2015, the year that was: economics and business

December 28, 2015

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As we approach 2016, we look back at the big stories of The Conversation’s economics and business coverage over the past 12 months.

The year began with fears of a “Grexit” and ended with the first increase in US interest rates in almost a decade.

Middle-class travails

The struggles of the middle class were a hot topic throughout the year, and more recently they have become an unexpected theme in the presidential campaign, on both sides of the partisan divide.

The housing market provides one window into the issue. Even as the industry appears mostly recovered from its collapse in 2008, a crisis looms as millennials and others struggle to afford the American Dream and its white picket fence. As Mechele Dickerson of the University of Texas at Austin points out, increasing numbers of middle-income Americans can no longer realistically aspire to become homeowners anytime soon.

Nobel Prize-winning economists George Akerlof and Robert Shiller blame the “dark side” of free markets for much of the reason we make bad choices that make it harder for us to achieve the American dream, arguing “as long as there is a profit to be made, [free markets] will also deceive us, manipulate us and prey on our weaknesses, tempting us into purchases that are bad for us.”

Some of our scholars connected the worsening situation for the middle class to the decline of labor unions, which we covered in a series on the topic early in the year.

The third-most-read business story of the year, in fact, was The rise and fall of US labor unions, and why they still matter, by Jake Rosenfeld of the University of Washington. In the series, we also explored the surge in right-to-work laws and the impact of irregular work hours.

While this focus on the middle class has more typically been a Democratic issue, this year’s Republicans have embraced it as well. At their October debate, for example, four of the candidates discussed ways to shore up Social Security and Medicare: Marco Rubio was perhaps most outspoken on the importance of addressing these issues. “So the good news,” MIT’s Thomas Kochan wrote, “is that the American public is being heard.”

Grexit schmexit

Another big topic was Greece’s near-exit from the eurozone, which dominated the news during the first half of the year.

It began with the victory of Greece’s left-wing Syriza party and a “Greferendum” in which voters rejected a bailout package the government had agreed to with its eurozone creditors. The European Central Bank (ECB) reacted by shutting off the flow of cash to Greece’s banks, which were forced to shut.

Eventually, the controversial finance minister – reviled in Europe – resigned, and Greece agreed to a bailout package that was even more draconian than the one Greeks rejected. Barry Eichengreen of the University of California at Berkeley blamed political incompetence on all sides for Europe’s tragedy, eight years in the making.

The future of the eurozone – and Europe – will surely be a dominant theme in the new year, as leaders struggle over immigration, austerity and other issues. With that in mind, two of our authors suggested European leaders should see the hit Broadway musical “Hamilton” to get some perspective.

The never-ending decision

Perhaps one of the biggest decisions of the year took the longest to make.

This month the Federal Reserve finally lifted interest rates for the first time since 2006 – and after seven years at pretty much 0%. But we’ve been writing about its near imminence all year, with scholars going back and forth on whether the economy was ready for “liftoff.”

In the end, there seemed to be consensus that now was as good a time as any to begin normalizing rates, but there was more concern about whether it would work.

The US may be ready, but it wasn’t clear the rest of the world is. Emerging markets in particular are expected to get slammed, while the ECB and other countries continue to chart their own course.

The pace of Fed rate increases will be another important theme in 2016.

Lighter hearts

Beyond Main Street and Wall Street, our scholars also offered some more lighthearted fare, from research debunking the “opposites attract” cliche to the economics of literature and the detective story. Our columnist Jay Zagorsky also looked into Star Wars and the force of inflation.

Looking at just the numbers, here are the top 10 economics and business articles of 2015, based on number of reads: