Assorted links

by on March 7, 2013 at 1:31 pm in Uncategorized | Permalink

1. The long data of European Jewish expulsion.

2. The economics of hiring paralysis; this piece goes a lot further than does a lot of sticky wage theory, noting that the two can be combined into a larger final explanation.  Nonetheless it gives real support to “risk premium” theories.

3. Columbia thievery of Nutella becomes costly.

4. Potato parties lead to misconduct at McDonald’s Japan.

5. Jeremy Stein on reaching for yield, not my view but always worth hearing from dissenters.

6. Upgrade or die.

1 Rahul March 7, 2013 at 1:55 pm

#3 A Nutella-sniffing canine at dining room exit?

2 zbicyclist March 7, 2013 at 1:57 pm

#3 As someone who worked his way through a commuter school, I find this sentence obscene:

“While Dining is not considering getting rid of Nutella, it has noted that it is hesitant to offer other “luxury” items, like lobster tails, due to similarly high anticipated demand.”

Perhaps it’s sarcasm by dining management that the staff writer didn’t catch?

3 jmo March 7, 2013 at 3:00 pm
4 Careless March 7, 2013 at 8:22 pm

The idea that fishermen could go out of business because their waters were too full of their catch is a novel one.

5 Mark Thorson March 7, 2013 at 3:58 pm

A friend of mine worked in food service at Washington College. They did have lobsters from time to time. She wasn’t allowed to make a stock out of the shells and legs, nor do any other thrifty cooking methods that save value. Lobster shells, trimmings from filet mignon, etc. all went into the garbage. Part of that was budget — if you save money, you don’t get to keep it. The incentive is to spend money to justify the budget. If you were to pick a college to attend strictly on the basis of the food, I find it hard to believe you’d be able to top Washington College.

6 Chris March 7, 2013 at 4:41 pm

In my dorm days, one could predict with a high degree of confidence the following sequence of events: The lunch following a dinner of hamburgers would feature beef-vegetable soup; close inspection of said soup would reveal wedges of hamburger as the beef. Once the mechanical engineers tried to collect enough hamburger pieces to reconstruct a complete hamburger, but bloating from the brothing made it difficult to tell if the pieces fit, so they got someone to buy them beer and played D&D instead.

Of course this was in the upper midwest.

Interestingly it was all-you-can-eat cereal and the CrunchBerries always went first.

7 Howl March 7, 2013 at 8:23 pm

“The lunch following a dinner of hamburgers would feature beef-vegetable soup; close inspection of said soup would reveal wedges of hamburger as the beef.”

So your dining hall was economical? Good on ’em.

At home I eat my leftovers the next day, too.

8 zbicyclist March 7, 2013 at 9:18 pm

That’s the way it’s supposed to be done.

Home-made vegetable soup at coffee-shop type restaurants is nutritious and tasty, but does tend to feature veggies a little along in days.

9 john personna March 7, 2013 at 2:03 pm

#2 in my engineering days the need for hiring was tied to the need to hit deadlines, and to create shorter future project timelines. I wonder if part of the “stickiness” is that culture has shifted and slower progress is accepted. Has the “risk premium” reduced the value in “time to market?”

10 Chris March 7, 2013 at 4:44 pm

Ouch, that two tempests in teapots in less than 24 hours for TC.

11 Chris March 7, 2013 at 4:45 pm

…and one failure of a triple-check by Chris. Mea culpa. Of course I meant to reply to the Nutella-gate comment by SL.

12 collin March 7, 2013 at 2:12 pm

How does ‘hiring paralysis’ not support the ZMP? Companies are quick to dispose of a ZMP but careful not to hire someone who would become a ZMP.

13 Doug March 7, 2013 at 2:16 pm

How do you hire paralysis?

14 Brian Donohue March 7, 2013 at 2:17 pm

#5. Banks’ carrying costs for deposits run 2.5% per year? Sounds awfully high.

15 Billy March 7, 2013 at 5:25 pm

Especially when they pass their FDIC costs along to the depositor.

16 Matt Waters March 7, 2013 at 2:55 pm

There’s nothing in #2 that exactly contradicts or replace sticky wage theory. The whole point of sticky wage theory is that the effect is similar to a high minimum wage. A high min. wage’s effects include

– A surplus of supply.
-A dearth of demand.

And now, an article was posted about how the labor market has…a surplus of supply and a dearth of demand. It is squarely in line with sticky wages creating above-market prevailing wages.

The most elucidating line in the article is about how companies do not really have pressure to hire. A new hire cannot spend their salary solely on goods they make, but on goods from across the economy. If there are five different sectors and everybody spends a fifth of their income in each sector, a particular sector can only justify a new hire if the other four sectors also hire. Otherwise that one sector loses money on the new employee. Cyclical unemployment is pure game theory and monetary/fiscal policy is needed for coordination of uncoordinated actors.

