Monday assorted links

1. Checkout lanes for people who want it to be slow?

2. “In summary I’d say the most important and mysterious unanswered question of economics is the point from #2: which cooperative norms are chosen to be enforced and how does this come about?”  Link here.

3. Larry Summers and his wife discussing poetry, mostly Larry doing the reading (video), and discussion here.

4. New and important results on why labor’s share has fallen:

The recent fall of labor’s share of GDP in numerous countries is well-documented, but its causes are poorly understood. We sketch a “superstar firm” model where industries are increasingly characterized by “winner take most” competition, leading a small number of highly profitable (and low labor share) firms to command growing market share. Building on Autor et al. (2017), we evaluate and confirm two core claims of the superstar firm hypothesis: the concentration of sales among firms within industries has risen across much of the private sector; and industries with larger increases in concentration exhibit a larger decline in labor’s share.

That is from Autor, Dorn, Katz, Patterson, and van Reenen.

Comments

The "why" is interesting - to economists. What we choose to do about it is important. Until we solve the latter, expect more Trumps, Brexits, and other surprises.

Doesn't the "why" directly affect what we choose to do about it?

I suspect that this:

"We sketch a “superstar firm” model where industries are increasingly characterized by “winner take most” competition,"

Directly lead to the populism of Trump.

I like how the term "superstar firms" has replaced the real term: monopolies.

Google, Apple, etc aren't monopolies. Indeed, the only monopolies in the US tend to be utilities. So, your comment is pretty much completely off the mark.

No it isn't.

"To see what is in front of one's nose needs a constant struggle"

" leading a small number of highly profitable (and low labor share) firms to command growing market share" that pretty much describes a monopoly the whole "super star firm" terminology are simply weasel words used to make it look like the publishing economist has discovered some new phenomenon when they haven't at all. Also calling a monopoly a "superstar" makes people a lot more accepting of monopolistic behaviour - I mean why mess with something that's SUPER? Sure Apple, Google, etc. are not natural monopolies like a utility or railway but when discussing a single firm growing to dominate a market its much more correct to talk in the language of monopolies and not this BS "superstar firm" nonsense.

"” leading a small number of highly profitable (and low labor share) firms to command growing market share”"

I would say that description fits Apple and Google and multiple other tech companies.

Tyler posts a completely apolitical set of links, and the 23rd word posted in the comments section is "Trump."

You are all psychos.

What a crashing hypocrite you are. Just substitute Obama for Trump and look in the mirror LOL

While I had the self-control not to go there immediately, yesterday's protests were exactly about norms, who gets to set them, who gets to enforce them.

For instance: the norm that the Executive follow the law and respect Court orders.

What do you mean, "self control"? You patted yourself on the back immediately.

I think you have a valid point about some protests, but perhaps not about yesterday's. They were just the stick picked up to beat Trump with. All nations have rules and laws about which people get to enter. Give me a list of countries that could be on a similar list that would placate the protesters. Russia? Saudi Arabia? Or my guess: any country whose selection would piss off Trump.

The US is not just another nation. We don't have religious tests for entry, until now. We're supposed to be better than that. The protesters have a right to express their vision for what this country is supposedly about.

We still don't have religious tests for entry.

If this is a Muslim ban, then we have been fighting a Muslim war for 15+ years. We have targeted only Muslim nations and only Muslim people. Fighting a Muslim war would seem to be a greater evil than a Muslim ban. Yet the great majority of those up in arms now remained silent as Obama continued the Muslim drone war.

There's no "if", it's a Muslim ban. Doesn't apply to Christians or Jews. Own it.

As for your continued false equivalence ploy, there's a big difference between using drones to try to kill terrorists (isn't that sort of a good goal?) and specifically banning people from the entering (or returning to!) the US, even green card holders, based on their religion. Again, the protests are about who we are in this country. There's a case to be made for a Muslim ban, but to many it's un-American.

Nothing I need to own. I didn't write it, support it, or support those who implemented it.

It isn't a false equivalency, except that one kills people and the other blocks their travel. Civilians have been killed too - guess their religion? And as far as I know, we have not giving any sort of due process to these suspected terrorists we have been blowing up on other people's soil.

