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iii

C O N T E N T S

ECONOMIC REPORT OF THE PRESIDENT ....................................................1

ANNUAL REPORT OF THE COUNCIL OF ECONOMIC ADVISERS* .......7

CHAPTER 1. PROMOTING OPPORTUNITY AND SHARED,

SUSTAINABLE GROWTH..................................................21CHAPTER 2. THE YEAR IN REVIEW AND THE YEARS AHEAD.....45

CHAPTER 3. THE ECONOMIC IMPACT OF THE AMERICAN

RECOVERY AND REINVESTMENT ACT FIVE

YEARS LATER.......................................................................91

CHAPTER 4. RECENT TRENDS IN HEALTH CARE COSTS, THEIR

IMPACT ON THE ECONOMY, AND THE ROLE OF

THE AFFORDABLE CARE ACT......................................147

CHAPTER 5. FOSTERING PRODUCTIVITY GROWTH....................179

CHAPTER 6. THE WAR ON POVERTY 50 YEARS LATER:

A PROGRESS REPORT ......................................................221

CHAPTER 7. EVALUATION AS A TOOL FOR IMPROVING

FEDERAL PROGRAMS ......................................................269

REFERENCES ...............................................................................................299

APPENDIX A. REPORT TO THE PRESIDENT ON THE ACTIVITIES

OF THE COUNCIL OF ECONOMIC ADVISERS

DURING 2013 ........................................................................345

APPENDIX B. STATISTICAL TABLES RELATING TO INCOME,

EMPLOYMENT, AND PRODUCTION ............................359

____________

*For a detailed table of contents of the Councils Report, see page 11.
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Economic Report of the President | 3

T C U S:

This years Economic Report of the Presidentdescribes how after 5years of grit and determined effort, the United States is better-positioned

for the 21st century than any other nation on Earth. Weve now experi-

enced 4 straight years of economic growth with more than 8 million new

private-sector jobs. Our unemployment rate is the lowest its been in more

than 5 years. Our deficits have been cut by more than half. For the first

time in nearly 20 years, we produce more oil at home than we buy from

the rest of the world. The housing market is rebounding, manufacturers

are adding jobs for the first time since the 1990s, and we sell more of what

we make to the rest of the world than ever before.

But in many ways, the trends that have threatened the middle class

for decades have grown even starker. While those at the top are doing bet-

ter than ever, average wages have barely budged. Inequality has deepened.

Too many Americans are working harder and harder just to get by, and

too many still arent working at all. Our job is to reverse those trends. It is

time to restore opportunity for allthe idea that no matter who you are orhow you started out, with hard work and responsibility, you can get ahead.

Thats why this must be a year of action. Im eager to work with the

Congress to speed up economic growth, strengthen the middle class, and

build new ladders of opportunity into the middle class. But America does

not stand still, and neither will I. Wherever and whenever I can take steps

without legislation to expand opportunity for more American families, I

will. Because opportunity is who we are. And the defining project of our

generation is to restore that promise.Simply put, this opportunity agenda has four parts. Number one is

more new jobs. Number two is training more Americans with the skills to

fill those jobs. Number three is guaranteeing every child access to a world-


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4 | Economic Report of the President

class education. And number four is making sure hard work pays off for

every American.

With the economy picking up speed, companies say they intend to

hire more people this year. We should make that decision even easier for

them by closing wasteful tax loopholes and lowering tax rates for busi-nesses that create jobs here at home, and use the money we save in the

process to create jobs rebuilding our roads, upgrading our ports, and

unclogging our commutes. We should help America win the race for the

next wave of high-tech manufacturing jobs by connecting businesses and

universities in hubs for innovation. We should do more to boost exports

and fund basic research. We should maintain our commitment to an all-

of-the-above-energy strategy that is creating jobs and leading to a safer

planet. Finally, we should heed the call of business leaders, labor leaders,faith leaders, and law enforcement, and fix our broken immigration sys-

tem. Independent economists say this will grow our economy and shrink

our deficits by almost $1 trillion in the next two decades. We should get it

done this year.

