Data Source

Into the United States that is:

Overall, the relationship is strong and positive (r = .56, p < 0.001): immigrant groups that are more skill-selected tend to have higher average incomes. The five most skill-selected groups are: Taiwanese, Nigerians, Swedes, Indians and Swiss. The five least skill-selected groups are: Mexicans, Salvadorans, Hondurans, Portuguese and Cape Verdeans. For example, 82% of Nigerians are high-skilled, while only 4% are low-skilled. By contrast, only 14% of Mexicans are high-skilled, while 57% are low-skilled.

Methodological caveats: I was unable to match a number of the ancestry groups (e.g., ‘Hmong’, ‘Jewish’, ‘Cajun’); the income data are not adjusted for household size or reporting bias.

That is from Noah Carl, here are his other essays.  For the pointer I thank Dan Klein.

Compensation for the heads of some elite private K-12 schools in New York City is nearing $1 million.

Much in the city’s private school world can seem beyond the norm: the tuition and fees (topping $50,000 a year), the kindergarten application process (interviews for 4-year-olds), the facilities (climbing walls). And so too executive compensation that exceeds the pay of many college presidents.

Pay packages often include deferred compensation and perks like housing, housekeeping, social club dues and free tuition for heads’ children. Chiefs of New York City schools earn far more than the national average, due to the high cost of living, ambitious fundraising duties, competition for talent, relatively large enrollments and other factors, according to the National Association of Independent Schools.

The median base salary for heads of the city’s private schools is $493,478 this academic year among 44 city schools in a survey by the association. That compares to $275,000 nationwide. The group says the city’s pay for heads grew faster as well: Its median salary jumped 70% in a decade, compared with 45% nationwide.

At least nine heads of private K-12 schools in New York City earned total yearly packages topping $800,000, according to 2015 federal tax forms, the most recent year available.

Here is the WSJ piece, via the excellent Samir Varma.

In 2016, the island nation’s police reported 135 total days without any crimes including snatch-theft, house break-ins and robbery. That low crime rate means many small businesses enjoy little concern about shoplifting.

In fact, as CNBC recently observed, many local businesses take few precautions when closing shop at night.

For instance, in the ground floor lobby of a mixed-use building in the downtown business district, many shops don’t have windows, locks — or even doors.

Here is the full story.

This study compared perpetrators of seven mass killings during 2013–2017 with more than 600 celebrities over the same time period. Findings indicate that the mass killers received approximately $75 million in media coverage value, and that for extended periods following their attacks they received more coverage than professional athletes and only slightly less than television and film stars. In addition, during their attack months, some mass killers received more highly valued coverage than some of the most famous American celebrities, including Kim Kardashian, Brad Pitt, Tom Cruise, Johnny Depp, and Jennifer Aniston. Finally, most mass killers received more coverage from newspapers and broadcast/cable news than the public interest they generated through online searches and Twitter seems to warrant. Unfortunately, this media attention constitutes free advertising for mass killers that may increase the likelihood of copycats.

That is from an Adam Lankford paper, via Rolf Degen.

Yes, it would seem.  The subtitle is “The Effect of Medical Marijuana Laws on US Crime,” the authors are Evelina Gavrilova, Takuma Kamada, and Floris Zoutman, and the outlet is The Economic Journal.  Here is the abstract:

We show that the introduction of medical marijuana laws (MMLs) leads to a decrease in violent crime in states that border Mexico. The reduction in crime is strongest for counties close to the border (less than 350 kilometres) and for crimes that relate to drug trafficking. In addition, we find that MMLs in inland states lead to a reduction in crime in the nearest border state. Our results are consistent with the theory that decriminalisation of the production and distribution of marijuana leads to a reduction in violent crime in markets that are traditionally controlled by Mexican drug trafficking organisations.

Here is the link to the paper, here are earlier versions.  For the pointer I thank Peter Metrinko.  That said, I learn from Kevin Lewis that the high school graduate rate goes down.

Claims about Bitcoin

by on January 14, 2018 at 3:22 pm in Data Source, Economics | Permalink

A single actor likely drove the USD/BTC exchange rate from $150 to $1000 in 2 months.

