Why Do States Privatize their Prisons? The Unintended Consequences of Inmate Litigation.” (Job market paper).
The United States has witnessed privatization of a variety of government functions over the last three decades. Media and politicians often attribute the decision to privatize to ideological commitments to small government and fiscal pressure. These claims are particularly notable in the context of prison privatization, where states and the federal government have employed private companies to operate and manage private correctional facilities. I argue state prison privatization is not a function of simple ideological or economic considerations. Rather, prison privatization has been a (potentially unintended) consequence of the administrative and legal costs associated with litigation brought by prisoners. I assemble an original database of prison privatization in the US and demonstrate that the privatization of prisons is best predicted by the legal pressure on state corrections systems, rather than the ideological orientation of a state government. PDF of most recent version here, comments welcome. Appendix here.
Do Private Prison Companies Suffer When Inmates Win Lawsuits? The central claim of my dissertation argues it is the advent of inmates’ rights and rising prisoner litigation that contributed to the rise of prison privatization in the state. A separate dissertation chapter considers this relationship from the viewpoint of the business: is it the case that the economic future of the company is vulnerable to the announcement of successful court orders? I use event study methodology and find I find that on aggregate, investors are not particularly concerned with these judicial decrees. Rather, investors respond to the lawsuits in those states that are the most consequential for private prison firms’ business. This chapter fleshes out the behavior of private prison companies and provides further empirical evidence for the central claim of the dissertation, that private prison firms are indeed vulnerable to the announcement of court orders.
Those are new papers by Anna Gunderson, Ph.D candidate in political science from Emory, starting at Louisiana State, and I note she just won the Elinor and Vincent Ostrom award from the Public Choice Society. Here is her home page.
Mark [Lutter] has a PhD in Economics from George Mason, but don’t let that fool you into thinking he’s conventional.
Here is the full bit:
Mark Lutter (29) and Tamara Winter (23), United States
Mark and Tamara are building charter cities — a concept where cities are governed by their own charter rather than general law. Imagine a world with dozens of new cities, each with their own distinct style, governance and populace. Mark and Tamara are working to make that vibrant future a reality.
Noteworthy: Mark has a PhD in Economics from George Mason, but don’t let that fool you into thinking he’s conventional. He’s a disagreeable, life-long adventurer. He decided to do his own thing after questioning the profit share in his previous company. He moved to Honduras while it was the murder capital of the world. Now he’s stumbling through Africa looking for city settlers.
They are part of the third cohort of Pioneer winners, congrats to Justin Zheng too and all the others, read through the list for some fascinating ideas and projects to come. Tamara is a Mercatus alum, follow her here on Twitter, here is Mark. Here is their institutional website. Here is various information about Pioneer — apply!
2. ““Frankly, the idea of separate honeymoons may signal the continued evolution of marriage,” said Jessica Carbino, an online dating expert based in Los Angeles who is also a sociologist for the dating app Bumble.” (NYT)
6. Good review of Us, a movie masterpiece (the link is full of spoilers).
Africa was the birth-place of Homo sapiens and has the earliest evidence for symbolic behaviour and complex technologies. The best-attested early flowering of these distinctive features was in a glacial refuge zone on the southern coast 100–70 ka, with fewer indications in eastern Africa until after 70 ka. Yet it was eastern Africa, not the south, that witnessed the first major demographic expansion, ~70–60 ka, which led to the peopling of the rest of the world. One possible explanation is that important cultural traits were transmitted from south to east at this time. Here we identify a mitochondrial signal of such a dispersal soon after ~70 ka – the only time in the last 200,000 years that humid climate conditions encompassed southern and tropical Africa. This dispersal immediately preceded the out-of-Africa expansions, potentially providing the trigger for these expansions by transmitting significant cultural elements from the southern African refuge.
That is from Teresa Rito, et.al., in Nature, vis Charles Klingman.
