Tyler Cowen

The gap between the unemployment rates in north and south, for instance, will soon be wider than that between east and west (see chart 2). In the New Social Market Economy Initiative’s education rankings, Saxony and Thuringia took the two highest places among Germany’s 16 states while Berlin and Brandenburg, also eastern states, took the two lowest. The north-south divide on life expectancy is now greater than the east-west one; women in Baden-Württemberg and Saxony live the longest. According to André Wolf of the Hamburg Global Economics Institute, “in the medium term the north-south differential could definitely supersede the (current) east-west one.”

In 1960, however, Bavaria was the poorest part of West Germany.

That is from The Economist.

It was created by Josh Hendrickson, here is the whole thing.  I excerpt one part of it, I’ve done no additional indent but all of this following is from Hendrickson:

Institutions and Public Choice
 
In the 1970s, Earl Thompson started down a path of research that would continue through his career. This research represented the intertwining of institutions and public choice.
  • Taxation and National Defense“, Journal of Political Economy, Vol. 82, No. 4, p. 755 – 782, (1974). In this paper Thompson argues that the optimal tax structure for a country should be one that is structured around national defense. He presents evidence that the U.S. tax system is the approximately optimal tax system using this criteria.
  • An Economic Basis for the `National Defense Argument’ for Aiding Certain Industries,” Journal of Political Economy, Vol. 87, No. 1, (1979). This paper is essentially an extension of the previous paper in that Thompson argues that many protectionist policies are optimal when considered in the context of national defense. He again shows that U.S. policy is approximately optimal in this context.
  • On Labor’s Right to Strike“, Economic Inquiry, Vol. 28, p. 640 – 653, (1980). In this paper Thompson argues that under certain conditions a strike by workers will actually benefit capital owners. He argues that the right of labor to strike and the existence of strikes are often explained by the profitability of the strike to capital owners.
  • Characteristics of Worlds with Perfect Strategic Communication“, Journal of Economic Theory, Vol. 23, No. 1, p. 111 – 119, (1980). This paper as well as the one that follows are designed to discuss how institutions emerge in society. Thompson posits the idea of a hierarchical structure in society in which each group commits to a reaction function. The resulting institutions are Pareto optimal, given those reaction functions. This model pops up throughout Thompson’s subsequent work to explain why we get efficient institutions (like the defense-based tax system) despite the fact that very few people would be able to articulate its purpose. The paper below is a more popular extension of this paper.
  • A Pure Theory of Strategic Behavior and Social Institutions” (with Roger Faith), American Economic Review, Vol. 71, No. 3, p. 366 – 380, (1981).
  • Ideology and the Evolution of Vital Economic Institutions: Guilds, The Gold Standard and Modern International Cooperation. (with Charles Hickson). Kluwer Academic Publishers, 2000. This book is an attempt to summarize and extend Thompson’s work on institutions, growth collapses, and globalization. The book is exploding with ideas. Some of them you will find convincing. Others you might find crazy. However, the book will make you think. You won’t get these types of arguments or this type of thinking from any other economist.
  • What Globalization is Really All About.” This was a keynote address that Thompson gave at a conference. It is a short summary of Thompson’s career and his perspective on globalization.
Other Work
 
This is far from an exhaustive account of Thompson’s work. For a summary of his work, see “A tribute to Earl A. Thompson and, in his own words, a summary of his general economic and social theory” by Don Allison Jr. and Thomas Borcherding in Public Choice, (2013).

Saturday assorted links

by on August 19, 2017 at 2:24 pm in Uncategorized | Permalink

What’s the perfect form of therapy for a world that’s more frantic than ever? An animal that appears to do absolutely nothing.

One freezing February morning this year, Kayla Premack, 27, arrived at 3:30 a.m. and waited for hours in a sleeping bag at Denver’s Downtown Aquarium. Never mind the sharks, otters and turtles. She’d come to take a selfie with Aspen, a two-toed sloth.

Only the first 100 people in line that day would get photo opportunities with the aquarium’s most popular resident, and Ms. Premack, an office manager, was determined to be one of them. It didn’t matter that she already has at least 50 photos of him. “Sloths just invoke this happiness inside of me,” she said.

The slow-moving mammal, which has exploded in popularity in recent years, has caused some unusual reactions from its fans. MaryCharles Wolfe, 21, lost her breath and started sobbing when she saw a sloth for the first time last month at The Houston Zoo.

