Month: November 2015

Saturday assorted links

1. “The Russian navy had to lease and purchase eight commercial transports in order to deliver supplies for the operation at the level of up to 50 sorties a day (which means one sortie per aircraft).” Link here.  And: “Over the last three years I have found that the best way of learning what is really happening in the war is to visit military hospitals.

2. Ted Gioia praises John Fowles.

3. This could pass as satire.  (That link was taken down but it is still posted here.)  Don’t neglect the subtitle of the publication itself.  In fact you could have convinced me it was a bad right-wing satire of something that doesn’t happen, but I’ve seen it so many times in my Twitter feed I think it must be true.

4. Jonathan Haidt talk on how Ethical Systems Design could reduce inequality.

5. “…just 6% of Africans qualify as middle class, which it defines as those earning $10-$20 a day. On this measure the number of middle-income earners in Africa barely changed in the decade to 2011.

6. JEP piece on how the Fed plans to raise interest rates and how monetary policy works today.  Boring, but a very good explainer.

7. Maryland real estate, an interior, no grain in sight.

The Amish and the marginal value of health care

Or is that the infra-marginal value?:

…we have compared lifespan in the Old Order Amish (OOA), a population with historically low use of medical care, with that of Caucasian participants from the Framingham Heart Study (FHS), focusing on individuals who have reached at least age 30 years.

Analyses were based on 2,108 OOA individuals from the Lancaster County, PA community born between 1890 and 1921 and 5,079 FHS participants born approximately the same time. Vital status was ascertained on 96.9% of the OOA cohort through 2011 and through systematic follow-up of the FHS cohort. The lifespan part of the study included an enlargement of the Anabaptist Genealogy Database to 539,822 individuals, which will be of use in other studies of the Amish. Mortality comparisons revealed that OOA men experienced better longevity (p<0.001) and OOA women comparable longevity than their FHS counterparts.

That is from a 2012 PLOS paper, by Braxton D. Mitchell, et.al., via Ben Southwood.

Middle eastern barter markets in everything

Against Salafist jihadis in Sinai, as well as Hamas in Gaza, Egypt and Israel are working together more closely than at any time since the peace treaty was signed. In many respects Egypt and Israel now consider themselves to be closer allies to each other than each is to the United States. Jordan recognises that Israel is a guarantor of its security, the regional power most likely to intervene on its behalf should it face a serious threat.

That is from Nathan Thrall at LRB.

Friday assorted links

1. Tracking Air Horse One.  And birds save old documents in their nests.

2. The shifting popularity of musical genres over the last ten years.  Uh-oh.

3. On the global ZLB economy.  And Brad DeLong reviews Bernanke.

4. Calorie counts on menus don’t seem to help, paper here.

5. An Austrian [sic] dispute over peoples’ quantitative easing, ask your granny!  Or not.

6. Which religion produces the most generous children? (speculative)

7. Maybe those journals were right to reject the Case and Deaton article.

Bully for Ben Carson

If you pulled over one hundred people on the street, and asked them to state a religious belief they hold, I’m not sure you would get any answer more plausible than “the pyramids were built for the storage of grain.”  Would you now?

Yet we mock Ben Carson for this, but we do not make fun of those who believe openly in the Trinity, Virgin Birth, ex cathedra, and many other beliefs which are to my mind slightly less plausible claims.  It’s not so different from the old prejudice that Mormon beliefs are somehow “weirder” than those of traditional Christians, except now it is secularists picking and choosing their religious targets on the supposed basis of sophistication.  The Seventh Day Adventists, Carson’s church, are of course weirder yet.

I doubt the storage claim is true as a dominant explanation, but should there not be some storage — of something — in a profit-maximizing or rent-maximizing model of pyramid supply and inventory management?  Maybe Ben’s economic intuition confirmed what he had heard in church.  And what about Coase’s durable goods monopoly model?  In that treatment the monopolist stores grain, admittedly for the pyramids variable Coase was hermetic in his exposition, perhaps properly so given how much is at stake here.  And “remains of storage pests have been found in grain recovered from pyramid tombs.”  Further argumentation along these lines can be found in F. Zacher’s classic 1937 article “Vorratsschädlinge und Vorratsschutz, ihre Bedeutung für Volksernährung und Weltwirtschaft” (Cowen’s Second Law), which by now has been cited over nineteen times (twenty in fact).

The Quran notes that the pyramids were made of baked clay, when instead according to many standard accounts much of the pyramids are made of quarried limestone (yet even that question is murky and I would not entirely count out the Quranic exposition).  Presumably many Muslims, who ascribe a holy status to the Quran, would defend the baked clay proposition in some manner.  How often is that thrown in their faces?

Might Joe Lieberman, an Orthodox Jew, possibly hold some views about Joseph which are not literally true?  After all, those stories do come from the Torah.

