With lagging economic growth, and the massive tax cuts, revenues are falling below projection. From The Topeka Capital Journal today:
Tax collections by Kansas state government in September fell a sobering $21 million below projections to mark the fourth time in the past six months revenue failed to match targets, officials said Tuesday.
From Chapter 4 of the IMF’s World Economic Outlook, released today:
The two neighboring states of Wisconsin and Minnesota share a similar economic structure and size; and yet their fortunes have diverged over the past three years. One correlate of Wisconsin’s growth deficit is state and local government spending.
From “Fast trains, supply networks, and firm performance” in VoxEU:
We find that sales and measured productivity rose substantially for firms near the new (high speed rail) stations after the opening. Firms in industries with greater purchased input shares outperformed firms in industries with lower purchased input shares.
So Wisconsin dodged the fate of having higher firm productivity.
The report is authored by Bernard, Moxnes, and Saito.
Update, 10/1 12:26PM Pacific: And here is the IMF’s assessment of the role of infrastructure investment. Not that I expect it to convince all the folks who think we should privatize all roads, airports, harbors, and train service…
From Buoyant Dollar Recovers Its Luster, Underlining Rebound in U.S. Economy in today’s NY Times:
The United States dollar, after one of its most prolonged weak spells ever, has now re-emerged as the preferred currency for global investors. Across trading desks in New York, London and elsewhere, analysts are rushing to raise their dollar forecasts based on the resurgence in the American economy.
Recently Jim highlighted the odd behavior of the various Treasury term premia. Here are some additional thoughts.
First, from “Debt market goes off script” in the WSJ:
Here are some economic indicators for Kansas; they indicate rising GDP but stalling real personal income (through 2014Q1), stagnant employment growth, with manufacturing employment deviating from national trends.
For academic researchers who are readers of this blog (and I know you’re lurking out there), I wanted to call attention to my new paper on Macroeconomic Regimes and Regime Shifts:
Many economic time series exhibit dramatic breaks associated with events such as economic recessions, financial panics, and currency crises. Such changes in regime may arise from tipping points or other nonlinear dynamics and are core to some of the most important questions in macroeconomics. This chapter surveys the literature on regime changes. Section 1 begins with an interpretation of the move of an economy into and out of recession as an example of a change in regime and introduces some of the basic tools for analyzing such phenomena. Section 2 provides a detailed overview of econometric methods that are appropriate for time series that are subject to changes in regime. Section 3 summarizes the ways in which changes in regime can be incorporated into theoretical economic models and briefly reviews applications in a number of areas of macroeconomics.
The MacIver Institute, an organization of endlessly imaginative analysis, has highlighted this LFB memo that reports that under the right conditions, the structural budget balance will be +$535 for the 2015-17 biennium.
DWD released August employment figures today. Attainment of Governor Walker’s 250,000 net new private sector jobs continues to be unlikely.