Month: August 2005

Critical Decline?

In perusing back issues of econ journals I’ve always enjoyed the critical commentary sections.  Today, however, commentary is less frequent.  Writing in the latest issue of Econ Journal Watch, Coelho, De Worken-Elly III, and MCClure present some hard data on the decline.  The Quarterly Journal of Economics, for example, used to prints lots of short commentary pieces but now hardly prints any.

The authors decry the decline but don’t explain it.

One explanation is that the opportunity cost of space at the top journals has increased.  One hundred years ago the top journals were (more or less) the AER, JPE, and QJE, all among the top journals today.  One hundred years ago the journals published about the same amount of material as they do today.  Yet the number of economists today is many times that of one hundred years ago.  Since more articles are competing for the same number of printed pages it follows that on the intensive margin average article quality will increase and on the extensive margin types of articles with lower value will decline.  Since comments are on average of less value than original contributions it’s not surprising that they have declined over time.

At the same time as commentary has declined in the top journals, the total number of journals has increased so it’s not obvious that total commentary has declined.  Indeed, don’t we now have EJW?

Jokes about opportunity cost

So this guy is driving down the high and passes an orchard… 

He sees this farmer holding up a pig so that it can gobble apples right off the tree.  The pig is going crazy eating apples. 

"That’s the craziet thing I ever saw," the guy tells himself and he pulls over to the side of the road, gets out of the car, and goes up to the farmer. 

"Hey, I couldn’t help noticing what you were doing.  Does your pig like apples?"

The farmer says, "My pig loves apples." 

"Well, if you don’t mind my saying so, if you took a stick and knocked the apples on the ground instead of lifting the pig up, you would save lots of time." 

And the farmer answers, "What’s time to a pig?" 

That is attributed to Paul Willis, and is from Peter Kaminsky’s new and excellent (for foodies) Pig Perfect.

An unusual New Zealand hotel

This awesome New Zealand hotel built out of a hillside, and a defunct train and plane, has three sleeping options:

"Sleeping inside a 1950’s Bristol Freighter Plane refurbished into 2 beautiful motel rooms.

"Sleeping inside a 1950’s Rail Carriage 3 room motel unit, which sleeps six.

"Sleeping like a Hobbit–underground with a circular window."

That is from Boing Boing, photo included, I am not sleeping there but I would select the Hobbit option.  Here is the original link with geographic information as well.  Here is a site Unusual Hotels of the World.

Ten predictions about cars for 2025

The indispensable Chris F. Masse writes me:

Drive’s top 10 sure-fire predictions for 2025

1. Diesels will account for half of all new vehicles sold.
2. CVT transmissions will outnumber manuals and automatics combined.
3. Cars will be 30 per cent lighter and physically smaller on average.
4. Average fuel consumption will be down 50 per cent per vehicle.
5. Luxury cars will offer light-refracting, colour-changing paint.
6. Visual advertising will permeate the cabin and outer skin of cars.
7. Autopilot will still be 20 years off (thankfully).
8. We’ll still be complaining about congestion and fuel prices.
9. Road safety measures will be education-based and constructive, not
punitive.
10. Some car parts will be assembled atom by atom using nanotechnology.

The Melbourne paper The Age offers more and also lists the predictions.  In my view, #8 is the sure thing.

Discard your books for love

Many of you wrote in to recommend www.bookcrossing.com for discarded books.  The system works as follows:

  1. Read a good book (you already know how to do that)
  2. Register it here (along with your journal comments), get a unique BCID (BookCrossing ID number), and label the book
  3. Release it for someone else to read (give it to a friend, leave it on a park bench, donate it to charity, "forget" it in a coffee shop, etc.), and get notified by email each time someone comes here and records journal entries for that book. And if you make Release Notes on the book, others can Go Hunting for it and try to find it.

Claudia Morgenstern directs me to the Wikipedia entry on BookCrossing.  Some readers report that coffee shops are especially popular places to leave books.  The "hunting" aspect may make this more efficient than simply leaving your book somewhere.  Furthermore BookCrossing seems like an alternative means of finding dates.  Here is a list of BookCrossing meet-up groups.