Besides, our Founding Fathers had some pretty strange notions about pyramids.  Most of them did a pretty good job in office.

What Ben Carson has done is to commit the unpardonable sin of talking about his religion as if he actually takes it seriously.

Loyal MR readers will know that I am myself a non-believer.  But what I find strangest of all is not Ben Carson’s pyramids beliefs, but rather the notion that we should selectively pick on some religious claims rather than others.  The notion that it is fine to believe something about a deity or deities, or a divine book, as long as you do not take that said belief very seriously and treat it only as a social affiliation or an ornamental badge of honor.

Bully for Ben Carson for reminding us that a religion actually consists of beliefs about the world.  And if you’re trying to understand his continuing popularity, maybe that is the place to start.

Bill Simmons estimate of the day

The trouble with podcasts is that they are difficult to grow: while text can be shared and consumed quickly, a podcast requires a commitment (which again, is why advertising in them is so valuable). Simmons, though, by virtue of his previous writing, is already averaging over 400,000 downloads per episode.

Podcast rates are hard to come by, but I’m aware of a few podcasts a quarter the size that are earning somewhere in excess of $10,000/episode; presuming proportionally similar rates (which may be unrealistic, given the broader audience) The Bill Simmons Podcast, which publishes three times a week, could be on a >$6 million run rate, which, per my envelope math in the footnote above, could nearly pay for a 50-person staff a la Grantland.

Most of the article, by Ben Thompson, is about the economics of Grantland.

Rural China worry about the human capital

This is from a recent paper by Stanford’s Scott Rozelle:

We also seek to explain why parents in rural China appear to be engaging in poor parenting practices. The paper brings together quantitative results from a survey of 1,442 caregivers of 18- to 30-month-old children in children in 11 nationally designated poverty counties as well as analysis of interviews with 20 caregivers in 8 rural villages. The results of the quantitative analysis demonstrate that 42 percent of children in the sample are cognitively impaired and 10.2 percent experience delayed motor development [emphasis added by TC]. According to the quantitative data, the poor cognitive development is not due to the fact that parents do not care for their children, as the majority reported that they enjoyed spending time with their child (88.6%). Nor are the delays due to a lack of a sense of parental responsibility, as almost all caregivers responded that they believed it was their responsibility to help their child learn about the world around them (94.6%). Yet poor parenting practices appear to be in part to blame: quantitative analysis shows a significant positive correlation between singing, reading, and playing with a child and their cognitive and psychomotor development. The empirical data shows, however, that 87.4 percent of parents do not read to their children; 62.5 percent do not sing to their children; and 60.8 percent do not play with their children. In the qualitative section of the paper we provide evidence suggesting that the prevalence of poor parenting practices does not stem from inadequate financial resources or parental indifference to the child’s development. Instead, the three main constraints influencing parental behaviors are (a) not knowing that they should be engaging in these parenting behaviors at this stage in the child’s development, (b) not knowing how to properly interact with the child, and (c) not having time to practice such behaviors.

Like all papers, this one is subject to various cavils and caveats, or perhaps the sample is not truly representative.  Still, it is a useful antidote for assuming that factors of IQ and human capital necessarily give China a big growth advantage in the decades to come.  Chinese test scores are good, but rural China does not always meet the Chinese average, and that is where much of the next wave of growth needs to come from.

Of course for more on these issues you need to read Garett Jones’s forthcoming The Hive Mind.

For the pointer I thank Christopher Balding, here is his new post on how stressed are the major Chinese banks?: “Chinese banks are slush funds to direct capital to preferred companies.”

Thursday assorted links

1. Toilet paper equality row at Canadian university.

2. Tyler, Noah, and Bob walk into a Chinese bar…

3. University of Maryland position in philosophy and economics.  And Derek Parfit lecture on altruism.  Too much on redistribution, not enough on economic growth.

4. How the GOP primary rules limit outsiders.

5. Douthat on Houllebecq.  And “Some refugees who descended on the tiny German village of Sumte have started leaving the ‘boring’ backwater where ‘there is nothing to do’ – and accused the authorities of lying to them.”

The Amazon bookstore (hi, future!)

Every book is tagged with a custom label featuring its aggregate rating on Amazon.com, along with a review from the website. There are no prices. To get a book’s price, you must use the Amazon app on your smartphone to scan the barcode. This act will provide you with the product listing, all the title’s reviews on Amazon.com, and the price. If you don’t have a smartphone or the app handy, associates are on hand to assist.

An associate at the store also confirmed what many news reports about Amazon Books have stated, that the store only stocks books with Amazon.com ratings of four stars and above [TC: is this really wise?]. The associate also confirmed that prices for books in the store are identical to those of the books sold online. And, since book prices on Amazon.com can fluctuate regularly, so can prices in the store. The associate said one thing they are vigilant about in the store is ensuring customers don’t get confused by receiving different price quotes at different times.

