Category: Food and Drink

Murugan Idli

E. 149, Murugan Idli Shop, 1, 6th Avenue, opp. Velankanni Church, GOCHS Colony, Besant Nagar, Chennai, Tamil Nadu 600090, India

Most of all, get the Onion Rava Masala Dosa.  The key dishes there cost not much more than one dollar, sometimes less.

Is there any general model as to why, so often in the world of food, price and quality are negatively correlated?

How to eat well in Sri Lanka

Food here is excellent, but eating well involves some counterintuitive advice.

For one thing, there are few “undiscovered gems” along the roadways.  It is just not a thing here, and several Sri Lanka residents have confirmed this to me (one person suggested there used to be lots of them, but they have faded).  During my extensive road travels, I saw many many closed, empty, or otherwise deserted roadside restaurants.  The open ones had few or no customers.  So don’t put a lot of time into searching for them.  You will do just fine eating at the obvious restaurants, including hotel restaurants.

Often breakfast is the best meal, as you can sample hoppers and string hoppers.  If they will cook a hopper for you with an egg (and spices) inside, do that.  Think of it as a spongy carbohydrate turned into a kind of crepe.  The egg inside should not be overdone, but the woman cooking it for you has done this 7,834 times before, so probably it will be just right.

When you get string hoppers, it is all a matter of composition.  Put the right spices, sauces, and sambals on top.  Ask for assistance.  The quality of the string hoppers varies only marginally, it is really all about your skills at composition and at asking for aid.

Hoppers and string hoppers are pretty much always very good.  You want to keep on ordering them.  And yes, food in Sri Lanka is somewhat of an exercise in repeated monotony, but it is a very appealing repeated monotony.

Vegetables in Sri Lanka are first-rate, and if you visit the vegetable markets in and near Dambulla you will come away impressed.  If you are served just ordinary broccoli or cauliflower, without spice or garnish, it will be as good as anywhere.

The best vegetable to eat Sri Lankan style is the green beans.  Never turn them down.  Overall, Sri Lanka is one of the very best countries for vegetarians or vegans.  You’ll see many other kinds of curry, such as with jackfruit or manioc, and they are not bad, but once you have tried them you will be returning to the green beans.

The lentils are consistently superb, arguably better overall than in India, though in fewer styles.  Keep on ordering them.

Thou shalt not refuse any curry served with cashews in it.

If you are at a buffet, sample any item that has a small green leaf in the sauce.  Sample any item with an unusual name, with “tempered cowpeas” being one but not the only example.

Beware of buffets designed for Russian or Chinese package tourists, though usually there will be hoppers or string hoppers somewhere to be had.

Coconut roti is a wonderful snack, but you should not eat too many of them, either at once or across the course of a lifetime.

There is the usual array of tropical fruits, high in quality, though to be frank most of them bore me at this point.

Both pork and bacon are excellent (and common) in Sri Lanka.  The pork is much better than the beef.  So far I’ve had better luck with shrimp than with fish, though I don’t feel I’ve cracked the cultural codes yet for seafood.  Some love Sri Lankan crab, but I haven’t had the chance to explore that direction.

Western-style baked goods are by no means a total disaster here, and it is not a mistake to try them.  The high quality is supposed to stem from the earlier Portuguese influence, at least if you can believe llama Chat.

Aqua Forte, in Galle, is a Michelin star-quality Italian restaurant with affordable prices.  The chef is from Trentino.  The cured raw fish with pistachios is one of the best courses I’ve had in years.

In Colombo, Monsoon is a good Asian fusion place, get the beef rendang.  Shang Palace is a good Chinese restaurant.

In sum, you can eat very well here at great prices and booking doesn’t ever seem to be a problem.  You do need to be willing to double and triple down on some items, but don’t worry — you’ll like them!

Addendum: The perceptive reader will note I have covered only the food of southern Sri Lanka.  That is also the part of the country — by far — that you are most likely to visit.

The Economics of Export Bans

India recently banned the export of non-Basmati rice. What are the economics of export bans? An export ban will tend to decrease the world supply thereby raising world prices but some of the previously exported goods will flow to the domestic market reducing domestic prices, which is the typical reason for an export bans.

