Month: October 2017
Model this saliva exchange
One of the most blatant violations of the rules against touching saliva among other taboos is described by Dubois…in his [1906] account of one of the “disgusting religious orgies” he so meticulously depicts. In these orgies, not only do men and women eat meat and drink alcoholic beverages, but they transgress the normal saliva prohibition. I cannot possibly improve upon Dubois’ vivid word picture: “In this orgy called sakti-puja, the pujari, or sacrificer who is generally a Brahman, first of all tastes the various kinds of meats and liquors himself, then gives the others permission to devour the rest. Men and women thereupon begin to eat greedily, the same piece of meat passing from mouth to mouth, each person taking a bite until it is finished. Then they start afresh on another joint, which they gnaw in the same manner, tearing the meat out of each other’s mouths. When all the meat has been consumed, intoxicating liquors are passed around, every one drinking without repugnance out of the same cup.
That is from the quite interesting Two Tales of Crow and Sparrow: A Freudian Folkloristic Essay on Caste and Untouchability, by Alan Dundes.
The boom continues and indeed broadens
Growth in the all-important US services sector picked up sharply in September, providing further evidence that the recent string of hurricanes that battered swathe of southeastern US is unlikely to have a significant impact on US third quarter growth.
The Institute for Supply Management’s non-manufacturing gauge came in at 59.8 last month – the highest reading since August 2005. It is a sharp leg up from the reading of 55.3 recorded in August and easily trounced expectations for it to dip to 55.1.
Readings above 50 point to expansion, while those below indicate contraction.
The services sector, which includes professional services, healthcare and other non-manufacturing industries, makes up about 80 per cent of US gross domestic product.
The report comes just days after another ISM survey showed US manufacturing activity grew at its fastest pace in more than 13 years in September and reinforces the view in the market that US economic recovery remains on course for the second half of the year.
That is from Pan Kwan Yuk at the FT, file under “The Show So Far.”
Sentence of the Day
…we show that the industries where concentration has risen the most are also those where there has been the fastest growth in productivity and innovation.
From Van Reenen and Patterson at HBR based on The Fall of the Labor Share and the Rise of Superstar Firms.
Wednesday assorted links
Baseball fact of the day
Statistics showing precisely when starting pitchers become less effective have prompted teams to remove them from games earlier than before. That has increased one of the biggest drags on pace of play: pitching changes. Regular-season games this year saw an average of 8.4 pitchers used between both teams, an all-time high. That’s up from 5.8 pitchers a game 30 years ago.
This to me seems deadly:
Games this season saw an average gap of 3 minutes, 48 seconds between balls in play, an all-time high.
And the average game is now three hours, five minutes long.
That is from a WSJ article, by Brian Costa and Jared Diamond, about how the quants are slowing down the game of baseball.
Hat tip goes to Cliff Asness.
The Dangers of Fiscal Policy
Here’s the latest video from Principles of Macroeconomics at MRUniversity. As always these videos can be used with any textbook but they go great with the best textbook, Modern Principles of Economics. The video is on situations when fiscal policy doesn’t work well or can even reduce growth and GDP.
Separatist sentences to ponder
The European Commission backed Madrid in describing the vote as illegal and said an independent Catalonia would not be part of the union. President Trump also rejected the independence movement; the Catalan nationalists’ only backers are separatist-ruled Scotland, the pariah government of Venezuela and Russia’s intelligence and propaganda apparatus, which mobilized its media outlets and social media bots in support of the separatists. Moscow evidently perceives the Catalan movement as another vehicle for dividing and weakening the democratic West.
That is from the Washington Post editorial board. Hat tip goes to AC.
The lava shock and the benefits of moving house (who’s complacent?)
This paper from last year somehow I neglected to blog, here is the abstract:
We exploit a volcanic “experiment” to study the costs and benefits of geographic mobility. We show that moving costs (broadly defined) are very large and labor therefore does not flow to locations where it earns the highest returns. In our experiment, a third of the houses in a town were covered by lava. People living in these houses where much more likely to move away permanently. For those younger than 25 years old who were induced to move, the “lava shock” dramatically raised lifetime earnings and education. Yet, the benefits of moving were very unequally distributed within the family: Those older than 25 (the parents) were made slightly worse off by the shock. The large gains from moving for the young are surprising in light of the fact that the town affected by our volcanic experiment was (and is) a relatively high income town. We interpret our findings as evidence of the importance of comparative advantage: the gains to moving may be very large for those badly matched to the location they happened to be born in, even if differences in average income are small.
That is from an NBER paper by Emi Nakamura, Jósef Sigurdsson, and Jón Steinsson. There will someday be a Puerto Rican version of this study.
Tuesday assorted links
1. #EJMinfo is a new Twitter hashtag for job market information.
