Assorted links

1. Has there been a financial incentives bubble?  A short essay by Mihir Desai.

2. Paul Krugman has a forthcoming book, and the optimal sequencing of reform, with regard to Star Wars.

3. The nationalist argument for more immigration.

4. New report on the Milwaukee voucher experience (pdf).

5. The culture that is Nordic (nice picture of single women, safe for work).


That suggested viewing order is ridiculous. The correct order is and always will be 4 5 6.

Agreed. As Mike from the wonderful (and NSFW/children) Red Letter Media reviews points out, the prequel story frankly doesn't need to be told. As he also points out, Lucas handled the delivery and construction of the story in a pretty self-defeating way.

Someone do the Tarantino cut.

He links to the Plinket reviews.

I'm was more surprised he left out 1 and not 2. 1, for its many flaws, has the essential elements of a plot: a bad guy, and a good guy trying to stop him. 2 has conflict but no reason to care why it matters whether the clones or the droids win.

As a support for the 4-5-6 trilogy, though, 2 and 3 might do the job better. The unseen childhood friendship makes their romance in 2 more believable, too.

Belated Media on how episode one should have been written:!

A better expansionist nationalist strategy would be to announce the U.S. will hold immigration elections online, for every country. Whatever percentage of that country votes to become American, the U.S. will invade and conquer that percentage of the land mass and invite all those who wish to live under American law to move. Everyone will be happy!

5: "The culture that is indigenous."

Fixed it for you.

Indigenousness explains this? You mean Sweden's 10% of people who were not born in the EU? The vast Irish minority in the UK? Help me out here.

Regarding the last link, it's my understanding that the concept of single parenthood in the Scandinavian countries is quite different than elsewhere. It is common to the point of being routine for a man and woman to live together and raise children without ever getting married. For all intents and purposes they are married, just without official sanction.

I've heard something similar. A Finnish friend was getting a mortgage with a woman who he was having a child with and apparently that was a bigger step than actually getting married.

I would have to agree. My college roommate who is Norwegian went back after college, had a kid and didn't get married to his girlfriend until the child was 3 years old. At first I thought maybe it was a "scandal" or embarassment because his father is a very prominent person in Norway. However, I was told his parents did the same thing with him and his sister (had both and then got officially married years later).

Danish social benefits to single parents are very generous. Generally, the difference in the amount paid out (not taking into account the value of the publicly covered health insurance of the child, subsidized child care ect.) in social assistance to an unemployed single mom relying solely on the public safety net is in the order of $1000/month, compared to the amount paid out to an unemployed without children. That's not directly related to marriage, but rather cohabitation, however it's important to keep such features of the system in mind. The difference is high enough to motivate some couples to engage in fraud by claiming that they do not live together (and perhaps even keeping two separate adresses, one of them for the sole purpose of selling the story that they do not live together) because if they did not, they'd lose out on a lot of public money.

There was a recent Danish debate about the case of a single mom named Carina. She thought she was poor and felt that she had a difficult time handling her situation even though she was paid $2,6k/month after tax (13.639 kr. - 15.728 kr pre-tax). In Carina's case, if she had not been a single parent it was estimated that the amount of money she'd receive from the government would drop by $16k/year (6.800 kr/month) - to 8.915kr/month. No link to English material, but google translate is your friend:

At least in Denmark it's quite common to have children even though you're not married and few people really think much about that. Sometimes people get married later (to deal with government paperwork - my mom and dad never tried to hide the fact that that was why they got married in the end..), sometimes not at all. Some data from Statistics Denmark:

There are 269 600 married Danes living with one child in the household. There are 122 854 unmarried -ll-.
There are 419 566 married Danes living with two children in the household. Unmarried: 95 956.
For 3 children, the numbers are 144 120 and 22 704.

The parents aren't married in roughly a third of all one-child households. Naturally the unmarried ratio goes down with family size.

First thing we do, let's annex Canada, Mexico, and the Philippines.

@ 5

This must mean we in the U.S. need further subsidization of women with no future time orientation and their bastard spawn in order to eliminate poverty; bulletproof plan with no mis-incentives or dysgenic effects!

--AIG Liberal Policies Quant

Someone reads dealbreaker!