“How do you look at that and not think it’s the sweetest?” she said. “In this world with chaos and grossness everywhere, sloths don’t do any wrong. They can’t do anything.”

…Animal keepers have grown accustomed to people shedding tears upon seeing a sloth, even bawling hysterically on the ground. “They’re just overcome with emotion,” said LynnLee Schmidt, a curator at Denver’s Downtown Aquarium. “I think to myself: What do I love that much?”

Here is the story by Nicole Hong.  The article seems to suggest that sloths are worshipped as an offset to the frenetic pace of modern life, but what is cited is smart phones, and it is not the Silicon Valley CEOs lining up to pay their homage, and so I would give this story a slightly different spin…

Chris Blattman tweets:

Is there a modern day Fanon or Memmi writing about dvpt & globalizn as they wrote about colonialization? Doesn’t only have to be leftist.

Hardi and Negri come up in the mentions, but I am underwhelmed.  There is the alt right, mostly on the internet rather than in books of note.  To whatever extent they are objectionable, keep in mind Fanon was a Marxist, and in any case agreement is not the metric here.

I also nominate Alexander Dugin.  There is plenty in Islamic theology too, and the environmental movement would be yet another direction.

On the academic and also more liberal side, there is Joe Stiglitz and Dani Rodrik.  Is Roberto Unger going too far back?  Three-quarters of the Bengali intelligentsia?  Arundhati Roy?  Or maybe you think Naomi Klein is not serious enough, but the lower quality of at least some of these answers is itself data.  Does the writer have to be from a developing nation?

Frank Fukuyama would be a subtle answer, as would be “the government of China.”  I am reluctant to categorize Slavoj Žižek, but he is not irrelevant for this question by any means.

And let’s not restrict ourselves to non-fiction.  How about Roberto Bolaño’s 2666?  Jia Zhangke’s A Touch of SinNeill Blomkamp?  Michel Houllebecq of course.

What do you all think? I know I am missing a great deal.  That said, if you look for a very direct parallel and just google “leading Algerian intellectuals,” little of relevance comes up, focus maybe there on rai music and theology.

I would stress that the nature of intellectual fame has changed, and if there are few exact parallels to Fanon it is for that reason.  I do not think there is a more general vacuum in this area of inquiry.

I recall the eclipse in 1973.  As a kid, I made some kind of cardboard box, so I could view the sun through a little squinting hole.  The entire event was a big disappointment, even given the fact that, at the time, I had hardly seen anything before.  I hadn’t even been to Philadelphia.

I’ve seen it get dark before.  So is it special because we wonder how the others will react?  If traffic will freeze up and wild animals will burrow into the sleep holes for the night?  Or do we care simply because it is rare and publicly observable?  (NB: It is the 3 billionth total solar eclipse.)  Because it upends something about our sense of the world and its underlying orderliness?  Because we somehow find the crossing of the heavenly bodies intrinsically aesthetic?

Because we can see it?  No one much seems to care when various planets line up in what are supposed to be astrologically meaningful ways.  Or maybe because the event is dangerous and capable of damaging our eyes.

Or is it like a football game, namely that you go someplace to watch it and drink a lot of beer?  Would it be a lesser public event if everyone could see it perfectly from their back yard?  Few people get to see it from a plane.

I expect to be underwhelmed.

That is the excellent title they gave to my latest Bloomberg column.  The piece starts by offering a very simple theory of what statues are for, and then I shift to the perspective of a foreigner.  Here is one bit:

Or consider the debates in Macedonia. The city of Skopje went on a major statue-building binge several years ago, both as fiscal policy and to cement national identity. One of the resulting disputes is whether those statues should emphasize the country’s ancient Greek connections (e.g., Alexander the Great) or the Slavic heritage (e.g., Saints Cyril and Methodius). It’s a strange debate to an outsider, yet to many Macedonians and some of their Greek neighbors (who wish to claim Alexander as their own), it is one of the most fraught issues of the day.

Again, you won’t get too far on this one by debating the life and times of Alexander, whether he led aggressive or defensive wars, or by asking how many slaves he owned. It’s better to focus on which political faction you wish to see assume more authority in Macedonia, and then work backward to figure out your preferred statues.