That is from the JME, via the excellent Kevin Lewis.  It is worth noting that the single actor was right!

The World Bank repeatedly changed the methodology of one of its flagship economic reports over several years in ways it now says were unfair and misleading.

The World Bank’s chief economist, Paul Romer, told The Wall Street Journal on Friday he would correct and recalculate national rankings of business competitiveness in the report called “Doing Business” going back at least four years.

The revisions could be particularly relevant to Chile, whose standings in the rankings have been especially volatile in recent years and potentially tainted by the political motivations of World Bank staff, Mr. Romer said.

…Over time, World Bank staff put a heavy thumb on the scales of its report by repeatedly changing the methodology that was used to calculate the country rankings, Mr. Romer said.

The focus of the World Bank’s corrections will be changes that had the effect of sharply penalizing the ranking of Chile under the most recent term of Chile’s outgoing president, Michelle Bachelet.

“I want to make a personal apology to Chile, and to any other country where we conveyed the wrong impression,” Mr. Romer said. The problems with the report, he said, were “my fault because we did not make things clear enough.”

That is by Josh Zumbrun and Ian Talley at the (gated) WSJ.

That is the topic of my latest Bloomberg column, here is one bit:

Or consider Nigerian-Americans, Nigeria being the most populous nation in Africa. Their education levels are among the very highest in the U.S., above those of Asians, with 17 percent of Nigerian migrants having a master’s degree.

And:

Economist Edward Lazear suggests a simple experiment. Consider immigrants to the U.S. from Algeria, Israel and Japan, and rank them in order of most educated to least educated. The correct answer is Algeria, Israel then Japan. Although that’s counterintuitive at first glance, it’s easy enough to see how it works. If you are Algerian and educated, or aspire to be educated, your prospects in Algeria are relatively poor and you may seek to leave. A talented, educated person in Japan or Israel can do just fine by staying at home. These kinds of considerations explain about 73 percent of the variation in the educational outcomes of migrants.

Do read the whole thing.

Maybe not, as I argue in my latest Bloomberg column:

The numbers instead indicate that lobbying hurts the underlying capital values of the corporations. Lobbying doesn’t increase the chance that favored bills are passed by Congress, and it isn’t associated with the company receiving more government contracts.

Those are the key results from a new study by Zhiyan Cao, Guy D. Fernando, Arindam Tripathy and Arun Upadhyay, published in the Journal of Corporate Finance and considering 1,500 S&P companies over the period 1998 to 2016. Neither spending money at all on lobbying nor spending more money on lobbying over those years seem to help companies, and for that matter contributions to political action committees don’t work either.

And:

If corporate lobbying is an unprofitable use of money, why does it happen? One possibility is that corporate leaders are using company resources to indulge their own ideological preferences. Other researchers have found that companies with weaker governance and more entrenched management are those more likely to spend on lobbying. This study finds that lobbying expenditures are higher when the percentage of CEO perks is higher and when the board of the company is larger.

It’s also possible lobbyists are ripping off companies with slick sales pitches, or that incompetent CEOs are spending money on lobbying so they seem to be doing something constructive.

Do read the whole thing, I also consider under what kind of hypothesis the lobbying actually might be paying off.

The title of the paper is “The Churches’ Bans on Consanguineous Marriages, Kin-Networks and Democracy” and the author is Jonathan F. Schulz, here is the abstract:

This paper tests the hypothesis that extended kin-groups, as characterized by a high level of cousin marriages, impact the proper functioning of formal institutions. Consistent with this hypothesis I find that countries with high cousin marriage rates exhibit a weak rule of law and are more likely autocratic. Further evidence comes from a quasi-natural experiment. In the early medieval ages the Church started to prohibit kin-marriages. Using the variation in the duration and extent of the Eastern and Western Churches’ bans on consanguineous marriages as instrumental variables, reveals highly significant point estimates of the percentage of cousin marriage on an index of democracy. An additional novel instrument, cousin-terms, strengthens this point: the estimates are very similar and do not rest on the European experience alone. Exploiting within country variation support these results. These findings point to the importance of marriage patterns for the proper functioning of formal institutions and democracy.

I recall reading related ideas in the MR comments section from Steve Sailer and others.  For the pointer I thank Alexander B.

