25 July 2012

Economics in Song I

'The Day John Henry Died,' by the Drive-By Truckers:


I watched the rain; it settled in. We disappeared for days again.
Most of us were staying in, lazy like the sky. [Labor Force Hysteresis, Classical view of unemployment?]

The letters flew across the wire filtered through a million liars.

The whole world smelled like burning tires [negative externalities] the day John Henry died.


We knew about that big machine that ran on human hope and steam. [Solow Growth Model, Cobb-Douglas Production Function]

Bets on John were far between and mostly on the side.
 [financial intermediation & the derivatives market]
We heard he put up quite a fight. His hands and feet turned snowy white.

That hammer rang out through the night the day John Henry died.


When John Henry was a little bitty baby nobody ever taught him how to read [Underinvestment in Human Capital]

but he knew the perfect way to hold a hammer was the way the railroad baron held the deed. [Specialization]


It didn't matter if he won, if he lived, or if he'd run. 

They changed the way his job was done. Labor costs were high. [MPL < MPK]

That new machine was cheap as hell [IRR > R] and only John would work as well, [MP(John)=MP(new machine)]

so they left him laying where he fell the day John Henry died.


John Henry was a steel-driving bastard but John Henry was a bastard just the same.

An engine never thinks about his daddy and an engine never needs to write its name.


So pack your bags, we're headed west [Labor Force Mobility, Sector Shift?] and L.A. ain't no place to rest. [U(LA) < U(USA), 
Labor Force Participation]

You'll need some sleep to pass the test, so get some on the flight
and say your prayers John Henry Ford 'cause we don't need your work no more. [Structural Unemployment, Creative Destruction]

You should have known the final score the day John Henry died.

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