Perhaps in part because we cannot do without business, so many people hate or resent business, and they love to criticize it, mock it, and lower its status. Business just bugs them. After I explained the premise of this book to one of my colleagues, Bryan Caplan, he shrieked to me: “But, but . . . how can people be ungrateful toward corporations? Corporations give us everything! Corporations do everything for us!” Of course, he was joking, as he understood full well that people are often pretty critical of corporations. And they are critical precisely because corporations do so much for us. And do so much to us.
Does my colleague’s outburst remind you of anything? Well, immediately he followed up with this: “Hating corporations is like hating your parents.”
There is another reason it doesn’t quite work to think of businesses as our friends. Friendship is based in part on an intrinsic loyalty that transcends the benefit received in any particular time and place. Many friendships also rely on an ongoing exchange of reciprocal benefits, yet without direct consideration each and every time of exactly how much reciprocity is needed. In addition to the self-interested joys of friendly togetherness, friendship is about commonality of vision, a wish to see your own values reflected in another, a sense of potential shared sacrifice, and a (partial) willingness to put the interest of the other person ahead of your own, without always doing a calculation about what you will get back.
A corporation just doesn’t fit this mold in the same way. A business may wish to appear to be an embodiment of friendly reciprocity, but it is more like an amoral embodiment of principles that usually but not always work out for the common good. The senior management of the corporation has a legally binding responsibility to maximize shareholder profits, at least subject to the constraints of the law and perhaps other constraints embodied in the company’s charter or by-laws. The exact nature of this fiduciary responsibility will vary, but it never says the company ought to be the consumer’s friend, at least not above and beyond when such friendship may prove instrumentally valuable to the ends of the company, including profit.
In this setting, companies will almost always disappoint us if we judge them by the standards of friendship, as the companies themselves are trying to trick us into doing. Companies can never quite meet the standards of friendship. They’re not even close acquaintances. At best they are a bit like wolves in sheep’s clothing, but these wolves bring your food rather than eat you.
Those are both excerpts from my final chapter “If business is so good, why is it so disliked?”, from my book Big Business: A Love Letter to an American Anti-Hero.
As the information trickles out that the Mueller report probably will not end the Trump administration, it is worth thinking about how the broader landscape has changed, and who might be the winners and losers.
Politically, the biggest loser is probably Joe Biden. The belief that he can run as the “safest,” most vetted Democrat against an ailing, politically destroyed Trump all of a sudden seems less relevant. It now seems more important that Biden has run for president several times before, and never done extremely well, in part because he has not been an entirely convincing campaigner. He’s never come close to winning the nomination. He is a candidate of the past, for better or worse, but the dominant mood may not be one of restoration. The Mueller report makes it clear that we really are in a post-Obama era, and that even Trump critics need to be thinking about what comes next rather than looking to the past.
Which candidates then are helped the most? Most likely that would be the dynamic or potentially dynamic, relatively centrist Democrats, and that includes Beto O’Rourke, Pete Buttigieg (dynamic in a Mister Rogers sort of way), and Kamala Harris. I don’t see the candidates further to the left getting a boost from this development. Many Democrats might have been tempted to think: “Trump is so sure to lose, this is our chance to get a real radical in.” That now seems like a less convincing chain of reasoning.
There is another reason why Beto and Buttigieg might benefit, and that has to do with the risks from not so securely vetted candidates. It now seems they can survive in office, even if they partially screw up, as long as they don’t commit too many obviously treasonous crimes.
On the Congressional side, Nancy Pelosi looks wise for having talked down impeachment fervor in advance. Her political capital ought to go up and it probably will.
Many Democratic Congresspeople are better off too. Had the report levied stronger charges against Trump, they would have faced pressures from their base to impeach, even though impeachment might not have played well with independent and centrist voters. It is now likely those charges have been defused. Policy wonks may come back into fashion again, at least relative to where things stood a month or two ago.
Within the Republican Party, the Never Trumpers lost further ground, and in any case the momentum has been turning against them. Mike Pence has kept whatever political future he had, and he will not seem unacceptable as a president, due to moral taint, if say Trump later has to step down because of illness.