Similarly, if Macedonians were asked to evaluate the relative moralities of historic American leaders, I hope they would consider a similar approach. I don’t find it so fruitful to debate how much Robert E. Lee does or does not have in common with George Washington  — arguably Washington was a traitor of sorts as well, against a relatively benign British ruler, and he fought against Native Americans and owned slaves. American treatment of Native Americans makes it hard to find many truly “good guys” from that period. Still, we can ask what role Washington statues play in today’s politics; few people are using them to lord over Native Americans.

And my conclusion:

So if you’re considering the worthiness of a particular statue, here are three pointers: Pretend you’re from some very distant foreign country and view the dispute through that more objective lens. Second, focus on the future, and third don’t be afraid to make some changes.

Do read the whole thing.

Friday assorted links

by on August 18, 2017 at 12:31 pm in Uncategorized | Permalink

That is the new and interesting book by Rachel Sherman, consisting primarily of field work and interviews with the very well-off.  Here is one bit:

…they described their desires and needs as basic and their spending as disciplined and family-oriented.  They asserted that they “could live without” their advantages if they had to, denying that they were dependent on their comfortable lifestyles.  They distanced themselves from the negative images of consumption often associated with the wealthy, such as ostentation, materialism, and excess — all markers of moral unworthiness.  These interpretations allowed them to believe that they deserved what they had and at the same time to cast themselves as “normal” people rather than “rich” ones.

…for my respondents to be a “good person” was not to be entitled.

The rich themselves seem to be fond of the distinction between “the deserving rich,” and “the undeserving rich.”

You can pre-order here.  Here is the book’s home page.

Markets in everything?

by on August 18, 2017 at 7:10 am in Economics, Law, Religion | Permalink

I cannot tell whether this tale should count as confirmed:

As awful as that may sound, a number of religious scholars are offering themselves up for one-night stands with divorced Muslim women trying to save their marriages under a disputable Islamic law, an India Today investigation has found.

They charge anywhere between Rs 20,000 and Rs 1.5 lakh to participate in nikah halala, a controversial practice that requires a woman to marry someone else, sleep with him and get a divorce again in order to be able to remarry her first husband under personal laws, the probe discovered.

India Today’s investigative team has blown the lid off the taboo tradition that has remained largely unnoticed amid intense debates over triple talaq on the media and in the country’s top court.

The probe found many Islamic scholars putting themselves up on sale for women desperate to restore their broken marriages.

Here is the full article, via Raj.  I am surprised that the equilibrium price is that high.

The slope gets more slippery

by on August 18, 2017 at 12:45 am in Law, Music, Web/Tech | Permalink

Apple, LinkedIn, Spotify and Twitter have joined a growing chorus of technology companies to hit out at the far right and Donald Trump’s attempt to put white supremacists and leftwing counter-demonstrators at Saturday’s Charlottesville protest on the same moral plane.

Following the lead of Facebook’s Mark Zuckerberg, Google, Go Daddy and others, Apple CEO Tim Cook pledged $1m donations to the Southern Poverty Law Center (SPLC) and the Anti-Defamation League and sent a strongly worded memo to staff, quoting Martin Luther King, about the violence in Charlottesville on Saturday.

“We must not witness or permit such hate and bigotry in our country, and we must be unequivocal about it,” Cook wrote. “This is not about the left or the right, conservative or liberal. It is about human decency and morality.

Amid the ongoing fallout from the violence that saw a civil rights activist killed, music subscription service Spotify began removing so-called white power music, flagged by the SPLC as racist “hate bands”.

A Spotify spokesperson said: “Illegal content or material that favours hatred or incites violence against race, religion, sexuality or the like is not tolerated by us. Spotify takes immediate action to remove any such material as soon as it has been brought to our attention.

“We are glad to have been alerted to this content – and have already removed many of the bands identified, while urgently reviewing the remainder.”

What would Camille Paglia say?  Here is the article.  And here is a hate symbols database, to keep you on your toes.

