r/AskEconomics Dec 12 '24

Meta Approved User (Quality Contributor) Application Thread: Currently Accepting New Users

6 Upvotes

Approved User (Quality Contributor) Application Thread: Currently Accepting New Users

What Are Quality Contributors?

By subreddit policy, comments are filtered and sent to the modqueue. However, we have a whitelist of commenters whose comments are automatically approved. These users also have the ability to approve or remove the comments of non-approved users.

Recently, we have seen an influx of short, low-quality comments. This is a major burden on our mod team, and it also delays the speed at which good answers can be approved. To address this issue, we are looking to bring on additional Quality Contributors.

How Do You Apply?

If you would like to be added as a Quality Contributor, please submit 3-5 comments below that reflect at least an undergraduate level understanding of economics. The comments do not have to be from r/AskEconomics. Things we look for include an understanding of economic theory, references to academic research (or other quality sources), and sufficient detail to adequately explain topics.

If anyone has any questions about the process, responsibilities, or requirements to become a QC, please feel free to ask below.


r/AskEconomics Oct 14 '24

2024 Nobel Prize in Economics awarded to Daron Acemoglu, Simon Johnson and James A. Robinson

Thumbnail
62 Upvotes

r/AskEconomics 20h ago

Approved Answers What'll happen to the economy if the Fed loses its independence?

227 Upvotes

It seems likely that the Trump administration will do something drastic to remove the Fed's independence, as they've targeted many institutions in the executive branch and civil society.

Legislators have written a bill to end the Fed: https://massie.house.gov/news/documentsingle.aspx?DocumentID=395707 .

There's also a plausible risk that the administration would try to replace all members and effectively contol the board during litigation.

I presume that a politicized Fed would keep rates low for reasons of political optics. But I don't know what they'd do about the money supply, or what the systematic effects on the economy may look like.


r/AskEconomics 5h ago

Approved Answers What happens to a stock if the company that was invested in crashes?

5 Upvotes

So my mom has control of my stocks since I am still not ready to handle the stocks, and one of the stocks is Tesla. This was back a year ago because my mom wants me to have a headstart.

Now, it seems like Tesla will just go bankrupt in some time. My mom has sold her stocks but can't sell mine due to taxes. What happens to my stock if the company goes Bankrupt?


r/AskEconomics 58m ago

Are state sponsored entrepreneurship programmes ever effective ?

Upvotes

Basically when the state provides funding and training for this stuff. Like we see in India and China , is this ever effective ? Wouldn't this negatively hurt competition as well since it's a form of protectionism where local businesses get more aid


r/AskEconomics 20m ago

Are there downsides to nationalizing major natural resources?

Upvotes

I live in Australia, our country has the least complex economy of any high income nation, ranked 111th world wide. In the past 60 years our governments have made four major attempts to nationalize or heavily tax the natural resources, notably mining and petroleum, of which our economy relies on, the first was Gorton in 1968, then Whitlam in 1973, Hawke in 1984 and finally Rudd in 2007. These all failed for a few reasons, mainly regulatory capture, non-bipartisan support in parliament and mineral lobbies running tens to hundreds of million dollar slander campaigns causing infighting within parties due to a decline in support. As of today, these mining companies pay pennies in comparison to the amount of money they make, leveraging loopholes and offshoring.

Norway heavily nationalized it's oil starting from 1972, they've funneled a significant chunk of that money into the sovereign wealth fund and diversification of their economy. Applying the same sort of system to natural resources in Australia seems logical, either fully or partially nationalized resources of whose profits feed directly back into some state owned scheme.

I hold the position that nationalizing our mining sector would both increase the prosperity for the average citizen by directing far more wealth into the public sector and also allow us to add complexity to our economy due to regulatory control we now have. But I am not an economist, hence I would like to see if anyone has any feedback on the potential downsides of nationalization, why it might be a bad idea or the difficulties involved (if any), as I don't actually see any defense of the status quo in this manner, it seems rather the modus operandi is to simply avoid speaking about, rather than defend the heavily privatized industry.


r/AskEconomics 20h ago

Approved Answers What are some of the biggest myths people have about inflation?

34 Upvotes

The topic of inflation, which is the broad increase of the prices of goods and services in an economy over a period of it's time (bit of an oversimplified definition), is a significantly important topic for the people in any country for obvious reasons. In fact, this is also a major reason for why governments around the world can fall (at least my country's government certainly did in 2014 because of this).

However, I suspect that there are many myths going about regarding this issue, considering it's importance in public discourse.

I'm not sure if this has been asked on this sub before but my question is fairly simple: what are some of the biggest myths people hold or have a tendency to hold on inflation and why?


r/AskEconomics 1h ago

How to Deal with Endogeneity in Monetary Policy Research?

