Shortage or scarcity or supply constraints

 

"Intel Corp.’s INTC 1.15% new chief executive said a global chip-supply shortage could stretch two more years". (WSJ, April 2021) Here are questions.

1. Are chips scarce?
2. Does a shortage of chips exist?
3. What is the difference between a shortage and scarcity?
4. If a shortage exists, why doesn't an increase in price eliminate it?
5. What is the difference between the short run and the long run?
6. In which time periods, the short or long runs, can firms "put more capacity on the ground"?
7. Are the manufacturers earning more than a normal rate of return?
8. If firms are not earning more than a normal rate of return, why does Intel want to increase capacity?
9. Could automobile manufacturers have avoided shutting down by paying a premium to purchase the chips they need to maintain production?
10. Why would automobile manufacturers shut down instead of paying a premium to purchase the chips they need to maintain production?

Greenhouse emissions in the USA

 What the EPA says happened in 2019.

What happens wages for truckers when the demand for trucking increases?

Wages increase! (WSJ, April 2021)

Are minimum wages and the Davis-Bacon Act relics of Jim Crow?

"Labor economists William Even and David Macpherson’s study of the impact of state minimum-wage mandates in 2007-09 found that they cost younger blacks more jobs than the Great Recession did.

This is exactly what the early 20th century minimum-wage proponents were hoping these laws would do: keep black workers from competing for jobs. We hear a lot today from Democrats who want to ditch the Senate filibuster, which enables the minority party to block legislation that doesn’t have a 60-vote majority, ostensibly on the grounds that it has been wielded in the past to thwart black progress. Last summer, President Obama referred to the filibuster as a “Jim Crow relic” that was used to block civil-rights bills. We’ll know that Democrats are arguing in good faith when they hold minimum-wage laws and the labor unions that back them to the same standard" (WSJ, Feb. 2021). 

"The last year in which black unemployment was lower than white unemployment – 1930 – was also the last year in which there was no federal minimum wage law. The Davis-Bacon Act of 1931 was openly advocated by some members of Congress on grounds that it would stop black construction workers from taking jobs from white construction workers by working for less than the union wages of white workers." (Sowell, 2009, pp. 94-95, footnote deleted)

Addendum

"In the late 19th century, amid an influx of foreign immigrant labor, New York and other states began adopting prevailing-wage laws. Twenty-two states still have them on the books. The federal version—known as Davis-Bacon—was enacted in 1931 after a builder using a mixed-race work crew from Alabama won a bid to construct a veterans hospital on New York’s Long Island" (WSJ, April 2022).

What happens when people expect demand to decrease?

Suspension of COVID vaccines => people expect demand for oil to decrease => expect price of oil to decrease in the future => decrease in the demand for oil now => decrease in the price of oil now. (WSJ, March 2021)

Evidence that capitalism raises standards of living.

Many pets in the USA eat better than humans did 200 years ago. (Cafe Hayak, March 2021)

Unintended Consequences of Hero Pay

Stores employ fewer heroes (Reason, March 2020).