Robin Hanson to Guest Blog

Tyler is in Australia and I am in Mississippi lecturing to judges and eating fried strawberries (yes it’s true, Southerners do like to fry everything!) so we are delighted this week to be joined by our colleague Robin Hanson.  Like Robin, many economists started out in physics but how many continue to publish papers in quantum physics while creating innovative ideas in economics like terrorism futures and improved markets for health care?

I like to say that half of Robin’s ideas are brilliant and the other half are crazy.  I’m just not sure which half is which!  See if you can figure it out. 🙂

WiFi

I’m in Gulfport, MS blogging wirelessly from the airport.  Dulles and Atlanta don’t have free WiFi but a lot of the smaller airports do and it’s great.  According to Nicholas Kristof, the largest WiFi hotspot in the world is in Eastern Oregon where some 600 miles are covered.

Driving along the road here, I used my laptop to get
e-mail and download video – and you can do that while cruising at 70
miles per hour, mile after mile after mile, at a transmission speed
several times as fast as a T-1 line. (Note: it’s preferable to do this
with someone else driving.)

Cool!  Now if only they could solve the problem of long-life batt

Avian flu update

No good news here:

1. Human cases appear to be developing in Kazhakstan.

2. There is probably (weak) human-to-human transmission in Indonesia.

3. Birds are spreading the flu to other birds in Europe, and probably later to Australia and North America as well.

4. Casualties continue in Vietnam.

5. The Chinese government is not being forthright about the possibility — admittedly speculative — of rampant bird flu (for birds and humans) on its territory.

6. Bird flu is now entrenched in bird populations throughout Southeast Asia for at least the next six to eight years, giving the virus more time to mutate and possibly become a pandemic.

Your chance of dying from avian flu is much greater than your chance of dying from terrorism.  Yet the Bush Administration is still doing virtually nothing.

For documentation, and further updates, check in regularly on avianflu.typepad.com, the avian flu blog which I run with Silviu Dochia.

Addendum: Do not get too hopeful about recent vaccine reports.

My favorite things New Zealand

Having once spent a year living in Wellington, this one is easy:

1. Movie and movie director – Forget Peter Jackson and Lord of the Rings, I’ll opt for Vincent Ward’s The Navigator, where a group of medieval peasants suddenly emerges in late twentieth century Auckland.  Ward’s Map of the Human Heart might count as Canadian, but I love its surrealistic treatment of love and memory.  What Dreams May Come is sappy in parts but has Robin Williams doing a serious take on Bergman and Dante, doesn’t that sound strange?  Note that this category is especially strong – for instance Andrew Niccol directed the underrated Gattaca.

2. Music – The Kiwis have many good indie bands but Split Enz is the peak, buy their greatest hits.  Otherwise I’ll nominate the Jean-Paul Sartre Experience, if only for their name.

3. Fiction – Keri Hulme’s The Bone People or Janet Frame’s autobiography are both first-rate, catch the movie too.

4. Painter – Umm…things slow down a bit here.  The obvious pick is Colin McCahon, here are some images.  Here is my favorite, but I will admit some lameness in the category overall.

5. Food – Fish and chips is to New Zealand as barbecue is to Texas — tops in the world.  The best places are owned by Greeks.  New Zealand is also a first-rate locale for Malay, Cambodian, and Burmese cuisines.

6. City – Wellington is for me the single most beautiful city in the world, make sure you go to the lookout on Mount Victoria, here is alas only part of the panorama.  Wellington is also full of lovely Victorian homes.  I will Napier as an underrated second, here is some Art Deco, the city center was destroyed by an earthquake in the 1920s and rebuilt in that style.

The problem? I like New Zealanders so much, I wish there were many more of them.  Here is a brief photo tour, if you haven’t already decided to go. 

Is Firefly libertarian?

I am referring to the Jos Whedon science fiction show that went off the air after eight (?) episodes.  I now have watched the available corpus of eleven episodes available on DVD.  Many call it libertarian, I see the implicit politics as suggesting the following:

1. Don’t expect much from armed rebellion, the bad guys often win.

2. A galaxy devoid of the rule of law is not such a fun place.

3. Smuggler heroes are noble, but most smugglers are not heroes.

4. Economies of scale matter, and secession is a hard life.

In other words, it is actually Burkean conservative.

One of the heroines is a "companion", so I wonder if the series endorses legalized prostitution.  We are told repeatedly that she is "registered" (legally, in the form of a cartel?), and she seems to look down on garden-variety you-know-whats, who presumably also engage in price shading.

