Month: September 2012

Mexico fact(s) of the day

Today, Mexico exports more manufactured products than the rest of Latin America put together.

And this:

Partly as a result, the sum of Mexico’s imports and exports as a percentage of its gross domestic product, a strong indicator of openness, rose to 58.6 per cent in 2010. In the case of China, it was 47.9 per cent, and just 18.5 per cent in the case of Brazil. HSBC in Mexico City estimated recently that the figure for Mexico could increase to as much as 69 per cent this year.

And this:

In 2009, Mexico overtook South Korea and China to became the world’s leading producer of flatscreen television sets. The bulkier the item, the more Mexico makes sense. According to Global Trade Atlas, the country is also the leading manufacturer of two-door refrigerators.

Cars made in Mexico are now being exported to China.  Here is more (FT).

What is the smallest prime?

From Chris K. Caldwell and Yeng Xiong:

What is the first prime? It seems that the number two should be the obvious answer, and today it is, but it was not always so. There were times when and mathematicians for whom the numbers one and three were acceptable answers. To find the first prime, we must also know what the first positive integer is. Surprisingly, with the definitions used at various times throughout history, one was often not the first positive integer (some started with two, and a few with three). In this article, we survey the history of the primality of one, from the ancient Greeks to modern times. We will discuss some of the reasons definitions changed, and provide several examples. We will also discuss the last significant mathematicians to list the number one as prime.

The paper is here, hat tip goes to Natasha Plotkin.

Are we still in the short run?

The excellent Eli Dourado reports:

I think there is good reason to think that the short run is over—it is short, after all.

My first bit of evidence is corporate profits. They are at an all time high, around two-and-a-half times higher in nominal terms than they were during the late 1990s, our last real boom…

If you think that unemployment is high because demand is low and therefore business isn’t profitable, you are empirically mistaken. Business is very profitable, but it has learned to get by without as much labor.

A second data point is the duration of unemployment. Around 40 percent of the unemployed have been unemployed for six months or longer. And the mean duration of unemployment is even longer, around 40 weeks, which means that the distribution has a high-duration tail…

Now, do you mean to tell me that four years into the recession, for people who have been unemployed for six months, a year, or even longer, that their wage demands are sticky? This seems implausible.

A third argument I’ve heard a lot of is that mortgage obligations have remained high—sticky contracts—while income has gone down. Garett Jones endorses this as a theory of monetary non-neutrality, and I agree. In fact, I beat him to it. But just because debt can make money non-neutral in the short run does not mean that we are still in the short run.

In fact, there is good evidence that here too we are out of the short run. Household debt service payments as a percent of disposable personal income is lower than it has been at any point in the last 15 years.

There are numerous pictures at the link.

Makers vs. takers

The correct point is not about slotting particular individuals into one category or the other.  Rather, on a given policy issue what is the relevant political influence of — on that issue — the makers vs. the takers?  Very often the takers are the classic better-mobilized concentrated interest groups, a’la Mancur Olson.  Consider farm policy and patents as examples but the list is long.

Many commentators are framing the matter in terms of raising or lowering the relative status of aid recipients.  So it’s the aspiring student, the virtuous retiree, and the brave veteran, rather than the irresponsible bums.  That’s a distraction (albeit a legitimate correction), as the real question is whether the political equilibrium is shifting toward takers.  That’s takers as roles in particular political struggles, not individuals with “taker” stamped on their foreheads.

Various forms of crony capitalism arguably are on the rise.  Is the political influence of the issue-specific takers, relative to the issue-specific makers, a growing problem in American politics?   What does the evidence actually suggest?

It seems Romney got a lot wrong in his remarks, but I haven’t seen many of the commentators move the ball to even that simple place on the field.

How do the new Honduran “charter cities” differ from those of Romer?

Here is a very useful article and interview, excerpt:

Segundo, nuestro modelo donde los residentes siguen el acceso a las mejores leyes sin ser gobernados por extranjeros es mucho más respetuoso de la autonomía local y soberanía del país.

Tercero, aunque al final será el gobernador, que será hondureño, quien decidirá qué sistemas legales estarán disponibles en la RED, proponemos que los hondureños sean permitidos a decidir usar ley hondureña en sus contratos si la prefieren a los otros sistemas que proveeremos.

De esta forma, nuestra visión es simplemente expandir otros mecanismos legales aplicados a los contratos y no restringir el derecho a las leyes de Honduras y no estamos de acuerdo con imponer un sistema legal extranjero sin que la persona pueda personalmente adherirse a él.

La diferencia final entre nuestro modelo y el de Romer es que el de MGK no depende de una concesión de tierra por parte del Gobierno de Honduras.

Fewer concessions to foreigners and foreign laws, for a start.  More corporatist.  For the pointer I thank M.

Dan Searle fellowships in economics

The Dan Searle Fellowships in Economics offer the opportunity for newly minted PhDs to spend two years pursuing research as postdoctoral fellows before entering the academic job market. Before applying, applicants must identify an appropriate mentor in a highly ranked economics department and reach a tentative arrangement to spend two years at the prospective host department.

There is more information here.  I know a fair number of people who have benefited greatly from this program.

Warp 7, Mr. Scott

The only problem is, previous studies estimated the warp drive would require a minimum amount of energy about equal to the mass-energy of the planet Jupiter.

But recently White calculated what would happen if the shape of the ring encircling the spacecraft was adjusted into more of a rounded donut, as opposed to a flat ring. He found in that case, the warp drive could be powered by a mass about the size of a spacecraft like the Voyager 1 probe NASA launched in 1977.

Furthermore, if the intensity of the space warps can be oscillated over time, the energy required is reduced even more, White found.