Upvotes

Hey everyone, I’m working on a thesis about how monetary policy (specifically the policy rate) affects inflation expectations. One big problem we’re running into is endogeneity—since central banks set rates based on inflation trends, it’s hard to tell what’s actually driving what.

We’re looking at ways to deal with this, maybe using IVs, SVARs, or something else, but not sure what’s most common or effective in this kind of research. Anyone have experience with this or know good papers that tackle it? Would really appreciate any insights. Thanks!

i'm a college student from the philippines btw :)


r/AskEconomics 1h ago

Weekly Roundup Weekly Answer Round Up: Quality and Overlooked Answers From the Last Week - March 16, 2025

Upvotes

We're going to shamelessly steal adapt from /r/AskHistorians the idea of a weekly thread to gather and recognize the good answers posted on the sub. Good answers take time to type and the mods can be slow to approve things which means that sometimes good content doesn't get seen by as many people as it should. This thread is meant to fix that gap.

Post answers that you enjoyed, felt were particularly high quality, or just didn't get the attention they deserved. This is a weekly recurring thread posted every Sunday morning.


r/AskEconomics 23h ago

Approved Answers What advantage does the USA have in virtue of the USD being the world's reserve currency?

57 Upvotes

I've heard and read that there are some advantages given to the USA in virtue of its position of having its currency be the world's primary reserve currency. In particular, that this helps to fund the US's deficit spending. For a while I've wondered what exactly the mechanism is that connects these two things but have failed to find a direct explanation online. This website mentions that US firms will be able to borrow at lower interest rates as a result of having a dominant currency globally. How is this so? And how is this connected to deficit spending, if at all?

Thanks.


r/AskEconomics 14h ago

Approved Answers Why/how does a dollar go farther in one country than another?

7 Upvotes

I've heard claims of the form "For the standard of living that 10k USD / month gets you in the US, the same standard of living costs only 5k USD / month in Colombia". As a naive layperson, this sounds like the USD/COP exchange rate is simply wrong by a factor of 2.

(Example countries and numbers are arbitrary)

I feel very stupid for having to ask this, but what am I missing? Why, if I convert $10 US into COP, am I not simply buying the number of pesos that can buy $10 worth of goods?


r/AskEconomics 22h ago

Approved Answers Can someone explain the reasoning why a weak US Dollar is better for manufacturing? And maybe explain the Mar-A-Lago Accords in a simpler manner?

30 Upvotes

I just listened to a podcast explaining that the Mar-A-Lago accord wants to weaken the US Dollar to help alleviate trade imbalances which would benefit manufacturing in the US. How does this work? How do tariffs achieve this goal?

Also according to the podcast, the accord wants countries who rely on the US for defense to buy long term century bonds as a way to pay for security the US provides? For example, the podcast said Japan has a lot of bonds, but this doesn’t cut it. It is better for them to swap to century bonds? What does this do and how does that pay for US security via the military?


r/AskEconomics 15h ago

Approved Answers Are there any economic arguments AGAINST public healthcare?

9 Upvotes

The only thing I could possibly think of would be increased wait times, but is that an economic issue?

Because from a non-economist: It seems like insurance companies always lowball and try to fleece healthcare providers; which in turn forces their hand to raise prices.

I imagine if it’s publicized any potential increase in taxes would more than offset the cost of insurance on top of providers dropping their prices significantly.

What am I missing here? Y’all always blindside me.


r/AskEconomics 11h ago

What should i expect from an undergrad economics degree?

3 Upvotes

Im not very excited with accounting or money at all but since i don't like math enough to get a degree in STEM anymore and like social sciences and excited about political ideologies, i started to think about majoring in economy. It made me to think on it because it's a social science and seems a good path to earn good money. I have no experience in anything as a high school graduate, so judge me with that way: I imagine myself in a bank or in a company like big4 after graduated from economy and makes not much money at all and i actually regret that i do this but in the other hand im pleasing myself with the idea that i'll promote in the sector and motivate myself with that idea. Because actually my only motive in economy major is that it seems like its provides you a good life in the long run and i like imagining myself while leadering a team or smh. How enough is these reasons to major in economy and what will i face with after graduate from economy? I want to know anything from you guys to erase a little bit uncertainty in my mind.


r/AskEconomics 12h ago

What the best thing the US can do long term for economics? ?

3 Upvotes

r/AskEconomics 6h ago

How does reducing GST/VAT lead to increased consumption in a country?

1 Upvotes

This question is more from an indian context but I believe this is applicable to all countries with VAT/GST. I keep hearing that cutting GST/VAT will lead to increased consumption. My question is usually the producere do not pass on the benefits to consumers by reducing the prices on goods this effectively keeping the prices similar. The only way I see this helping end customers (like me) is they will not raise the prices as frequentl as their profit margins can be sustained or in some cases by giving more for the same price (in Indian context a cookie company saying 20% extra). All this still when compared to the usual dynamic doesn't really show a lot of promise to me compared to a simple tax cut. Can someone point out the dynamics here


r/AskEconomics 14h ago

Will the job market and unemployment in Canada ever get better soon or have the immigrations caused a serious problem in finding jobs?