Alina Stefanescu offers Firefly commentary; see Rod Long as well.  Dan Drezner describes his conversion to the series, plus offers his usual excellent links.  Jacqueline Passey is another avid fan.

What went wrong with red delicious apples?

I now find these apples inedible.  Why?  Falling prices led to overbreeding and lack of care:

Who’s to blame for the decline of Red Delicious? Everyone, it seems. Consumers were drawn to the eye candy of brilliantly red apples, so supermarket chains paid more for them. Thus, breeders and nurseries patented and propagated the most rubied mutations, or "sports," that they could find, and growers bought them by the millions, knowing that these thick-skinned wonders also would store for ages…

The Washington harvest begins in mid-August and runs to late October, and most apples sold through December are simply stored in refrigerated warehouses. Fruit shipped later in this cycle is kept in a more sophisticated environment called controlled-atmosphere storage — airtight rooms where the temperatures are chilly, the humidity high and the oxygen levels reduced to a bare minimum to arrest aging. Last year’s fruit will be sold through September, just as the new harvest is in full swing.

Storage apples must be picked before all their starches turn to sugar. Pick too late, and the apple turns mealy in the supermarket, but pick too soon, and the apple will never taste sweet. Growers test for optimum conditions, but today’s popular strains of Red Delicious turn color two to three weeks before harvest, making it difficult for pickers to distinguish an apple that is ready from one that isn’t…

The grower could deliver a better apple by harvesting a tree in two or three waves — the outside fruit ripens earlier than fruit in the center of the tree. This is done for Galas and other premium varieties, but the prices for Red Delicious are so depressed that farmers can’t afford that. "You would put yourself out of business," said Roger Pepperl, marketing director for Stemilt Growers Inc., a major grower in Wenatchee. In addition, the redder strains’ thicker skins, found to be rich in antioxidants, taste bitter to many palates.

The bottom line is that this practice has backfired.  Consumers are no longer looking to buy artificial fruits simply for their color or durability.  Here is the full story, and please support this trend by refusing to buy the standard red delicious apple.

The Australian housing bubble and the soft landing

[Australia] kept on raising [interest] rates the next year, and officials talked loudly about the threat of housing prices getting too high.  The most populous Australian state even imposed a special tax on investment properties to discourage real-estate speculation.  By 2004, the market peaked after more than two years of 14% or greater annual growth.  The most recent data suggest Australia’s home prices have changed little over the past year, and have fallen slightly in the two biggest cities, Sydney and Melbourne.

…on the whole the nation’s economy is healthy.  Unemployment is close to a 30-year low and incomes continue to rise.  The Australian Stock Exchange hit a high in mid-June.  Many economists and home buyers alike believe a reservoir of demand will help avoid a sudden crash in home prices.

That is from The Wall Street Journal, 14 July 2005.  I have noticed that even a middling quality home, an hour outside of Sydney, can be listed at U.S. $600,000 or higher.

Machu Picchu: Thoughts and Recommendations

Machu Picchu illustrates the real estate adage, location, location, location.  Everywhere you look you are assaulted by beauty.  For the mathematicians, MP sits on a saddlepoint so if you look North (I’m not sure of the directions but you will get the idea) you see one mountain, turning South you see another, on the East is a sheer cliff falling onto a river, on the West another cliff falling down onto the tiny town of Agua Calientes.  Even further out on the East and West horizons are snow-capped peaks.  And then there are the ruins themselves, majestic and mysterious.  The picture to the right, taken from Putucusi (see below) gives some idea of the location but no picture can take your breath away like the real thing (or perhaps that was just the altitude!).  Click to expand.100_0450_edited

Adding to the magic is the fact that getting to MP is still relatively difficult.  The most common route is by train from Cusco.  It’s only 68 km but takes over 3 hours because the train must go backwards and forwards along trackbacks to make it up some of the steep terrain.  The ride is not boring, however, as it takes you through mountain ranges alongside a raging river.  As you get further and further into the Andes you begin to understand why MP was not formally discovered until 1911.  At Agua Calientes you board a bus which takes you on a one-lane dirt road up the mountain.  There are no guard rails on the road and the bus drivers periodically have to slam on the brakes as they meet one of their fellows coming in the opposite direction – one of them then has to back up to let the other pass.  True, trains and buses are not the stuff of Indiana Jones but neither is this like negotiating the traffic of Rome in order to see the colliseum, there is a definite sense of exploration.