-meme detector guy

The Milwaukee stuff seems pretty mixed:

> When a snapshot of all MPCP students who took the state accountability test is compared to a snapshot
of the performance of MPS students with similar income disadvantages, the MPCP students are
performing at higher levels in the upper grades in reading and science but at lower levels in math at all
grade levels examined and in reading and science in 4th grade (Report #32).
> • Based on MPCP and MPS administrative data on MPCP students as well as parent surveys, between
7.5 and 14.6 percent of MPCP students have a disability, a rate at least four times higher than previously
reported by DPI (Report #35)
> When similar independent public charter and MPS students are matched and tracked over four years,
the achievement growth of the charter students compared to MPS students is similar in both reading and
math, though conversion charters, which used to be private schools, clearly deliver higher achievement
growth than MPS (Report #31).
> MPS students themselves are performing at somewhat higher levels as a result of competitive pressure
from the school voucher program (Report #11).
• The MPCP saves the state money -- nearly $52 million in fiscal year 2011 -- although not all types of
Wisconsin taxpayers benefit from the savings (Report #22).

So they're cheaper, but they otherwise don't much change scores - and the mention about high-stakes testing smells like Goodhart's law...

I think cheaper is reason enough to be a big school supporter. Suppose a doctor offered two cancer treatments that were equally effective, but one cost 2/3rd as much. Which one would you take? In any case, we already spend more per capita on education than any country except maybe Switzerland.

1. The biggest error in the Star Wars movies is episode three is clearly not episode three. If you follow traditional movie serial style, episode three, as described in the opening of the original Star Wars movie, should concern itself with the Rebels stealing the Death Star plans.

3. Seems to ignore the fact that China's population is going to become very gray very fast.

I wonder if Krugman's book isn't a lagging indicator.

5.) My instincts lead me to ask the following questions:
-What definition of poverty does the study use? Does the study normalize its definition of poverty across countries? How many children does the average single mother have? Where is the father in this picture (thanks, Peter)? Does the researcher use a per diem amount of PPP adjusted income to determine poverty or does the researcher use a distributional definition of poverty?

We can confidently say the distribution varies between each country, though the United States' tends to be a touch wider with a higher mean (see: Pinkovskiy and Sala-i-Martin 2009, I've linked a condensed version, one can find individual country distributions in the appendix of the complete paper, which one can find on Prof. Sala-I-Martin's website

The above questions matter a great deal for interpreting this regression. Homogeneity (which I've always been a bit uncomfortable with, as it seems to say "hey, white people are great!" without much more backing it) might matter, but a small population and higher density with low migration relative to other countries with similar incomes and distributions might be the real underlying driver.

re 5:

The graph is not about poverty as most Americans think about it; it is about so-called relative poverty. From the sociologist's post which the graph was taken from:

the relative poverty of single mothers versus the total population — that is, what percentage had incomes below half the median (per person, after accounting for taxes and government transfers). Such a relative poverty measure is really a measure of inequality, but specifically inequality at the low end.

Actual poverty in the US is a hair higher than in the Nordic countries, not a quantum leap higher like the graph implies. Framed differently, the middle class (as defined by the median anyway) in the US is substantially better off (in terms of income anyway) than in the Nordic countries.

For those curious as to how I found the above quote, I clicked on Tyler's link, then chopped off the part of URL that came after:

The permalink to the blog post is:

I did the same thing as happyjuggler to the URL, but I was looking for nice pictures of Nordic women. I was the only one?

Given that in the Nordic countries a much larger share of GDP is allocated to the lower quintile than in the US and the overall levels of per capita GDP are similar it is hard to see how actual poverty in the US is higher than in the Nordic countries.

#5: State as father substitute watch.

Has there been a financial incentives bubble? A short essay by Mihir Desai.

I agree that there has been and incentives bubble. It is my observation that it always takes a while for free people to try, adjust and maybe discard new ideas. Even the 2008 financial collapse if due to deregulation does not mean for sure that the deregulation was bad. I would have hoped that the financial collapse would have taught people with not to lend to the likes of Lehman and the other investment banks. Very educational.

Part of the problem is the cultural belief in super men. Perhaps this coems in part from watching sports where a LeBron James is a real superman but Jim Cramer and Jack Welch, not so much. Even Steve Jobs and Bill Gates though very good at what they do are not like LeBron James, there was quite a bit of serendipity that went into there success.

The incentives of mutual fund and money mangers seem particularly bad to me more so than CEOs.

BTW one thing that one can do is invest with Carl Icon (IEP), but the big problem with trying to control executive compensation is that it is a small part of profits.

Now in defense of the overpaid in business they often do not consume much of the money that they get much of it goes into investments that make us all better off.