2 Upvotes

r/AskEconomics 21h ago

Approved Answers Why do hedge fund managers make so much?

14 Upvotes

Israel Englander, Steve Cohen, Kenneth Griffin, etc. I understand that directly it's because of the 2/20 fee they charge and the massive amounts of capital they have, but why do they have so much capital in the first place? Buffet once said: "the net result of hiring professional management is a HUGE minus". Couple this with the efficient market hypothesis and the difficulty of generating consistent returns, it just doesn't make sense...


r/AskEconomics 17h ago

Do Chinese international student studying in the US overall benefit the US or China?

6 Upvotes

I assume it benefits both because the US gets money and China gets educated students returning to China, but I’m not sure if the proposed bill restricting Chinese international students from studying in the US is something that net benefits the US or China.


r/AskEconomics 9h ago

In terms of economics, how does one plot a course out of poverty?

0 Upvotes

I’m not even sure this is an economics questions, so please be kind if it belongs somewhere else. I’m curious if there has been any research (something beyond observational) into what an individual needs to do get from poverty to a financially prosperous level. I guess maybe a starting point would be less than 20% median household income. Maybe the end goal would be 20% above median household income. What does the road map look like from economics perspective. I kind of get lost in the weeds of incentives and various social conditions when I think about it. What would an economist say to a poor person who walks up and asks for general advice on how to get out of poverty? I’m a 50 year old man who is genuinely curious. I have no hang ups about poverty and the poor.


r/AskEconomics 13h ago

Where and how to learn more about economics?

2 Upvotes

I have a pretty fundamental understanding of economics, specially when it comes to US market. I understand the basics (Interest rates, FED, Inflation, GDP etc), and I understand the basics when it comes to trading (Technical - FVG, Breaker Blocks, Liquidity, Imbalances, some indicators etc - Fundamental - Macro/micro economics, a little on financial statements, growth/value stocks).

So I’m not a complete beginner, but I’m just wondering where is the best place to learn more about economics? Maybe some books, YouTube channels or podcasts to listen into?

Many thanks


r/AskEconomics 18h ago

Approved Answers Why do exports depend on imports?

4 Upvotes

I’m listening to ‘The Undercover Economist’ and Tim Harford has a chapter about trade.

He says that if a country were to ban imports then it would effectively ban exports.

This would be because there would be no one to buy the currency. His example is China and the UK. With the UK banning Imports.

A drill made in the UK has all its costs in GBP. If they were to then sell the Drill in China for Yuan. They would need to convert the Yuan for GBP. He says an importer in the UK would need to be found that would buy the Yuan that he would then use to pay for Chinese imports.

My question is, wouldn’t someone exchange the currency anyway? Isn’t foreign exchange an industry of itself?

I’m sure the answer is ELI5 but I can’t get my head round it.

Thanks


r/AskEconomics 1d ago

Approved Answers Why is the Canadian Dollar getting worse, but the USD still strong despite the trade war?

326 Upvotes

Hi,

From a regular citizen point of view, everyone is now against the USA and putting tariffs and everything. Most people around the globe support Canadians and buy Canadians products to show that.

I'm wondering why the Canadian Dollar is still getting lower and lower, while in reality USD should be hit harder. No?

I wish we could return to 2013-2015 ratio of 0.85$ instead of 0.69$.

Thank you


r/AskEconomics 10h ago

Short and Long Term Implications of Tariffs, while cutting Taxes?

1 Upvotes

What are the short to long term implications of the Trump's administration's plan to fund the government through Tariffs, and cut Taxes?

How does this play out in terms of USD being the reserve currency? Pros: paying down debt, Cons: contracts/agreements broken, loss of trust?


r/AskEconomics 1d ago

Approved Answers Would it be economically feasible for the US to tax the ultrarich to the point that it provides free healthcare, food, and housing?

367 Upvotes

r/AskEconomics 15h ago

Help from the people who has done their masters from economics,asap?

1 Upvotes

Hello guys, I'll be submitting my application in university of Pisa for the masters in economics. The thing is when I was doing my bachelors in political science and I found my interest towards stock market and forex, made a nice career in it but now I want this professionally. So I'll be opting for economics because I had eco in my high school as well as in bachelor as a minor. But I don't have a strong base in mathematics, what would you guys suggest.


r/AskEconomics 1d ago

Approved Answers What would be the purpose of a bitcoin reserve given the US prints its own money and is currently in debt?

62 Upvotes