The deal may “feel wrong” to a lot of people, but for the regulators it ought not to be a big deal:

AT&T’s proposed acquisition of Time Warner…is considered “vertical” because the two companies largely do not compete against each other but operate on the same supply chain.

This is the bottom line:

“By standard antitrust metrics, this deal should be O.K. in Washington,” said Paul Gallant, a technology, media and telecommunications policy analyst with Cowen & Company. “But the Democratic Party is moving left, and if Clinton wins, this could become an early test for her ‘tougher on business’ rhetoric.”

The negative arguments are speculative or quite a stretch:

AT&T could make it more expensive for its competitors to gain access to Time Warner’s content or give preferential treatment to its own programming, said John Bergmayer, senior counsel at Public Knowledge, a digital rights advocacy group.

That is all from Leslie Picker and Cecilia Kang at the NYT.  I would stress that “entertainment” and “content” are sectors where choices have exploded more or less without precedent.  If the goal is to stop Time-Warner content from spreading to multiple sectors of the consumer media universe, I don’t see this one as a winner.

More generally, it is hard to see where the efficiencies from the deal are supposed to come from.  About the recent Bayer and Monsanto proposed merger I wrote:

There is a well-known academic literature, dating to the early 1990s, showing that acquiring firms usually decline in value after tender offers, especially after the biggest deals. Mergers do not seem to make companies more valuable or efficient.

Why then do so many mergers and acquisitions happen? Well, some of them do pay off (Google buying YouTube), but also many managers engage in empire-building by increasing the size of their companies, even at the expense of the shareholders. Another possibility is what economists call “winner’s curse,” namely that the winner of an auction or contest or bidding war tends to be the person or institution most optimistic, and in fact overly optimistic, about the value at stake.

So from a social point of view, I doubt if there is so much at stake here.

Addendum: Matt Yglesias comments.  And here is FT coverage.

The accuracy of these tests is astounding.
Hat tip: Nathaniel B.

Amanda Knox on Netflix is a shorter version of Making a Murderer. Shorter because there isn’t much evidence that Knox had anything to do with the murder of her amanda-knox-doc-netflix-780x439housemate. The documentary has extensive interviews with the lead investigator, a blowhard who likens himself to Sherlock Holmes but whose idea of deduction is that the murderer must have been a woman because the body was covered up. Surprisingly, the one clear sociopath isn’t the actual killer but the journalist whose lurid dispatches turned a tragic but ordinary murder into a witch hunt–a real Nightcrawler. Throw in some nationalism on both the Italian and U.S. sides and it’s not surprising that justice went awry. Trump has a cameo.

Luke Cage, also on Netflix, is the latest Marvel superhero story set in the same New York universe as Daredevil and Jessica Jones. Harlem is lovingly portrayed and the barbershop name dropping–Walter Mosley, Zora Neal Hurston, Crispus Attucks–and luke-cagevarious basketball, jazz, and rap references adds color. The central conflict, however, is flat. Super-strong, well-nigh invulnerable Cage is not evenly-matched by drug dealer-businessman Cottonmouth. Despite a watchable performance by Mahershala Ali, Cottonmouth is no Kingpin. Vincent D’Onofrio’s Kingpin had Shakespearean intensity, depth, and the physical power to battle a super-hero. Indeed, one of the things that made Daredevil special was that you could see his exhaustion and pain in every battle. Similarly, Jessica Jones’s nemesis, Kilgrave, was one of the most horrific characters ever seen on television (in a great understated performance by David Tennant) and Kilgrave had Jones under his thumb for much of the season. Super heroes need super villains. To be sure, there is pickup in the second half of Luke Cage, but it takes a long time to develop.

Westworld (HBO)–this is the one that you must watch. The first two episodes have been remarkable. Every scene has something to see or to think about. Audience expectations are continually subverted. The cinematography is stunning.

One characters says “That’s what I love about this place all the secrets, all the little things I never noticed even after all these years. You know why this place beats the real world…in here every detlevelsail adds up to something.” Very meta. The shots also speak to the structure of the plot. Look at this amazing shot of the control building–levels of meaning.

It does not pass notice that it’s bright and shiny on top but the lower levels are dark, moist, subterranean–like our subconscious. We are told that WestWorld is a maze, a maze literally and figuratively, in our heads.