17 Philip March 7, 2013 at 3:21 pm


Evolutionary dynamics 101:

Horizontal transmission evolves virulence.

Immigration liberalization enables horizontal transmission hence the evolution of virulence. It should be no surprise, whatsoever, that a key mechanism of bookkeeping in civilization — guilt — is so abused by the virulent who have evolved from a long history of horizontal transmission. If you can’t identify them (which they are specialized at avoiding) then you have only one option:

Shut down horizontal transmission.

If you are a truly bold soul, truly scientific and truly compassionate, however, you’ll go ahead and identify those that have evolved as a consequence of civilization’s enabling of horizontal transmission. But for that we’re talking 3-sigma out on a dimension that involves more than mere IQ.

18 Ray Lopez March 7, 2013 at 4:26 pm

Re Jewish expulsions @#1 – A more rational explanation than your PC gibberish is that eyeballing the graph shows only two clear correlations: one when Jews were expelled during the Black Death, and one in 1492 in Spain, just about when the houses of Aragon and Castile were united (the Jews expulsions in 1290 in England and 1306 from France were apparently reversed by later rulers). An apologist for Jewish expulsions would argue that Jews were scapegoats for the Black Death–when 33% of the population in Europe died–and that the 1492 expulsions, like the Protestant Reformation and Spanish Inquisition, was an attempt at nation building by Spain, that some historians have argued was a successful attempt (too bad for the hapless Jews of Spain of course, some of whom ended up in Salonika, Greece and were wiped out in the Holocaust).

19 david March 7, 2013 at 5:04 pm

PC gibberish? He’s unsubtly implying that Jews are a virus, who should have been locked out via shutting down migration over borders. That’s, um, not very PC.

20 Ray Lopez March 7, 2013 at 5:47 pm

Well it’s hard to understand what it was saying, you could also read it to mean that expulsion (‘horizontal transmission’) was bad. So it was PC gibberish: gibberish generated by some nitwit on a PC!

21 david March 8, 2013 at 7:46 am

The imagery is quite old: the ethnic nation-state as a body, the minority as an infectious agent, etc.

22 andropov March 7, 2013 at 7:15 pm

I don’t think he’s saying that Jews are a virus. Evolutionary dynamics applies to everything, including mammals. It’s just a fact of evolution that horizontal transmission leads to virulence generally in whatever the organism undergoing horizontal transmission.

23 Brandon Berg March 7, 2013 at 10:31 pm

To make it PC, you have to cross out “Jews” and write “the rich” or “Wall Street fat cats.”

24 byomtov March 8, 2013 at 9:34 pm

Reversed by late rulers?

Sure, and in England it took a mere 350 years or so.

An apologist for Jewish expulsions would argue that Jews were scapegoats for the Black Death

An apologist??? Do you know what “scapegoat” means?

the 1492 expulsions, like the Protestant Reformation and Spanish Inquisition, was an attempt at nation building by Spain, that some historians have argued was a successful attempt

Those historians are apparently unfamiliar with the post hoc fallacy.

25 ad*m March 7, 2013 at 5:44 pm

Interesting metaphor. I am a Jew, and it seems to me that the horizontal transmission was not a lack of “shut down” but rather time and time again an open invitation to transmit horizontally (see for example Casimir the Great or my family’s history).

I can go more reductionist and propose the more compelling metaphor of the Jew as mitochondrion. Hard to do well without them, as Spain discovered.

26 andropov March 7, 2013 at 7:12 pm

I don’t think it’s a metaphor. Evolutionary dynamics apply to viruses and all kinds of organisms, from bacteria to mammals. It’s just a fact of evolution that horizontal transmission leads to virulence generally in whatever the organism undergoing horizontal transmission. Think about traveling snake oil salesman vs sedentary town general store owner. The general store owner can’t sell snake oil and flee to the next town and repeat the process. He has to sleep in the bed he’s made so he doesn’t sell snake oil.

27 Joe in Morgantown March 7, 2013 at 7:26 pm

Spain’s Alhambra Decree was evil and foolish but it did not result in an objectively impoverished Spain.

This was 1492 and the start of 300 years of Spanish wealth and global empire.

28 So Much For Subtlety March 8, 2013 at 5:12 am

One personal bete noir of mine is Gross National Happiness. As pushed by the small Hindu kingdom of Bhutan. Which has recently expelled about a quarter of its population for the crime of being of Nepali descent. I would guess that hit their GDP, but if you concentrate hard enough of GDH instead, who knows? you might argue it was a plus. Some do.