"using drones to try to kill terrorists (isn’t that sort of a good goal?) and specifically banning people from the entering (or returning to!) the US, even green card holders, based on their religion."

Notice you express the idealized version of the drone strikes and the least-ideal version of the temporary travel ban. Why not say it is "using a temporary travel ban to try to stop terrorist entry"? Both catch innocents in their envelop. One kills them.

"Doesn’t apply to Christians or Jews."

I read most of the initial order. I don't know if there has been some subsequent order, I try to pay as little attention to the issue as possible. But the initial order would only allow Christians and Jews in if they suffered religious persecution. And by the same token, I would read it to allow those in minority Muslim sects to enter if they suffered religious persecution.

I think there is a reasonable argument to be made that the Global War on Terror has been and continues to be a War on Muslims, regardless of our protestations that it isn't. And I think there are reasonable arguments to be made that this is a Muslim ban, despite protestations that it isn't. But I don't think you can believe that the Global War on Terror isn't a War on Muslims while also believing that this ban is a Muslim ban. Both are subjected almost entirely onto Muslims. Both specifically target Muslim-majority nations. Both, despite this, are officially not targeted at Muslims. I think American interests are best served if the official line wins in both cases. I'm not sure what I believe.

Actually, I can put it more simply. The belief you are expressing and that others seem to be expressing is:

if we think there are terrorists in a country, it is better for the U.S. to send drones there (without declaring war and not always with permission) and kill people (without convicting them of anything) than to temporarily ban travel from that nation while seeking to improve vetting procedures. The former is fine; the latter goes too far.

That actually sounds very much like the America I have lived in.

That's funny. Turkey Vulture comments about 30 times in the last 24 hours, trying to attach a fig leaf to the Muslim ban, but he doesn't support it. He doesn't know what he thinks.

We know, TV. We know.

I try to make arguments from a variety of view points to test them out. The "It's a Muslim ban" seemed like BS to me, so I continue to try to make the best case against that view as I can. I believe Tyler had recently suggested something like that as a way of not getting stuck in intellectual bubbles.

I have received plenty of insults from the likes of yourself, and Boonton, for trying to do so, as anyone who doesn't pronounce a Trump disloyalty oath at the start of every post is evil and probably has Trump's cock in their mouth (per Hazel Meade).

It all has been very unpleasant. You can't just disagree about something. You have to attack the person, every time.

You're an asshole.

Nothing personal, TV. Trump is a very dangerous man, and we are all safer if he is weak. You spend 30 posts looking for defences of his very dangerous Muslim ban, and of course you will be opposed.

It is not just about us.

"Several hundred career State Department officers have signed a document protesting President Trump’s travel ban — arguing that the policy makes America less safe and more vulnerable to terror attacks."

http://nypost.com/2017/01/30/state-department-officers-protest-immigration-ban/

I expect to be opposed. With reasoned argument. Not with cheap insults and the like.

The vitriol I get from the anti-Trump crowd doesn't make me more open to your views. It makes me ever more suspicious of them. If you can't make your point with unemotional, uninsulting, reasoned discourse, it suggests that you don't have much faith in the strength of your arguments.

Pfft. You want harsh?

"President Trump mocked Senate Minority Leader Chuck Schumer (D-N.Y.) on Monday, accusing him of “fake tears” after Schumer gave an emotional response to Trump’s refugee order temporarily banning refugees over the weekend."

“I’m going to ask him who was his acting coach, because I know him very well. I don’t see him as a crier,” Trump said Monday morning in the Oval Office, going out of his way to mock his fellow New Yorker a day after Schumer grew emotional while criticizing Trump’s order. “There’s about a 5% chance that it was real, but I think they were fake tears.“

Compared to that, my comment above his kid gloves.

Also, you skipped a link that cut across all the amateur opinion in blogs that this ban would be effective or positive.

Several hundred career State Department officers is a lot, especially given that despite protections for the dissent channel Trump would not be pleased.

Several hundred put their jobs on the line.

