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Thursday assorted links

by on December 11, 2014 at 12:59 pm in Uncategorized | Permalink

1. Jeff VanderMeer has a very interesting and smart favorite fiction of 2014 list.

2. Does the Super Bowl require subsidized insurance?

3. There is no great sports stagnation (short video).

4. Economic divergence of China and Japan?

5. Cataloging various development successes and failures.

6. Is YouTube becoming the dominant media source?

7. 1972 Harvard Crimson profile of Judith Shklar, fascinating along multiple dimensions.

Many economists like to dump on their fellow social scientists, and personally I find that reading anthropology is often quite uninspiring.  That said, I would like to say a small bit on the superiority of anthropologists.  I view the “products” of anthropology as the experiences, world views, and conversations of the anthropologists themselves.  Those products translate poorly into the medium of print, and so from a distance the anthropologists appear to be inferior and lackluster (I wonder to what extent the anthropologists realize this themselves?).

Yet anthropologists have some of the most profound understandings of the human condition.  They have witnessed, absorbed, and processed some of the most interesting data, especially those anthropologists who do fieldwork of the traditional kind.

The rest of us are simply (usually) too blind to see this.  It even can be argued that anthropology is the queen and most general of the social sciences, and that economics, as a social science, is simply playing around in one of the larger anthropologically-motivated sandboxes, namely the economy.

We so often confuse “what can be translated into print well” with “what is important and interesting.”  In classical music there have been performers, such as Jorge Bolet, who are incredible but whose genius didn’t translate well in the recording studio.  That does mean anthropology is very often not a highly leveraged means of status and influence.

I believe that travel — when done intelligently — is the most fundamental method of learning.  And yet most travel books are a crashing bore.  Don’t confuse what you — as an outsider — can consume well with what is good and important from an inside perspective.

Assorted Wednesday links

by on December 10, 2014 at 12:28 pm in Uncategorized | Permalink

1. New blog from the research department of the IADB (much but not all is in Spanish).

2. Feline average is over.  But there is a counter here.

3. NPR favorite albums of the year list.

4. Lingerie RCT, safe for work, sort of.

5. How a car door should sound.

6. What a Harvard Business School professor orders from a Sichuan restaurant.  For all the fuss, he could have chosen better dishes (only the fish was a good selection), nor did the items as a whole have proper balance.

7. The now-full Cato forum on reviving economic growth.  Videos of the panels are here.

This is from Wojciech Kopczuk in his recent NBER paper:

The methods that rely on direct measurement of wealth — that is, those based on the Survey of Consumer Finance and on the estate tax — show at best a small increase in the share of wealth held by the top 1 percent, while the capitalization methods show a steep increase.

These methods start diverging in their estimates in the 1980s, and the paper has a very useful discussion of their strengths and weaknesses.  This is a notable paragraph:

The most striking feature of the estimates for 2000s is a huge run-up of fixed income-generating wealth in the capitalization series. In fact, this run-up accounts for virtually all of the increase in the share of the top 0.1% between 2000 and 2012 and most of the increase since 2003. The underlying change in taxable capital income (reported by Saez and Zucman, 2014, in their Figure 3) is nowhere as dramatic. The fixed income actually falls in relative terms, as would be expected when yields fall. Instead, the (almost) tripling of the fixed income component on Figure 3 (from 3.3% of total wealth in 2000 to 9.5% in 2012) is driven by an increase in the underlying capitalization factor from 24 to 96.6. This is precisely what the method is intended to do: as yields have declined, the capitalization method should weight the remaining income much more heavily. This increase – if real – would correspond to enormous re-balancing of the underlying portfolios of the wealthy throughout the 2000s. An alternative possibility is simply that the capitalization factors are difficult to estimate during periods of very low rates of return resulting in a systematic bias.

Overall Kopczuk does not favor the capitalization method and thus there seems to be a very real possibility that U.S. wealth inequality has gone up by only a modest amount.

For the pointer I thank Allison Schraeger.

