I wrote this in 2004 on MR:

Here are my suggestions:

1. There is always time to do more, most people, even the productive, have a day that is at least forty percent slack.

2. Do the most important things first in the day and don’t let anybody stop you.  Estimate “most important” using a zero discount rate.  Don’t make exceptions.  The hours from 7 to 12 are your time to build for the future before the world descends on you.

3. Some tasks (drawing up outlines?) expand or contract to fill the time you give them.  Shove all these into times when you are pressed to do something else very soon.

4. Each day stop writing just a bit before you have said everything you want to.  Better to approach your next writing day “hungry” than to feel “written out.”  Your biggest enemy is a day spent not writing, not a day spent writing too little.

5. Blogging builds up good work habits; the deadline is always “now.”

Rahul R. asks me if I would like to revise the list.  I’ll add these:

6. Don’t drink alcohol.  Don’t take drugs.

7. At any point in your life, do not be watching more than one television show on a regular basis.

8. Don’t feel you have to finish a book or movie if you don’t want to.  I cover that point at length in my book Discover Your Inner Economist.

I think I would take back my old #5, since I observe some bloggers who have gone years, ten years in fact, without being so productive.

I remain amazed that we have as much free trade as we do.  Here is from a recent Pew poll:

President Barack Obama and other world leaders are having a tough time selling the benefits of the trade agreements they’re negotiating, in part because much of the public thinks all the talk about trade’s benefits is a bunch of baloney.

Out of 44 nationalities surveyed this year, only one — Israelis — tends to believe the basic tenet of economists that increased trade will foster competition and deliver lower prices for consumers.

On a broader question of whether increasing trade and business ties with other countries is a good thing, only 68% of Americans agree, compared with 76% worldwide, according to the study released Tuesday by the Pew Research Center.

The Pew study itself is here and it is interesting throughout.  It is in Bangladesh, Uganda, and Lebanon that people are most likely to believe trade raises real wages, and Bangladeshis are most sympathetic to foreign direct investment.  Only 28% of Americans believe it is good when foreigners buy up U.S. companies.  58% of Chinese think trade leads to price increases, perhaps a sign of the prevalence of foreign luxury goods in that country.

For the pointer I thank Ray Lopez, who himself benefits from free trade, factor mobility, and foreign direct investment.

That is a new paper (pdf) by John Cawley, here is the abstract:

This guide, updated for the 2014-15 job market season, describes the academic market for new Ph.D. economists and offers advice on conducting an academic job search. It reports findings from published papers, describes practical details, and provides links to internet resources. Topics addressed include: preparing to go on the market, applying for academic jobs, the AEA’s new electronic clearinghouse for the job market, signaling, interviewing at the ASSA meetings, campus visits, the secondary market scramble, offers and negotiating, diversity, and dual job searches.

Here is some of the good news from the paper itself:

National Science Foundation data indicate that Ph.D. economists have the lowest unemployment rate (0.9%) of any doctoral field,
as well as one of the highest median salaries of any doctoral field. Finally, the vast majority of people are happy with the outcome of their search. Of the new Ph.D. economists in 2001-02, 94% reported that they liked their jobs very much or fairly well (Siegfried and Stock, 2004).

For the pointer I thank Bruce Bartlett.

Sentences to ponder

by on September 15, 2014 at 1:27 pm in Education | Permalink

…the relation between the strength of constitutional educational rights and the quality of education is negative and statistically significant.

That is from Sebastian Edwards and Alvaro Garcia Marin, the paper is here.

Is hypergamy fading?

by on September 12, 2014 at 2:20 am in Education, Games | Permalink

Here is a new paper from Christine R. Schwartz and Hongyun Han, and here is the key part of the abstract:

…marriages in which wives have the educational advantage were once more likely to dissolve, but this association has disappeared in more recent marriage cohorts. Another key finding is that the relative stability of marriages between educational equals has increased. These results are consistent with a shift away from rigid gender specialization toward more flexible, egalitarian partnerships, and they provide an important counterpoint to claims that progress toward gender equality in heterosexual relationships has stalled.

