The manufacturing sector is now operating at 77.8 percent of its capacity, according to Federal Reserve data, well above the 76 percent average during the last expansion and not far from the 79.1 percent peak during the mid-2000s.
That is from Neil Irwin. As I’ve been saying for over a year, we are no longer at the point where boosting nominal demand will help very much if at all.
Slowest Growing Populations (%, 2000-10)
1 Moldova -13%
2 Georgia -8%
4 Bulg -6%
5 Latvia -6%
6 Lithuania -5%
7 Belarus -5%
That is from here, the most rapidly growing populations are given here, some Gulf states and Africa, both are tweets from Ian Bremmer.
There is a new NBER Working Paper from Brianna Cardiff-Hicks, Francine Lafontaine, and Kathryn Shaw, and the abstract is this:
With malls, franchise strips and big-box retailers increasingly dotting the landscape, there is concern that middle-class jobs in manufacturing in the U.S. are being replaced by minimum wage jobs in retail. Retail jobs have spread, while manufacturing jobs have shrunk in number. In this paper, we characterize the wages that have accompanied the growth in retail. We show that wage rates in the retail sector rise markedly with firm size and with establishment size. These increases are halved when we control for worker fixed effects, suggesting that there is sorting of better workers into larger firms. Also, higher ability workers get promoted to the position of manager, which is associated with higher pay. We conclude that the growth in modern retail, characterized by larger chains of larger establishments with more levels of hierarchy, is raising wage rates relative to traditional mom-and-pop retail stores.
This is not a surprising result, but it doesn’t receive nearly enough attention in popular discussions of the subject. There is a related ungated earlier draft here.
From Becker, Philipson, and Soares (pdf):
GDP per capita is usually used to proxy for the quality of life of individuals living in different countries. Welfare is also affected by quantity of life, however, as represented by longevity. This paper incorporates longevity into an overall assessment of the evolution of cross-country inequality and shows that it is quantitatively important. The absence of reduction in cross-country inequality up to the 1990s documented in previous work is in stark contrast to the reduction in inequality after incorporating gains in longevity. Throughout the post–World War II period, health contributed to reduce significantly welfare inequality across countries. This paper derives valuation formulas for infra-marginal changes in longevity and computes a “full” growth rate that incorporates the gains in health experienced by 96 countries for the period between 1960 and 2000. Incorporating longevity gains changes traditional results; countries starting with lower income tended to grow faster than countries starting with higher income. We estimate an average yearly growth in “full income” of 4.1 percent for the poorest 50 percent of countries in 1960, of which 1.7 percentage points are due to health, as opposed to a growth of 2.6 percent for the richest 50 percent of countries, of which only 0.4 percentage points are due to health. Additionally, we decompose changes in life expectancy into changes attributable to 13 broad groups of causes of death and three age groups. We show that mortality from infectious, respiratory, and digestive diseases, congenital, perinatal, and “ill-defined” conditions, mostly concentrated before age 20 and between ages 20 and 50, is responsible for most of the reduction in life expectancy inequality. At the same time, the recent effect of AIDS, together with reductions in mortality after age 50—due to nervous system, senses organs, heart and circulatory diseases—contributed to increase health inequality across countries.
That reminder is from Aaron Schwartz. And of course that is the Becker, yet another contribution from Gary Becker.
Do note, by the way, that medical progress is usually egalitarian per se. A common metric is something like “health outcomes of the poor” vs. “health outcomes of the rich,” and that may or may not be moving in an egalitarian direction. But very often the more incisive metric is “health outcomes of the sick” vs. “health outcomes of the healthy,” and of course most medical treatments are going to the sick. The more desperate is the lot of the sick, the more likely that medical progress is egalitarian per se.
It is a pretty mixed bag, as illustrated by this newly published paper by Dean Lacy, the abstract is here:
The 2012 election campaign popularized the notion that people who benefit from federal spending vote for Democrats, while people who pay the preponderance of taxes vote Republican. A survey conducted during the election included questions to test this hypothesis and to assess the accuracy of voters’ perceptions of federal spending. Voters’ perceptions of their benefit from federal spending are determined by family income, age, employment status, and number of children, as well as by party identification and race. Voters aged 65 and older who believe they are net beneficiaries of federal spending are more likely to be Democrats and vote for Barack Obama than seniors who believe they are net contributors to the federal government. However, the 77.5 percent of voters under age 65 who believe they are net beneficiaries of federal spending are as likely to vote for Romney as for Obama and as likely to be Republicans as Democrats. Voters who live in states that receive more in federal funds than they pay in federal taxes are less likely to vote for Obama or to be Democrats. For most of the electorate, dependence on federal spending is unrelated to vote choice.