Assorted links

by on December 9, 2014 at 2:08 pm in Uncategorized | Permalink

1. Nouriel Roubini on the new machine age.

2. Do high heels influence how men behave?

3. Amazon introduces Dutch-style auctions.

4. Steve Albini defends today’s world of music.

5. An app for valet parking service.

6. Jonathan Gruber’s opening statement (pdf).

7. Russia’s richest man bought Watson’s Nobel medal and now will return it to him.

The question refers to which economies are underrated or undervalued, not which economies are the strongest.  (Along these lines, LBJ is probably the most overrated player in the NBA today, but he is still also probably the best.)

Last time I picked Pakistan and the Philippines, the latter was a good choice for sure, although now its reputation has caught up to the reality of ongoing rapid growth.  I would say Pakistan remains up for grabs, but still the growth rate has been running about five percent, which you would hardly guess from a random episode of Homeland season four.  The fiscal deficit is down from eight percent to 5.5 percent, a big step for Pakistan.  The stock market has been doing quite well.  I don’t wish to claim vindication there, but at the very least it does seem they were underrated a year ago or two and still today.

This year I am going to pick Sri Lanka as well, which has a growth rate of about eight percent, one of the highest in the world.  The country receives a lot of bad press because of its vicious, decades-long civil war.  Sri Lanka also practices censorship and has iffy democratic credentials and a potentially chaotic election coming up.  That’s what helps make it underrated, but of course the war is over now.

The educational system is reasonably good relative to per capita income, English literacy is much higher than in India, and the Chinese are building a lot of infrastructure there.  Its tourism potential will expand considerably (I loved the trip there I did with Yana).  The poverty rate is down.  Here is one overview of recent developments.  Here are a variety of country reports, lots of positive features.

Still, you don’t hear so much positive about Sri Lanka these days.  On economic terms, I don’t find this one such a tough call, it’s simply a sticky reputation because of the bad politics and previous history.

So my picks for most underrated, this year, are Sri Lanka and Pakistan.

Here are some of my quasi-predictions from 2012.

debates

The full article is here, by Joe Francis, cited on Twitter by Justin Wolfers.

Assorted links

by on December 8, 2014 at 1:16 pm in Uncategorized | Permalink

1. A good music aggregator for “popular smart-indie” 2014 recordings.

2. Corey Robin on the real problem with TNR.

3. Improving the power of the mouse brain with human cells.

4. Australian writers pick their favorite books of the year.

5. Amy Alkon podcast with my GMU colleague Todd Kashdan on his new book on the dark side of the emotions (warning: clicking on the link does bring some noise).

6. Markets in everything, three-year-old fruit cake edition.

Restaurants, movies, you name it, it seems you so often see people in The Big Apple waiting in line.  In the spacious northern Virginia, in contrast, things are built larger and sellouts are uncommon.  You stroll right in and let them take your money.

It is not a priori that the net effect should work this way.  Manhattan has higher rents, but also a higher value of human capital, and thus possibly the losses from waiting time are higher.  But Manhattan also has higher inequality, which means those waiting are often the young rather than the wealthy.  The rich can queue-jump in separate spheres of activity, whether it be holding MOMA membership, being a regular at Le Bernardin, or getting a special invitation to the movie premiere on opening night and walking down a red carpet.

(If you are wondering “why don’t they just raise the price?”, raising the price changes the composition and quality mix of buyers, not always in desired ways for long-run profit maximization.  In the implicit model here, allowing queuing and building more capacity are two alternative substitutes for raising the price.)

Lately I have noticed a small but perhaps not insignificant increase in “waiting culture” in Washington, D.C.  What are ostensibly the town’s two best restaurants –  Little Serow and Rose’s Luxury — now both involve significant waits, as the places do not take reservations.

Income inequality is rising, and in select parts of this country, land rents are rising more rapidly than are returns to human capital for the marginal buyer/waiter.

Does that mean we can expect a culture of waiting to spread further throughout the bicoastal United States?

In principle, almost everyone agrees that investing more in education makes sense as it could help build human capital and see Chile advance out of “middle income status” and into the ranks of the developed world.

However, banning students from using vouchers to attend for-profit schools and prohibiting schools that receive public subsidies from receiving top-up payments from parents, also goes against the market-based system. That has startled Chile’s close-knit and conservative business class, which fears the return of statist policies once endorsed by socialist president Salvador Allende in the 1970s.

