Month: July 2006

The best paragraph I read yesterday

Apart from the part from War and Peace I read on the plane, here is tops:

Above all, a classical liberal needs to identify, expose, and counter
the marketing strategies and tactics that are used to expand
government. Both political parties play up fears in order to sucker us
into ceding money and power. Just as certain citizens’ groups are known
for exposing the false advertising of corporations, we need to expose
the false advertising of politicians.

That is Arnold Kling, here is the full argument.

Market Approaches to Conservation

The Nature Conservancy continues to pioneer innovative, market-based approaches to conservation.

The Nature Conservancy announced today the purchase of six federal
trawling permits and four trawling vessels from commercial fishermen in
Morro Bay as part of a collaborative effort to protect a vast swath of
ocean off the coast of central California and help reform a troubled
fishery. The precedent-setting acquisitions represent the nation’s
first private buy out of Pacific fishing vessels and permits for
conservation purposes.

Thanks to Monique van Hoek for the pointer.

Why did the electric car die?

David Friedman cites one critic of the idea:

General Motors lost two billion
dollars on the project, and lost money on every single EV1 produced.
The leases didn’t even cover the costs of servicing them.

range of 130 miles is bogus. None of them ever achieved that under
normal driving conditions. Running the air conditioning or heater could
halve that range. Even running the headlights reduced it by 10%.

recharge time was two hours using special charging stations that except
for fleet use didn’t exist. The effective recharge time, using the
equipment that could be installed in a lessee’s garage, was eight
hours. …

batteries that had lasted up to three years in testing were failing
after six months in service. There was no way to keep them from
overheating without doubling the size of the battery pack. Lead-acid
batteries were superior to NiMH in actual daily use.

Believe it or not, it wasn’t because of an oil company conspiracy.  Here is an article on the importance of range.  Here is a negative review of the new movie on the electric car.

The immigration and wages debate

Here is a very good article by Roger Lowenstein, from The New York Times Magazine today.  It takes you behind the scenes of the Card vs. Borjas debate and tries to figure out who might actually be right and why.  Print it out, it is worth reading in full.  I interpret Lowenstein as closer to Card’s position, although he takes care to present both sides of the issue.

Markets in Everything: Child Brides

Another sad one (from the NYT Magazine):

In Afghanistan, a child bride is very often just that: a child, even a preteen,
her innocence betrothed to someone older, even much, much older.  Rather than a willing union between a man and woman, marriage is frequently a
transaction among families, and the younger the bride, the higher the price she
may fetch.

The best economics columnist you’ve never heard of?

David Warsh nominates Shane Greenstein for this honor.  Here are Shane’s recent columns on the tech industry.  Try his essay on why inventors are not usually famous.  But I’ve heard of Shane, and once I even interviewed him for a job.  So for me he is not even in the running for the "unheard of" designation.  Other nominations are welcome…

What is Robert Skidelsky doing?

That’s Lord Skidelsky, author of the excellent biographies of Keynes.  His Oswald Mosley biography earned him much enmity in academia.  And now?

Late in life, the historian and peer of the realm has re-connected with
his Russian roots. He has learned the language (he took his A-level at
the age of 64) and keeps a flat in Moscow. "I went there first in the
early 90s to research a book called The World After Communism," he
says. "Now I’ve started to feel more Russian, I go at least half a
dozen times a year." He also travels regularly in the other direction.
He is on the board of one of the most successful mutual funds in
America and is about to become a director of a large employment agency
in Florida. "I’m just modestly restoring the Skidelsky family fortune
after all those years in academia," he says.

Here is the full story, and thanks to for the pointer.

Repent and be rewarded

…the Yobe State Government [in Nigeria, AT] determined to curb the
spate of armed robbery in the state introduced a novel anti-crime,
social protection programme, what it termed "the repentant robbers
scheme". The objective was to encourage armed robbers in the state to
confess to their sins, and if they did and signed up for the programme,
the state offered to pay them a sum of N5, 200 per month. The repentant
robbers were only required to swear with the Holy Qu’ran that they
would never again return to their bad ways.

    Either the government does not understand elasticity of supply, surely the elasticity of supply of "repentant robbers" is infinite or they believe that they public does not understand the concept of time consistency.  Either way this does not seem like a good program.  More on the story here.

Greg Mankiw takes on Jacqueline Passey

Jacqueline Passey writes:

…gambling is distributive justice, moving money from stupid people to smart people.

Greg Mankiw writes (do note that Greg is not a pure utilitarian):

The utilitarian in me points out that Jacqueline gets things exactly
backwards: distributive justice demands moving money from smart people
to stupid people.  Smart people have the potential to make a lot of
money and thus have lower marginal utility per dollar, while stupid
people have less money-making potential and higher marginal utility.

This question is tricky.  If gambling leads to little real enjoyment, stupid/poor people are receiving a low marginal utility from these expenditures.  If we discourage gambling (whether by taxation or moralizing), might the would-be gamblers spend the money in yet another wasteful and thus low marginal utility way?  Short of having government manage the entire budget of poor people, through extensive taxes and subsidies, this problem is hard to avoid. 

Alternatively, if stupid people enjoy losing their money through gambling, then it is not wasteful and need not be discouraged.

It is hard to say that both a) marginal expenditures are wasted, and b)
marginal expenditures bring a high marginal utility.  Perhaps once
gambling is removed as a temptation the poor will spend those marginal funds on tofu and vitamins, but I would not count on that.

Readers, how do you score Greg vs. Jacqueline?

Sad facts of the day

"80% of US families did not buy or read a book last year."

"58% of the US adult population never reads another book after high school."

"…more people probably read Engadget than all of the top 50 science blogs combined."

Bill Simmons (a good link for NBA fans) thinks that Allen Iverson would have been the greatest soccer player ever to try the game.

You’ll find all of those over at the ever-excellent

How American is Globalization?

Extending the analysis to 1999, we see that the percentage of the world’s population who are native speakers of English actually declined from 9.8 to 7.8 percent.  The percentage of native speakers of the world’s leading language, Mandarin, also declined slightly, from 15.6 to 15.2 percent…The language groups that have increased dramatically as a percentage of the world population are Arabic and Bengali, which each accounted for 2.7 percent of the world’s speakers in 1958, but rose to 3.5 percent and 3.2 percent, respectively, in 1992.  Hindi speakers rose from 5.2 to 6.4 percent, and Spanish speakers from 5.0 to 6.1 percent.  English as a first language has fallen from its mid-century position of second place to fourth as the millennium ended.

That is from William H. Marling’s How "American" is Globalization?  This wide-ranging book is the definitive current source on which cultures are gaining and losing in respective cultural areas.  The bottom line of this book?  The world is not becoming Americanized.  Very highly recommended.