Creating jobs is step one, but in this rapidly-changing economy,

we also must make sure every American has the skills to fill those jobs.

Ive asked Vice President Biden to lead an across-the-board reform ofAmericas training programs to make sure they have one mission: training

Americans with the skills employers need, and matching them to good jobs

that need to be filled right now. That means more on-the-job training, and

more apprenticeships that set a young worker on an upward trajectory for

life. It means connecting companies to community colleges that can help

design training to fill their specific needs.

Im also convinced we can help Americans return to the workforce

faster by reforming unemployment insurance so that its more effective intodays economy. But first, the Congress needs to restore the unemploy-

ment insurance it let expire at the end of last year, affecting around 2 mil-

lion workers.

Of course, its not enough to train todays workforce. We also have

to prepare tomorrows workforce, by guaranteeing every child access to a

world-class education. Our high school graduation rate is higher than its

been in 30 years, and more young people are earning college degrees thanever before. The problem is were still not reaching enough kids, and were

not reaching them in time.

That has to change. I am repeating a request I made last year ask-

ing you to help States make high-quality preschool available to every four


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Economic Report of the President | 5

year-old. In the meantime, Im going to pull together a coalition of elected

officials, business leaders, and philanthropists willing to help more kids

access the high-quality early education they need. Ill also work to redesign

high schools and partner them with colleges and employers that offer the

real-world education and hands-on training that can lead directly to a joband career, and follow through on my pledge to connect 99 percent of our

students to high-speed broadband over the next 4 years. With the support

of the FCC, weve announced a down payment to start connecting more

than 15,000 schools and 20 million students over the next 2 years, without

adding a dime to the deficit, and with the help of some of Americas top

companies, were going to make the most of these new connections.

My Administration is also shaking up our system of higher educa-

tion, so that no middle-class family is priced out of a college education.Were offering millions the opportunity to cap their monthly student loan

payments to ten percent of their income, and I will continue to look for

other ways to see how we can help even more Americans who feel trapped

by student loan debt.

But we know our opportunity agenda wont be completeand too

many young people entering the workforce today will see the American

Dream as an empty promiseunless we do more to make sure hardwork pays off for every single American. This year, we should do more to

secure a womens right to equal pay for equal work. We should expand the

Earned Income Tax Credit to help more workers without children make

ends meet, and help more Americans save for retirement through the new

MyRA plans my Administration is creating. We should protect taxpay-

ers from ever footing the bill for a housing crisis ever again. And we will

continue the work of making sure every American has access to affordable,

quality health insurance thats there for them when they need it.And we should raise a minimum wage that in real terms is worth

less than it was when Ronald Reagan took office. In the year since I first

asked the Congress to raise the minimum wage, six States raised theirs, and

more companies like Costco see paying fair wages as one of the best ways

to reduce turnover, increase productivity, and boost profits. As Americas

chief executive, I agree, which is why I signed an Executive Order requiring

Federal contractors to pay their employees to pay their federally fundedemployees a fair wage of at least $10.10 an hour for new contracts. There is

a bill in front of both the House and the Senate that would raise the mini-

mum wage to $10.10 for all Americans. The Congress should pass that bill

and give America a raise.


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6 | Economic Report of the President

I believe this can be a breakthrough year for America. But it falls

to all of us to grow the economy and create new jobs, to strengthen the

middle class, and to build new ladders of opportunity for folks to work

their way into the middle class. So in the coming months, lets see where

we can make progress together. Lets continue to make this a year of action.Together, we can restore an economy that works for everybody, and our

founding vision of opportunity for all.


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9

C E A

Washington, D.C., March 10, 2014

M. P:

The Council of Economic Advisers herewith submits its 2014

Annual Report in accordance of the Employment Act of 1946 as amended

by the Full Employment and Balanced Growth Act of 1978.