Hat tip goes to Kevin Lewis. I am not able to find an ungated copy.
Kevin also points us to this interesting paper interpreting the Scandinavian model. The authors are Erling Barth, Karl O. Moene, and Fredrik Willumsen, and the abstract is this:
The small open economies in Scandinavia have for long periods had high work effort, small wage differentials, high productivity, and a generous welfare state. To understand how this might be an economic and political equilibrium we combine models of collective wage bargaining, creative job destruction, and welfare spending. The two-tier system of wage bargaining provides microeconomic efficiency and wage compression. Combined with a vintage approach to the process of creative destruction we show how wage compression fuels investments, enhances average productivity and increases the mean wage by allocating more of the work force to the most modern activities. Finally, we show how the political support of welfare spending is fueled by both a higher mean wage and a lower wage dispersion.
Again, I cannot find an ungated copy.
There is a new and extremely distressing NBER paper by Derek Neal and Armin Rick:
More than two decades ago, Smith and Welch (1989) used the 1940 through 1980 census files to document important relative black progress. However, recent data indicate that this progress did not continue, at least among men. The growth of incarceration rates among black men in recent decades combined with the sharp drop in black employment rates during the Great Recession have left most black men in a position relative to white men that is really no better than the position they occupied only a few years after the Civil Rights Act of 1965. A move toward more punitive treatment of arrested offenders drove prison growth in recent decades, and this trend is evident among arrested offenders in every major crime category. Changes in the severity of corrections policies have had a much larger impact on black communities than white communities because arrest rates have historically been much greater for blacks than whites.
The paper is here. There are ungated copies here.
There is a new NBER paper by Scott Cunningham and Manisha Shah:
Most governments in the world including the United States prohibit prostitution. Given these types of laws rarely change and are fairly uniform across regions, our knowledge about the impact of decriminalizing sex work is largely conjectural. We exploit the fact that a Rhode Island District Court judge unexpectedly decriminalized indoor prostitution in 2003 to provide the first causal estimates of the impact of decriminalization on the composition of the sex market, rape offenses, and sexually transmitted infection outcomes. Not surprisingly, we find that decriminalization increased the size of the indoor market. However, we also find that decriminalization caused both forcible rape offenses and gonorrhea incidence to decline for the overall population. Our synthetic control model finds 824 fewer reported rape offenses (31 percent decrease) and 1,035 fewer cases of female gonorrhea (39 percent decrease) from 2004 to 2009.
Alas, I do not see ungated versions on Google, or maybe try this one (pdf).
The Stanford Geospatial Network Model of the Roman World
“For the first time, ORBIS allows us to express Roman communication costs in terms of both time and expense. By simulating movement along the principal routes of the Roman road network, the main navigable rivers, and hundreds of sea routes in the Mediterranean, Black Sea and coastal Atlantic, this interactive model reconstructs the duration and financial cost of travel in antiquity.”
For the pointer I thank Michael Gibson.
This is from a New York Craigslist post, from a restaurant owner who apparently viewed tapes of customers from 2004 and 2014, here is part of his account of the more recent behavior:
Customers walk in.
Customers get seated and is given menus, out of 45 customers 18 requested to be seated elsewhere.
Before even opening the menu they take their phones out, some are taking photos while others are simply doing something else on their phone (sorry we have no clue what they are doing and do not monitor customer WIFI activity).
7 out of the 45 customers had waiters come over right away, they showed them something on their phone and spent an average of 5 minutes of the waiter’s time. Given this is recent footage, we asked the waiters about this and they explained those customers had a problem connecting to the WIFI and demanded the waiters try to help them.
Finally the waiters are walking over to the table to see what the customers would like to order. The majority have not even opened the menu and ask the waiter to wait a bit.
Customer opens the menu, places their hands holding their phones on top of it and continue doing whatever on their phone.
There is more here, interesting throughout, and for the pointer I thank Jacqueline Mason.
This is for call center operators:
The results are surprising. Some are quirky: employees who are members of one or two social networks were found to stay in their job for longer than those who belonged to four or more social networks (Xerox recruitment drives at gaming conventions were subsequently cancelled). Some findings, however, were much more fundamental: prior work experience in a similar role was not found to be a predictor of success.
