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William Baumol, whose famous economic theory explains the modern world, has died - Vox

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William Baumol — an economist who just died at the age of 95 — had a famous idea, commonly known as Baumol’s cost disease, that explains a lot about our modern world. It explains why barbers make more in San Francisco than in Cleveland and why services such as health care and education keep getting more expensive. And it provides a possible explanation for why rich countries like America are devoting more and more of their workforces to low-productivity services, dragging down the economy-wide rate of productivity growth. In the 1960s, Baumol was trying to understand the economics of the arts, and he noticed something surprising: Musicians weren’t getting any more productive — playing a piece written for a string quartet took four musicians the same amount of time in 1965 as it did in 1865 — yet musicians in 1965 made a lot more money than musicians in 1865. The explanation wasn’t too hard to figure out. Rising worker productivity in other sectors of the economy, like manufacturing, wa

Politics William Baumol, whose famous economic theory explains the modern world, has died by Timothy B. Lee May 4, 2017, 9:00 PM UTC Economist William Baumol in 2005. William Baumol - an economist who just died at the age of 95 - had a famous idea, commonly known as Baumol's cost disease , that explains a lot about our modern world. It explains why barbers make more in San Francisco than in Cleveland and why services such as health care and education keep getting more expensive. And it provides a possible explanation for why rich countries like America are devoting more and more of their workf

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William Baumol, whose famous economic theory explains the modern world, has died - Vox

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