The incentives in government are even worse and politics evolves slower.

How do I prevent every institution I invest in or deposit savings in from investing in the shadow banking system which is recklessly creating money by making loans backed by phantom assets? Did you know your personal money market funds were fueling all the reckless lending by supporting the market for money created based on bad debt?

The US Treasury and Fed bailed out all the money market funds which had created the illusion of safety around putting savings in institutions that put your savings into all sorts of hot money with high risk of default, like US Treasuries, and low risk of default like Lehman where the investment decisions are made by people risking their own money and thus totally adverse to crashing their firm, unlike the government technocrats that make decisions with no personal risk because they get overpaid no matter what, because a minimum wage worker could run the US government or Fed.

Why the obsession with increasing GDP? Is there a top to this? Is "growth" really supposed to go on forever?

Aren't we just concerned because the US has more bills coming due than it can possibly pay and since we've stopped breeding future taxpayers now we have to import them? This is actually an 'imperialist' argument, not a 'nationalist' argument. The difference is that instead of rent-seeking from overseas holdings, we just import the subordinate nation and put them to work on the tax farm here. (BTW, all empires eventually devolve into their subordinate nations but I'm sure we've thought this through.)

"Growth by immigration" assumes that 1) the immigrant population will be as productive as the previous population, and 2) the immigrant population will pay taxes for debts they didn't incur for the benefit of people with whom they share no ancestry or culture. We assume, for example, that the new Americans will be as concerned about saving Medicare as they are about, say, funding to increase the local hospital's bilingual capabilities in obstetric and pediatric services.

California will make a great test case. The California government has promised generous benefits to old white bureaucrats, lots of tax breaks for wealthy white homeowners, lots of 'green' initiatives for young whites, while simultaneously welcoming huge amounts of Meso-American immigrants and telling them they need to help pay for all these great things. The gamble California has made is that the immigrants will do so instead of being net tax consumers themselves, filing spurious tort claims, not particularly caring about whether their business is 'green,' stubbornly refusing to develop revolutionary technologies, etc. I'm sure it will work out fine.

Well, what you pay when migrating to California is an infrastructure paid for by well over a hundred years of California taxpayers whether the railroads moving cargo, the roads moving people, the water projects turning desert into high density living spaces, a high level of education in society and the reservoir of knowledge that fuels the California economy.

In a lot of ways, moving to California is like buying shares in google at its IPO - the shares offered to the public bore the burden of "debt" of the private equity interests which then and now extract the majority of the wealth from google operations which have expanded into many new ventures, some of which have been bad investments, using all the cash from the IPO, cash that exceeded the earlier pre-IPO "debt". (The initial investments and the cash from stock sales are listed as liabilities like loan debt is.)

And buyers of google's IPO paid for the ideology of going green held by google's do no evil founders.

Both google and California plan on growing.

Do you invest in shares of companies that have no plans to grow? Why aren't such firms seen as very good investments by Wall Street?

"And buyers of google’s IPO paid for the ideology of going green held by google’s do no evil founders."

You take shares in companies because your shares will increase in values, not so that the company increases in total value while your shares remain static.

Almost no one would invest in such a company that increased in value while your share remained static, or unaffected by its growth, or think that company becoming richer was a good thing in itself.

Some few people might, but most of these would presumably be driven by a strong attachment to the company, which would generally be incompatible with it being an agglomoration of random people doing random things, rather than a specific entity with a specific purpose and history with which they personally identify.

What a great way to insult Krugman without having his acolytes come and mess up your comment section. Well Done.

I was thinking the same thing!

Yes, but Tyler took a very significant risk of insulting Star Wars fans. If I were worried about one of those two fan bases, Krugman's fan base wouldn't be the one to worry me. They're not as clever and, probably, not as fanatical.

"3. The nationalist argument for more immigration."

Ah, yes, the pressing need for more cannon fodder so that our betters in the D.C. area can imagine big.

Seems like there's a really simple solution to the Star Wars sequencing problem...hmm....

5. The culture that is redefinition of poverty, redefinition of single motherhood, cross national differential marriage patterns between rich and poor and having more people in poverty who aren't single mothers in some countries (e.g. relatively more married families, single men, single and childless women in poverty - how's that tax system working out for them?).

#3 - apparently Tyler doesn't understand what the word "nationalist" means.

4. Good

5. Adjust for ethnicitiy and "poverty line." I bet single female Nords in the U.S. are doing the same or better.

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