There are ungated versions here, and for the pointer I thank the excellent Kevin Lewis.


by on September 10, 2014 at 1:07 am in Books, Education, History, The Arts | Permalink

In Welsh poetry, dyfalu is the piling on of comparisons, definition through conceit.  The word also means “to guess” in Welsh, and many poems of dyfalu have an element of guesswork, a fanciful and riddling dimension.  “The art of dyfalu, meaning “to describe” or “to deride,” rests in the intricate development of a series of images and extended metaphors which either celebrate or castigate a person, animal, or object,” the encyclopedia of Celtic Culture explains.  Dafydd ap Gwilym’s poems to the mist and the wind are classic fourteenth-century examples.

That is from Edward Hirsch, A Poet’s Glossary, which I am quite enjoying.  There is interesting material on every page and it is written with passion.   A hendiatris is a “figure of speech in which three words are employed to express an idea, as in Thomas Jefferson’s tripartite motto for the Declaration of Independence: “Life, liberty, and the pursuit of happiness.””  When there are only two words so employed, it is of course a hendiadys.

This one is so simple it is stupid, yet you hardly ever hear it.  If anything it is mocked, but I will go on record:

Eat at 5 p.m. or 5:30.

The quality of the food coming out of the kitchen will be higher.  Only the very top restaurants (and even then not always) can maintain the same quality at say 8 p.m. on a Saturday night.  It is also the easiest time for getting a reservation.

The best time to eat at @ElephantJumps is 4:20 p.m.  They’re all just sitting around, waiting to cook for you.

Oyamel is a good example of a D.C. restaurant which can be quite iffy, but is tasty and consistent first thing in the evening.

There is a beauty to having a restaurant all to yourself.  And if you don’t like the timing, have no more than an apple for lunch.

This is also a better system for getting work done, if the nature of your workplace allows it.  Few people who do the 7:30 dinner work through to 11 p.m.  If you have  dinner 5-6:30, you are ideally suited to get back into the saddle by 7:15.

But please, I hope not too many of you follow this advice.  The funny thing is, you won’t.  You will leave the low-hanging fruit behind, you strange creatures you.

It seems culture and training matter a great deal.  T.M. Luhrmann reports:

Recently, a team of anthropologists and psychologists at the Max Planck Institute for Psycholinguistics and Radboud University, both in Nijmegen, the Netherlands, set out to discover how language and culture affected sensory awareness. Under the leadership of Asifa Majid and Stephen C. Levinson, they made up a kit of systematic stimuli for the traditional five senses: for sight, color chips and geometric forms; for hearing, pitch, amplitude and rhythm variations; for smell, a set of scratch-and-sniff cards; and so forth. They took these kits to over 20 cultural groups around the world. Their results upend some of our basic assumptions.

For example, it’s fairly common, in scientific literature, to find the view that “humans are astonishingly bad at odor identification and naming,” as a recent review of 30 years of experiments concluded. When ordinary people are presented with the smell of ordinary substances (coffee, peanut butter, chocolate), they correctly identify about half of them. That’s why we think of scent as a trigger for personal memory — leading to the recall of something specific, particular, uniquely our own.

It turns out that the subjects of those 30 years of experiments were mostly English-speaking. Indeed, English speakers find it easy to identify the common color in milk and jasmine flowers (“white”) but not the common scent in, say, bat droppings and the leaf of ginger root. When the research team presented what should have been familiar scents to Americans — cinnamon, turpentine, lemon, rose and so forth — they were terrible at naming them. Americans, they wrote, said things like this when presented with the cinnamon scratch-and-sniff card: “I don’t know how to say that, sweet, yeah; I have tasted that gum like Big Red or something tastes like, what do I want to say? I can’t get the word. Jesus it’s like that gum smell like something like Big Red. Can I say that? O.K. Big Red, Big Red gum.”

When the research team visited the Jahai, rain-forest foragers on the Malay Peninsula, they found that the Jahai were succinct and more accurate with the scratch-and-sniff cards. In fact, they were about as good at naming what they smelled as what they saw. They do, in fact, have an abstract term for the shared odor in bat droppings and the leaf of ginger root. Abstract odor terms are common among people on the Malay Peninsula.

I am good at smelling curries.

Luigi Zingales has a relatively new paper on that and related questions:

The very same forces that induce economists to conclude that regulators are captured should lead us to conclude that the economic profession is captured as well. As evidence of this capture, I show that papers whose conclusions are pro-management are more likely to be published in economic journals and more likely to be cited. I also show that business schools’ faculty write papers that are more pro management. I highlight possible remedies to reduce the extent of this capture: from a reform of the publication process, to an enhanced data disclosure, from a stronger theoretical foundation to a mechanism of peer pressure. Ultimately, the most important remedy, however, is awareness, an awareness most economists still do not have.

