Month: May 2022
The LGBTQ+ earnings gap
There is a new paper on this topic, here is the abstract:
This article provides recent estimates of earnings and mental health for sexual and gender minority young adults in the United States. Using data from a nationally representative sample of bachelor’s degree recipients, I find a significant earnings and mental health gap between self-identified LGBTQ+ and comparable heterosexual cisgender graduates. On average, sexual and gender minorities experience 22% lower earnings ten years after graduation. About half of this gap can be attributed to LGBTQ+ graduates being less likely to complete a high-paying major and work in a high-paying occupation (e.g., STEM and business). In addition, LGBTQ+ graduates are more than twice more likely to report having a mental illness. I then analyze the role of sexual orientation concealment and find a more pronounced earnings and mental health gap for closeted graduates.
That is from Marc Folch at the University of Chicago.
Saturday assorted links
1. Do people see their political opponents as more stupid than evil?
2. Sam Enright on Charles Haughey.
3. “I argue that lawmakers representing more homogeneously white districts have greater electoral incentive to moderate their voting records, since the two parties compete more for support of white voters than for the support of minority voters.” Link here.
4. Petite Maman is an excellent movie. It is rare to see a film with a truly original premise.
5. Puffin photo.
I Hate Paper Straws!
I am interviewed by James Pethokoukis at his substack Faster, Please! Here’s one Q&A:
JP: American political debates are generally more interested in redistribution than long-term investment for future innovation. What are the incentives creating that problem and can they be fixed?
A big part of the incentive problem is that future people don’t have the vote. Future residents don’t have the vote, so we prevent building which placates the fears of current homeowners but prevents future residents from moving in. Future patients don’t have the vote, so we regulate drug prices at the expense of future new drug innovations and so forth. This has always been true, of course, but culture can be a solution to otherwise tough-to-solve incentive problems. America’s forward looking, pro-innovation, pro-science culture meant that in the past we were more likely to protect the future.
We could solve many more of our problem if both sides stowed some of their cultural agendas to focus on areas of agreement. I think, for example, that we could solve the climate change problem with a combination of a revenue neutral carbon tax and American ingenuity. Nuclear, geo-thermal, hydrogen–these aren’t just clean fuels they are better fuels! Unfortunately, instead of focusing on innovation we get a lot of nonsense about paper straws and low-flow showers. I hate paper straws and low-flow showers! There is a wing of the environmental movement that wants to punish consumerism, individualism, and America more than they want to solve environmental problems so they see an innovation agenda as a kind of cheating. Retribution is the goal of their practice.
In contrast, what I want is for all of us to use more water, more energy and yes more plastic straws and also have a better environment. That’s the American way.
Subscribe to Faster, Please! for more.
What I’ve been reading
1. Dervla Murphy, A Place Apart: Northern Ireland in the 1970s. Imagine a single Irish woman in the 1970s bicycling though Northern Ireland at the height of The Troubles. Charming and perceptive throughout, and remarkably well-written. Murphy is in general an underrated figure, and note she is still at it, recently in her 90s she did a Lunch with the Financial Times.
2. Marc F. Bellemare, Doing Economics: What You Should Have Learned in Grad School — But Didn’t. A sober and very useful book, covering topics such as “Navigating Peer Review” and “Finding Funding” and “Doing Service.” The advice offered is on the mark. Yet the book as a whole makes economics (academia?) as a whole come across as a grim and dysfunctional profession. You won’t find much on “generating new ideas” or “influencing policy” or “inspiring students.” I guess they taught all those things so well in grad school!
3. Gregory Forth, Between Ape and Human: An Anthropologist on the Trail of a Hidden Humanoid. The claim is that the Flores mini-humanoids may have existed on the island until quite recently, or possibly even still today. I am not persuaded (for one thing the villagers promote too many other ancillary hypotheses about these creatures, for instance they fly), but at the very least this is a fascinating take on how to interpret eyewitness evidence. And the author is a credible authority. They should invite this guy to Hereticon, he is an actual heretic!
William R. Cross, Winslow Homer: American Passage is a definitive biography with wonderful photos, maps, and images. Not a “picture book” but a book with amazing pictures. And text.
Yaffa Assouline, Avant-Garde Orientalists: Tribute to Igor Savitsky. One of the largest collections of Russian avant-garde art is in Karakalpakstan in northwestern Uzbekistan — you can view the work here, recommended.
Thomas W. Merrill, The Chevron Doctrine: Its Rise and Fall, and the Future of the Administrative State, “This book is primarily a work of history about the Chevron doctrine — where it came from, how it spread, the fate of attempts to cabin it, and recent arguments that it should be overruled o significantly rewritten.”
I have not read Jerry Z. Muller, Professor of Apocalypse: The Many Lives of Jacob Taubes, but it appears to be a work of promise.
