Month: December 2014

*The Student Loan Mess*, and implicit vs. explicit leverage in higher education

I reviewed this very good and very useful book by Eric and Joel Best in the 28 November issue of the Times Literary Supplement, not on-line.  Here is one excerpt from my review:

The second problem is that American higher education is much more indebted than it appears at first glance.  Most non-profit colleges and universities have only small amounts of explicit debt on their books, but there are many forms of implicit debt.  Many of those institutions made salary commitments to tenured faculty members, or promised donors they would continue various programmes, or they initiated or expanded sports teams and facilities, hoping to fund those plans with future tuition increases.  A slow economic recovery, sluggish entry-level wages in labour markets, recalcitrant state legislatures, and, yes, the student debt crisis will make those tuition increases very difficult to pull off.  This liquidity crunch is already under way and it has come first to the profit-making institutions and to stand-alone business and law schools, which will be closing and consolidating in great numbers.

I call it “probably the best and clearest book on the United States’ complex student debt problem.”  You can buy the book here.  Also buy the TLS issue, it is their best of the year, as it contains an especially fine “Best Books of the Year” list, you can stop worrying about TNR now.

Africa fact of the day

For now, the advance of democracy in Africa appears to have stalled. In 1990, just three of Africa’s 48 countries were electoral democracies, according to Freedom House, a Washington-based pro-democracy advocacy group. By 1994, that number had leapt to 18. Two decades later, only 19 qualify.

That is from Drew Hinshaw and Patrick McGroarty at The Wall Street Journal, the article is interesting throughout.

The Kuznets curve in India strikes back

Indian industries have often complained that convoluted environmental regulations are choking off economic growth. As a candidate, Mr. Modi promised to open the floodgates, and he has been true to his word. The new government is moving with remarkable speed to clear away regulatory burdens for industry, the armed forces, mining and power projects.

More permanent changes may be coming. In a report made public last week, a high-level committee assigned to rewrite India’s environmental laws assailed the existing regulatory system, saying it has “served only the purpose of a venal administration” seeking to extract bribes.

To speed up project approvals, the committee recommended scrapping a layer of government inspections; instead, it said, India should rely on business owners to voluntarily disclose the pollution that their projects will generate and then monitor their own compliance, an approach the committee described as “the concept of utmost good faith.”

That is from Ellen Barry and Neha Thirani Bagri.  I am a fan of Michael Greenstone’s work, but I did not find this recent piece on Indian pollution sufficiently penetrating.

A demographic warning sign for the United States

The number of women in the United States who gave birth dropped last year, according to federal statistics released Thursday, extending the decline for a sixth year.

The National Center for Health Statistics reported Thursday that there were 3.93 million births in the United States in 2013, down slightly from 3.95 million in 2012, but 9 percent below the high in 2007.

According to the report, the general fertility rate in the United States — the average number of babies women from 15 to 44 bear over their lifetime — dropped to a record low last year, to 1.86 babies, well below the 2.1 needed for a stable population. For every 1,000 women ages 15 to 44, there were 62.5 births in 2013, compared with 63 the previous year.

From Tamar Lewin, there is more here.  Here is Clive Crook on the importance of demography.

Assorted links

1. How some video stores are thriving.

2. Patrick Jory reviews the Andrew MacGregor Marshall book on Thailand.

3. The Economist picks best books of the year, a good list.

4. Chimpanzees are denied legal rights.

5. George Selgin and Bob Murphy on the 1920-21 recovery.  I say we still haven’t gotten to the bottom of this.  Here is Scott Sumner.  “Falling wages are good when needed,” is indeed a likely takeaway.

6. EconLOLcats.

7. Putting this month’s wage gain in context.

China to stop harvesting organs from prisoners

The mainland – which has long been criticised by international human rights groups for using organs harvested from executed prisoners as its main source of organ transplants – will completely ban the practice from next year.

All organs used in future transplants must be from donors, the Southern Metropolis News quoted Dr Huang Jiefu as saying. Huang is former deputy director of the health ministry and director of the China Organ Donation and Transplant Committee.

Major transplant centres had already stopped using executed prisoners’ organs, said Huang, who chaired an industry forum in Kunming on Wednesday.

There is more here, via Mark Thorson.  The article notes China has one of the lowest voluntary organ donation rates in the world.  0.6 individuals out of a million sign up to donate their organs after they die, and that means the number of actual donors is lower yet.  If you google around, you will find some ambiguity as to whether the donation rate or the “register to donate rate” is that low, but as far as I can tell (try this Chinese source) it is the actual register to donate rate, in part because they just aren’t many ways to register right now.  Please let us know if you have additional information on this point.

Wikipedia by the way reports:

The wait times for organ transplants for organ recipients in China are much lower than elsewhere in the world, and there is evidence that the execution of prisoners for their organs is “timed for the convenience of the waiting recipient.

Here are some of Alex’s earlier posts on a market for transplanted organs.

The value of an NFL roster spot

One of the most self-sacrificing—read: craziest—players from that era, Jack Youngblood, played through the 1979 playoffs and 1980 Pro Bowl with a broken leg. (That’s right: he played through a severe injury in the Pro Bowl). Last year, Youngbloodtold the New York Post that guys who missed time with an injury back then didn’t just have to explain themselves to their untrusting employers—they had to explain themselves to their own teammates. Rather than fake injuries to swindle their way into bogus workers’ compensation claims, it has always been much more common for NFL players to fake health.

In the same New York Post story, Antrel Rolle says he hid not one, but two rotator cuff tears from team doctors. In 1974, the team doctor for the Los Angeles Rams told the Washington Post that he’d learned to check both legs for injuries because limping players liked to trick him by presenting the wrong one. The marginal guys, it is generally understood, are the most likely to fake good health, knowing how tenuous their hold on a roster spot can be.