Here is more, caveat emptor.

Eurozone sticky wage update

From the always essential FT Alphaville:

Société Générale points out that unit labour costs — basically, wages — have been falling quite rapidly in the peripherals, and that this is probably due to austerity measures. New data from Eurostat breaks out what the agency calls ‘non-business’ wages: the education, health services, and public administration sectors. In otherwords, ‘non-business’ is a rough proxy for the public sector:

The logical follow-on from the above being that “non-business” sectors are a big contributor to the rapidly falling unit labour costs in the periphery, especially given their large state sectors:

SocGen’s Michel Martinez writes that there are outright wage declines in Greece while in the other peripherals, labour productivity (as measured by ULC) is outpacing wage gains.

TC again: No one should doubt that depreciation and expansionary monetary policy are a much easier path to lower real wages.  Yet the claim that wages are outright sticky for long periods of time, when economic pressures dictate wage declines, isn’t holding up that well.

And I would add this: They are not as wealthy as they thought they were.

Why 8 1/2 x 11?

Most books aren’t printed on 8 1/2 x 11 paper so why are these the standard paper dimensions? Paul Stanley offers an answer:

…we have ended up with paper sizes that were never designed or adapted for printing with 10-12 point proportionally spaced type. They were designed for handwriting (which is usually much bigger) or for typewriters. Typewriters produced 10 or 12 characters per inch: so on (say) 8.5 inch wide paper, with 1 inch margins, you had 6.5 inches of type, giving … around 65 to 78 characters: in other words something pretty close to ideal. But if you type in a standard proportionally spaced font (worse, in Times — which is rather condensed because it was designed to be used in narrow columns) at 12 point, you will get about 90 to 100 characters in the line.

The standard paper dimensions are thus not optimized for reading using printed fonts so typographers try to make adjustments. One adjustment is to abandon the standard paper size which is what books do. Another is to make the margins very wide which is the Latex default.

[Another] answer — which is what most wordprocessors did — was to stick to the standard “document design” (margins of an inch or so) and just use proportionally spaced fonts as if they were typewriter text. This produces very long lines, which are not comfortable to read. But that discomfort can be somewhat alleviated by increasing the space between lines (1.5 or double space), which helps prevent “doubling”, and by avoiding type sizes below about 11 or 12 points (depending very much on the design of the font).

Another possibility is to use the margins for marginalia, which I like. (Stanley points to the Latex tufte class as a way to do this.) One could also a two-column format or just make the text bigger.

Stanley concludes:

These are all potentially valid design choices. I happen to think that the most conventional one (stick with 1 inch margins, and add line spacing to prevent doubling) is probably the worst of them, and that it only seems “right” because we are accustomed to it. And it doesn’t generally save paper, because unless you use single spacing you lose vertically the extra space that you gain horizontally.

We need to fix this problem. Now is the time for a margin revolution.

Hat tip: John Cook at The Endeavour.

Small business under Proposition 37 (GMO labeling in California)

I advise anyone who favors Proposition 37 to read the text of the law.  It is full of bad ideas and questionable distinctions, many of which are not apparent from the more superficial descriptions of the proposal.  Here is one of them:

Retailers (such as grocery stores) would be primarily responsible for complying with the measure by ensuring that their food products are correctly labeled. Products that are labeled as GE would be in compliance. For each product that is not labeled as GE, a retailer generally must be able to document why that product is exempt from labeling. There are two main ways in which a retailer could document that a product is exempt: (1) by obtaining a sworn statement from the provider of the product (such as a wholesaler) indicating that the product has not been intentionally or knowingly genetically engineered or (2) by receiving independent certification that the product does not contain GE ingredients. Other entities throughout the food supply chain (such as farmers and food manufacturers) may also be responsible for maintaining these records.

I call this the “how to kill off small farmers and retailers” provision.  And what would it do to local farmers’ markets to have the burden of proof so shifted?  Who is best situated to handle possible lawsuits or shakedown lawsuits?  The larger corporations.

It is interesting to see what receives an exception from the labeling provisions: alcohol, restaurant food, and animal meats raised from genetically engineered crops.  (Lobby much?)  For varying reasons, those are some of the outputs most likely to be harmful to you or to the environment.

Prop. 37 also exempts milk, cheese, and meat and it exempts “small” amounts of transgenic material in foodstuffs.  According to critics of the bill it exempts 2/3 or so of the food products which Californians consume.

I do not think it is very well thought through.

Fox and Mitchum on the Flynn Effect and how it works

James R. Flynn recommends this paper, by Fox and Mitchum, in his new book:

Secular gains in intelligence test scores have perplexed researchers since they were documented by Flynn (1984, 1987). Gains are most pronounced on abstract, so-called culture-free tests, prompting Flynn (2007) to attribute them to problem solving skills availed by scientifically advanced cultures. We propose that recent-born individuals have adopted an approach to analogy that enables them to infer higher-level relations requiring roles that are not intrinsic to the objects that constitute initial representations of items. This proposal is translated into item-specific predictions about differences between cohorts in pass rates and item-response patterns on the Raven’s Matrices, a seemingly culture-free test that registers the largest Flynn effect. Consistent with predictions, archival data reveal that individuals born around 1940 are less able to map objects at higher levels of relational abstraction than individuals born around 1990. Polytomous Rasch models verify predicted violations of measurement invariance as raw scores are found to underestimate the number of analogical rules inferred by members of the earlier cohort relative to members of the later cohort who achieve the same overall score. The work provides a plausible cognitive account of the Flynn effect, furthers understanding of the cognition of matrix reasoning, and underscores the need to consider how test-takers select item responses.

The paper is here (pdf).