If it's a Muslim ban, they're doing it wrong. 90% of Muslims can still get in.

TMC, I think it started as a Muslim ban, but what it became ...

"A colleague of mine, a Danish citizen, has been denied entry into the US because he excavates archaeological sites in Iraq. Really."

https://twitter.com/peterbcampbell/status/826022617014378499

I think you prove my point. Not a Muslim ban, but a ban on those from, or who frequent, areas of concern.

Several hundred put their jobs on the line.

I suspect that, like the air traffic controllers, they didn't think their jobs were on the line.

Some people, without naming names, play this game:

1. Trump campaigns on a Muslim ban.

2. Trump asks Rudy how to do a legal Muslim ban.

3. "Ok, now we must all be fooled."

I refuse to be fooled. It is both the orignal plan and new incompetence heaped on top.

Now the really sad thing is that "now we must be fooled" folk are ignoring the actual consequences around the world. They are interested in fig-leafing a disaster:

"Iraqi general who works with American military kept from visiting U.S."

https://twitter.com/SenJohnMcCain/status/826430986942550016

The worst moment yesterday was when US Congressmen asked Border Agents to honor Court Orders, and they refused.

https://www.theguardian.com/us-news/2017/jan/29/customs-border-protection-agents-trump-muslim-country-travel-ban

I freely admit my predictions have never been that dark. Let us all hope that it was a confusion of the moment thing, and not a sign of things to come.

That Congresscritter should be ignored. He's got no authority over members of executive branch. It's amazing that morons like you prattle on about respecting the separation of powers when you obviously don't have a clue about it.

It is really amazing that someone can read "court order" and not see the "court order" part.

Ok, actually I did worry about it in September.

"There is no precedent for electing 'a guy like Trump,' certainly not in the last century.

My fear is that there are enough craven henchmen in waiting that they will take a word, a hint, and run with it. 'Who will rid me of this priest?'”

"For instance: the norm that the Executive follow the law and respect Court orders."

If the norm hasn't been normal for more than 8 years, is it still the norm?

2. I think norms and enforcement are the tip of an iceberg. They are what we notice, but a small fraction of what is there. Yes, we can step back and chuckle that tie wearing is an amusing anachronism, without noticing our participation in an unspoken social interaction. We gravitate towards this year's color, this year's width, this year's height relative to belt, without noticing. Or thinking a tie is cool without remembering the social interactions that made it so.

Since so much of this is not conscious action, it can't be consciously described. It is not economics, it is beneath that cognitive overlay.

You appear to be consciously describing it.

I get glimpses, but kind of after-images. I buy a shirt I like, and notice others in the similar shirts. I must have noticed the trend earlier, but not consciously.

It is this unconscious social response that makes me think culture arises more from base psychology than higher economics.

anon,

You are correct about unconcious processes. See the work of Jonathan Haidt and the citations therein. We are driven by machinery honed by tens of
millions of years of evolution. The rational apparatus is a recent addon.

Grocery checkout -- How about a television lounge where you can order a beverage while they get to your cart and tally the charges? (Thinking of bowling alleys.)

Just stay home, watch TV, have a beer, and order your groceries online

Peapod was great, except that the quality of produce was always worse than I would have selected myself.

My ideal grocery store would remove the credit card scanners at each register and instead have you hand over your credit card to the person in the checkout aisle and have them take care of it, just like at a restaurant or bar. The number of people who, for one reason or another can't seem to handle the card swiping machines is a little bizarre and a lot annoying. Poor vision, I think, is a problem for a lot of them, and then I think old people just get confused sometimes because different machines have different sequences of menus and buttons that need to be pressed. Whatever the cause, it's not working for me.

Do it this way and you won't need to go through a checkout aisle at all:

https://play.google.com/store/apps/details?id=com.samsclub.sng&hl=en

I've said this before, but there should be only one line in the store served by all of the tellers. If any store does this, I'm willing to give them all of my business for life and pay double. However, they won't do it because they hate their customers.

