Lecture 24 - Michigan Allen C. Goodman, 2015 With thanks to Charles Ballard, MSU.
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Transcript of Lecture 24 - Michigan Allen C. Goodman, 2015 With thanks to Charles Ballard, MSU.
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Lecture 24 - Michigan
Allen C. Goodman, 2015
With thanks to Charles Ballard, MSU
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Calendar
• Monday – April 13 – Michigan• Wednesday – April 15 – Detroit 1• Monday – April 20 – Detroit 2• Wednesday – April 22 – Extra Credit –
Those who wish to earn up to 20 points can present their research papers
• Monday – April 27 – Wrap-up, SET• Friday – May 1 – Final Exam Friday,
from 1:20 pm to 3:50 pm
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Michigan’s Economy:Past, Present, and Future
Presented to:Oakland University
Economics Advisory Board Lecture SeriesNovember 13, 2014
Charles L. BallardDepartment of EconomicsMichigan State University
East Lansing, [email protected]
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Good News: Employment in Michigan has been growing for nearly five years.
Not-so-good News: Still, we are more than half a million jobs below the all-time peak in 2000.
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The Worst
The recent recession is BY FAR the worst since the
Great Depression, and the recovery continues to be long and slow.
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Recovery has been slow
BAD, but we got out
of it quickly.
BAD, but we got out
of it quickly.
BAD, but it’s taken a
while.
BAD, but it’s taken a
while.
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Almost1,000,000
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Good News: Adjusting for Inflation, Per-Capita Income in Michigan is Higher Than It Has Ever Been.Not-so-Good News:
(1) Michigan Remains Well Below the U.S. Average.
(2) The Benefits of Growth Haven’t Reached Everyone.
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Migration to Michigan
Migration to Michigan Migration
from Michigan
Migration from
Michigan
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Manufacturing’s Share of the Economy Has Shrunk Dramatically
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Fundamental structural changes in the U.S. economy have created big problems for the Michigan economy for a very long time– not just in the last decade.
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Is Michigan now poor?
Despite our struggles, Michigan is not a poor place.
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Michigan Has Big Regional Differences in
Per-Capita Income (2011)
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1. Oakland County $53,297 2. Leelanau County $43,978 3. Midland County $43,446
U.S. Average $41,560 4. Washtenaw County $40,821 11. Kent County $36,589
Michigan Average $36,264 14. Clinton County $35,926 16. Macomb County $35,717 19. Ingham County $34,450
20. Wayne County $34,012 27. Calhoun County $33,541 43. Genesee County $31,057 73. Kalkaska County $27,137 83. Luce County $24,492
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Also, although Michigan is not a poor place, our economy has not grown as fast as the national average.
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Ratio = 1Ratio = 1
Trend lineTrend line
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Right to Work is unlikely to make much difference.
For better or worse, the strength of labor unions has already diminished greatly.
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Per-Capita Personal Income, 2011:
• Right-to-Work States:$38,046
• Non-RTW States:$44,515
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Many of the states with the highest incomes have high levels of educational attainment.
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Some Examples
Education IncomeState Rank 2010 Rank 2010
Massachusetts 1 2
Minnesota 10 10
Michigan 34 39
Mississippi 49 50
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Are we OVERTAXED !!!!
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Potential Sources of Tax Revenue for Michigan:
• Extend the sales tax to services and entertainments.
• Establish a graduated income tax, or at least raise the flat rate of the current income tax.
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Although Michigan is not a poor place, there are poor people in Michigan (and other states).
Incomes are distributed much more unequally than they were 35 years ago.
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In most parts of the country, the increase in income inequality was NOT spread evenly through the income distribution:
The top pulled away from the middle, but the middle did not pull away from the bottom.
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Less So in Midwest