In defense of extremism
That is my latest Bloomberg column, the argument is super-simple:
Calling something “extremist” is not an effective critique. It’s a sign that the speaker or writer either doesn’t want to take the trouble to make a real argument, or is hoping to win the debate through rhetoric or Twitter pressure rather than logic. It’s also a bad sign when critics stress how social media have fed and encouraged “extremism.”
I favor plenty of extremist ideas. For instance, I think that the world’s major cities should adopt congestion rush-hour pricing. (I know, it hardly sounds extreme, but I assure you that many drivers consider it extremely outrageous to have to pay to drive on roads that were free a few hours before.) London and Singapore have versions of congestion pricing, with some success, but given the public reaction and that most other major cities do not seem close to enactment, it has to count as a relatively extreme idea.
I also favor human challenge trials, arguably an even more extreme idea. In human challenge trials, rather than waiting for a virus to infect those vaccinated (randomly) with the placebo, scientists recruit volunteers and infect them deliberately and immediately. This accelerates the speed of a biomedical trial. To many people there is something repugnant about asking for volunteers and then deliberately doing them harm by injecting them with the virus.
Maybe human challenge trials aren’t a good idea. But calling them extreme or repugnant does not help explain why.
We then get into some more “extreme” ideas…
Someone complaining about “extremism” is a likely predictor of an epistemic vice.
Friday assorted links
Nobel Conversations
Part I, with Josh Angrist, Guido Imbens, and Isiah Andrews. Research collaboration dos and don’ts.
Part II. Pushing new ideas.
Part III, on how econometrics is changing.
Produced and brought to you by Marginal Revolution University.
Does the right-wing or left-wing have better graphics?
Tom Martin emails me:
Might be my aging brain hallucinating again, but I would swear that the average right-leaning publication has fairly ugly graphics and the average left-leaning publication is ‘nicely/artfully’ designed.
• National Review: consistently ugly covers
• Bryan Caplan’s new book: not a cover of beauty
• The New American: ugly
• Reason: getting better, but from an ugly past just 5 years ago
• The American Spectator: goofy?
Compared to:
• New Yorker
• New York Times
• Atlantic
• Dissent
• Jacobin
Maybe my tastes are just left wing, despite my politics, but I sense there is something deeper here.
Agree? If so, what is the best theory of this? I don’t think it is educational polarization alone, as the readers of say National Review, or for that matter MR, are going to be pretty highly educated. Nor do I think it is about budget per se, though that is likely one factor.
Axel Leijonhufvud has passed away
And here is his famous essay “Life Among the Econ.” Via Scott Ashworth.
The nuclear bunker culture that is Finnish
With its brightly coloured slides, trampolines and tunnels, the soft play area at the Hakaniemi Arena, near the centre of Helsinki, looks much like any other. The difference is that it lies 25m below ground in a cavernous space hollowed out of the Precambrian bedrock beneath the city, and is designed to withstand nuclear, biological and chemical attacks.
The clambering children may not realise it, but they are in one of the safest playgrounds on earth.
Most of the time, this is a family-friendly sports centre. Above ground, the only visible clue to its second identity is a small orange and blue triangle on the wall by the entrance that states: “VÄESTÖNSUOJA SKYDDSRUM”, or “defence shelter”. In the event of an emergency, the arena would revert to being the Merihaka bomb shelter, a subterranean living quarters where up to 6,000 people could exist for weeks, or even months…
Helsinki alone has more than 5,500 bunkers, with space for 900,000 people. Finland as a whole has shelter spaces for 4.4 million, in more than 54,000 separate locations.
Here is more from The Telegraph, via the excellent Kevin Lewis.
Thursday assorted links
1. More on the new Bryan Caplan collection.
2. Alice Evans on the new Robin Dunbar book on religion.
3. Ideological equilibrium? Don’t be one of those!
4. New data study on transgender kids (NYT), original paper here. You can read these results either way. I was surprised to see 6.5 as the average age for the transition to start.
Learn Public Choice!
The Public Choice Outreach Conference is a compact lecture series designed as a “crash course” in Public Choice for students planning careers in academia, journalism, law, or public policy. The Outreach Conference will be online Monday July 25 to Saturday July 30, noon to 1:15 est daily. Sign up here!
Everyone welcome. Teachers please do let your students know about this opportunity!
Monday, July 25
An Introduction to Public Choice—Alex Tabarrok
Tuesday, July 26
Arrow’s Theorem and All That—Alex Tabarrok
Wednesday, July 27
Public Choice and Development Economics—Shruti Rajagopalan
Thursday, July 28
Public Choice and The Military Industrial Complex—Abby Hall Blanco
Friday, July 29
Government by Insurance or Who vouches for You?—Robin Hanson
Saturday, July 30
Hayek and Buchanan—Peter Boettke
Automatic Tax Filing?