The media comes up as one of the biggest losers. While Matt Taibbi’s recent critical account is exaggerated, the mainstream media did talk up the Russia collusion story for two years plus, and now it seems overdone. After the media botched the “Hillary’s emails” story, there was plenty of talk of “never again.” It now seems that all along a new false set of stories was being created, albeit in a different direction. That will be perceived as a significant loss of media credibility, even if you think there is a more finely grained exculpatory story involving accountability some highly suspicious circumstances.
The bigger negative effect may be on media profitability. Trump- and Russia-related stories often have done very well for getting clicks, and indeed the dramatic stakes with those issues have been very, very high. But now it is easy to see the American public losing a lot of its interest in this line of inquiry. The line of “Trump is still corrupt and New York state now will get at him,” while quite possibly correct, isn’t nearly as big of a draw.
Among intellectuals, Glenn Greenwald has been insisting throughout that the Russia collusion story was phony. Whether or not his extreme skepticism was entirely correct, he is due to rise in status. Ross Douthat of The New York Times also had been suggesting that the Russia collusion angle may not pan out and some of his columns now seem pretty wise. John Brennan loses big time.
Oh, and another beneficiary is Steve Moore, Trump’s most recent nominee to the Federal Reserve Board. He has come in for a great deal of critical commentary, but at this point Republican Senators are less likely to cross a jubilant, resurgent Trump on the matter of a single nomination, and not one very much in the public eye.
The biggest winner of course is the United States of America. It seems, after all, that we did not have a president, or even presidential staff, who colluded with the Russians. Maybe you wanted Trump to go down on this one, but that is most of all big reason to celebrate.
4. A claim that 95 percent of Bitcoin trading is fake — can any of you speak to this?
5. Video of my economics vs. philosophy debate/dialogue with Agnes Callard at University of Chicago. Long (three hours), lots of content not available elsewhere in any other form.
The five million Jews who lived in the Pale of Settlement at the turn of the century were overwhelmingly over-represented in towns and in cities. They specialized in seemingly urban occupations, were relatively literate, and were almost absent in agriculture. This pattern persisted overseas where one third of them would eventually immigrate. Hence, Jews were typically characterized as an urban minority. I argue that the opposite was true. The economic ecology of the Jews, the patterns of choices of occupation and location, are described in a model in which Jews were countryside workers with a comparative advantage in rural commerce, complementing agricultural workers, and without comparative advantage in denser urban settings. Using data from the 1897 census, I show that the cross-sectional patterns across districts and localities were consistent with all the predictions of this model. When the share of Jews in the population grew, Jews spilled across two margins—occupational, as manufacturing workers, and geographic, as rural frontier men. Non-Jews were imperfect substitute for Jews, rendering the latter indispensable to the countryside economy. No evidence of urban advantage is evident in the data. Turn of the century Pale of Settlement Jews ought to be understood as rural workers, in and of the countryside. In this light, the patterns exhibited in the US after immigration appear as a sharp break from, rather than a continuation of, old country economic tradition.
That is the abstract of a new paper by Yannay Spitzer. For the pointer I thank Ilya Novak.
Audiences only really like two parts of a show — the beginning and the end. You should prolong the former by rolling directly through your first three numbers without pausing. Then make sure you end suddenly and unexpectedly. Audiences rewards who stop early and punish those who stay late…
Finally, there’s nothing an audience enjoys more than hearing something familiar. If you think your songwriting and all-round musical excellence are enough to entertain a bunch of strangers for an hour with songs they have never heard before, bully for you. The Beatles didn’t, but what the hell do they know?
That is from the entertaining and insightful David Hepworth book Nothing is Real: The Beatles Were Underrated and Other Sweeping Statements About Pop. He lists the following as the ten best blues songs ever:
Memphis Jug Band: K.C. Moan
B.B. King: You Upset me Baby
Blind Willie Johnson: Dark Was the Night
Mississippi Fred McDowell: Shake ‘Em On Down
Lightnin’ Slim: Rooster Blues
Muddy Waters: Too Young to Know
Elmore James: I Can’t Hold Out
Otis Rush: All Your Love
Richard ‘Rabbit’ Brown: James Alley Blues
Blind Blake: Too Tight
By the way, Paul and the Beatles really did record both “I’m Down” and “Yesterday” in the same day.