Most of the rest of the quite interesting article details a case of a player who was administered truth serum in 1986.  The full article, by Andrew Heisel, is here.

If you are not allowed to set the price…make it yourself

For years, Amazon naysayers have warned that the e-commerce giant’s ambition would drive it to compete ever more directly with the merchants who sell goods on Amazon’s popular online marketplace. On Wednesday, the company is introducing its own line of diapers and baby wipes, which will only raise these fears.

Called Amazon Elements, the line of diapers and baby wipes will only be available to customers who belong to the Amazon Prime membership program, adding another item to the growing list of membership perks. By working directly with a manufacturer, Amazon will be able to price the brand aggressively, with a 40-count package of diapers starting at $7.99. That works out to about 19 cents a diaper, compared to competitor prices that mostly range from 24 cents to 34 cents.

I would think Amazon is an especially likely competitor in areas where brute force goes a long way, it is economies of scale rather than expertise which lower costs, and a direct marketing pipeline to the buyer is important.  Oddly — or perhaps not — books do not seem to fit those characteristics.  But do diapers?

There is more here, via Samir Varma.

Why not take fur from roadkill?

There may be a nascent movement towards reappropriating roadkill as ethical meat, but sustainable fur couture? Paquin was in uncharted territory. No matter: In short order she located a taxidermist in Vermont who schooled her in the nitty-gritty of skinning and — oof — scraping an animal pelt ahead of the tanning process. Her induction came in the form of a deceased raccoon: “We both had a shot of whiskey, I put some peppermint oil under my nose, and we found a branch in the woods to hang this thing from. It was super intense.”

There is more here, from Meaghan Agnew.  I found these estimates interesting though perhaps speculative:

So, how many animals do you think get killed on the streets of this country every year? Whatever your guesstimate, go higher: according to Culture Change, it’s  approximately 1 million a day, or 365 million a year. By comparison, Born Free USA reports that approximately 50 million animals are killed every year for their fur.

For the pointer I thank Hugo Lindgren.

Skype Translator is on the way

In May, Satya Nadella and Skype Corporate Vice President Gurdeep Singh Pall unveiled Skype Translator, Microsoft’s breakthrough in real-time speech translation at Re/code’s inaugural Code Conference. Since then, the engineering team has been hard at work to get the technology behind Skype Translator ready for a preview release. Starting today, we are rolling out a Skype Translator preview program sign-up page.

There is more here, the pointer is from Lotta Moberg.

Assorted links

1. Does your horse need a blanket?  A user’s guide.

2. Patrick Suppes has passed away.  Here is Suppes on “What is a scientific theory?” (pdf)  And Angrist and Pischke have a new book on causal inference.

3. How do people bunch their time in the Louvre?  And more here.

4. Daniel Drezner responds on the importance of foreign policy for economic growth.

5. Stephen Williamson on the superiority of economists.

6. Ronald Coase’s impact on economics.

7. Why has progress slowed down?  And driverless cars to be tested in the UK.

8. Jonathan Chait defends Obamacare.

There is no great stagnation

Tekla Perry reports:

To feel the impact of the [hockey] hits at home, TV viewers will need to purchase the $300 ButtKicker (I kid you not), a gadget that attaches to a chair or couch and uses low-frequency audio signals (the company calls it a silent sub-woofer) to shake the furniture in perfect synchrony to the on-screen action.

There is more here, via David Price.

What I’ve been reading

1. Hassan Blasim, The Corpse Exhibition and Other Stories of Iraq.  Short stories about the conflict in Iraq, by an Iraqi.  I expected to find these widely heralded stories to be disappointing, as the premise is a little too easy for the Western critic to embrace.  But they are excellent and this book is one of the year’s best fiction releases.

2. Michael Hofmann, Where Have You Been?: Selected Essays.  Excellent and informationally dense literary essays, I especially like the ones on the German-language poets and writers, such as Benn and Walser and Bernhard and Grass.

3. Andy Weir, The Martian.  Ostensibly science fiction, but more a 21st century Robinson Crusoe story — set on Mars of course — with huge amounts of (ingenious) engineering driving the story.  Lots of fun, many other people have liked it too.

4. Andrew MacGregor Marshall, Kingdom in Crisis: Thailand’s Struggle for Democracy in the 21st Century.  It is hard for me to judge the specifics of the argument, still this is a readable and conceptual account of the mess that is Thai politics, namely that much of it is about royal succession.  If true, this is a very good book.

Arrived in my pile is Amy Finkelstein, Moral Hazard in Health Insurance, with Gruber, Arrow, and Stiglitz as commentators.

Christmas economics — a sleigh ride

This paper is from Laura Birg and Anna Goeddeke:

Do you believe that at Christmas time the gas prices, the economy and the number of suicides peak? Do you think that the value of presents you are giving to your beloved is of importance? We show in this paper that conventional wisdom about Christmas is often doubtful. Furthermore, we give an idea of how Santa Claus — and maybe you — is able to finance Christmas celebrations, why emergency departments are a place to especially avoid during this time of the year and why Christmas tree growers might care to explain the differences across species to you this year. We cannot clearly establish whether Christmas entails a welfare loss or gain, however, we give you an idea as to which institutional settings might reduce a potential welfare loss. Also, we give advice about which behaviours might get you more Christmas presents from Santa this year. Finally, we find that more research is needed to give conclusive reasons why Santa Claus actually brings presents to (nearly) everyone.

Here is Alex on whether Santa Claus reduces the rating of saving.