…Compounding the uncertainty is that the reform drive coincides with the end of a commodity boom that has seen the price of copper, which makes up half of Chilean exports, shrink 12 per cent this year. In the third quarter, economic growth collapsed to 0.8 per cent, from almost 5 per cent a year ago, while investment contracted 10 per cent.

Amid the abrupt slowdown, critics joke that Ms Bachelet’s unwieldy coalition, “The New Majority”, is much like Christine Lagarde’s “New Mediocre”, as the head of the International Monetary Fund recently described the world economy. Certainly, business confidence has fallen in the gloomy atmosphere, while Ms Bachelet’s popularity has plummeted to 42 per cent from 58 per cent in June.

The FT article has other points of interest.  Perhaps Chile soon will no longer be so overrated.

…Google announced that 56.1% of ads served on the internet are never even “in view”—defined as being on screen for one second or more. That’s a huge number of “impressions” that cost money for advertisers, but are as pointless as a television playing to an empty room.

This is not a big revelation. The web metrics company ComScore reported last year that 46% of online ads are never seen. Spider.io, an ad fraud company acquired by Google in February, has pointed out that a large portion of ads are “viewed” only by robots, revealing that one botnet of 120,000 virus-infected computers viewed ads billions of times, running up the tab for advertisers without offering them the human eyeballs they sought.

There is more here, by Zach Wener-Fleiner, and for the pointer I thank a loyal MR reader.

Assorted links

by on December 7, 2014 at 1:00 pm in Uncategorized | Permalink

1. Stephen L. Carter picks best books of the year.

2. $80 million Bitcoin transaction.

3.  Profile of me, in Dutch.  I took the guy to the local Yemeni restaurant.

4. In this problem of tax incidence theory, which is the more elastic factor of production?

5. Aubade, read by Philip Larkin.

6. China sends fresh water to the Maldives.

7. New results on the economics of the minimum wage.

I reviewed this very good and very useful book by Eric and Joel Best in the 28 November issue of the Times Literary Supplement, not on-line.  Here is one excerpt from my review:

The second problem is that American higher education is much more indebted than it appears at first glance.  Most non-profit colleges and universities have only small amounts of explicit debt on their books, but there are many forms of implicit debt.  Many of those institutions made salary commitments to tenured faculty members, or promised donors they would continue various programmes, or they initiated or expanded sports teams and facilities, hoping to fund those plans with future tuition increases.  A slow economic recovery, sluggish entry-level wages in labour markets, recalcitrant state legislatures, and, yes, the student debt crisis will make those tuition increases very difficult to pull off.  This liquidity crunch is already under way and it has come first to the profit-making institutions and to stand-alone business and law schools, which will be closing and consolidating in great numbers.

I call it “probably the best and clearest book on the United States’ complex student debt problem.”  You can buy the book here.  Also buy the TLS issue, it is their best of the year, as it contains an especially fine “Best Books of the Year” list, you can stop worrying about TNR now.

Assorted links

by on December 6, 2014 at 7:00 am in Uncategorized | Permalink

1. Vox goes Hansonian on the TNR story.

2. Smarter vs. stupider burglars.

3. Ragan Petrie with new results on gender competitiveness.

4. Interview with Michael Hofmann on poetry.

5. Who owns the intellectual property rights to CRISPR?

6. What happened to those who were predicted in the 1990s to be our future leaders?

7. Update on smart meters and dynamic pricing.

Assorted links

by on December 5, 2014 at 11:43 am in Uncategorized | Permalink

1. How some video stores are thriving.

2. Patrick Jory reviews the Andrew MacGregor Marshall book on Thailand.

3. The Economist picks best books of the year, a good list.

4. Chimpanzees are denied legal rights.

5. George Selgin and Bob Murphy on the 1920-21 recovery.  I say we still haven’t gotten to the bottom of this.  Here is Scott Sumner.  “Falling wages are good when needed,” is indeed a likely takeaway.

6. EconLOLcats.

7. Putting this month’s wage gain in context.