FT: India’s ministry of consumer affairs said on Thursday it would prohibit exports to “lower the price as well as ensure availability in the domestic market”. Rice prices in India have risen 11.5 per cent over the past year and 3 per cent over the past month, according to the ministry, reflecting a 35 per cent year-on-year surge in export volumes between April and June.

As noted, in the very short run, an export ban will reduce domestic prices as export stocks flood the domestic market (although even here we have to be a bit careful as a temporary ban could lead to distributors storing–“hoarding”–grain in the expectation of a lifting of the ban). As producers adjust to the lower price and start to produce less, however, the quantity supplied will decrease and domestic prices will rise from Psr to Pban, as shown in the diagram.

Even in the long run the domestic price (Pban) will be below the free trade price (Pft) so the export ban helps domestic rice consumers, i.e. increases their consumer surplus (the green area). India has a lot of rice consumers who vote so the goal here is obviously political. The export ban, however, hurts rice producers, i.e. producer surplus declines (the hatched area). Moreover, producer surplus declines by more than consumer surplus rises so the net effect of the export ban is to reduce domestic welfare.

Rice producers in India are often small family farmers and the government tries to help these farmers with other policies like subsidies so the export ban goes against the grain of other government policy. Moreover, the decline in rice producer incomes will hurt rural incomes more generally. Thus, the export ban protects urban consumers at the expense of typically poorer rural farmers and is likely to increase inequality.

In the long run, an export ban means a smaller farm sector. An export ban is like prohibiting a hotel from raising prices during seasons of high demand. That’s nice if you can get a room but it means fewer hotels. In other words, more hotels will enter the market if they know that they can offset low profits in periods of low demand with high profits in periods of high demand. In the same way, preventing farmers from selling at high prices reduces farmer profits which reduces long run entry and production.

The United States had an export ban on crude oil for 40 years. It’s sometimes said that the export ban was non-binding because the US was a big oil importer. I suspect, however, that the export ban reduced the speed of the fracking revolution. The US export ban also lead to a lot of bizarre mispricing. The ban didn’t apply to refined oil products, for example, so the US went more heavily into refineries and over-produced refined oil products even when (on the margin) exporting crude oil at market prices would have been more profitable.

The Indian government does hold buffer stocks of rice. Strategic reserves have their own problems but it might have been better to draw on the strategic reserve rather than ban exports. Rice and circuses for the capital city at the expense of rural farmers is not a good long run strategy for economic development.

Korean markets in everything

One restaurant in Seoul rose to notoriety after “politely declining” people over 49 (on the basis men of that age might harass female staff), while in 2021, a camping ground in Jeju sparked heated debate with a notice saying it did not accept reservations from people aged 40 or above. Citing a desire to keep noise and alcohol use to a minimum, it stated a preference for women in their 20s and 30s.

Other zones are even more niche.

Among those to have caused a stir on social media are a cafe in Seoul that in 2018 declared itself a “no-rapper zone,” a “no-YouTuber zone” and even a “no-professor zone”.

Here is the full story, via Arpit Gupta.

The Harried Leisure Class

How easy is it for a male breadwinner to raise a family? Oren Cass argues that the cost of “thriving,” is increasing. That’s false. When you do the numbers correctly, Winship and Horpedahl show that the cost of thriving is falling. It’s falling more slowly than we would like–but it’s still the case that current generations are, on the whole, better off than previous generations. 

Still, Winship and Horpedahl face an upward battle because while they are right on the numbers many people feel that they are wrong. Almost every generation harbors a nostalgic belief that circumstances were more favorable during their youth. Moreover, even though people are better off today, social media may have magnified invidious comparisons so everyone feels they are worse off than someone else.

I offer a third reason: the Linder Theorem. Real GDP per capita has doubled since the early 1980s but there are still only 24 hours in a day. How do consumers  respond to all that increased wealth and no additional time? By focusing consumption on goods that are cheap to consume in time. We consume “fast food,” we choose to watch television or movies “on demand,” rather than read books or go to plays or live music performances. We consume multiple goods at the same time as when we eat and watch, talk and drive, and exercise and listen. And we manage, schedule and control our time more carefully with time planners, “to do” lists and calendaring. A search at Amazon for “time management,” for example, leads to over 10,000 hits.