Sincerely yours,

Jason Furman

Chairman

Betsey Stevenson

Member

James H. Stock

Member


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11

C O N T E N T S

CHAPTER 1. PROMOTING OPPORTUNITY AND SHARED,

SUSTAINABLE GROWTH ..........................................................................21

THE ECONOMY FIVE YEARS AFTER THE CRISIS..................................23

HOW WE GOT HERE: THE ADMINISTRATIONS RESPONSE TO

THE CRISIS ...................................................................................................26

SOURCES OF OPPORTUNITY IN 2014 AND BEYOND........................... 28Cyclical Factors.....................................................................................29

Structural Trends ................................................................................ 30

Long-Term Fiscal Sustainability........................................................ 33

THE CHALLENGES THAT REMAIN AND THE PRESIDENTS

PLANS TO ADDRESS THEM .......................................................................34

Continuing to Restore the Economy to its Full Potential.............. 34Expanding the Economys Potential..................................................37

Promoting Economic Opportunity.................................................... 40

CONCLUSION .............................................................................................. 43

CHAPTER 2. THE YEAR IN REVIEW AND THE YEARS

AHEAD ...............................................................................................................45

KEY EVENTS OF 2013 .................................................................................. 46Aggregate Output Growth During the Year.................................... 46

Fiscal Policy ......................................................................................... 47

Monetary Policy .................................................................................. 50

Financial Markets ................................................................................ 51

International Developments ...............................................................53

DEVELOPMENTS IN 2013 AND THE NEARTERM OUTLOOK............56

Consumer Spending............................................................................. 56Business Investment............................................................................. 59

State and Local Governments............................................................62

International Trade ............................................................................. 64

Housing Markets .................................................................................. 67
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12 | Annual Report of the Council of Economic Advisers

Energy....................................................................................................72

Labor Markets ......................................................................................76

Wage Growth and Price Inflation..................................................... 81

THE LONGTERM OUTLOOK................................................................... 84

The 11-Year Forecast...........................................................................84Growth in GDP over the Long Term................................................86

CONCLUSION .............................................................................................. 89

CHAPTER 3. THE ECONOMIC IMPACT OF THE AMERICAN

RECOVERY AND REINVESTMENT ACT FIVE YEARS

LATER .................................................................................................................91

THE 200709 RECESSION AND THE EARLY POLICY RESPONSES.......93Initial Policy Responses ....................................................................... 94

AN OVERVIEW OF THE RECOVERY ACT AND SUBSEQUENT

JOBS MEASURES .......................................................................................... 95The Recovery Act.................................................................................. 96

Subsequent Jobs Measures .................................................................. 99

Automatic Countercylical Measures ...............................................100

Total Fiscal Response .........................................................................103NEARTERM MACROECONOMIC EFFECTS OF THE RECOVERY

ACT AND SUBSEQUENT FISCAL LEGISLATION ..................................103Model-Based Estimates of the Macroeconomic Effects of theRecovery Act and Subsequent Fiscal Legislation...........................105

Cross-State Evidence ..........................................................................111

International Comparison ................................................................ 114

Benchmarking the Economys Performance Since 2009..............114

EFFECTS OF THE RECOVERY ACT IN PROVIDING RELIEF FOR

INDIVIDUALS ............................................................................................117Tax Cuts for Families ........................................................................118

Unemployment Insurance................................................................ 119

THE EFFECT OF THE RECOVERY ACT ON LONGTERM

GROWTH ....................................................................................................122Protecting and Expanding Investments in Physical Capital....... 123

Protecting and Expanding Investments in Human Capital........ 126

Investments in Technology and Innovation..................................128

Fiscal Sustainability and the Recovery Act....................................131

CONCLUSION ............................................................................................132
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Contents | 13

APPENDIX 1: COMPONENTS OF THE RECOVERY ACT AND

SUBSEQUENT FISCAL MEASURES..........................................................133Tax Relief ........................................................................................... 134

Aid to Affected Individuals ............................................................... 136

State Fiscal Relief............................................................................... 137Investments ......................................................................................... 138

Subsequent Fiscal Measures .............................................................139

APPENDIX 2: FISCAL MULTIPLIERS: THEORY AND EMPIRICAL

EVIDENCE ..................................................................................................139Forward-Looking Models with Rigidities .....................................141

