Monday, October 21, 2013

Mike Kimil at Angry Bear is wrong, multipliers are less than one in California

The issue is: Does increasing government jobs in California help or hurt growth?
The blue line in this chart is the ratio of government workers to total payroll. The red is the real growth rate for California.  Simple enough, when we have a greater ratio of private workers, growth is up, and growth is coincident.

This is in contrast to what Mike Kimil shows at Angry Bear. Mike Kimil experimental design is incomplete, and he observes correlations not real. 

My correlations are real, and stand up to my claim that the US economy suffers from very low multipliers in California. The reason is simple, our legislature in California has low IQ and, like many economists, fail to understand the government channel.  Federal programs cause conflict in the California Government System, and they raise the cost of government.

No comments: