Paul Krugman has had a few posts on this question, most recently this one, the first one here.  Krugman is right in asserting a major role for air conditioning, but there is a subtle framing point which is sometimes neglected.  The most on-point study is this piece from Jordan Rappaport (pdf):

U.S. residents have been moving en masse to places with nice weather. Well known is the migration towards places with warm winters, which is often attributed to the introduction of air conditioning. But people have also been moving to places with cooler, less-humid summers, which is the opposite of what is expected from the introduction of air conditioning. Nor can the movement to nice weather be primarily explained by shifting industrial composition or by elderly migration. Instead, a large portion of weather-related moves appear to be the result of an increased valuation of nice weather as a consumption amenity, probably due to broad-based rising per capita income.

Overall Rappaport concludes that “nice [warm] weather is a normal good” is the more important driving force behind the movement to the Sun Belt than is air conditioning per se, though of course air conditioning makes nice warm weather all the nicer.  Evidence from compensating differentials also indicates that “…the decreased discomfort from heat and humidity afforded by air-conditioning has not been the primary driver of the move to nice weather.” (p.26)

From 1880 to 1910, Americans overall are moving to places with bad (cold) weather.  In the 1920s they start moving, on net, to places with nicer weather and that trend has not let up.  The arrival of affordable air conditioning in the postwar era bumps this up a bit, but the main trend already was in place.  Furthermore air conditioning has been in the south for quite a while now, but migration in that direction continues.  In his second post on the topic, Krugman refers to this as a “gradual adjustment” to AC, but it seems to better fit the nice weather as a normal good story.  We’ll know more if we see this migration continuing, but I expect it will.  At some point it won’t be plausible to call the ongoing movement a “lagged response” to the introduction of air conditioning, but again it will fit the normal good story pretty smoothly.

Note also that life expectancy is notably higher in warm weather than cold weather.  Deschenes and Moretti conclude (pdf): “…The longevity gains associated with mobility from the Northeast to the Southwest account for 4% to 7% of the total gains in life expectancy experienced by the U.S. population over the past thirty years.”

That again points toward a “normal good” explanation, with air conditioning playing a supporting role.

That all said, if you look at the larger political debate going on here, Krugman is correct in arguing that lower taxes are the not main reason for this migration, even though the median voter in these states probably approves of such relatively low tax rates.  In any case, there is a clearer and better version of the weather hypothesis which can be put forward.

Addendum: David Beckworth adds commentary and some fascinating maps.

Education in Mao’s China

by on March 28, 2015 at 3:02 am in Books, Education, History | Permalink

Advancement in China’s school system was highly competitive, and the odds of reaching the top of the educational ladder were very steep.  Of the 32.9 million children who entered primary school in 1965, only 9 percent could expect to enter junior high school.  Only 15 percent of junior high school entrants, in turn, could expect to graduate and enter high school.  Among the highly selected groups that graduated from academic high schools, only 36 percent could expect to enroll in a university.  Of those who entered primary school in 1965, only 1.3 percent could expect to attend an academic high school, and only one-half of 1 percent could expect to attend university.

Of course the Caplanian point is that China managed a lot of post-1979 economic growth with what was fundamentally a not very educated generation.

That excerpt is from Andrew G. Walder’s China Under Mao: A Revolution Derailed, my previous post on this excellent book is here.

Here is one excerpt from his very interesting post:

I get and very much like the skeptical, anti-theoretical thrust of Strauss. I like his deep wariness of ideal theorizing, his exhortations to pay attention to the political life we are always already living. He’s right to see reasoning with others about about how to live as an inherently political activity. He’s right to insist on honoring the distinctive excellences of those sensitive to the texture of real political life and expert in its ceaseless negotations. He’s right that social scientific theories about politics are less politically valuable then good political judgment, and that people who think they’re going to govern “scientifically” are dangerously stupid. (Paraphrasing, here.) And, yes, when philosophy is merely a handmaiden to the dogmas of our age, pursued under the “ecumenical supervision” of the universities, it is profoundly compromised. To be a philosopher is not to have a job you clock in and out of. To be a philosopher is simply to be, philosophically, always. Right! But the Socratic life is the one very best life? The naturally right, life? Nope. Nope. I’ve read and read and never quite follow how we end up there. I mean, I think this is a great life, beyond wonderful. But nope.

Anyway, Strausseans are strangely obsessed with this idea that the philosophical life, so construed, is the best human life, full stop, and are therefore obsessed with the tension between the best life, which is in the business of exposing bullshit, and the political life, which is built on it.

I am very happy to order this book in advance, I hope Will lets me know when that is possible.

I may not follow any of your suggestions, but just thought I should ask for advice, for my dialogue with Peter next week.  I am the interviewer, he is the interviewee, more or less.  #CowenThiel

China under Mao

by on March 26, 2015 at 2:37 am in Books, History, Law, Political Science | Permalink

That is the new and excellent book by Andrew G. Walder.  Here is one excerpt:

The Communists’ contribution to the war effort was extremely modest.  According to a December 1944 Soviet Comintern report, a total of more than 1 million Nationalist troops had been killed in battle, compared to 103,186 in the CCP’s Eighth Route Army and another several thousand in the New Fourth Army.  The Communists suffered only 10 percent of total Chinese military casualties.  One author has called Mao’s famous doctrine of people’s war one of the “great myths” about the period: “people’s war was hardly used in the conflict against the Japanese.”

Definitely recommended.

From The New Left Review, Moretti and Pestre report:

Three new semantic clusters characterize the language of the Bank from the early 1990s on. The first—and most important—has to do with finance: here, alongside a few predictable adjectives (financial, fiscal, economic) and nouns (loans, investment, growth, interest, lending, debt), we find a landslide of fair value, portfolio, derivative, accrual, guarantees, losses, accounting, assets; a little further down the list, equity, hedging, liquidity, liabilities, creditworthiness, default, swaps, clients, deficit, replenishment, repurchase, cash. In terms of frequency and semantic density, this cluster can only be compared to the material infrastructures of the 1950s–60s; now, however, work in agriculture and industry has been replaced by an overwhelming predominance of financial activities.

…The second cluster has to do with management—a noun that, in absolute terms, is the second most frequent of the last decade (lower than loans, but higher than risk and investment!). In the world of ‘management’, people have goals and agendas; faced with opportunities, challenges and critical situations, they elaborate strategies. To appreciate the novelty, let’s recall that, in the 1950s–60s, issues were studied by experts who surveyed and conducted missions, published reports, assisted, advised and suggested programmes. With the advent of management, the centre of gravity shifts towards focusing, strengthening and implementing; one must monitor, control, audit, rate (Figure 2); ensure that everything is done properly while also helping people to learn from mistakes. The many tools at the manager’s disposal (indicators, instruments, knowledge, expertise, research) enhance effectiveness, efficiency, performance, competitiveness and—it goes without saying—promote innovation.

The concept of governance is another clear winner in more recent times, and furthermore the reports seem to overuse the word “and” relative to the word “the.”  That I can believe.  The article is interesting throughout, hat tip goes to Avinash Celstine.

The grand confluence of Protestantism has dwindled to a trickle over the past thirty years, and the Great Church of America has come to an end.

…The death of Mainline Protestantism is, as we’ve noted, the central historical fact of our time: the event that distinguishes the past several decades from every other period in American history.  Almost every one of our current political and cultural oddities, our contradictions and obscurities, derives from this fact: Mainline Protestantism has lost the capacity to set, or even significantly influence, the national vocabulary or the national self-understanding.

That is from Joseph Bottum, An Anxious Age: The Post-Protestant Ethic and the Spirit of America.

The Tea Party, the great stagnation, etc., maybe you can find it all right here.

Don’t worry people, just joking on that one…

That is the new Ian Bremmer book, with the subtitle Three Choices for America’s Role in the World.  It can be Indispensable America (our postwar role), Moneyball America (pick priorities and accomplish them), or Independent America (limited foreign policy aspirations but lots of nation-building at home and trade abroad), and Ian prefers the latter — “I believe it’s time for Americans to redefine our value to the world.”  Most of all he thinks we have to choose, and articulate the reasons for our choice; right now we are left with Question Mark America, arguably the worst of all worlds.

As you would expect from a focus on foreign policy, he builds a good case for TPP, starting on p.114, from a broadly social democratic point of view, very much worth the read.

The most notable feature of this book is that Bremmer constructs the very best case for each of the foreign policy approaches, not just his favorite, and in this sense he makes the maximum effort to instruct the reader.  We could use a lot more of this approach.  He is also one of the very best people to follow on Twitter.

Our previous blog entries on Singapore are here, there are many dozens of them.  And yet Singapore is about the size of Fairfax County.

For the last fifty years, Singapore has been one of the truly special places in the world and a large part of that credit has to go to Lee Kuan Yew.

Here are previous MR entries on “China fact of the day.”  Again, there are many dozens, and a lot of the credit there too should go to Lee, who provided the model and inspiration for China’s reforms.

Corey Robin has a useful survey of responses from the Left, some of which include repudiations of Zionism, in addition to claims that the current Israeli policies simply have to unravel, to the detriment of virtually everybody.  Think of the latter as a prediction of comeuppance, much like how inequality critics sometimes predict eventual doom for the wealthy if they do not redistribute their wealth.

From a separate direction, economist Glen Weyl explains on Facebook why he is now supporting the BDS movement.

I’m not interested in debating the normative side of the election, or various peace plans, right now.  What I find striking is how unready many critics are to confront what has happened, not just in the “Plan B” sense but also rhetorically.  The possibility that civil rights progress, peace progress, and self-governance and democratic progress simply have stopped, and won’t be back any time soon, is before us.  If anything, matters might become worse yet, especially once you contemplate Gaza.  Yet Western commentators don’t know where to turn, because the prevailing progressive narrative is one, not surprisingly, of progress.  The common progressive remedy is one of moral exhortation, but at this point it doesn’t seem like another lecture to Israeli voters is going to do the trick.

Such stagnation and possibly retrogression in outcomes is hardly novel at the global level, and even within Israel/Palestine proper it’s far from clear there has been much actual news from the Israeli election (i.e., the two-state solution has been failing for some while now).  Still, Israel attracts enough attention, and loyalty, that this is producing an intellectual crisis for many.  Some people feel they have been made fools of, and they are no longer happy playing along with the fantasy of an eventual peace deal based on ideals of democracy and rule of law.  They wish to recast their mood affiliations, but where really to turn?

By the way, the world has been getting more violent since 2007.

There are just 6 per cent more people working in greater Los Angeles than there were 25 years ago. By contrast, the Inland Empire has nearly doubled in size. In fact, the absolute number of jobs added in the Inland Empire since 1990 is nearly double the absolute number of jobs added in greater LA. To get a sense of how wild that is, the entire workforce of the Inland Empire was only 13 per cent the size of Los Angeles’s back in 1990. Even now, there are more than three workers in Los Angeles for every one in the Inland Empire.

It’s a little hard to see given the scale of the chart, but it’s also worth noting that LA experienced a Depression-level drop in employment in the early 1990s. Between January, 1990 and November, 1993, employment in the America’s second-biggest metro area fell by nearly 11 per cent. Employment didn’t return to its previous peak until July, 1999. Talk about a lost decade! (It may help explain this.)

That is from Matthew C. Klein, there is more here, about other American cities too, possibly FT-gated but interesting throughout.

This is from his Polemics book:

43. In point of truth, the headscarf law expresses only one thing: fear.  Westerners in general, and the French in particular, are no more than a bunch of shivering cowards.  What are they afraid of?  Barbarians, as usual.  Barbarians both at home, the ‘suburban youths’, and abroad the ‘Islamic terrorists’.  Why are they afraid?  Because they are guilty, but claim to be innocent.  Guilty from the 1980s onward of having renounced and tried to dismantle every politics of emancipation, every revolutionary form of reason, every true assertion of something other than what is.  Guilty of clinging to their miserable privileges.  Guilty of being no more than grown-up kids who play with their many purchases.  Yes, indeed, ‘after a long childhood, they have been made to grow up’.  They are thus afraid of whatever is a little less old than they are, such as, for example, a stubborn young lady.

44. But most of all, Westerners in general, and the French in particular, are afraid of death.  They can no longer even imagine that an idea is something worth taking risks for.  ‘Zero deaths’ is their most important desire.  Well, they see millions of people throughout the world who have no reason to be afraid of death.  And among them, many die for an idea nearly every day.  For the ‘civilized’, that is a source of intimate terror.

I’ve tried a few other Badiou books, but I find this to be the one easiest to make sense of.  Here is Wikipedia on Badiou.  Here is a Guardian article on him.

This 2010 piece looks very interesting, I haven’t had the chance to read it yet, source here.

Brookings emails me:

Capital income is not growing unboundedly at the expense of labor, and further accumulation of capital in fact most likely means a fall in capital’s share of total income – refuting one of the main theories of economist Thomas Piketty’s popular book Capital in the 21st Century — according to a paper presented today at the Spring 2015 Conference on the Brookings Papers on Economic Activity (BPEA).

Existing studies that show an increase in capital’s share of income miss the growing role of depreciation in short-lived capital, in items such as software, says MIT’s Matthew Rognlie in “Deciphering the Fall and Rise in the Net Capital Share.”  Rognlie subtracts depreciation in seven large developed economies (the US, Japan, Germany, France, the UK, Italy, and Canada) to get net capital income, and finds that the only long-term rise in capital’s share of income is in housing. Capital income elsewhere in the economy has grown moderately, but it is only recovering from a large fall that lasted from 1948 through the 1970s.

Piketty’s Capital argues that the role of capital in the economy, after falling during the Depression and two world wars, is set to recover to the high levels of the 19th and early 20th centuries. According to Piketty, wealth will accumulate amid slowing economic growth to push up the capital-to-GDP ratio in the economy, which will then cause an increase in capital’s share of income — and growing inequality.

In contrast, Rognlie finds that a rising capital-to-GDP ratio is most likely to result in a fall in capital’s share of income, since the net rate of return on capital will fall by an even larger proportion than the capital-to-GDP ratio rises. Outside of housing, postwar changes in the value of the capital stock have not led to parallel changes in capital’s share of income. In fact, the value of the capital stock relative to private income reached its highs in the late 1970s and early 1980s, when capital’s share of income was near a low.

Rognlie shows that the share of net income generated by housing has risen in all seven large developed economies since data became available. “Housing’s central role in the long-term behavior of the aggregate net capital share has… not been emphasized elsewhere…Observers concerned about the distribution of income should keep an eye on housing costs,” he writes.

Brad DeLong offers comment.

Here Jim Tankersley has a superb profile of Rognlie and the story behind his comment, MR plays a role too.  Recommended.

Our social and political life is awash in unconsciously held Christian ideas broken from the theology that gave them meaning, and it’s hungry for the identification of sinners—the better to prove the virtue of the accusers and, perhaps especially, to demonstrate the sociopolitical power of the accusers.

That is from Joseph Bottum, via PW.