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2. There doesn't appear to be any liquidity in the market. The current spread is 6.1 - 9.4.

Intrade's markets are almost always illiquid, even the most liquid among them. They are very weak information sources.

Tyler, I hope you take time to review and comment on Wolff's research on productivity, including his last paper.

Spillovers, Linkages, and Productivity Growth in the US Economy, 1958 to 2007 Edward N. Wolff NBER Working Paper No. 16864 March 2011
JEL No. O30,O33
ABSTRACT
I speculate that technological spillover effects may have become more important over time as IT penetrated the U.S. economy. The rationale is that IT may speed up the process of knowledge transfer and make these knowledge spillovers more effective. Using US input-output tables for years 1958, 1967, 1977, 1987, 1997, and 2007, I compare my new results with Wolff and Nadiri (1993) covering years 1947-1977 and Wolff (1997) covering 1958- 1987. I estimate that the direct rate of return to R&D is now 22% and the indirect rate of return to R&D is 37%. The former is higher than in the previous studies. The indirect rate of return to R&D is now significant at the one percent level, in comparison to a 10 percent significance level in Wolff (1997). The newly estimated social rate of return to R&D is 59%, compared to 53% in Wolff (1997). In contrast to the earlier studies, the coefficients of R&D embodied in new investment are now statistically significant at the five percent level. Separate regressions on the 1958-1987 and 1987-2007 periods and the addition of successive periods to the sample also suggest a strengthening of R&D spillovers between the 1958-1987 and 1987-2007 periods. A decomposition of TFP growth also indicates a higher contribution from R&D spillovers in the later period. These results suggest a strengthening of the R&D spillover effect over time.

#5. Brilliant analysis of a ghastly phenomenon. Question -- to what extent do we see this (albeit to a lesser degree) in non-totalitarian situations. Are the dynamics the same with a high-level politician, CEO, etc?

Thanks for the tip on inventables! I'm going to keep an eye on their product line and definitely use some of their unusual materials for hobby craft.

#5

Thought experiment: suppose that instead of a single dictator, there is an elite class, which has general control over most cultural organs and elite institutions but whose political ascendancy is somewhat tenuous. Like the dictator, it will want signals of loyalty (both for determining loyalties and because of general ingroup/outgroup dynamics.) But because it's not a single dictator, the signal can't just be "the Generalissimo is awesome." Instead, the shibboleth would be particular statements, or articles of faith, that are known to be supported by the ruling class.

Of course, making the shibboleth a mathematical axiom would be pointless; if nothing else, non-loyal mathematicians would be misperceived as loyal elites. The signal must be costly. So the articles of faith must be faintly ridiculous; easily challengeable on the facts, so that only people really devoted would at first make those claims. (Of course they can't be obviously false either, else the integrity of the ruling class would also be called into question.)

Like cults of personality, there is a ratchet effect. As the elite becomes more entrenched, the shibboleths, while never changing in form (too costly to coordinate), will ever increase in intensity and audaciousness. And the enforcement of the party line will be strongest in educational institutions where the future members of the elite class are trained. It would be considered a matter of proper education - like the finishing schools of old - when "politically incorrect" thoughts in these institutions are mercilessly squelched.

If consumers are paying for actual goods, also apparently not. Many times we pay for the goods, but not the actual service. For example, we to the barber shop repair once the hair, pay not only for things that you have lost something. But we still is consumer. Law has a regulation, says only buy necessities or essential services,

1997) covering 1958- 1987. I estimate that the direct rate of return to R&D is now 22% and the indirect rate of return to R&D is 37%. The former is higher than in the previous studies. The indirect rate of return to R&D is now significant at the one percent level, in comparison to a 10 percent significance level in Wolff (1997). The newly estimated social rate of return to R&D is 59%, compared to 53% in Wolff (1997). In contrast to the earlier studies, the coefficients of R&D embodied in new investment are now statistically significant at the five percent level. Separate regressions on the 1958-1987 and 1987-2007 periods and

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