Is there a case for a system that sometimes produces undemocratic outcomes? I think so, on two grounds. First, it creates incentives for political parties and candidates to seek supermajorities rather than just playing for 50.1 percent, because the latter play is a losing one more often than in a popular-vote presidential system.
Second, it creates incentives for political parties to try to break regional blocs controlled by the opposition, rather than just maximizing turnout in their own areas, because you win the presidency consistently only as a party of multiple regions and you can crack a rival party’s narrow majority by flipping a few states.
According to this — admittedly contrarian — theory, the fact that the Electoral College produces chaotic or undemocratic outcomes in moments of ideological or regional polarization is actually a helpful thing, insofar as it drives politicians and political hacks (by nature not the most creative types) to think bigger than regional blocs and 51 percent majorities.
That is from the NYT, he also considers some arguments against.
1. Those new service sector jobs: helping Chinese families name their babies with English-language names in a culturally appropriate way.
6. Psychopathy by individual state, D.C. a champ. How is New Jersey only number nine?
Or do the offer curves simply not intersect?:
Just over half of Americans between the ages of 18 and 34 — 51 percent of them — said they do not have a steady romantic partner, according to data from the General Social Survey released this week. That 2018 figure is up significantly from 33 percent in 2004 — the lowest figure since the question was first asked in 1986 — and up slightly from 45 percent in 2016.
This account has some gloomy rhetoric, but doesn’t drum up such an awful scenario, for instance:
Among the little-noticed impacts: U.K. citizens and businesses will no longer be able to register internet sites using the .eu domain, and any U.K. entities that currently have such sites will not be able to renew them.
As mentioned, no doubt British truckers would be badly hurt, but what else? This sounds correct to me:
Tariffs would be reimposed. They are as high as 74 percent for tobacco, 22 percent for orange juice, and 10 percent for automobiles. That would hurt exporters. Some of that pain would be offset by a weaker pound.
Is this the biggest danger?:
Health Secretary Matt Hancock has warned medical drug companies to expect six months of “significantly reduced access” to the main trade routes between Britain and Continental Europe if there is a no-deal Brexit.
This one seems exaggerated:
“Bodies may remain uncollected and children might miss exams due to gridlocked roads in the event of a no-deal Brexit”, the report said.
So people, what’s the deal? Put aside the longer and medium-term effects on gdp and the like, what are the greatest short-run dangers of a hard Brexit in the weeks to come? Or is it a big, overstated worry, the new Y2K?
You will find them here, for instance Hayek’s copy of Wealth of Nations went for almost 200k, it was estimated in the 4k to 6k range.
“Desktop ephemera and personal effects” were estimated at 200-300 British pounds, went for 87,500 British pounds. Crazy! Many of the items went for 10x or 20x their original estimates.
Perhaps Hayek is back in fashion again, if only with the wealthy.
For the pointer I thank Lotta Moberg.
Addendum: Here is BC from the comments section:
So, the central planners couldn’t accurately estimate the values of Hayek’s personal effects because the necessary information was distributed among all the auction participants?
A proposal to open a halal butchery facility in Alexandria hit a snag Saturday after some local business owners and dog owners objected. DC Poultry Market wants to open a facility that would sell fresh, humanely killed chickens on Colvin Street in a mostly industrial area of Alexandria between Duke Street and railroad tracks. There are no residential properties in the immediate area, but pet businesses abound: Pinnacle Pet Spa & More, Frolick Dogs, Dogtopia, and the Wholistic Hound Academy.
Therein lay a problem. Though city staff and Alexandria’s planning commission recommended approving DC Poultry Market’s application, dog lovers showed up to the Alexandria City Council’s March 16 meeting to object on olfactory grounds (“My dog can smell when there’s a cookie down the block,” one resident said) and on proximity to poultricide (“Knowing that my dogs may be walked by a business that holds chickens in a windowless room before their throats are slit while fully conscious does not make me feel that my dogs are in a safe environment,” another said).
Here is the full story, via Bruce A. Few seem to be complaining about the chickens.