by Ryan McMaken
In response to last week’s post on median incomes, several readers responded on Twitter with links to posts by the American Enterprise Institute think tank which explain some of the problems with using measures of household income.
At the Mises Institute, we’re not exactly in the business of helping the US government defend it’s own economic data, but the discussion raises some opportunities to look at the problem of relying strictly on empirical data without the backing of sound economic theory.
The issues with household median income are highlighted in more than one post by Mark Perry at the AEI site in which Perry presents several variables that may be affecting the trend in median household incomes. Overall, Perry’s goal is to show that our view of the trend in incomes may be skewed by factors that don’t really point toward a worsening economy.