Time management is a cognitively strenuous task, leaving us feeling harried. As the opportunity cost of time increases, our concern about “wasting” our precious hours grows more acute. On balance, we are better off, but the blessing of high-value time can overwhelm some individuals, just as can the ready availability of high-calorie food.

So, whose time has seen an especially remarkable appreciation in the past few decades? Women’s time has experienced a surge in value. As more women have pursued higher education and stepped into professional roles, their time’s value has more than doubled, incentivizing a substantial reorganization of daily life with consequent transaction costs.

It’s expensive for highly educated women to be homemakers but that means substituting the wife’s time for a host of market services, day care, house cleaning, transportation and so forth. Juggling all of these tasks is difficult. Women’s time has become more valuable but also more constrained and requiring more strategic allocation and optimization for both spouses. In previous eras, a spouse who stayed at home served as a reserve pool of time, providing a buffer to manage unexpected disruptions such as a sick child or a car breakdown with greater ease. Today, the same disruption require a cascade of rescheduling and negotiations to manage the situation effectively. It feels hard.

By the way, the same theory also explains why life often appears to unfold at a slower, more serene pace in developing nations. It’s not just an illusion of being on holiday. In places where time is less economically valuable, meals stretch more leisurely, conversations delve deeper, and time itself seems to trudge rather than race. In contrast, with economic development comes an increased pace of life–characterized by a proliferation of fast food, accelerated conversation, and even brisker walking (Levine & Norenzayan, 1999).

Linder’s theorem, as you may have correctly surmised, is related to Baumol’s theorem. In fact, Baumol (1973, p. 630) explained Linder’s theorem succinctly, “rising productivity decreases the demand for commodities whose consumption is expensive in time.” In essence, Baumol’s theorem is about the cost of production while Linder’s theorem is about the cost of consumption. I discuss Baumol and Linder at greater length here (ungated).

If the value of time fell, we might find ourselves eating more leisurely meals and taking more time to appreciate the simple pleasures in life. But, contrary to popular belief, neither Baumol nor Linder effects reduce our well-being; instead, they are a byproduct of economic growth and greater wealth. Rather than lamenting the rise in relative prices, we should recognize and appreciate our ability to afford them, and even acknowledge that on certain occasions, they are worth paying.

Is American Culture Becoming More Pro-Business?

In Capitalism: Hollywood’s Miscast Villain, a piece I wrote in 2010 for the Wall Street Journal, I described the slew of movies and television shows featuring mass-murdering corporate villains including “The Fugitive,” “Syriana,” “Mission Impossible II,” “Erin Brockovich,” “The China Syndrome” and “Avatar,” and Hollywood’s not so subtle attacks on capitalism with characters like Jabba the Hut in the Star Wars universe and the Ferengi in Star Trek. I explained some reasons for Hollywood’s antipathy to capitalism:

Directors and screenwriters see the capitalist as a constraint, a force that prevents them from fulfilling their vision. In turn, the capitalist sees the artist as self-indulgent. Capitalists work hard to produce what consumers want. Artists who work too hard to produce what consumers want are often accused of selling out. Thus even the languages of capitalism and art conflict: a firm that has “sold out” has succeeded, but an artist that has “sold out” has failed.

…Hollywood share[s] Marx’s concept of alienation, the idea that under capitalism workers are separated from the product of their work and made to feel like cogs in a machine rather than independent creators. The lowly screenwriter is a perfect illustration of what Marx had in mind—a screenwriter can pour heart and soul into a screenplay only to see it rewritten, optioned, revised, reworked, rewritten again and hacked, hacked and hacked by a succession of directors, producers and worst of all studio executives. A screenwriter can have a nominally successful career in Hollywood without ever seeing one of his works brought to the screen. Thus, the antipathy of filmmakers to capitalism is less ideological than it is experiential. Screenwriters and directors find themselves in a daily battle between art and commerce, and they come to see their battle against “the suits” as emblematic of a larger war between creative labor and capital.

However, I also noted that some good stories could be told if Hollywood would only put aside their biases and open their eyes to the world:

…how many [movies] feature people who find their true selves in productive work? Not many, which is a shame, since the business world is where most of us live our lives. Like many works of literature, Hollywood chooses for its villains people who strive for social dominance through the pursuit of wealth, prestige, and power. But the ordinary business of capitalism is much more egalitarian: It’s about finding meaning and enjoyment in work and production.

Well, perhaps things are changing. Three recent movies do a good job highlighting a different perspective on capitalism: Flaming Hot, Air and Tetris.

Flaming Hot (Disney) tells the story of a janitor and his improbable rise to the top of the corporate world via leveraging his insights into his Mexican-American heritage and culture. The details of the story are probably false but no one ever said a good story had to be true. A standout aspect of the film is Richard Montanez’s palpable excitement witnessing the Frito Lay factory’s operations — his awe of the technology, the massive machines churning out potato chips, and his joy at being part of a vibrant, productive enterprise, quirks and all. Montanez does find meaning and enjoyment in work and production. Flaming Hot also skillfully emphasizes the often-underestimated significance of marketing, which is frequently brushed off as superfluous or even evil. Incidentally, does “Flaming Hot” contain a subtle nod to the great Walter “E.” Williams?

Air (Amazon Prime) is about a shoe contract. Boring? Not at all. The shoe was the Air Jordan and Air is about Nike’s efforts to court Jordan and his family with a record-breaking and precedent shattering revenue percentage deal. Nike was not united on going all in on Jordan and at the time it was a much smaller firm than it is today so a lot was at stake. Jordan wanted to go with Adidas. His mother convinced him to hear Nike out. Jordan’s mother comes across as very astute, as she almost certainly was, although it seems more probable that it was Jordan’s agent, David Falk who engineered the percentage contract. Regardless, this is a good movie about entrepreneurship. Directed by Ben Affleck, who also portrays Phil Knight, “Air” showcases Affleck’s directorial prowess, previously demonstrated in “Argo,” a personal favorite for personal reasons. 

Tetris (Apple) is also a story about legal contracts. In the dying days of the Soviet Union, multiple teams race to license the Tetris video game from Elektronorgtechnica the Soviet state owned enterprise that presumptively held the rights as the employer of the inventor, Alexey Pajitnov. Gorbachev and Robert Maxwell both make unlikely appearances in this remarkable story. One aspect which was surprising even to me, all the players take the rule of law very seriously. A useful reminder of the importance of property rights and a sound judiciary to the capitalist process.

While these films may not secure a spot among cinema’s timeless classics, each is engaging, skillfully made, and entertaining. Moreover, each movie offer insightful commentary on different facets of the capitalist system. Bravo to Hollywood!

Addendum: See also my review of Guru one of the most important free market movies ever made.

High Fructose Corn Syrup and the Sugar Quota

A viral tik-tok video compares the ingredients in American Heinz ketchup with those in Canadian Heinz ketchup. The American version contains high fructose corn syrup (HFCS) while the Canadian one contains sugar. An an economist I can’t tell you whether, “this is why America makes you sick” but I can tell you why the American version doesn’t contain sugar. It’s the sugar quota!

The American sugar quota taxes any imports above a small amount at a very high rate. As a result, the US price of sugar is typically about twice the world price of sugar. The higher price of sugar means that US consumers spend billions more for candy, soda and other products and American sugar farmers increase their sales and profits. But the high price also incentivizes producers of goods that need a sweet kick, including Heinz, to substitute with high fructose corn syrup. Americans are the biggest consumers of HFCS in the world.

The two effects of the higher price–raising the price of domestic sugar and causing substitution towards high fructose corn syrup–illustrate the peculiar political economy of the sugar quota. Most obviously, the sugar quota is supported by domestic sugar producers, including the infamous Fanjul brothers, but it’s also supported and indeed was lobbied for by Archer Daniels Midland the inventors of HFCS! Even though the two sides sit together uneasily, there has apparently been enough profits to go around.

Agglomeration externalities from restaurants

We estimate agglomeration externalities in Milan’s restaurant sector using the abolition of a unique regulation that restricted where restaurants could locate. In 2005, Milan abolished a minimum distance requirement that had kept the number of establishments artificially constant across neighborhoods. We find that after 2005, the geographical concentration of restaurants increased sharply and at an accelerating rate. Consistent with the existence of strong and self-sustaining agglomeration externalities, restaurants agglomerated in some neighborhoods and deserted others, leading to a growing divergence in local amenities across neighborhoods. Restaurants located in neighborhoods that experienced large increases in agglomeration reacted by increasing product differentiation.

That is from a new AER Insights piece by Marco Leonardi and Enrico Moretti.  Here are some ungated copies.  I am myself repeatedly surprised how much the mere location of a restaurant can predict its quality.

Pristina notes

Imagine a third-tier Ottoman city, accidentally elevated to the status of a national capital, and you have Pristina.  Furthermore, that is a pretty good thing!  The town is charming, walkable, and has first-rate street and cafe life.  There is one good monastery nearby and some quality Brutalist architecture.  My favorite site was the National Library of Kosovo:

National Library of Kosovo – Pristina, Kosovo - Atlas Obscura

Here are additional views of the building, is it fair to call it one of the greatest Communist achievements of Yugoslavia?  1982.

Government debt is only about five percent of gdp.  I am not sure how accurate is the data, but growth rates are not so bad.  The country has about 5k per capita gdp, but about 15k PPP-adjusted, that is a large gap and maybe the truth lies somewhere in between.

Might this be the cheapest country in all of Europe?   I had one good meal in a nice restaurant with nice decor for only five euros.

Tiffany served the tastiest and also most representative meal, there is no menu and they simply bring you what they have.  The food is in general excellent, though not varied.  Be ready for meats, sausage, cheese, tomato, kebab, green and red peppers, and bread.  There is pasta too, but few other foreign offerings.  I didn’t see any Asian food whatsoever, or any international fast food chains, or any Starbucks.

Throughout the town you find scattered statues, such as the obligatory Mother Teresa, and the others of very masculine heroes, often labeled explicitly as “heroes.”  The quotient for sexual dimorphism is reasonably high.

It is quite safe, so more people should visit.  In three days I saw zero tourists.  It is not a “thrills destination,” but where else can you ponder all the historical reasons why, for so long, a “Greater Albania” has proven impossible?

Cheat sheet of neighboring countries:

Serbia: Feels imperial, “seen better days,” no longer a transport hub, looks toward Moscow.

North Macedonia: Stands a bit apart, closer to Bulgarian culture, less recent historical trauma, more right-wing and pro-U.S., keen to integrate with the West.

Albania: Tenacious, spent decades lost in the wilderness, never been able to “play its hand” on that Greater Albania thing, did it ever recover from the fall of Venetian Albania?

Few parts of the world are more interesting, or unsettling.  All of these are great countries to visit.

My excellent Conversation with Seth Godin

Here is the audio, video, and transcript from a very good session.  Here is part of the episode summary:

Seth joined Tyler to discuss why direct marketing works at all, the marketing success of Trader Joe’s vs Whole Foods, why you can’t reverse engineer Taylor Swift’s success, how Seth would fix baseball, the brilliant marketing in ChatGPT’s design, the most underrated American visual artist, the problem with online education, approaching public talks as a team process, what makes him a good cook, his updated advice for aspiring young authors, how growing up in Buffalo shaped him, what he’ll work on next, and more.

Here is one excerpt:

COWEN: If you were called in as a consultant to professional baseball, what would you tell them to do to keep the game alive?

GODIN: [laughs] I am so glad I never was a consultant.

What is baseball? In most of the world, no one wants to watch one minute of baseball. Why do we want to watch baseball? Why do the songs and the Cracker Jack and the sounds matter to some people and not to others? The answer is that professional sports in any country that are beloved, are beloved because they remind us of our parents. They remind us of a different time in our lives. They are comfortable but also challenging. They let us exchange status roles in a safe way without extraordinary division.

Baseball was that for a very long time, but then things changed. One of the things that changed is that football was built for television and baseball is not. By leaning into television, which completely terraformed American society for 40 years, football advanced in a lot of ways.

Baseball is in a jam because, on one hand, like Coke and New Coke, you need to remind people of the old days. On the other hand, people have too many choices now.

And another:

COWEN: What is the detail you have become most increasingly pessimistic about?

GODIN: I think that our ability to rationalize our lazy, convenient, selfish, immoral, bad behavior is unbounded, and people will find a reason to justify the thing that they used to do because that’s how we evolved. One would hope that in the face of a real challenge or actual useful data, people would say, “Oh, I was wrong. I just changed my mind.” It’s really hard to do that.

There was a piece in The Times just the other day about the bibs that long-distance runners wear at races. There is no reason left for them to wear bibs. It’s not a big issue. Everyone should say, “Oh, yeah, great, done.” But the bib defenders coming out of the woodwork, explaining, each in their own way, why we need bibs for people who are running in races — that’s just a microcosm of the human problem, which is, culture sticks around because it’s good at sticking around. But sometimes we need to change the culture, and we should wake up and say, “This is a good day to change the culture.”

COWEN: So, we’re all bib defenders in our own special ways.

GODIN: Correct! Well said. Bib Defenders. That’s the name of the next book. Love that.

COWEN: What is, for you, the bib?

GODIN: I think that I have probably held onto this 62-year-old’s perception of content and books and thoughtful output longer than the culture wants to embrace, the same way lots of artists have held onto the album as opposed to the single. But my goal isn’t to be more popular, and so I’m really comfortable with the repercussions of what I’ve held onto.

Recommended, interesting throughout.  And here is Seth’s new book The Song of Significance: A New Manifesto for Teams.

Free Insurance for Everyone!

President Biden says “We’re planning to make it mandatory for airlines to compensate travelers with meals, hotels, taxis, and cash, miles, or travel vouchers when your flight is delayed or cancelled because of their mistake.”

A classic example of the Happy Meal Fallacy:

Some restaurants offer burgers without fries and a drink. These restaurants cater to low-income people who enjoy fries and drinks but can’t always afford them. To rectify this sad situation a presidential candidate proposes The Happy Meal Act. Under the Act, burgers must be sold with fries and a drink. “Burgers by themselves are not a complete, nutritious meal,” the politician argues, concluding with the uplifting campaign slogan, “Everyone deserves a Happy Meal!”

But will the Happy Meal Act make people happy? If burgers must come with fries and a drink, restaurants will increase the price of a “burger.” Even though everyone likes fries and a drink they may not like the added benefits by as much as the increase in the price of the meal. Indeed, this must be the case since consumers could have bought the meal before the Act but chose not to. Requiring firms to sell benefits that customers value less than their cost makes both firms and customers worse off.

Almost everyone understands this when it comes to burgers and fries but make it burgers, fries and air miles and some people will think this is a good idea. To recap, requiring firms to sell benefits that customers value less than their cost makes both firms and customers worse off. And if customers value the benefits at more than the cost then that’s a profit opportunity and there is no need for a mandate.

Alaska food notes

There is salmon, halibut, and crab, the latter usually priced at $125 for the meal.  The salmon I liked but did not love, so the halibut is the standout order in Anchorage, noting that even fish and chips may cost you $45.  The vegetables were somewhat better than expected.  Many quite good restaurants (at least if you order halibut) look like they are somewhat less than quite good, so the usual visual cues do not apply.  Prices seem determined by ingredients, rather than restaurant location or status of the restaurant.  I enjoyed my reindeer bibimbap.  Chinese restaurants are not common, you will find many more Japanese and sushi places, which based on n = 2 are pretty good.  Namaste Shangri-La was excellent, it is one of three (!) Nepalese places in town.  The Mexican food I did not try.  There are several Polynesian locales.  Fresh blueberry and lingonberry jams are not to be neglected.  Lower your expectations for the supermarkets, not just the fruit but also the cheese.