The paper is here, via the excellent Kevin Lewis.  And here is another new Zingales paper (pdf, with Guiso and Sapienza) on time-varying risk-aversion, here is the tail end of the abstract:

Consistent with a fear-based explanation, we find that subjects who watched a horror movie exhibit a higher risk aversion than subjects who did not. The size of the increase in risk aversion caused by the horror movie is similar to the one experienced by our bank’s clients during the crisis.

Our new class on international finance is up here.  The class description reads as follows:

International finance covers some of the most complex but also important topics in economics. How are exchange rates determined? When if ever are ongoing trade deficits harmful? Are fixed or floating exchange rates better? What are the roots of the euro crisis and what resolution can we expect? Does China manipulate its exchange rate and if so how does that matter? We cover all of these topics and more, with an eye toward what a person really might want to know. There is no use of mathematics in this course beyond the very basic.

The interesting thing about international finance is that even a lot of professional economists don’t understand it very well, unless they have specialized in the area. If you complete this course, you’ll probably know a lot which they don’t!

You will find particular videos on capital controls, the classical gold standard, “dark matter,” “the Dutch disease,” the Asian financial crisis of 1997, and are devaluations contractionary?, among many other topics.

Again, here is Guinevere Liberty Nell’s recent class on the Soviet Union (still relevant alas!) and our Principios de Microeconomía, by Andres Marroquin, is growing as well.  There is more on the way!

College Admission Secrets

by on September 2, 2014 at 7:38 am in Economics, Education | Permalink

Most colleges are non-profits with unclear ownership status so their incentives do not lead to simple profit-maximization. Don’t be fooled, however, neither do colleges maximize student welfare or the public good. Instead colleges pursue some index of free cash flow, prestige, and administrative and faculty independence. The result is some peculiar outcomes. Most businesses, for example, don’t want to reject customers but colleges often encourage students to apply so that they can reject them. The Washington Monthly’s college issue has an excellent primer, Ten Ways Colleges Work You Over, that explains:

education moneyThe aim of the game for colleges is to boost the number of students who apply and can be rejected. By doing this, the schools see their acceptance rates fall, making them appear to be more selective—which helps them rise up the U.S. News & World Report rankings.

Take Northeastern University in Boston… [which] sends nearly 200,000 personalized letters to high school students each year. The institution then follows up these letters with emails, making it seem that the school is wooing these individuals.

… Nearly 50,000 students applied to Northeastern this year for 2,800 spots in the fall 2014 class…

Lowering its acceptance rates is at least one factor in why Northeastern has catapulted up the U.S. News rankings, rising more than 100 spots since 2002.

Profit-maximization (or maximization of free cash flow) is also not absent from the process. Many schools, for example, say they are need blind but that just means that admission officers don’t know the student’s income. Admissions officers, however, do know lots of information that is highly correlated with income including where applicants live, what high school they attended and the occupations of the applicants parents–not exactly what I would call blind.

Schools even use seemingly arbitrary bits of information to increase their revenues. The  Free Application for Federal Student Aid (FAFSA) form, for example, has students list the colleges that they are interested in applying to. Although the order is irrelevant, students often list in preferential order and the colleges see this information. As a result, colleges have an incentive to offer students who list their college first less financial aid simply because that is an indication that the student has a high demand for that college.

1. Bolivia became a semi-stable democracy in the early 1980s and it has stayed that way.

2. For all the rhetoric to the contrary, the current regime is a mix of 1990s-era market-oriented reforms and Evo Morales.  Probably you like one of these, though perhaps not both.

3. Many more Bolivian children go to school than before, and the incidence of malnutrition has been plummeting, with longer-run benefits for IQ.  You will read many fabricated or non-causally-backed claims about the connection between inequality and growth, but for Bolivia I believe these arguments.

4. Bolivia has done so many things wrong in the past, there is a lot of low-hanging fruit through purely internal improvements.  For instance the country is a fantastic tourist destination, but would not at this moment be experienced that way by mainstream American tourists, due to language, hotel, and infrastructure shortcomings.  Eventually those problems can be and will be solved.  Eventually.

