The new issue of Econ Journal Watch

Volume 14, Issue 3, September 2017 

Twitter Mood Predicts the Stock Market? Johan Bollen, Huina Mao, and Xiaojun Zeng claimed the affirmative in a conspicuous 2011 article. Michael Lachanski and Steven Pav conclude otherwise after looking from many angles, replicating as best they can, and applying robustness tests. 

Who Knows What Willingness to Pay Lurks in the Hearts of Men? John Whitehead argues that certain authors claim to know, based on their survey data, more than they do about people’s willingness to pay for a wetlands project. The article continues an exchange from the Journal of Environmental Economics and Management. 

Fire and Ice: Hannes Gissurarson, who published an article on Iceland in our last issue, picks up the story in 1991, now turning critic of certain narratives about the last quarter-century. A principal opponent, Stefán Ólafsson, provides a reply that criticizes Gissurarson’s interpretations and his characterization of liberalism. 

What Adam Smith Told His Teenagers About Domestic Policy: Adam Smith’s jurisprudence course included a section on “police,” or domestic policy, captured in student lecture notes. The notes from 1763­­–1764 enrich our conversation today about Smith’s sensibilities, as they provide a candid window on his classroom edification. 

Glimpses of David Hume: “You hope I shall be damned for want of faith, and I fear you will have the same fate for want of charity.” Anecdotes and miscellanea about David Hume, most drawn from James Fieser’s 10-volume compilation Early Responses to Hume. 

An Economic Dream—of Erik Gustaf Geijer, historic Swede, and historian, published in 1847. “It is a dream of national economy…”

EJW Audio

Evan Osborne on Liberalism in China

Jeffrey Rogers Hummel on Kenneth Rogoff’s The Curse of Cash


I will read and summarize these articles mentioned and be first (the bot before me doesn't count).

1) Wow. After about 25 pages of teasing, we get to the conclusion: "The results in Table 3.6’s first four rows show that, using BMZ’s testing
strategy, we have no evidence that Twitter mood predicts the stock market". OK then.

2) Ridiculous. Two groups of academics fighting it out whether people prefer to preserve wetlands "as you go" (yearly payments) or a one-time payment. From the data you can't really tell. But my intuition says "pay as you go" is better, for the same reason spend-as-you-tax is superior to deficit spending funded by bonds (future generations pay): you can't predict the future. Someday these fabled wetlands could be better off as a paved parking lot, and it's hard to tell now.

3) OK, "A Nobel Laureate in economics wrote that Iceland’s economy “was in effect hijacked by a combination of free-market ideology and crony capitalism” and that thus it was brought down (Krugman 2010). In this paper, it will be argued that these narratives are without sound basis in fact" - there you have it. Author makes a good case for pension reform, lower taxes and higher revenue, and prosperity from the Icelandic government led by Oddsson (odd name!), and rebound after the 2008 collapse (Icelandic banks were not bailed by US/EU taxpayers out so that's why they crashed so hard says the author). But in a rebuttal the author's critics say he engages in 'alternative facts'. Bonus trivia: are the famed Lewis chessmen from Iceland or from Norway? It's contentious.

4) Adam Smith's lecture notes on police functions of a state, at least as recorded by a student, are even more laissez faire than in Wealth of Nations. Bonus trivia: there was a lively debate over whether the government should be engaged in factors of production or whether it should be left to the private sector, not just in the Han dynasty of China (202 BC to 220 AD) (the famous iron and salt debates) but also in the 11th century northern Song Dynasty (local vs national taxes). Fact. And way underreported.

5) David Hume...I'm tired and skeptical I'll learn anything from some minutia....OK, I did learn Hume was no stick in the mud. Once, when stuck in the mud, he had to renounce his atheism before a Christian woman would lend him a hand and pull him out of a bog. Interesting.

6) My gosh, what to make of this? Some poet waxes poetically about the Industrial Revolution and/or hydraulic theory of how an economy works, everybody affecting everybody else. No Austrian he, rather, a Swede.

Time to hit the Enter button and see if I'm first...

Yes! I was first. I amaze myself how good and fast I am.

Thanks for the summary.

So, anyone know what 'JIN' stands for in regards to Klein (the Smith article)?

David Hume: Was Hume partial to, and did he regularly quote from, the Epistle of James? For the theologically minded, Protestants and Catholics do differ in their belief about the path to salvation, Protestants believing that faith alone is the path to salvation while Catholics believing it takes both faith and "charity" (Hume's term).

Wow is that Osborne article awful. I particularly liked this sentence "And so ideas did battle in China from roughly 1895 to the Japanese invasion of 1937" I guess as long as you toe the Libertarian line you can ignore the massive literature on Chinese history and thought and still call yourself a scholar, at least in some circles.

Tyler, if you are interested in learning anything about the importation of foreign ideas into China you might try

Liu, Lydia. Translingual Practice: Literature, National Culture, and Translated Modernity-China, 1900-1937. Stanford University Press, 1995.
Zarrow, Peter. After Empire: The Conceptual Transformation of the Chinese State, 1885-1924. Stanford University Press, 2012.

Great to watch, i really liked it.

I guess as long as you toe the Libertarian line you can ignore the massive literature on Chinese history and thought and still call yourself a scholar, at least in some circles

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