That's the way the much maligned post office does it. And sometimes self-checks have just one line

The Fairway on 86th Street in Manhattan did this (and perhaps still does). It was lovely, though Fairway filed for bankruptcy last year so it seems clear this model isn't universally loved.

Not sure how well that would work for grocery stores. A great deal of time is saved by the on-deck shopper being able to unload their cart while waiting for the cashier to finish up with the previous shopper. That would get lost if you had it all feeding through one line (although I guess you could feed them so there'd be two shoppers at each check out line).

Much needed, though, for hotel registration.

+1 to this. Every queuing theory analysis says single queue is better, every place I have seen it done in real life (including a few supermarkets in NYC) it's fantastic. I don't buy @DukeSantos's objection that shopper unloading makes a significant difference; I remember checkouts from my childhood where shoppers were expected to unload their carts onto the conveyor, but in every supermarket I'm in nowadays the conveyor doesn't even start until the spot where the checker stands, and the checker unloads the cart. I think the lack of adoption goes back to (i) supermarkets being afraid how their customers will respond to the visual of a long line and (ii) single queue hasn't doesn't fit well with existing layouts. But single queue is so fantastic that we should make the effort to overcome these obstacles.

There is a high-volume discount liquor store that I have gone to a couple times that has the single queue setup.

My first time going there, I gathered my liquor and looked for the line, and found it stretched nearly to the back of the store. I considered saying forget it and leaving, but didn't really need to be anywhere in a hurry. Turned out to be amazingly quick.

So I think (i) must be a significant part of it. But probably (ii) as well, as there was specifically a long, wide aisle in the middle of the store to allow the line to form.

"...high-volume discount liquor store I go to..."

Uh oh! :)

"but in every supermarket I’m in nowadays the conveyor doesn’t even start until the spot where the checker stands, and the checker unloads the cart"

Perhaps it's regional, but in my area (southeast), the second customer in line drops down a separator bar and starts piling groceries onto the end of the conveyor while the cashier is checking out the tail end of the goods from the first customer. The cashier rarely if ever pulls anything out of the cart, indeed, they generally can't even reach the cart from their position.

Military commissaries have always worked this way, with a separate line for small purchases. It does work very well, but most commissaries are very high volume establishments with around ten checkout lanes open.

2. This is tangential at best - relating to how norms are transmitted, particularly to children - but it has been bugging me.

So many books and shows intended for little kids follow the adult model of a moral tale: there is action, there is bad action, there is conflict, ultimately conflict is resolved and we all learn a valuable lesson. Oftentimes the bad behavior and the conflict take up far more of the story than the resolution.

But little kids don't seem to operate that way (both in my experience and in my reading on the subject). They primarily model behavior.

So when a story models bad behavior and conflict, it may eventually be resolved, but the primary takeaway for a little kid is to model the bad behavior (or the conflict, as conflict usually leads to attention from adults in the story).

I try to choose shows and books that just model good behavior without creating the adult-/older-kid-centric conflict and resolution. "Dinosaur Train" on PBS is pretty good about that, and sticking with goofy or informative books instead of those with a narrative mostly avoids the issue for books. But sometimes they slip through. A family member gave us a book where a little blue truck teaches city vehicles the importance of taking turns and such, but my son's main takeaway from the book was "Me first! said the limo, all puffed with pride."

Anyway, I guess the upshot is: if you are going to produce content that conveys cooperative norms, and aim it at little kids, please just focus on modeling the good behavior and not on giving it the conflict-based form that would be interesting to a more mature child or adult.

You've identified what's wrong with almost all popular narrative entertainment. Eighty percent of it is establishing the nefariousness of the bad guys, usually through shocking and repellent displays of cruelty, ten percent of it is information dumping, and ten percent is the resolution, which usually involves the torture-killing of the bad guy. It's sadism on both sides.

That is an interesting question but hasn't it been focused upon by political science, anthropology, and sociology? So is it unanswered because we don't have a great way to incorporate that into economic models for economists or is it that we don't have a convincing answer from those fields?

My own take is that there's parts of the puzzle that each social science has covered but the hard part is getting a convincing and rigorous story that ties it all together.