5. Bolivia does not have much export exposure to China, and does not face much geopolitical risk.

6. Of all commodities, hydrocarbons may be relatively protected in price through the forthcoming global turmoil, because the Middle East implosion will make Bolivia’s current main resource more valuable.

7. Bolivia’s fiscal situation is surprisingly sound.

The three main reasons to be pessimistic about Bolivia are:

1. Most of their economic policy is quite bad, especially when it concerns the nationalization of foreign direct investment.  The FDI future of Bolivia will be extremely unfavorable.  The rhetoric and indeed the behavior of the government sometimes is like a villain from an Ayn Rand novel.

2. Their main trading partner is Brazil, a country which will have gone from eight percent growth to near-zero growth in but a few years time.  Argentina is either the number two or number three trade partner, along with the U.S., depending on the year in question.

3. Bolivia hasn’t done that well in the past.

Of those three reasons, #1 probably matters a bit less than you might think, and #3 a bit more.

It is much debated in Bolivia whether corruption is going up or down.  I believe it is going up, but partially for good reasons.  For instance the construction sector is doing well, and construction tends to be corrupt in many countries, for reasons intrinsic to the activity itself (e.g., lots of big contracts, easy to claim invisible expenses, etc.).  That means higher corruption but also a better corruption than the penny ante bribes of a shrinking economy.

Right now Bolivia is growing at a rate of above six percent.

It is potent:

If people married each other more randomly, poverty levels would be considerably lower than they are now.  If we abandoned all current family arrangements and randomly grouped all Bolivians into new families of 5 persons, poverty levels would fall by about 15 percentage points (from the current level of 55% of all households to about 40% of all households).  The Gini coefficient measuring inequality would also fall from about 0.70 to 0.55.

But Bolivians do not mix much in marriage.  The correlation between partners’ education levels is extremely high at about 0.77, with no signs of falling.  For comparison, the corresponding number for Germany is 0.52 and for Britain it is 0.41.

But not all Bolivians are equally restricted in their marriage choices.  In the department of Santa Cruz the correlation is only 0.69 while in Potosi it is 0.82, with a corresponding difference in poverty rates.

That is from Lykke E. Andersen, Development from Within, an interesting and well-written collection of essays on Bolivian development, and sometimes on development policy more generally.  The cited piece was written in 2008.

Here is a good sentence from that book:

Just one little road block can disrupt an entire vacation.

Here is the author on Twitter.  Here is her blog.

Here is a new paper by Steve Brito, Ana Corbacho, and Rene Osorio Rivas, it seems the answer is yes:

This working paper studies the effect of remittances from the United States on crime rates in Mexico. The topic is examined using municipal-level data on the percent of household receiving remittances and homicides per 100,000 inhabitants. Remittances are found to be associated with a decrease in homicide rates. Every 1 percent increase in the number of households receiving remittances reduces the homicide rate by 0.05 percent. Other types of crimes are analyzed, revealing a reduction in street robbery of 0.19 percent for every 1 percent increase in households receiving remittances. This decrease is also observed using a state-level panel in another specification. The mechanisms of transmission could be related to an income effect or an incapacitation effect of remittances increasing education, opening job opportunities, and/or reducing the amount of time available to engage in criminal activities.

For the pointer I thank Axayacatl Maqueda.  Here is a Spanish-language discussion of the work.

From David Cay Johnson:

From 2000 to 2012, American workers as a whole had a tough time, as population grew much faster than new jobs and many people gave up looking for work. There was one major exception: jobs paying $100,000 to $400,000 (in 2012 dollars).

This is what I call America’s new prosperous class. Many of these workers have an advanced degree. They no longer struggle, but they continue to work because their wealth is far from adequate to support their lifestyles.

The number of prosperous-class jobs soared to 10.8 million, an increase of 2.1 million since 2000. That is almost 10 times the growth rate of jobs paying either more or less.

Most astonishing is how much of the overall increase in wages earned by the 153.6 million people with a job in 2012 went to this narrow band of very well paid workers: Just 7 percent of all jobs pay in this range, but those workers collected 76.9 percent of the total real wage increase.

For the pointer I thank Mary Ray.  (p.s.: the paperback edition of Average is Over is out today).