Month: December 2009

Assorted links

1. Recent work in Austrian economics.

2. 121-hour long lecture (with breaks), the longest ever?

3. Scott Sumner on movies, great post.

4. Is it possible that 225,000 Haitian children are slaves?  Read this too: "Researchers said the practice of young servants, known as 'restavek', is so common that almost half of 257 children interviewed in the shantytown of Cite Soleil were household slaves. The report found that most of the children are sent by parents, who cannot afford to care for them, to families just slightly better off."

5. More on the psychology of menu pricing.

6. Peter Singer and Bill Easterly on Bloggingheads.TV.

“Late believers”: more rational than you think

It's from The Washington Post, but for a moment I thought I was reading Robin Hanson:

Santa's spell hasn't been broken for Fiona Penn, either. A 12-year-old student at Carl Sandburg Middle School in the Alexandria part of Fairfax, Fiona is aware of the ubiquitous shopping mall Santas and the fact that some presents arrive via a UPS truck, not from the sky. But she chooses to believe that her Santa is different.

"The mall Santas, they change. They get hired and fired. But he's the real one," she said.

The full story is here.

Addendum: Fiona responds to critics in the comments section.

Nicaragua notes (avoid walls!)

The keys to eating well here are: avoid walls, seek corn, and bow down to the finest white creams and cheeses you are likely to find.  They use cabbage frequently and well and they are not afraid of sour tastes.  Fried chicken is a treat and they sprinkle white cheese on top of that and on your french fries.  It is an under-mined cuisine.

Horse and donkey carts have not disappeared.  Few people speak English.  Many women carry baskets on their heads to transport goods.  I stayed in what is arguably the country's nicest hotel and my room was $100 a night.  The place was empty.

Nicaragua is wealthier than Honduras but much poorer than El Salvador or Panama.  Here is a garbage dump in Managua, La Chureca.  The economy is likely to shrink two percent this year.  On the bright side, the drug trade doesn't (yet?) have so much of a hold.  The lower income classes seem to do better in terms of social services than in many other countries of comparable wealth.

Leon has one of the best Latin American town squares for cute children, street musicians, balloons and ringing bells, and flirtatious teenage social life.  The Sandinista murals are maintained.  There are few international chain stores of any kind outside of Managua and even most of Managua is under-chained.  People will insist of getting you back the change you are due, even when you tell them to keep it because you don't want to wait for them to get it from their uncle across the street.

Appreciating the country boils down to how much you can enjoy a very direct feeling of genuineness all around; Nicaragua is a hidden jewel, at least for tourist visitors.  

I did not see anyone smoke, not once. 

What does programmer productivity look like?

I am unable to judge the details of its contents, but this article intrigued me.  The key question is why pay across highly-talented and lesser-talented programmers isn't more unequal.  (That's a question I'd like economists to study more generally, given the disparities in productivity across individuals within a firm.)  Here is an excerpt:

Software output cannot be measured as easily as dollars or bricks. The best programmers do not write 10x as many lines of code and they certainly do not work 10x longer hours.

Programmers are most effective when they avoid writing code. They may realize the problem they’re being asked to solve doesn’t need to be solved, that the client doesn’t actually want what they’re asking for. They may know where to find reusable or re-editable code that solves their problem. They may cheat. But just when they are being their most productive, nobody says “Wow! You were just 100x more productive than if you’d done this the hard way. You deserve a raise.” At best they say “Good idea!” and go on.  It may take a while to realize that someone routinely comes up with such time-saving insights. Or to put it negatively, it may take a long time to realize that others are programming with sound and fury but producing nothing.

For the pointer I thank Hamilton Ulmer.

Christopher Hayes on China

The article is interesting throughout, here is one good bit:

The foremost difficulty is immigration. In English we'd call it "migration," but our translators unfailingly used the word "immigration," and I began to see that it was the more accurate description of what was happening. Just as developed countries like the United States and members of the European Union face an influx of workers from the developing world, so does China: it's just that China contains both the developed and developing worlds within its borders.

The way China regulates this flow is not that different from the way nation states do. There is a residence permit called a hukou that anchors people to their home region by tying social services (healthcare, pension and, most important, schooling) to that area. But just as walls and laws have a hard time restricting human traffic from Mexico to the United States when the economic incentives are so extreme, so do the internal regulations of the Chinese state.

And this:

Pick any major city in America and start adding 500,000 people a year. It wouldn't be long before it broke under the strain.

Which are the “safest” cuisines?

James Hinckley asks:

Which cuisine are you most likely to be satisfied with when dining out?  Which disappoints you the least # of visits?

If you were at a shopping center you’ve never been to before and it has one restaurant of each cuisine and your goal was to simply be satisfied (you’re not looking to be blown away, you just don’t want a bad experience), which cuisine do you pick?

