
The IMF confirms that ‘trickle-down’ economics is, indeed, a joke - gfmio
https://psmag.com/economics/trickle-down-economics-is-indeed-a-joke
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amadeuspagel
No economist has ever described something he believed in as "trickle-down
economics".

Many economists support policies that people who don't understand economics
would describe as benefiting only investors, like lowering corporate taxes.
But the reason for this is not a belief that the wealth will "trickle down"
but to encourage investment and growth.

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scotty79
My country is currently attempting trickle up economy. It gave monthly
payments to mothers of two or more children (sometimes even one). It's a fixed
amount per child. They hoped to boost fertility rates. Of course they didn't
because people don't work like that. What it did is allow a lot of poor women
to stop working some minimum wage jobs and spend more time with their
children. Prices of basic goods predictably started to rise.

Now a new idea is under way. They are going to raise minimal wage to be around
60% of national average wage. There might be regions where this will be such a
high boost up that 80% of people there will earn new high minimum wage. This
will be of course financed directly by employers. Also they will bear some
additional cost of increased monthly social security payments due to higher
salaries.

What I think will happen is that this forcibly spread money will trickle up to
the owners of companies that sell and manufacture goods that will be bought
more by poor people. You definitely want to sell your stuff in Poland in the
next couple of years. You probably would want to avoid hiring anyone for
simple jobs there.

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AstralStorm
The thing is you cannot avoid hiring people for simple jobs, as they're local,
physical and cannot be outsourced.

Especially with the latest changes to contracts. The only way here is illegal
work, and of course it's illegal and risky for both parties.

Women taking care of children is precisely the desired (by the political
party) and expected social result of this policy.

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amadeuspagel
> The thing is you cannot avoid hiring people for simple jobs, as they're
> local, physical and cannot be outsourced.

You wouldn't believe what jobs can be outsourced. There are hospitals and
nursing homes in germany that send their laundry to poland because wages are
lower there. There are restaurants in San Francisco that import sliced
cucumbers from places that have a lower minimum wage.

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AstralStorm
Both of these share an important characteristic called volume. (Including due
to regularity.)

Anything else would be already outsourced and/or centralized if labour costs
dominate over transport. Polish labour costs are not even close to Chinese or
say Romanian, while the hike is not big enough to overcome sunk costs in most
other cases.

If you think aforementioned outsourced jobs would evaporate, your right.

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RickJWagner
What did Americans think of Trickle Down Economics and Ronald Reagan at the
time?

Reagan was re-elected by winning 49 states. (He lost only Minnesota, home
state of his opponent. Reagan said he did not campaign there, as it was not
kind.)

Make no mistake-- Americans heartily approved of the way the country was run.
It lasted even one more election, as the older George Bush (Reagan's vice
president) won.

Then the economy soured briefly and Bill Clinton swept into office. Clinton
ran the economy well, too, which was another age of prosperity.

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TheCapeGreek
The beginning and end peaks for the top 0.1% on the last chart are quite
similar. If there were more macro data, would we see that sort of high
concentration as the norm across history, and more income equality as an
anomaly?