“It actually opens up doors for people who would never have gotten to interview based on their CV,” says Ms Morse. Some managers initially questioned why new recruits were appearing without any prior relevant experience. As time went on, attrition rates in some call centres fell by 20 per cent and managers no longer quibbled. “I don’t know why this works,” admits Ms Morse, “I just know it works.”
The rest of the Tim Smedley FT story is here, via Peter Sahui.
“This study finds total marijuana demand to be much larger than previously estimated,” Colorado’s study concluded.
And this, which I think suggests the laws in other states are binding for many consumers:
Colorado concluded that visitors account for 44 percent of recreational marijuana retail sales in the Denver area. In the mountains and other vacation spots, visitors to Colorado account for 90 percent of recreational dispensary traffic.
And this, which sounds tautologous, but is not:
“Heavy users consume marijuana much more often, and more intensely, than other consumers,” the study concluded.
Overall heavy users seem to account for about seventy percent of total demand. Here is some detail:
Colorado’s market numbers bore out survey estimates that most marijuana is consumed by heavy daily users. For example, survey authors estimated that a third of all Colorado’s pot consumers use the drug less than once a month. But that group accounts for just 0.3 percent of the total market, analysts concluded.
The full story is here, the study itself is here. For the pointer I thank C., who I believe is not part of that seventy percent of market demand.
(VP) is a digital humanities project, currently in development, for a collection of prices drawn from literary and historical sources in 18th and 19th century England. Users will be able to search for information relating to a specific good or service, or a specific amount of money. For example, a query for 3 shillings in 1789 reveals that in London, that amount would purchase a bushel of wheat, a quarto of translations from Diderot, or a day’s services of a crippled or deformed child as a companion to an adult beggar. My intent is for the database to make use of the influx of printed texts onto the web in facsimile format, in databases like Google Books, the Hathi Trust Digital Library, Eighteenth Century Collections Online, the British Newspapers Collection, and the London Times Online Archive, to name only a few. Though entry privileges are currently restricted, the goal is to eventually make it possible for registered users to enter data in the process of individual research or classroom activities; and thus to make it possible for researchers specializing in other time periods and regions to extend the scope of the database.
The pointer is from Pam Regis.
From Jason Mitchell at Harvard:
Recent hand-wringing over failed replications in social psychology is largely pointless, because unsuccessful experiments have no meaningful scientific value.
Because experiments can be undermined by a vast number of practical mistakes, the likeliest explanation for any failed replication will always be that the replicator bungled something along the way. Unless direct replications are conducted by flawless experimenters, nothing interesting can be learned from them.
Three standard rejoinders to this critique are considered and rejected. Despite claims to the contrary, failed replications do not provide meaningful information if they closely follow original methodology; they do not necessarily identify effects that may be too small or flimsy to be worth studying; and they cannot contribute to a cumulative understanding of scientific phenomena.
Replication efforts appear to reflect strong prior expectations that published findings are not reliable, and as such, do not constitute scientific output.
The field of social psychology can be improved, but not by the publication of negative findings. Experimenters should be encouraged to restrict their “degrees of freedom,” for example, by specifying designs in advance.
Whether they mean to or not, authors and editors of failed replications are publicly impugning the scientific integrity of their colleagues. Targets of failed replications are justifiably upset, particularly given the inadequate basis for replicators’ extraordinary claims.
The full piece is here, I don’t quite buy it but a useful counter-tonic to a lot of current rhetoric. I found this in my Twitter feed, but I forget whom to thank, sorry!
Addendum: An MR reader sends along this related argument.
The largest-ever study of same-sex parents found their children turn out healthier and happier than the general population.
A new study of 315 same-sex parents and 500 children in Australia found that, after correcting for socioeconomic factors, their children fared well on several measures, including asthma, dental care, behavioral issues, learning, sleep, and speech.
Do note this:
Perceived stigmas were associated with worse scores for physical activity, mental health, family cohesion, and emotional outcomes. The stigmas, however, were not prevalent enough to negatively tilt the children’s outcomes in a comparison to outcomes across the general population.
There is more here, from German Lopez, the study itself is here.
93% of that country is satisfied with the degree of freedom in that country, ranking it #3 in the world (New Zealand is #1 by that standard).
There is more here. U.S. is #36.
Happy Fourth of July!