"1. Checkout lanes for people who want it to be slow?"

Just add more automated checkout lanes. Most stores in my area have 10 regular checkout lanes, of which only 2-4 are actually manned and 6 automated checkout lanes that are all busy. Carving off half the regular checkout lanes and doubling the automated checkout lanes will increase throughput without additional labor costs.

automated checkout lines are marginally faster, but require more work on my part.

Then you can still use one of the regular checkout lanes.

And I usually do--although I use one of the regular ones at an entirely different grocery store that has its act together. I may pay a couple pennies more per product for this increased service, well worth the price though.

'Kerry Speed, a Tesco customer assistant' if you have never visited Kerry this ladies name is a great bit of nominative determinism

In case you're interested, I posted more about Trump's executive order (http://necpluribusimpar.net/trumps-executive-order/ and http://necpluribusimpar.net/meanwhile-in-yemen/), where I point out the inconsistency in the positions of many people who oppose it, which is not to say that there is nothing wrong about the order.

You really are an asshole.

Unfortunately, it kind of works -- I clicked, and the Trump one is actually interesting. I agree he needs to advertise only when he's on topic.

Well, I have been spamming pretty shamelessly to be honest, but I said in the comments of yesterday's post that I'd only advertise a post when it's relevant to the topic at hand. I was just triggering Mark Thorson on that one, but I'll really stop now because I fear that he is on the edge of a mental breakdown :-p

Yea, more interesting than typical partisan pablum.

Thanks, I'll take that!

2. What cooperative norm governs?

We all have he same feeling when our glass is half full. The same feeling as deja vu. The same feeling Jim Hamilton talks about when we see the two previous gas price peaks. The same feeling you get in the tore and see only two people in the checkout lane. It is our inner Nyquist-Shannon.

We have this information peak, one thing is uninformative, two things is suddenly very informative, but the fourth adds nothing. We all know where that peak is, it is a survival instinct, it assure us that the goodie is likely to be where we expect it.

If we are to look at Larry Summers anecdotes, enjoy this.
https://www.bloomberg.com/view/articles/2017-01-26/the-day-harvard-stopped-being-a-hedge-fund

Good link. I like this:"The Harvard professors and alums who deemed themselves more insightful about the mysteries of investing than the professionals is just the sort of hubris that the trading gods love to punish."

Doesn't this go for much of what Harvard professors spout off about? Classic professional vs. academic result.

#4 echoes the paper by Barkai, "Declining Labor and Capital Shares," that Tyler had flagged earlier this month.

I think that attempts to answer #2 by economists are their single biggest overreach. You can study all you want, but it's the statements implying conclusions from correlations real or imagined that turn you into just another source of authoritarianism.

"#2: which cooperative norms are chosen to be enforced and how does this come about?"

Social cooperation & Division of Labor are the entire basis of economics -- but 21st Century PhD economists can't figure out how it happens or who enforces it ??

... Nobody chooses & enforces it. It's spontaneous, rational self-interest occurring across human history from billions of individuals and their multitude of personal decisions seeking to improve their lives. The shapes and designs of the resulting economy (and "culture") are in constant flux. Some old guy once characterized it as a seemingly "Invisible Hand" guiding things.

(why is it, again, that we need professional economists these days ?)

The problem is that stealing--or any number of other things--if you can get away with it, is almost always in someone's short-term material interest. Yet most people don't steal, cheat, etc.--well, maybe a little. Obviously, a group in which everyone always stole, cheated, etc. would quickly unravel. So there has to be some felt self-interest in going against short-term material self-interest. But what are those feelings and where do they come from?

#3 - what a great video. they don't write poems like that anymore!

A friend of mine and me already wrote a Master thesis back in 2014 on how rising markups can lead to a falling labor share.
We estimated markups for different industries and indeed found empirical evidence for rising monopolization.
https://lup.lub.lu.se/student-papers/search/publication/4617196

You guys may have been able to get more cites and a link on MR if you did a Find-and-Replace of "monopoly" with "superstar firm".

3) Summers: God, what a pompous twit

No wonder he was so popular with the Harvard faculty!

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