Westworld also challenges us with questions. Who are we? If we visited Westworld would we be the good guys or the bad guys? How many of us secretly harbor the desire to do evil and are restrained only by fear of punishment? What kind of Zimbardo experiment is Westworld?

Or are we the operators of Westworld who treat other people (?) as mere means and not as ends in themselves? Parts of Westworld look like an abattoir and from one perspective there are mass rapes.

Or are we the robots, living in a simulation, a reality of someone else’s construction? And what is going on with the corporation? The ultimate god?

The executive producer of Westworld is Jonathan Nolan, brother of Christopher, and writer or co-writer of Memento, The Prestige, The Dark Night and Interstellar.

We are only two episodes in but so far this is thrilling art in action.

*American Honey*

by on October 11, 2016 at 3:37 pm in Film, Religion | Permalink

This sprawling, 2 hour, 42 minute movie likely will be seen as one of the important creations of the decade.  Variety described it as “femme-driven corrective to…”Spring Breakers””, and “Part dreamy millennial picaresque, part distorted tapestry of Americana and part exquisitely illustrated iTunes musical,” the phrase “Midwestern America Walpurgis Night” came to my mind.  “…Almost ridiculously full of life…” was another account.  Most of all, it is a story of how a post-Christian America can go awry, told through the classic medium of a road trip.  Instead of the blood and flesh of Christ at Holy Communion, here the serving is toxic mezcal and eating the worm inside the bottle, for cash of course.  The other parallels I do not wish to give away.

In terms of cinematography and especially soundtrack, it’s as strong as any movie in recent times.  Scene after scene felt special and memorable, and only about ten minutes or so dragged.  I kept on thinking it couldn’t keep up its pace of quality, but it did and in fact kept surpassing itself.  Sasha Lane deserves the Best Actress Oscar, and in her film debut at that.  I just ordered everything I can by British director Andrea Arnold.

Recommended (re)reading for a viewing includes Genesis, most of all the story of Jacob, his family, and his wrestle with the angel.  But don’t expect the reviews to mention any of that — Ross Douthat, telephone!

Remember people, the influential thinkers of the next generation will be the religious ones…whether you like it or not.

The very beginning is a little slow, but I thought Ezra was one of the very best guests.  The topics include the nature and future of media, including virtual reality, the nature of leadership (including Ezra’s own), how running a project shapes your political views, a wee bit on health care, what he thinks are the Obama and Clinton models of the world, Robert Putnam’s research on the costs of diversity, the proper role of shame in society, animal welfare, and of course Ezra’s underrated and overrated, with takes on Bob Dylan, The Matrix, William F. Buckley, Joe Biden, and more.  There is no video but here is the podcast and transcript.  Here is one excerpt:

COWEN: …Now Putman, let me ask you about Putnam, and how Putnam relates to Donald Trump. As you know, Robert Putnam at Harvard, he has some work showing that when ethnic diversity goes up that there’s less trust, less cooperation, less social capital.

If you think of yourself in the role of an editor, so you have an American society, diversity has gone up, and a lot of people have reacted to this I would say rather badly — and I think you would agree with me they’ve reacted rather badly — but there’s still a way in which the issue could be framed that while diversity is actually a problem, we can’t handle diversity.

Putnam almost says as such, and do you think there’s currently a language in the media where you have readers who are themselves diverse, where it’s possible not to just be blaming the bigots, but to actually present the positive view, “Look, people are imperfect. A society can only handle so much diversity, and we need to learn this.” What’s your take on that?

KLEIN: I strongly agree. We do not have a language for demographic anxiety that is not a language that is about racism. And we need one. I really believe this, and I believe it’s been a problem, particularly this year. It is clear, the evidence is clear. Donald Trump is not about “economic anxiety.”

COWEN: A bit, but not mainly, I agree.

KLEIN: That said, I think that the way it’s presented is a choice between economic anxiety and racism. And one I don’t think that’s quite right, and two I don’t think that’s a productive way of having that conversation.

COWEN: Why don’t we have that language? Where did it go, or did we ever have it?


COWEN: You see this with Medicaid. A lot of people don’t sign up. They don’t have addresses. You can’t even get them, whatever.

KLEIN: They don’t like doctors. They’re afraid of doctors.

COWEN: This is me.

KLEIN: You’re afraid of doctors?

COWEN: “Afraid” isn’t the word.

KLEIN: Averse. [laughs]

COWEN: Maybe dislike. Averse. [laughs] They should be afraid of me, perhaps.