Pro-publica regularly reports that H&R Block and Quicken lobby against allowing the IRS to pre-fill tax forms. Sure, of course they do and that’s bad. It doesn’t quite follow, however, that “Filing Taxes Could Be Free and Simple” if only for such lobbying. In fact, Lucas Goodman, Katherine Lim, Bruce Sacerdote & Andrew Whitten estimate that less than half of tax forms could be filled out correctly by the IRS and those are the simpler types where the costs of private tax preparation services are lower:
Each year Americans spend over two billion hours and $30 billion preparing individual tax returns, and these filing costs are regressive. To lower and redistribute the filing burden, some commentators have proposed having the IRS pre-populate tax returns for individuals. We evaluate this hypothetical policy using a large, nationally representative sample of returns filed for the tax year 2019. Our baseline results indicate that between 62 and 73 million returns (41 to 48 percent of all returns) could be accurately pre-populated using only current-year information returns and the prior-year return. Accuracy rates decline with income and are higher for taxpayers who have fewer dependents or are unmarried. We also examine 2019 non-filers, finding that pre-populated returns tentatively indicate $9.0 billion in refunds due to 12 million (22 percent) of them.
Jeremy Horpedahl has an excellent post explaining why:
…there is one major thing missing from your income tax withholding estimate: your spouse’s income. You see, the United States is one of the few remaining OECD countries that primarily taxes income based on the family unit (you can use “married filing separately” as a status, but generally there is no benefit and you might lose some deductions). Most countries tax based on your individual income, even if you are married. This is important for two reasons. First, it means there is a “secondary-earner penalty,” where one spouse faces a much higher marginal tax rate (this is different from the “marriage penalty,” but that’s a topic for another day. For purposes of a pre-filled tax return, the second and larger issue is that your employer has no idea how much tax to withhold because it is dependent on how much your spouse makes (and whether you are married).
Moving the US to a system of individual taxation…would simplify the calculation of your taxes.
The other major factor that Jeremy mentions is that the US simply tries to do a lot through the tax code so we have lots of itemized deductions or special tax structures–veterans, widows, widows of veterans–which make it difficult to pre-fill taxes without either simplification or a major overhaul of the administrative data system.
Jeremy also worries that pre-filling will further disconnect the payment of taxes from services rendered thus making costs more opaque. Probably true, although I think that ship has sailed.
My Conversation with the excellent Chris Blattman
Here is the audio, transcript, and video, we did this one face-to-face. Here is part of the summary:
What causes war?…Chris and Tyler also cover why he doesn’t think demographics are a good predictor of a country’s willingness to go to war, the informal norms that restrain nations, the dangers of responding to cyberattacks, the breakdown of elite bargains in Ethiopia, the relationship between high state capacity and war, the greatest threats to peace in Ireland, why political speech isn’t usually a reliable indicator of future action, Vladimir Putin’s centralized motives for invading Ukraine, why he’s long on Colombia democratically — but not economically, why more money won’t necessarily help the Mexican government curb cartel violence, the single-mindedness necessary for bouldering, how Harold Innis’s insights about commodities led Chris to start studying war, how the University of Chicago has maintained a culture of free inquiry, and more.
And from the dialogue:
COWEN: If you look at the marginal cases — since there are some wars — there’s a bunch of cases, even if unusual, where someone is right at the margin. At the margin, what are the factors that are most likely to account for the explanatory variation in whether or not a country goes to war?
BLATTMAN: For me, the one that people talk the least about that strikes me as the most important is how concentrated is power in the country. What’s holding back someone from considering all of the implications of their actions on other people, should they decide to take their society to war?
It’s maybe the most important margin in history, and it’s maybe the one that no one of my tribes — which are political economists — think and talk the least about. It’s the one that — in journalism, people leap to psychological explanations, and they try to understand the psychology of leaders, but they don’t try to understand the way in which they’re constrained. So, it’s this combination of the most important and the most ignored.
COWEN: So federal societies are less likely to go to war?
Interesting throughout. And I am very happy to recommend Chris’s new and important book Why We Fight: The Roots of War and the Path to Peace. And here is my earlier 2018 Conversation with Chris.
Insurance markets in everything
In many golf circles, it was (and still is) customary for the lucky golfer to buy drinks for everyone in the clubhouse after landing a hole-in-one. This often resulted in prohibitively expensive bar tabs.
And an industry sprouted up to protect these golfers.
A newspaper archive analysis by The Hustle revealed that hole-in-one insurance firms sprouted up as early as 1933.
Under this model, golfers could pay a fee — say, $1.50 (about $35 today) — to cover a $25 (~$550) bar tab. And as one paper noted in 1937: “The way some of the boys have been bagging the dodos, it might not be a bad idea.”
Though the concept largely faded away in the US, it became a big business in Japan, where golfers who landed a hole-in-one were expected to throw parties “comparable to a small wedding,” including live music, food, drinks, and commemorative tree plantings.
By the 1990s, the hole-in-one insurance industry had a total market value of $220m. An estimated 30% of all Japanese golfers shelled out $50-$70/year to insure themselves against up to $3.5k in expenses.
Here is the full story, via Mathan.