Time Series Evidence ........................................................................142

Cross-Sectional Multipliers ..............................................................145

CHAPTER 4. RECENT TRENDS IN HEALTH CARE COSTS,

THEIR IMPACT ON THE ECONOMY, AND THE ROLE OF

THE AFFORDABLE CARE ACT .............................................................147

RECENT TRENDS IN HEALTH CARE COSTS........................................150

WHAT IS HAPPENING NOW, AND WHAT WILL HAPPEN NEXT?...156The Role of the 2007-09 Recession..................................................156

Non-ACA Factors Affecting Health Spending Growth................160

The Role of the Affordable Care Act...............................................162

ECONOMIC BENEFITS OF SLOW HEALTH SPENDING GROWTH...171Higher Living Standards ................................................................... 171

Lower Deficits .....................................................................................173

Higher Employment and Economic Growth ..................................176

CONCLUSION ............................................................................................178

CHAPTER 5. FOSTERING PRODUCTIVITY GROWTH............179

TRENDS IN TOTAL FACTOR PRODUCTIVITY....................................181Labor Productivity, Total Factor Productivity, and MultifactorProductivity......................................................................................... 181

Postwar U.S. Productivity Growth ..................................................182

PRODUCTIVITY GROWTH AND INEQUALITY GROWTH................189

Trends in Inequality, Productivity Growth, andCompensation .....................................................................................189

Technological Change and Inequality............................................190
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POLICIES TO FOSTER PRODUCTIVITY GROWTH AND TO HELP

ENSURE THAT EVERYONE BENEFITS FROM IT..................................193

TELECOMMUNICATIONS AND PRODUCTIVITY GROWTH............197Innovation and Investment..............................................................197

Four Key Areas for Telecommunications Policy...........................198Challenges to Broad Adoption of TelecommunicationsTechnology.......................................................................................... 209

PATENTS .....................................................................................................212Standard-Essential Patents ...............................................................213

Patent Assertion Entities ................................................................... 215

CONCLUSION ............................................................................................217

CHAPTER 6. THE WAR ON POVERTY 50 YEARS LATER:

A PROGRESS REPORT ..............................................................................221

MEASURING POVERTY: WHO IS POOR IN AMERICA?......................223Measuring Poverty............................................................................. 223

The Official Poverty Measure...........................................................223

The Supplemental Poverty Measure...............................................225

Who is Poor?.......................................................................................228

Employment........................................................................................229

Education Level..................................................................................230

Children ...............................................................................................230

The Elderly......................................................................................... 230

Women ................................................................................................232

Race and Ethnicity............................................................................. 232

People with Disabilities .....................................................................233

Rural and Urban Communities .......................................................233

ASSESSING THE WAR ON POVERTY .....................................................234Context ................................................................................................234

Correcting the Historical Account of Poverty Since the 1960s ...240

Measuring the Direct Impact of Antipoverty Efforts....................242

THE ROLE OF ANTIPOVERTY PROGRAMS: A CLOSER LOOK..........245

Antipoverty Effects of Specific Programs........................................ 245The Effects of Antipoverty Programs on Work and Earnings..... 248

Economic Mobility............................................................................. 252

Intergenerational Returns ................................................................. 255
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Contents | 15

THE OBAMA ADMINISTRATIONS RECORD AND AGENDA TO

STRENGTHEN ECONOMIC SECURITY AND INCREASE

OPPORTUNITY ..........................................................................................258Taking Immediate Action During the Economic Crisis...............258

Expanding Health Care Security ....................................................260

Rewarding Work ................................................................................ 260

Empowering Every Child with a Quality Education ...................263

Creating Jobs and Growing Our Economy ...................................265

Investing in and Rebuilding Hard-Hit Communities..................265

CONCLUSION ............................................................................................266

CHAPTER 7. EVALUATION AS A TOOL FOR IMPROVING

FEDERAL PROGRAMS ..............................................................................269

CONDUCTING RIGOROUS IMPACT EVALUATIONS IN FEDERAL

PROGRAMS .................................................................................................271Estimation of Causal Effects of a Program or Intervention........ 272