Definitely recommended.  The same dialogue, with a different introduction, is included in The Ezra Klein Show podcast.

Uber Versus Taxi Cab Racism

by on October 6, 2016 at 7:28 am in Economics, Film, Travel | Permalink

Film maker Charles Mudede, a black Zimbabwean living in the United States, is thrown back into the racist past by a visit to Vancouver.

Vancouver B.C. does not have Uber or Lyft, the ridesharing service I mainly use in Seattle and New York City…the absence of ridesharing companies in Vancouver has meant the persistence of a problem that, in my experience, pretty much vanishes from the surface of things when you have an account with Uber or Lyft: taxi cab racism….I had all but forgotten this form of racism until this weekend, when I found myself in downtown Vancouver unable to hail a cab. They just simply passed by me, though many were not engaged. At first I thought I was not visible enough to drivers, but after a few cabs passed by my increasingly theatrical waving, I remembered the color of my skin.

It’s important to note that many of the taxi drivers were not white but South Asians—some who were even blacker than me. But when it comes to taxi racism, the color of the driver often does not matter. White racism, in this sector, has been adopted, sometimes even intensified, by all other races, many of which have been and still are the victims of white racism. Even in Seattle, when Yellow Cab was the top dog, East African drivers would pass by me because I looked like them. All of that nonsense came to an end with ridesharing, whose apps made hailing unnecessary.

The author, it’s worth noting, is not a fan of neoliberalism:

The sad thing is that much of my thinking is strongly opposed to the sharing economy because the society in which its modes are expressed, a neoliberal society, results, for one, in the encroachment of the “entrepreneurial spirit” into all aspects of our lives.

So give him credit for grudgingly acknowledging one important benefit.

Sunday assorted links

by on September 18, 2016 at 4:23 am in Film, Uncategorized | Permalink

1. “…we find that the real price of watches in nearly all categories falls steadily by 1.3 per cent per year, equivalent to a fall of 75 per cent over a century, showing that sustained innovation in the production of a highly complex artefact had already appeared in one important sector of the British economy by the early eighteenth century.”  Here is the article.

2. Have tasting menus become too expensive?  I say yes: ““It means D.C. is a town that has come of age, and that should worry us all.”

3. Garett Jones argues for a high-SAT immigration policy.

4. How to store your butterflies (photo).

5. My former student, Dr. Yonas Biru, who did his dissertation on the coup d’etat, is on a hunger strike.

6. Interview with Decius.  Caveat emptor, I say he has been “played” by Trump.  Still, the media of so much coverage of the “hillbilly” and “downtrodden” Trump supporters, I say let’s look at the intellectuals, anonymous though some of them may be.

7. Weiner is a splendid movie with many subtle points, including in the philosophical direction.  It is about leadership, publicity, motivation, compulsion, and what a marriage really consists of, or not.  In another life, Huma Abedin could have been a movie star.  She has exactly the right mix of distance and involvement, and she dominates every scene she is in, even when just sitting quietly in the background.  Um…I guess she is a movie star.  Starlet.  Whatever.

The Wi-Fi kiosks were designed to replace phone booths and allow users to consult maps, maybe check the weather or charge their phones. But they have also attracted people who linger for hours, sometimes drinking and doing drugs and, sometimes, boldly watching pornography on the sidewalks.

Now, yielding to complaints, the operators of the kiosks, LinkNYC network, are shutting off their internet browsers.

That is from Patrick McGheehan at the NYT.

I hadn’t known Ed “Let’s take the con out of econometrics” Leamer was the VP on the Larry Kotlikoff ticket.

The quality, and popularity, of Sully raises anew the question of why Hollywood doesn’t make more such movies.  Which is the scarce input?  The script?  Yet virtually every Clint Eastwood movie seems to come up with a good script.  I suspect “a recognized auteur with bargaining clout” is what is scarce.

Insects are not so scarce, but the marketing is tough:

Aketta grows its crickets in the United States and fills orders on a first come, first serve basis with weekly harvests. The company sells cricket flour and whole-roasted crickets. Flour is made from 100% milled crickets and has a “deep, earthy, umami flavor with hints of raw cocoa.” Sold in small batches of 1 to 1.5 lbs. Order online.

Here are many more insect food sources, but the claim is that the most innovative insect-selling start-ups are in Europe.

