I just wanted you to know that I’m fond of your blog so much.
Posted by: oilpaintings | 06/27/2011 at 10:08 PM
Thanks for the cool badgees! When do we find out who the Petties nominees are???
Posted by: MBT Sale | 07/09/2011 at 08:15 AM
Nice blog and the article are simply superb. The article posted was very informative and useful. You people are doing a great job. Keep going.
Posted by: cheap nike air max 90 for sale | 07/12/2011 at 10:41 PM
And new writers? I can't think of a single more valuable tool to increase your readership than by engaging with other writers here, both by commenting on their blogs and by responding to the comments that others leave on your blog. I believe that most of us want to feel some kind of connection with other OS members, especially if we've taken the time to read your blogs and leave thoughtful or encouraging comments.
Posted by: crystal model truck | 07/17/2011 at 08:36 PM
Like it or not, there is a social aspect to Open Salon, as well as a certain amount of "quid pro quo". You get a built-in audience here, and along with that comes some responsibility to participate. Not doing that seems to me like merely talking to yourself, or "drive-by posting". There are lots of places you can do that, and perhaps you should find one.
Posted by: crystal truck model | 07/17/2011 at 08:37 PM
Recommander une bonne magasins shopping en ligne: www.myefox.fr
Posted by: fournisseur grossiste | 07/18/2011 at 04:47 AM
Wonderful! I enjoyed learning about rug hooking first of all, and then how you transformed the students introduced to needlepoint.
Posted by: pvc panel | 07/28/2011 at 12:35 AM
That would have made my day. Sounds like a cute kid. His behavior doesn't remotely resemble sexual harrassment.
Posted by: china-pvc-door | 07/28/2011 at 12:38 AM
Brilliant! That sounds like fun - and it sounds like Berlin.
Posted by: china-ceiling-panel | 07/28/2011 at 12:41 AM
This is such a horribly sad story, but I love the way you told it. Thanks for not dragging us into a guns-or-no-guns debate and just allowing us to enjoy your wonderful writing.
Posted by: pvc-door-suppliers | 07/28/2011 at 12:43 AM
Very excellent. The details of your experience converge through description into a finely tuned human reminder of both the terror and technologic futulity of violence.
Posted by: PVC-panels | 07/28/2011 at 12:45 AM
There was time when I took an active interest in the oil price. I made the classical economic assumption that the price was predominantly set by the ironclad laws of Supply & Demand. Not anymore. I can go for weeks now without knowing what the price is. But my curiosity was renewed yesterday when I noticed that a barrel of oil
Posted by: Louis Vuitton Outlte | 08/07/2011 at 09:19 PM
Hopefully online marketing jobs don't dry up in the wake of this ongoing economic collapse. The Dow dropped, what, 512 points today?! It's starting to feel like 2008 all over again. Ever wonder what's really going on? I think I know.
we sale nfl jerseys:http://www.nflsporter.com
Posted by: nfl jerseys | 08/08/2011 at 05:06 AM
Love your Blog and every article.
Posted by: tr | 08/08/2011 at 06:56 AM
City Negs Billboard Changes: By an overwhelming 7-0 vote, the City Council voted against a billboard industry-sponsored ordinance change that would have allowed relocation and reconstruction against existing billboards and the conversion of some signs to digital format. As the Indy suggests, the visual juxtaposition of a billboard hawking a Raleigh gun/knife show this weekend hovering right over the new R.
Posted by: Louis Vuitton Outlte | 08/08/2011 at 07:54 PM
Wow this is a great resource, I'm enjoying it! good article.
Posted by: tr | 08/08/2011 at 08:34 PM
Ich denke, Flytouch 3 ist ein sehr gutes Produkt, ich weiß nicht, wie es sich anfühlt? Um Empfehlung empfehlen.
Posted by: Flytouch 3 | 08/09/2011 at 10:02 PM
Ich denke, Flytouch 3 ist ein sehr gutes Produkt, ich weiß nicht, wie es sich anfühlt? Um Empfehlung empfehlen.
Posted by: Flytouch 3 | 08/09/2011 at 10:07 PM
In many past commentaries I attacked labor markets in Western Europe as being too rigid regarding layoffs and hires, and for providing too generous unemployment compensation often for very extended periods.
Posted by: Essay writing | 08/16/2011 at 10:33 PM
Wir danken Ihnen, diesen Artikel zu teilen, lernte ich eine Menge Wissen.
Posted by: Tablet PC | 08/17/2011 at 04:38 AM
thnk you for sahring
Posted by: ankara escort bayan | 08/18/2011 at 09:03 AM
thnk you for sahring
Posted by: ankara escort bayan | 08/18/2011 at 10:11 AM
I started blogging about the dangers of buying stuff almost two years ago, made a few posts and then kind of forgot about it. This is the fate of many blogs, I guess, and since I never really told anyone about it, I figured it would just sit there, which, by and by, it did. Except for one part - the BAD McAfee part, which took on a life of its own while I was off doing other things.
Posted by: Louis Vuitton Outlet | 08/20/2011 at 03:29 AM
I started blogging about the dangers of buying stuff almost two years ago, made a few posts and then kind of forgot about it. This is the fate of many blogs, I guess, and since I never really told anyone about it, I figured it would just sit there, which, by and by, it did. Except for one part - the BAD McAfee part, which took on a life of its own while I was off doing other things.
Posted by: Louis Vuitton Outlet | 08/20/2011 at 03:35 AM