Other Criteria for High-Quality, Successful ImpactEvaluations ......................................................................................... 274

Lower-Cost Ways for Impact Evaluations to Facilitate Real-Time

Learning ...............................................................................................275IMPACT OF THE EVIDENCEBASED AGENDA ....................................278

Uses of Evaluation ............................................................................278

Building Evidence when Existing Evidence is Limited.................283

FURTHERING THE EVIDENCE AGENDA..............................................286Legislative Support for Evaluation .................................................287

Building Evaluation into the Design of Programs .......................290

Developing the Capacity to Link to Other Administrative andSurvey Data Sources ..........................................................................294

Facilitating Researcher Access to Federal Data whileProtecting Privacy ......................................................................... 296

CONCLUSION ............................................................................................297

REFERENCES .................................................................................. 299

APPENDIXES

A. Report to the President on the Activities of the Council ofEconomic Advisers During 2013 .......................................................345

B. Statistical Tables Relating to Income, Employment, andProduction .............................................................................................359
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FIGURES

1.1. Monthly Change in Private Nonfarm Payrolls, 20072014 ............. 221.2. U.S. Merchandise and Overall Trade Deficits, 20002013 .............. 241.3. Major Deficit Reduction Episodes Over a FourYear Period

Since the Demobilization from WWII ................................................241.4. Real GDP Per WorkingAge Population in 20072008 BankingCrisis Countries, 20072013 .................................................................27

1.5. Quarterly Effect of the Recovery Act and SubsequentFiscal Measures on Employment, 20092012 ....................................27

1.6. Change in Poverty Rate from 20072010, With and WithoutTax Credits and Benefits .......................................................................29

1.7. Domestic Crude Oil Production and Net Imports, 20002013 ...... 31

1.8. Growth in Real Per Capita National Health Spending,19612013 ................................................................................................331.9. Unemployment Rate by Duration, 19942014 .................................. 351.10. Growth in Real Average Hourly Earnings for Production and

Nonsupervisory Workers, 20072014 .................................................361.11. Real Median Family income, 19802012 ............................................ 361.12. Building Permits for New Residential Units, 19602014 ................. 381.13. Growth in Total Factor Productivity, 19532012 ............................. 391.14. Share of National Income Earned by Top 1 Percent,

19152012 ................................................................................................411.15. Growth in Productivity and Average Wage, 19472013 .................. 412.1. Mean GDP Growth, 20072013 ........................................................... 472.2. Federal Budget Deficit, 19502015 ...................................................... 502.3. Interest Rates, 20102014 ..................................................................... 522.4. Treasury Bills Maturing in Late OctoberEarly

November, 2013......................................................................................532.5. Current Account Balance by Country, 20002013 ........................... 55

2.6. Cumulative Flows into Mutual and ExchangeTraded FundsInvesting in Emerging Markets, 20102014 .......................................56

2.7. Household Deleveraging, 19902013 .................................................. 582.8. Consumption and Wealth Relative to Disposable Personal

Income (DPI), 19522013 .....................................................................582.9. Business Investment and the Acceleration of Business Output,

19652013 ................................................................................................622.10. Real State and Local Government Purchases During Recoveries ... 63

2.11. State and Local Pension Fund Liabilities, 19522013 ....................... 642.12. Trade in Goods and Services, 20072013 ........................................... 652.13. U.S. Exports Growth, 20092013 ......................................................... 652.14. Current Account Balance, 19852013.................................................66


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Contents | 17

2.15. Housing Starts, 19602013 ................................................................... 712.16. National House Price Indexes, 20002013 ......................................... 712.17. Cumulative Over and UnderBuilding of Residential and

Manufactured Homes, 19962013 .......................................................732.18. Petroleum Net Imports, 19802015 .................................................... 742.19. Monthly Crude Oil Production and Net Imports, 19902013 ........ 742.20. Wind and Solar Energy Production, 20002013 ............................... 752.21. U.S. Per Capita Consumption of Gasoline and Real Gasoline