This story has scary good photos:

The Bund reached the height of its prominence on February 20, 1939, when some 20,000 members held a “Pro-America Rally” in Madison Square Garden.

Inside, jackbooted Nazi supporters filled the aisles while speakers ranted against President “Frank D. Rosenfeld” and his “Jew Deal.”

Outside, some 80,000 anti-Nazi demonstrators furiously protested the event, clashing with police and attempting to gain entry to the arena and shut it down.

The Bund called George Washington “the first fascist.”

Chileans remain upset at their semi-privatized pension system (NYT), and I say that is now the country to sell short.

Here’s an excellent letter from Don Boudreaux. I admit he had me at the title, Thinking At the Margin: It’s Revolutionary:

…I agree that most people are troubled that the likes of Tom Brady and Jennifer Lawrence earn far higher pay than does any firefighter or school teacher.  But this reality reflects not people’s correct understanding of a failing economy but people’s incorrect understanding of a successful economy.  It reflects also a failure of economists to better teach basic economics to the general public.  So let me ask: would you prefer to live in a world in which the number of people who can skillfully fight fires and teach children is large but the number of people who can skillfully play sports and act is very tiny, or in a world in which the number of people who can skillfully fight fires and teach children is very tiny but the number of people who can skillfully play sports and act is large?

I’m sure that you’d much prefer to live in a world in which skills at fighting fires and teaching children are more abundant than are skills at playing sports and acting.  Precisely because saving lives and teaching children are indeed far more important on the whole than is entertainment, we are extraordinarily fortunate that the numbers of our fellow human beings who possess the skills and willingness to save lives and to teach children are much greater than are the numbers who can skillfully play sports and act.

The lower pay of fire fighters and school teachers simply reflects the happy reality that we’re blessed with a much larger supply of superb first-responders and educators than we are of superb jocks and thespians.  Were it the other way around, then while we’d be better entertained with more top-flight sporting events and movies, all but the richest amongst us would suffer significantly greater risks of being unable to educate our children and of dying in house fires and from other mishaps.

The more some people go, the more other people want to go too.  It is something to share and talk about.  From the latest JPE, by
Duncan Sheppard Gilchrist (Wealthfront) and Emily Glassberg Sands (Coursera), here is the abstract:

We exploit the randomness of weather and the relationship between weather and moviegoing to quantify social spillovers in movie consumption. Instrumenting for early viewership with plausibly exogenous weather shocks captured in LASSO-chosen instruments, we find that shocks to opening weekend viewership are doubled over the following five weekends. Our estimated momentum arises almost exclusively at the local level, and we find no evidence that it varies with either ex post movie quality or the precision of ex ante information about movie quality, suggesting that the observed momentum is driven in part by a preference for shared experience, and not only by social learning.

Here are ungated copies, note it is fitting this research comes in part from Coursera.  Also from the new JPE, if a Spanish region has a disproportionate share of lottery winners, it is more likely to opt for the incumbent.

No, that is not enlightenment about life, that is enlightenment about Enlightenment, as in the eighteenth century phenomenon.  P., a loyal MR reader, wrote to me with such a request, noting correctly that “I usually find that broad, ambitious survey books are not the answer.”

That survey would be Peter Gay, recently a bestseller in China by the way, and then Ernst Cassirer, Jonathan Israel, and Roy Porter, but let me outline an alternative program of study.  The goal here is to be practical, engaging, and vivid, not comprehensive or scholarly per se:


Geoffrey Clive’s short book The Romantic Enlightenment.

James Boswell, Journals, selected excerpts, he was an early blogger by the way, and David Hume, An Enquiry Concerning Human Understanding.  I find that to be one of the wittiest of books.  Plus Hume’s Essays.

Diderot, Rameau’s Nephew, and Rousseau’s Second Discourse.  Condorcet, Essay on the Progress of the Human Mind.  Voltaire I consider overrated.

Swift, Gulliver’s Travels, yes I know it is arguably “anti-Enlightenment,” better yet.  If you insist on another Irishman, Bishop Berkeley is an entertaining writer as well.

Founding documents of the United States, and Ben Franklin, Autobiography.

Kant, Perpetual Peace, “What is Enlightenment?”, and Lessing, Nathan the Wise.

Beccaria, Of Crimes and Punishments.