The store, which aims to seamlessly transition the online shopping experience to a real world scenario, allows you to use credits associated with your account at the register. However, you cannot order merchandise online and have it delivered to the store.

There is more here, interesting throughout, via M.  Can anyone from Seattle report on this?

Swiss Referendum on 100% Reserves

A Swiss group has collected the 100,000 signatures necessary to require a national referendum on requiring banks to hold 100% reserves.

In a nut shell, the proposal extends the Swiss Federation’s existing exclusive right to create coins and notes, to also include deposits.  With the full power of new money creation exclusively in the hands of the Swiss National Bank, the commercial banks would no longer have the power to create money through lending. The Swiss National Bank’s primary role becomes the management of the money supply relative to the productive economy, while the decision concerning how new money is introduced debt free into the economy would reside with the government.

After interest in the 1930s Chicago plan of Fisher and Simons died off, Murray Rothbard and other libertarians were virtually the only people calling for 100% reserves. More recently, however, the idea has almost become mainstream. Consider Martin Wolf’s FT column:

Printing counterfeit banknotes is illegal, but creating private money is not. The interdependence between the state and the businesses that can do this is the source of much of the instability of our economies. It could – and should – be terminated.

…Banks create deposits as a byproduct of their lending. In the UK, such deposits make up about 97 per cent of the money supply. Some people object that deposits are not money but only transferable private debts. Yet the public views the banks’ imitation money as electronic cash: a safe source of purchasing power.

Banking is therefore not a normal market activity, because it provides two linked public goods: money and the payments network. On one side of banks’ balance sheets lie risky assets; on the other lie liabilities the public thinks safe. This is why central banks act as lenders of last resort and governments provide deposit insurance and equity injections. It is also why banking is heavily regulated. Yet credit cycles are still hugely destabilising.

What is to be done? A minimum response would leave this industry largely as it is but both tighten regulation and insist that a bigger proportion of the balance sheet be financed with equity or credibly loss-absorbing debt.

…A maximum response would be to give the state a monopoly on money creation. One of the most important such proposals was in the Chicago Plan, advanced in the 1930s by, among others, a great economist, Irving Fisher. Its core was the requirement for 100 per cent reserves against deposits. Fisher argued that this would greatly reduce business cycles, end bank runs and drastically reduce public debt. A 2012 study by International Monetary Fund staff suggests this plan could work well.

Similar ideas have come from Laurence Kotlikoff of Boston University in Jimmy Stewart is Dead, and Andrew Jackson and Ben Dyson in Modernising Money.

Hat tip on the Swiss proposal to Dirk Niepelt who offers further comment.

Are American schools better than the American people?

Eduarto Porter has an excellent column on that topic, here is one bit:

In a report released last week, Martin Carnoy from the Graduate School of Education at Stanford, Emma García from the Economic Policy Institute in Washington and Tatiana Khavenson from the Institute of Education at the Higher School of Economics in Moscow, suggest that socioeconomic deficits impose a particularly heavy burden on American schools.

“Once we adjust for social status, we are doing much better than we think,” Professor Carnoy told me. “We underrate our progress.”

The researchers started by comparing test scores in the United States with those in France, Germany, Britain, Canada, Finland, South Korea, Poland and Ireland. On average, students in all those countries do better than American children.

Then the researchers divided students into groups depending on the number of books in their homes, a measure of the academic resources at families’ disposal. This adjustment significantly reduced the American deficit, especially among students on the bottom rungs of the resource ladder.

American students from families with the least educational resources, as it turned out, scored better on the PISA math test than similar children in France and about the same as Britons, Germans and Irish.

Read the whole thing.

Police steal from you so burglars don’t have to

Police in the East Rock section of New Haven are trying to send a strong message to residents to lock their doors amid several car break-ins and they are doing it an a rather unconventional way.

Starting today, police who notice valuables left in plain view inside unlocked cars will take them to keep them safe from would-be burglars, according to the New Haven Register.

There have been eight car break-ins in one week alone and Lt. Herbert Sharp told the Register that this strategy will prevent burglars from getting expensive items from cars, while forcing residents to make a trip to the police station to pick up belongings.

After taking the valuables, police will either leave a note or call the resident.

There is a noisy video at the link, via Craig Palsson.

Wednesday assorted links

1. A good post, but I call this Ptolemaic epicycles: ” I think the puzzle of why average wages continued to grow at a rate well above zero isn’t completely solved.”  Arnold Kling comments.

2. The Straussian Jar Jar Binks.

3. Men’s Delusion Curry.

4. Saudis put water-intensive hay farm in Arizona.  And $6000 desk lets you lie down while you work, magnets keep the computer in place.

5. How China wants to rate its citizens.

6. Two prestigious medical journals rejected the Deaton and Case piece.

7. Wallace Oates has passed away.