Prices, 20002013 ...................................................................................762.22. Unemployment Rate, 19792014 .........................................................782.23. Nonfarm Payroll Employment, 20072014 ........................................ 782.24. Unemployment Rate by Duration, 19902014 ..................................792.25. Predicted vs. Actual Manufacturing Payroll Employment,

20002014 ................................................................................................803.1. Recovery Act Programs by Functional Categories ............................ 983.2. Recovery Act and Subsequent Fiscal Measures by Functional

Category .................................................................................................1023.3. Automatic Stabilizers and the Budget Balance, 20092013 ...........1023.4. Fiscal Expansion as a Percentage of GDP.........................................1033.5. Estimates of the Effects of the Recovery Act on the Level of

GDP, 20092013 ...................................................................................109

3.6. Estimates of the Effects of the Recovery Act on Employment,20092013 ..............................................................................................109

3.7. Quarterly Effect of the Recovery Act and Subsequent FiscalMeasures on GDP, 20092012 ...........................................................110

3.8. Quarterly Effect of the Recovery Act and Subsequent FiscalMeasures on Employment, 20092012 .............................................110

3.9. Change in Nonfarm Employment ..................................................... 1133.10. Disposable Personal Income With and Without the ARRA ......... 119

3.11. Recovery Act Cumulative Public Investment Outlays,20092013 ..............................................................................................124

3.12. Advanced Renewable Electric Power Net Generation,20002012 .............................................................................................129

4.1. Growth in Real Per Capita National Health Expenditures,19612013 ..............................................................................................154

4.2. General and Health Care Price Inflation, 19602013 ..................... 1544.3. Growth in Real Per Enrollee Health Spending by Payer ................157

4.4. Medicare 30Day, AllCondition Hospital ReadmissionRate, 20072013 ....................................................................................166

4.5. InflationAdjusted Premiums for Medicare Parts B and D,20002014 ..............................................................................................173

4.6. Recent CBO Projections of Medicare and Medicaid Outlays ....... 176


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5.1. Nonfarm Private Business Productivity Growth, 19492012 ........ 1855.2. 15Year Centered Moving Average of Annual Growth Rates for

Labor and Multifactor Productivity, 19562005 .............................1875.3. Growth in Productivity and Average Wage, 19472013 ................1905.4. Basic Research Expenditures in the U.S. by Source Funding,

2010 ........................................................................................................1955.5. Composition of Total R&D Spending as a Share of GDP,

19532011 ..............................................................................................1965.6. Relative Investment of the Telecommunications Sector, 2011 .....1995.7. Exclusive and Shared Allocation of Radio Spectrum......................2025.8. Federal Agencies with Most Spectrum Assignments ...................... 2035.9. Percentage of Households with Access to Download Speeds

of 6 Megabytes per Second or Greater ..............................................209

5.10. Patents Issued in the U.S. by Technological Category ................... 2136.1. Trends in the Official Poverty Measure, 19592012 .......................2356.2. Average Real Household Income by Quintile, 19672012 ............2366.3. Womens 5010 Wage Gap vs Real Minimum Wage,

19732012 ..............................................................................................2386.4. Official vs Anchored Supplemental Poverty Rates,

19672012 ..............................................................................................2436.5. Trends in Market and PostTax, PostTransfer Poverty

19672012 ..............................................................................................2446.6. Trends in Market and PostTax, PostTransfer Deep Poverty,

19672012 ..............................................................................................2466.7. Percentage Point Impact on SPM Child Poverty for

Selected Years ........................................................................................2506.8. Percentage Point Impact on Deep SPM Child Poverty for

Selected Years ........................................................................................2506.9. Real Per Capita Expenditures on Select Programs, 19672012.....254

6.10. Economic Mobility for Children from First Income Quintile ......2566.11. Recovery Act and Subsequent Extensions: Cumulative

PersonYears Kept from Poverty, 20082012 .................................2617.1. Outlays for Grants to State and Local Governments,