The ruins are a tourist site, of course, but the poverty of Peru means there are few guard rails, plaques or tour guides pushing you on (you can hire a local guide if you want).  Again, to me at least, the experience was more like exploring ruins than visiting ruins.

 Recommendations

My most important recommendation is to stay the night in Agua Calientes.  Most people come in from Cusco for the day – what this means is that they don’t arrive at the site until about 10:30 and they leave by 2:30 to catch the 3:30 train back to Cusco.  Outside of these times there are surprisingly few tourists.  If you stay the night you won’t have MP to yourself but in the morning or late afternoon you will be able to explore at leisure and take pictures of the site sans tourists.

On the morning of my second day, I climbed the mountain opposite MP, Putucusi, and had the whole mountain to myself on the climb and the summit.  Only on the way down in the afternoon did I meet others. 

I recommend climbing both Huayna Picchu and Putucusi (but not on the same day!). 100_0425_edited_2
Huayna Picchu is the mountain in all the photos directly connected to MP.  Climbing it is not technically difficult but it can be arduous as the air is thin.  When I reached the top huffing and puffing, I was shocked to find an ancient Incan laughing at me.  At the top is a fort!  After doing the climb yourself your appreciation of the work and engineering that went into building at the top of a mountain is increased immeasurably.  Also the ruins at the top are dangerous!  No guard rails, guides, or people telling you where to go or what to do.  Very cool – see picture to the right – off the equilibrium path and you are a goner.

Putucusi is more difficult to climb, there are long sections where you are climbing nearly vertical ladders but reaching the top is worth it.

New Blog: Private Development

Tim Harford, who recently guest blogged on Marginal Revolution, is now blogging regularly at a new project of the World Bank, The private sector development blog.  The blog also features Pablo Halkyard who was "born in Brazil …raised in the Himalayas, grew up in Washington, studied in Lima, has a British passport,
though claims to be Chilean."  An ideal pair to write on development!

Here is a post from Tim.

[Regarding] Nancy Birdsall, Dani Rodrik and Arvind Subramanian’s piece from July/August Foreign Affairs (now syndicated to the New York Times).
It does sprawl a bit but there are more useful ideas in there than in a
bookshelf full of the worthy stuff we development types produce. For
instance:

For
every leader who demands a bribe, there is usually a multinational
company or a Western official offering to pay it. For every pile of
illicit wealth, there is usually a European or American financial
institution providing a safe haven for the spoils.

So:

…categorize
certain regimes as corrupt or "odious." Companies that deal with such
regimes would risk losing their claims to repayment if later on a
lawful government decided to default on the debt passed down by its
unlawful predecessor.

Also:

Even
small relaxations of work-visa restrictions generate large income gains
for workers from poor countries (as well as for the world economy).
What is especially appealing is that the gains in income go directly to
the workers, rather than through imperfect distribution channels (as
with trade in goods) or through governments (as with aid).

Where to leave your discarded books

When I finish a book, I dislike keeping it, unless I expect to read it again.  My Russian wife claims I throw things out for the sake of the action itself; she is right.  I also enjoy giving books away.  But when you are traveling, who should receive the book?

At times I engage in serendipitous fantasy, by leaving the book on a park bench and imagining what might happen to it, how seditious ideas might change lives around the globe.  But lately the practical economist in me has taken over.  How should I discard books so as to maximize social welfare?

In Singapore I tried leaving a book — a slightly salacious one at that — in the public library.  Surely it will be found there.  But will anyone be allowed to check it out?  Alternatively, you might think that the greatest number of people will see it in a crowded train or bus station.

One radical option is to leave the book, well…in a bookstore.  Most likely, the book will be sold.  If you bring it to the counter they will be puzzled but I suspect will be willing to ring it up and punch in a code.

Of course now the book has a price, which can restrict the chance it is ever read.  But the chance of it getting into the right hands — the high-valuing user — has gone way up.  This is a testament to the role of middlemen in a capitalist economy.  The book is probably worth more to the world at full price, in a bookstore, than lying on a bench for free.

So now you know where to leave your discarded books.