2. Are the American states really more efficient than the federal government?
3. Pseudoerasmus on labor repression and the Indo-Japanese divergence.
4. Further background on Puerto Rico’s pre-storm economic troubles.
5. Is the Australian economy overrated? (noisy link)
Mercedes-Benz Adopts What3Words
I’ve covered What3Words the innovative addressing system several times before. Here’s some news:
Forbes: What3words (w3w) has a surprisingly simple and efficient way to find an address and get you there. The London startup has divided the world into a grid pattern of 57 trillion 3m x 3m squares and given each one a unique 3-word address. It means anyone can accurately find any location and share it instantly, removing the ambiguity from the search process.
At the Frankfurt Motor Show this week, Mercedes Benz announced it would be integrating this radical new address system into a selection of its models from 2018. “The United Nations and the Red Cross use us in disaster zones, and now Mercedes has realized that there is a problem in the developed world with accurate mapping systems and they have employed our software,” says Giles Rhys Jones, w3w’s chief marketing officer.
Hat tip: Samir Varma.
Why is Turkey ‘s economy doing so well?
Gross domestic product for the country grew by 5.1 per cent in the second quarter, slightly below expectations but still far exceeding growth rates in developed countries.
The government’s consumer confidence index showed an improvement from 63.4 at the end of 2016 to above 70 for much of the year, though it dipped again in September to below 70.
That is from Javier Espinosa at the FT.
Compared to 2015, the Turkish stock market is up about 20 percent. I recall being pilloried when I wrote my very first Bloomberg column in July 2016: “Turkey’s economy isn’t likely to be affected much by the military uprising.”
Macro phenomena can be difficult to understand, but at least along this dimension Turkey has yet to see its comeuppance.
What should I ask Sujatha Gidla?
She is the author of the new and superb Ants Among Elephants: An Untouchable Family and the Making of Modern India. I will be interviewing her later in the month, with a podcast and transcript forthcoming, no public event. Here is her Macmillan bio:
Sujatha Gidla was born an untouchable in Andhra Pradesh, India. She studied physics at the Regional Engineering College, Warangal. The author of Ants Among the Elephants, her writing has appeared in The Oxford India Anthology of Telugu Dalit Writing. She lives in New York and works as a conductor on the subway.
Here is BBC coverage of her work. Here is the NYT review of her book. Here are further links about her. The Economist wrote: “Ants Among Elephants is an arresting, affecting and ultimately enlightening memoir. It is quite possibly the most striking work of non-fiction set in India since Behind the Beautiful Forevers by Katherine Boo, and heralds the arrival of a formidable new writer.”
So what should I ask her?
The Catalan and Spanish language issue, from the comments
There are many issues to this Catalan predicament
Bob has been providing arguments to a more nuanced view. He has said that “Spanish is not all that far from being banned from public schools” in Catalonia. That is true, but to put it into context provides additional knowledge. The reality is much worse. 60% of Catalan children has the Spanish language as mother tongue (30%, Catalan language) All primary and secondary schools use Catalan as vehicular teaching language (with an hour a week of Spanish… or nothing) Basically, in practice, you are not allowed to decide in which language do you want your children to be taught. I am sure most of you will think that this cannot be true in a democratic country.
As the United Nations recognizes (21st of February, day of the mother tongue) children should be schooled in the mother tongue whenever possible. But 60% of Catalan children are denied this right by successive Catalan regional governments… 30 years and counting. This has produced a situation in which two generations of Catalan children with Spanish as mother tongue have systematically been denied the possibility to develop his potential mental abilities to the upmost, with the consequences that Tyler, in other contests, has commented regularly. They will forever occupy the lowest range of jobs in the Catalan economy. This is cultural supremacy to the core. You will not find this in any other democratic country… nor by a mile. I will leave for other time, perhaps, which characteristics the teachers and principals of the schools share.
The Spanish Constitutional Court has ruled several times against this discrimination, instructing the Catalan government to remedy the situation. To no avail. The regional government pays not attention, neither the central government or the civil society doing much. Civil society movements, very prominent in Catalonia, are basically arms of separatist parties. Still, the threat of the Constitutional Court is there, so better to get rid of this nuisance declaring independence.
That is from a guy named Felix. Here are data from the government of Catalonia (pdf).
Call it the “Trump tax shift,” not the “Trump tax cuts”
Here is my Bloomberg column on that theme, excerpt:
It’s easy enough to pick on unpopular taxes as the problem, but the main issue is cultural presuppositions about what government should and should not do. That’s where any real tax reform would need to come from.
Do note the plan will be harder to pull off, the more specific it has to become.
Monday assorted links
1. Derek Parfit’s final submitted and published piece?
2. Luis Garicano on Catalonia and principles of secession. And Therese Raphael on Rajoy.
3. The finances of top Chinese universities.
4. The effect of the start-up deficit on aggregate productivity growth.
5. Are Millennials now leaving D.C.?
6. Carroll and Frakt on why Singaporean health care is so cheap (NYT). Notably, they identify the relevant market failure in health care as too much spending.
7. Russia helps North Korea open up a new internet connection (for hacking?).