19922012 ..............................................................................................2817.2. Inventory of Beds for Homeless and Formerly Homeless People,

20072012 ..............................................................................................287

TABLES

2.1. Administration Economic Forecast ..................................................... 852.2. SupplySide Components of Actual and Potential Real GDP

Growth, 19522014 ................................................................................87


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Contents | 19

3.1. Forecasted and Actual Real GDP Growth andUnemployment Rate ..............................................................................95

3.2. An Overview of Recovery Act Fiscal Impact ..................................... 993.3. Recovery Act Programs by Functional Categories ............................ 993.4. Fiscal Support for the Economy Enacted After the

Recovery Act .........................................................................................1013.5. Estimated Output Multipliers for Different Types of Fiscal

Support...................................................................................................1083.6. Estimates of the Effects of the Recovery Act on the Level

of GDP ...................................................................................................1123.7. Tax Relief and Income Support in the Recovery Act and

Subsequent Measures, 20092012 .....................................................1183.8. Recovery Act Long Term Growth Investment by Category .......... 123

3.9. Recovery Act Outlays, Obligations, and Tax Reductions ..............1353.10. Recovery Act Fiscal Stimulus by Functional Category ................... 1363.11. Fiscal Support for the Economy Enacted After the

Recovery Act ........................................................................................1403.12. Summary of CrossSectional Fiscal Multiplier Estimates .............1464.1. Real Per Capita NHE Annual Growth Rates by Payer and

Spending Category ...............................................................................1514.2. Recent Trends in Several Indicators of Health Care Spending

and Price Growth .................................................................................1555.1. Sources of Productivity Improvement, Nonfarm Private

Business, 19482012 ............................................................................1845.2. Nonfarm Private Business Growth ....................................................1865.3. Average Annual Rates of Change in the Nonfarm Business

Sector ......................................................................................................1916.1. Poverty Rates by Selected Characteristics, 19592012 ................... 2296.2. Poverty Rate Reduction from Government Programs, 2012 ......... 248

BOXES

Box 21: The 2013 Comprehensive Revision to the National Incomeand Product Accounts ....................................................................60

Box 22: Administration Trade Policy Initiatives ...................................... 68Box 23: The Climate Action Plan ............................................................... 77Box 24: Unemployment Duration and Inflation ...................................... 82Box 25: Immigration Reform and Potential GDP Growth ..................... 88

Box 31: Other Administration Policy Responses to theEconomic Crisis ............................................................................104

Box 32: The U.S. Recovery in Comparative International andHistorical Context .........................................................................116


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Box 41: Two Measures of Growth in Health Care Costs: Spendingand Prices .......................................................................................152

Box 42: How Will the ACAs Coverage Expansion Affect TotalSpending Growth? ........................................................................163

Box 43: The Cost Slowdown and ACA Reforms are ReducingMedicare Beneficiaries OutofPocket Costs .........................172

Box 44: Premiums on the ACA Marketplaces are Lower thanProjected.........................................................................................175

Box 51: Measuring Multifactor Productivity .......................................... 183Box 52: Does Inequality Affect Productivity? ......................................... 194Box 53: JustinTime Manufacturing ..................................................... 200Box 54: Spectrum Investment Policies ..................................................... 204Box 55: Electronic Health Records ...........................................................210

Box 56: The LeahySmith America Invents Act ....................................216Box 57: PayForDelay Settlements in Pharmaceutical

Patent Cases ...................................................................................218Box 61: Flaws in the Official Poverty Measure .......................................224Box 62: A Consumption Poverty Measure .............................................. 226Box 63: Women and Poverty .................................................................... 231Box 64: Social Programs Serve All Americans........................................237Box 65: Raising the Minimum Wage ....................................................... 262

Box 71: Impact Evaluations, Process Evaluations, and PerformanceMeasurement .................................................................................270

Box 72: Using Behavorial Economics to Inform Potential ProgramImprovements ...............................................................................277

Box 73: Rapid Cycle Evaluations in Center for Medicareand Medicaid Innovation ............................................................279

erp 2014 introduction

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