Is it hard to do well economically without Jews? As someone else pointed out, the Spanish did go on to centuries of greatness. He might have added that Germany and even Poland are richer now than they were 70 years ago. As is pretty much everywhere that saw their Jews murdered in the 1940s.

And you have to keep in mind that half the population of Israel came from such economic power houses as Morocco, Algeria, Iraq, Yemen and Ethiopia. All of which are probably better off now than they were in the 1950s or 1980s depending on when their Jews fled.

None of which ought to be taken as a justification of expelling anyone. But it does suggest the problem is more complex than you might think.

29 Ray Lopez March 8, 2013 at 5:24 am

Or C. De Gaulle said, “the graveyards are full of ‘indispensable men'” However, two points in rebuttal: most/many? German Jews were not killed, but actually fled to the USA, where they enriched the USA (Einstein, Bohr, et al, etc). Had they stayed in Germany, Germany would be even more ahead now; had they been killed, the world would be further behind. Second, economics is never a justification for human right abuses. For example, I recall a study from years ago (heard it on the radio) where economists concluded that slavery was economically justified (pays for itself). That does not make it right.

30 de Broglie March 8, 2013 at 10:53 am

By Bohr, do you mean Niels Bohr? He was not Jewish. The main Jewish theoretical physicists were Einstein, Max Born, Wolfgang Pauli. The Jewish ones are so championed because they came to the USA and helped the United States succeed.

31 byomtov March 8, 2013 at 9:27 pm

Bohr’s mother was in fact Jewish.

32 TR W March 8, 2013 at 2:07 am

Wow, that is an interesting observation.

33 byomtov March 8, 2013 at 4:27 pm

Maybe you could put this into English, if it’s not too much trouble. Thanks.

34 anon March 7, 2013 at 3:44 pm


“They’re chasing after that purple squirrel,” … now there’s a wonderful description of the policy paralysis too! Maybe it’s not our ZMPs (and their policy equivalents) that are causing us so much grief but our obsession with (and ‘failure’ to catch) the elusive purple squirrels?

BTW if the ‘risk premium’ theory you are talking about has anything to do with the policy uncertainty hypothesis from Bloom, I disagree that we see support in this article. More likely that firms see the shaky demand now threatened by the possibility of further fiscal tightening and other adverse shocks (note the upside is missing…), so I’d go for pessimism, not uncertainty. Very good article.

35 Sigivald March 7, 2013 at 3:51 pm

Even (“Even”) authors at the New Yorker confuse “Some guy’s Concept Art From the Internet” with a real plan for what the Next iPhone Will Be.

Ah, New Yorker. Never change.

36 SL March 7, 2013 at 4:23 pm
37 Mark Thorson March 7, 2013 at 5:27 pm

That’s one possibility. Another is that they buy Nutella from their “favorite” supplier, rather than shopping around.

38 Urso March 7, 2013 at 6:57 pm

A third option is that some random lady in Dining Services made up a number during an interview to make it sound like a Really Big Deal™, never suspecting anyone would ever go back and actually check the numbers. When they did, whoops! Turned out she was talking out of her behind, like 99% of Americans 99% of the time.

You guys can get real conspiracy theorish sometimes.

39 zbicyclist March 7, 2013 at 9:25 pm

And maybe those “lobster tails” they’re thinking about are really Alaskan pollock. 😉

40 Brandon Berg March 7, 2013 at 10:33 pm

There’s a correction at the bottom that says an earlier version of the story (#3 above) had said that it was $5,000 for the first few weeks. Should have quit while they were ahead.

41 NAME REDACTED March 7, 2013 at 6:13 pm

‘Nonetheless it gives real support to “risk premium” theories.’
You know that risk premium is a function of intrest rate. Would raising interest rates fix this problem?

42 Noah Yetter March 7, 2013 at 11:43 pm

Even after multiple interviews, an employer has only an uncertain notion of whether a potential employee will be a positive addition to the team. If that individual is hired, his or her teammates are going to lose productivity for months getting that person up to speed. During this time the new employee will produce little, if anything. If the new employee fails to learn the ropes, or otherwise turns out to be a poor hire, they can be fired to staunch the bleeding, but the waste involved in paying their salary and taxing the productivity of their teammates cannot be recovered.

This is the risk involved in hiring. Now tell me, what the hell does any of that have to do with interest rates?

43 albatross March 8, 2013 at 1:21 pm

Hiring someone is an investment with a fair bit of risk involved, in which the costs are taken up front (it will be several months till the new employee can be adding much, for most jobs) and the benefits materialize only if you hired the right guy and business conditions continue.

The higher your risk premium, the more you have to think this guy will add to your bottom line before you’re willing to hire him.

44 Nick Rowe March 7, 2013 at 11:34 pm

#2 sounded a lot like the old Keynesian multiplier.

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