If you have the time to tackle longer books, start with Smith’s Wealth of Nations and Boswell’s Life of Johnson and then Casanova and Tristram Shandy (there is by the way a splendid book on the postmodern in the Enlightenment but I can no longer remember the cite).  Leave Montesquieu to the Straussians, although the returns are high if you are so inclined.

For history, read up on eighteenth century scientific societies, Robert Darnton on the rise of publishing and the book trade, Habermas on the coffeehouse debate culture and the public sphere, and Brewer and McKendrick on the rise of consumer society in England.  Try Wikipedia for Catherine the Great, Frederick the Great, and other rulers of the time.  There is also Margaret C. Jacob, The Radical Enlightenment, and books on 18th century Freemasonry.  The French Revolution seems to require its own blog post, as does the Industrial Revolution, slavery too, in a pinch resort to the MR search function box on this blog.  Foucault will give you a sense of the dark side of the Enlightenment, his history is unreliable but read him on Discipline and Punishment and on ideology try the rather dense The Order of Things.

That all said, I would start with music and the arts first.


Haydn, the London symphonies and late piano sonatas and string quartets Op.76.

Mozart, the major operas, including reading through the libretti while listening.  If you can only do one thing on this list…

Gluck, assorted operas, noting he is not nearly the equal of Haydn or Mozart as a composer but he did capture the spirit of Enlightenment.

C.P.E. Bach, the Prussian Sonatas.


Study French painting from Chardin through David, picture books will do if you can’t visit the original works.  Focus on Watteau, Boucher, Fragonard, Vigée-Le Brun, Boilly, Hubert Robert, and others, how their works tie into the history of the period and how the styles transformed over time.  Visit Paris, Huntington Gardens, and Tiepolo’s work in the Residenz in Würzburg.  Do a tour of Georgian architecture in England, in a pinch visit the derivative works at Harvard, Yale, and Alexandria, Virginia.  Study Tiepolo more generally, Goya, and also Antonio Canova.



Why not?  I’ll toss up Dangerous Liaisons (Vadim and Malkovich versions), Barry Lyndon, Casanova, Amadeus, A Royal Affair (can’t forget Denmark!), Marie Antoinette, Ridicule, and The Madness of King George.

What did I leave out that is of utmost importance?

Hong Kong’s streets are safer, with fewer murders by the fierce crime organizations known as triads that figured in so many kung fu films. And its real estate is among the world’s most expensive, making it difficult for training studios to afford soaring rents.

Gone are the days when “kung fu was a big part of people’s cultural and leisure life,” said Mak King Sang Ricardo, the author of a history of martial arts in Hong Kong. “After work, people would go to martial arts schools, where they’d cook dinner together and practice kung fu until 11 at night.”

With a shift in martial arts preferences, the rise of video games — more teenagers play Pokémon Go in parks here than practice a roundhouse kick — and a perception among young people that kung fu just isn’t cool, longtime martial artists worry that kung fu’s future is bleak.

High studio rents are of course a big problem:

…According to Mr. Leung’s organization, the International WingTsun Association, former apprentices have opened 4,000 branches in more than 65 countries, but only five in Hong Kong…

“Kung fu is more for retired uncles and grandpas.”

That is from Charlotte Yang at the NYT, interesting throughout and yet I hear the author is only a summer intern.

New MRU Course: Money Skills!

by on August 22, 2016 at 7:23 am in Economics, Film | Permalink

We have a new course at Marginal Revolution UniversityMoney Skills. The first set of videos overlap with our Principles of Macroeconomics course and cover things like lessons from economics for investing in the stock market. We also cover this important material in our textbook, Modern Principles. Later videos will cover time discounting (mortgages), career choice, renting versus owning and other topics depending on demand.

Here’s our first video, How Expert Are Expert Stock Pickers? Later in the week, Tyler will cover the theory of efficient markets.

The Great Recession

by on August 10, 2016 at 7:25 am in Economics, Education, Film | Permalink

Our latest video from Marginal Revolution University covers the Great Recession and financial intermediation. It draws from our popular textbook, Modern Principles of Macroeconomics.

It’s an interesting process working with our creative animation team. We don’t always know what is possible let alone what works best in this medium and they don’t always know the economics so we have lots of discussion about the visuals, the pacing, the storytelling elements, the sounds and the music. It took us quite a while to get this video right because it covers a lot of material and we had to get the animations precise to correctly convey the economics but we are pleased with the final result.