Our estimates suggest that teacher collective bargaining worsens the future labor market outcomes of students: living in a state that has a duty-to-bargain law for all 12 grade-school years reduces earnings by $800 (or 2%) per year and decreases hours worked by 0.50 hours per week. The earnings estimate indicates that teacher collective bargaining reduces earnings by $199.6 billion in the US annually. We also find evidence of lower employment rates, which is driven by lower labor force participation, as well as reductions in the skill levels of the occupations into which workers sort. The effects are driven by men and nonwhites, who experience larger relative declines in long-run outcomes.

That is from a new paper by Michael Lovenheim and Alexander Willen, via Noah Smith.

From Amanda Y. Agan and Michael D. Makowsky, here is an new and important approach:

For recently released prisoners, the minimum wage and the availability of state Earned Income Tax Credits (EITCs) can influence both their ability to find employment and their potential legal wages relative to illegal sources of income, in turn affecting the probability they return to prison. Using administrative prison release records from nearly six million offenders released between 2000 and 2014, we use a difference-in-differences strategy to identify the effect of over two hundred state and federal minimum wage increases, as well as 21 state EITC programs, on recidivism. We find that the average minimum wage increase of 8% reduces the probability that men and women return to prison within 1 year by 2%. This implies that on average the wage effect, drawing at least some ex-offenders into the legal labor market, dominates any reduced employment in this population due to the minimum wage. These reductions in re-convictions are observed for the potentially revenue generating crime categories of property and drug crimes; prison reentry for violent crimes are unchanged, supporting our framing that minimum wages affect crime that serves as a source of income. The availability of state EITCs also reduces recidivism, but only for women. Given that state EITCs are predominantly available to custodial parents of minor children, this asymmetry is not surprising. Framed within a simple model where earnings from criminal endeavors serve as a reservation wage for ex-offenders, our results suggest that the wages of crime are on average higher than comparable opportunities for low-skilled labor in the legal labor market.

But two days ago I ran into Amanda and family at Penang restaurant in Philadelphia…

This is really a paper about alcohol, and indeed “the a word” dominates the very first paragraph of the text, here is the abstract:

Jason M. Lindo, Peter Siminski and Isaac D. Swensen

This paper considers the degree to which events that intensify partying increase sexual assault. Estimates are based on panel data from campus and local law enforcement agencies and an identification strategy that exploits plausibly random variation in the timing of Division 1 football games. The estimates indicate that these events increase daily reports of rape with 17–24-year-old victims by 28 percent. The effects are driven largely by 17–24-year-old offenders and by offenders unknown to the victim, but we also find significant effects on incidents involving offenders of other ages and on incidents involving offenders known to the victim.

That is from American Economic Journal: Applied Economics; from that same issue we also learn that “…increases in [Russian] alcohol prices would yield significant reductions in mortality.”

Michel Serafinelli and Guido Tabellini have a new paper on that question, here is the abstract:

Creativity is often highly concentrated in time and space, and across different domains. What explains the formation and decay of clusters of creativity? In this paper we match data on thousands of notable individuals born in Europe between the XIth and the XIXth century with historical data on city institutions and population. After documenting several stylized facts, we show that the formation of creative clusters is not preceded by increases in city size. Instead, the emergence of city institutions protecting economic and political freedoms facilitates the attraction and production of creative talent.

Recommended.

And here is what it tells us:

In the most recent paper, and one published earlier in the year by the Association for the Advancement of Artificial Intelligence, these were among the predictive correlations:

■ The system was able to accurately predict income, race, education and voting patterns at the ZIP code and precinct level in cities across the country.

■ Car attributes (including miles-per-gallon ratings) found that the greenest city in America is Burlington, Vt., while Casper, Wyo., has the largest per-capita carbon footprint.

■ Chicago is the city with the highest level of income segregation, with large clusters of expensive and cheap cars in different neighborhoods; Jacksonville, Fla., is the least segregated by income.

■ New York is the city with the most expensive cars. El Paso has the highest percentage of Hummers. San Francisco has the highest percentage of foreign cars.

That is from Steve Lohr at the NYT, and here is a link to the earlier research as cited in the first sentence.