Addendum: Some of you have given me grief over my posting of yesterday defending PayPal’s decision to stop serving some political groups.  I see it this way: giving PayPal its way passes a freedom of association test, and it also passes what I call a “first order Coasean test,” namely that Paypal and its affiliates wish to stop the relationship more than the cut off parties are willing to pay to maintain it.  Of course this development might have troublesome secondary consequences, due to slippery slopes, and also due to the spread of the practice to more monopolized sectors of the American economy.  Still, until major negative consequences emerge in verifiable and durable form…I am going to stick with the Coasean and freedom of association metrics for policy evaluation.  Should I have to deal with “extremist” groups if I don’t wish to?  No.  Is there a prima facie case for extending this same freedom to PayPal?  Yes.  But absolutely, I am all for vigilance to keep an eye on whether things start to go wrong in a big way.  And no, I don’t count all these “day after” reactions as nearly sufficient to establish that conclusion.

I will be doing a Conversation with Tyler with her.  On the off chance you don’t already know, here is a brief Wikipedia summary of her work:

Mary Roach is an American author, specializing in popular science and humor.[1] As of 2016, she has published seven books,: Stiff: The Curious Lives of Human Cadavers (2003), Spook: Science Tackles the Afterlife (2005) (published in some markets as Six Feet Over: Adventures in the Afterlife), Bonk: The Curious Coupling of Science and Sex (2008), Packing for Mars: The Curious Science of Life in the Void (2010), My Planet: Finding Humor in the Oddest Places, Gulp: Adventures on the Alimentary Canal (2013), and Grunt: The Curious Science of Humans at War (2016).

But there is much more to her than that.  Here is the full Wikipedia page.  Here is her own home page.

So what should I ask?  I thank you in advance for your inspiration.

Thursday assorted links

by on August 17, 2017 at 11:51 am in Uncategorized | Permalink

1. Is the claim of increasing alcoholism based on flawed data?

2. Poverty and housing insecurity along Jefferson Davis Highway.  By the way, did you know that a 1963 law required North-South streets in Alexandria to be named after Confederate generals, “insofar as possible”?  And in one poll, a plurality of African-Americans think the statues should stay.

3. What does the CBO say about cutting off CSR subsidiesNB: We do not know if this is correct!

4. The Haitian dollar as an abstract unit of account.  And viewing the 2015 eclipse from the Faroe Islands.

5. Why is pop music slowing down?

6. New major study of the Bank of England coming out.

This city removed several Confederate monuments before dawn Wednesday in a stealth operation that highlights the growing backlash against such memorials across the country.

“I said I would move as quickly as I could, and I did,” Baltimore Mayor Catherine Pugh, a Democrat, said in an interview. “We didn’t need those kinds of symbols.”

Bravo, and let’s hope Old Town Alexandria — wihch frankly I have never liked — does the same with its prominent Lee statue.  But, posturing aside, the real import of this story has not yet been digested.  This statue removal was done suddenly, without democratic input for the final decision to proceed, and, as far as I can tell, without much in the way of leaks.  The mayor just did it.  Physically.  Overnight.  The importance of physical space, and how we shape and present it, must have been paramount in her mind.

That is what the end of complacency looks like.  It may just be a blip, but keep the nature of this episode in mind as you track subsequent news developments in this and other areas.

Here is the WSJ article.

Where to even begin enumerating the wealth of fruitful work — some of it highly critical — that continues to emerge from real engagement with Freud’s ideas? Consider Marina Warner’s musings on Freud’s mediation of Eastern and Western cultural tropes told through the story of his Oriental carpet-draped couch; Rubén Gallo’s panoramic exploration of the reception of Freud’s work in Mexico and the reciprocal influence of Mexican culture on Freud; and the rich medley of sociopolitical critiques grounded in Lacan’s reinterpretation of Freud’s thought.

The idea that large parts of our mental life remain obscure or even entirely mysterious to us; that we benefit from attending to the influence of these depths upon our surface selves, our behaviors, language, dreams and fantasies; that we can sometimes be consumed by our childhood familial roles and even find ourselves re-enacting them as adults; that our sexuality might be as ambiguous and multifaceted as our compendious emotional beings and individual histories — these core conceits, in the forms they circulate among us, are indebted to Freud’s writings. Now that we’ve effectively expelled Freud from the therapeutic clinic, have we become less neurotic? With that baneful “illusion” gone, and with all our psychopharmaceuticals and empirically grounded cognitive therapy techniques firmly in place, can we assert that we’ve advanced toward some more rational state of mental health than that enjoyed by our forebears in the heyday of analysis? Indeed, with a commander in chief who often seems to act entirely out of the depths of a dark unconscious, we might all do better to read more, not less, of Freud.

That is from an excellent NYT book review by George Prochnik.