Profit margins for American companies have reached levels not seen since the post-war period.
There is a strong correlation between the rising share of corporate profits in gross domestic product and the sharp rise in prices in the United States after the Covid pandemic, according to a paper published by the University of Massachusetts.
After making windfall profits from fluctuating commodity prices and supply bottlenecks, large companies were encouraged to raise prices further to increase their profit margins.
They found that there was little evidence that the models used to explain 1970s inflation – such as excess aggregate demand, expanding money supply or rising wage costs that caused a spiral – applied to this recent increase. Covid-19 price increases are mostly seller inflation, they say. When cost increases are suffered by all their competitors, companies have felt safe to pass them on in the expectation of an “implicit agreement” that rivals will do the same.
Federica Cocco and Keith Fray
Our other cards of the week. . .
The introduction of remote work in the wake of the pandemic has helped to increase birth rates, especially among wealthier and better-educated women.
“While the prolonged decline in fertility rates in the developed world makes it difficult to be globally optimistic about the future trajectory of births, the rise of remote working is one factor that seems likely to help push in the other meaning, at least in some subgroups of the population,” said the authors of the analysis by the Economic Innovation Group, a US-based think tank.
Rising birth rates would provide an important boost to economic growth and counterbalance demographic changes such as the aging of the population.
The study also found that unmarried teleworkers were much more likely than those who weren’t working remotely to plan to get married next year. This may be because remote workers have higher migration rates than other workers, meaning those interested in marriage may have been able to move closer to a potential spouse. .
Britain’s approval rating for EU leadership, which has been rising since 2013, topped 50% in 2022 for the first time since the survey began. At 51%, that’s more than the 46% who approve of the UK’s leadership.
The last time a majority of Britons approved of the country’s leadership was in 2006, when Tony Blair was Prime Minister.
The majority of Britons support strikes by nurses and paramedics. The share has risen 3% since January, according to polling firm Ipsos.
Teachers and railway workers are next most widely backed, with sympathy also rising since January, while support has fallen for strikes in other sectors including border and passport control staff, civil servants , university staff and driving examiners.
Talks on Thursday between ministers and health unions resulted in a promising wage offer. Significantly improved conditions for nurses, ambulance staff and other NHS workers in England have raised hopes that further disputes may soon be resolved.
The RMT agreed to vote members on an improved offer from Network Rail and the teachers’ unions began talks on pay, conditions and workload on Friday.
Europe’s energy crisis has not deterred large car customers.
In January, total SUV sales rose 14% year-on-year to 464,000 units, a record 51% share of new car registrations in the EU, according to market researcher Jato Dynamics.
While gas-guzzling and diesel-powered models have remained the most popular choice, accounting for around three-quarters of new SUV sales, figures show demand for plug-in hybrid and pure electric versions of the ‘Chelsea Tractor’ is gaining momentum. .
Despite the launch of greener electric models, SUVs continue to be hugely popular. Plug-in hybrid SUVs, which offer a compromise between more polluting internal combustion engines and expensive pure electric vehicles, have attracted particularly high interest.
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