Korean is perhaps the safest bet, for two reasons.  First, non-Koreans are not usually interested in the food.  They might enjoy Bul-Gogi but there will be plenty of other dishes for Korean patrons and these will not be “dumbed down.”  The lack of mainstream interest limits the potential for sell-out behavior on the part of the restaurant.  Second, many Korean dishes, most of all the pickled vegetables, “travel” relatively well and do fine in a culture — the USA — which is not obsessed with fresh ingredients.

The most dangerous cuisine to try, in the United States at least, is Chinese.  Your best working assumption is that the restaurant simply isn’t any good.  Even in a Chinatown, such as in New York or DC, most of the restaurants aren’t very good.  Inverting the two principles mentioned above puts you on a path toward figuring out why.  Still, even in Paris or most of Europe for that matter, most of the Chinese restaurants aren’t very good.

I find also that (in the U.S.) Mexican restaurants are risky, Vietnamese establishments are relatively safe, and Thai places were traditionally safe but they are becoming riskier. I’ve never been to a bad Nepalese restaurant.

More on the economics of the decisive Senator

There's been a lot of moralizing about the holdout strategies of Lieberman and Nelson, but under some game-theoretic accounts it is a blessing in disguise, a blessing for Obama at least.  For instance Rahm Emanuel can now say to the House: "look, we just can't renegotiate this any more or the coalition will fall apart.  You'd better get on board with the Senate version of the bill"  A lot of these legislative games don't otherwise have a core, or it takes so long to find the core that the deal falls apart in the meantime.

The holdout behavior of one decisive Senator decreases the need to cut bargains with other members of Congress.  The key words here are "credible precommitment to no further renegotiation."  The more anxious or wavering Nelson and Lieberman were/are, the more credible this precommitment.

Often it's easier to trade with one or two guys than to suffer death by a thousand cuts by having to appease the larger group, yet again.  Keep in mind that Obama probably needs this bill more than do most of the Democrats in the House, so he can't just stonewall and win the staredown.  In addition to his other roles and effects, Lieberman arguably serves as Obama's "bad cop" enforcer.

Yet more evidence for Austro-Chinese business cycle theory

Zhao says Wang charges up to $30,000 per breeding session with Obama.

The full story is here.  Get this bit:

Last month, a Nanjing breeder paid $234,000 for his purebred pooch, reported the Yangtze Evening Times. In September, a young woman in Xian paid $600,000 for her pet, according to the Xian Evening News. Both led airport welcomes with long convoys of pricey automobiles.

For the pointer I thank Daniel Lippman.

Pricing Copenhagen

U.S. President Barack Obama said the climate-change accord he reached with China and most of the 193 attending nations on Dec. 18 was an “unprecedented” first step to slow global warming. Environmental groups such as Friends of the Earth called it a failure…

And the market says?

European and United Nations carbon prices fell the most since February after the Copenhagen climate accord didn’t set targets that would boost demand for permits.

European Union carbon-dioxide allowances for delivery in December 2010 declined 8.3 percent to close at 12.45 euros ($17.82) on the European Climate Exchange in London. Today was the first day of trading since the summit concluded Dec. 19.

The agreed targets in the Copenhagen deal amount to a “bunch of negotiation ranges” that investors had already factored in, Trevor Sikorski, an emissions analysts for Barclays Capital, said in a phone interview after returning to London from the Danish capital. “It seems to be below even our modest expectations.”

Both quotes from Bloomberg.  Hat tip to Tyler in Nicaragua.

No Give, No Take in Israel

In January, Israel will become the first country in the world to give people who sign their organ donor cards points pushing them up the transplant list should they one day need a transplant.  Points will also be given to transplant candidates whose first-degree relatives have signed their organ donor cars or whose first-degree relatives were organ donors.

In the case of kidneys, for example, two points (on a 0-18 point scale) will be given if the candidate had three or more years previous to being listed signed their organ card.  One point will be given if a first-degree relative had signed and 3.5 points if a first-degree relative had previously donated.

In Entrepreneurial Economics I argued for a point allocation system like this–which I called a "no give, no take" system–as a way to increase the incentive to sign one's organ donor card.  One advantage of a no-give, no take system over paying for organs is that most people find this type of system to be fair and just–those who are willing to give are the first to receive should they one day be in in need.  

The new policy will be widely advertised in Israel and will be transitioned into place beginning in January.  I think this new policy is very important.  If organ donation rates increase in Israel, I expect that other countries will quickly follow suit.

By the way, is it peculiar that the two countries in the world with the best organ donor systems are now Israel and Iran?

Hat tip to Dave Undis whose Lifesharers group (I am an advisor) is working on implementing a similar system in the United States.