Category: Religion
Upon which day of the week should Christmas fall?
I say the goal is to minimize non-convexities, which in this context means avoiding the possibility of no mail or UPS deliveries for two days running. That makes Saturday and Monday especially bad days to have Christmas.
When Christmas is on Wednesday, as it was this year, on that Wednesday you still can be reading the books which arrived on Tuesday and then a new lot comes on Thursday. The public libraries also close for only one day, not two or three in a row.
Christmas on Wednesday also means that the roads are deserted for all the other weekdays, since many people end up leaving town for the entire week. Then you can visit all those ethnic restaurants you wanted to get to in Gaithersburg or Mount Vernon without hassle.
And if you are taking a vacation abroad, and trying to use a limited number of vacation days, you certainly don’t want Christmas to fall on either a Saturday or a Sunday, which in essence wastes a granted day off.
You know what is also good about Christmas on Wednesday? It means New Year’s Day will be on Wednesday too, double your pleasure double your fun.
Merry Christmas!
Merry Christmas from New Orleans and best wishes for the New Year to all our readers.
Merry Christmas!
Does Ramadan make you happy? Harm output growth?
Filipe Campante and David Yanagizawa-Drott have a new paper (pdf), here is the abstract:
We study the economic effects of religious practices in the context of the observance of Ramadan fasting, one of the central tenets of Islam. To establish causality, we exploit variation in the length of the fasting period due to the rotating Islamic calendar. We report two key, quantitatively meaningful results: 1) longer Ramadan fasting has a negative effect on output growth in Muslim countries, and 2) it increases subjective well-being among Muslims. We then examine labor market outcomes, and find that these results cannot be primarily explained by a direct reduction in labor productivity due to fasting. Instead, the evidence indicates that Ramadan affects Muslims’ relative preferences regarding work and religiosity, suggesting that the mechanism operates at least partly by changing beliefs and values that influence labor supply and occupational choices beyond the month of Ramadan itself. Together, our results indicate that religious practices can affect labor supply choices in ways that have negative implications for economic performance, but that nevertheless increase subjective well-being among followers.
The ultra-Orthodox as (happy) threshold earners
Asher Meir writes to me:
I enjoyed your post today especially since it is one that actually interfaces with my research and not just my teaching of basic micro/macro.
Israeli Ultra-Orthodox are threshold earners in both the positive sense (they don’t on the whole strive to earn more than some basic level) and also the normative sense (they are really more interested in other things.)
Here is an interesting demonstration, you can easily do it yourself using the Israeli CBS “Social Survey Table Generator”. (surveys.cbs.gov.il/Survey/surveyE.htm)
One thing you can easily verify is that the Haredim (you can find them using Topic = Religion and Religiosity, Variable = Religiosity Jews and value is “Ultra Religious/ Haredi) have a reported life satisfaction that is through the roof. It is hugely higher than that of any other sector. (Get there from: Topic = Satisfaction – general; Variable = Satisfied with life.)
But you might say that could be because even though their economic situation is admittedly dire, they care more about other things. Now check out “Satisfaction economic situation”. They still come out way on top. They are not only happiest despite their economic situation, they are happiest with their economic situation. (I am aware that reported happiness and reported life satisfaction are different, I am just expressing myself briefly.) I’m attaching the spreadsheet.
Now here is the real threshold earner criterion: For each group, figure out the average life satisfaction for each earnings level. Then calculate the correlation between life satisfaction and earnings. For every population group it is positive, except for the Ultra-Orthodox. Their coefficient is not significantly different from zero. (J27 is the coefficient, J28 the standard error.)
I’m attaching an Excel spreadsheet that does this for 2012 but I’ve done it a number of times. I do not include the regressions for other sectors but you can easily do so and verify that the income coefficient is positive.
I calculated life satisfaction using a linear weighting, zero for Not so satisfied, one for Satisfied and two for Very satisfied. (Note that the “Not satisfied at all” column is empty. No ultra-orthodox gave this answer.) I used the middle of the income range for income. But in my experience it doesn’t matter much how you do this.
I played around with this once using the WVS to see if I could find some other group in the world for whom life satisfaction was totally uncorrelated with income. I didn’t find any but I imagine that Hal Varian would find it easy to do so.
Those are intriguing results. One possibility is that (some?) religions make people pretty happy. Another is that lack of money does not make you unhappy, provided that a) you can cite a good reason for having a lower income, b) you have peer and family support for your situation/decision, and c) there is no negative selection into the other lower income individuals you will end up hanging around. Bryan Caplan might cite the large number of children as a source of life satisfaction.
If one was looking for grounds to be skeptical, perhaps extremely religious groups use the concepts of happiness and life satisfaction in different ways. For instance complaining about your life satisfaction might be considering a signal of impiety and thus the extremely religious might put a better gloss on things than their actually happiness would warrant. Of course “pretending to be happy” may itself be a possible source of happiness.
Stanley Fischer on the Israeli economy
The word is that Stanley Fischer will be nominated to be #2 at the Fed, good news in my view. Here is Ari Shavit recounting his meeting with Stanley Fischer:
…he [Fischer] utters the relevant figures in slow, measured, Anglo-Saxon Hebrew. In the years 2004 to 2008, Israel’s average annual growth rate was 5.2 percent. While the world was in crisis in 2010-11, Israel’s average annual growth rate was 4.7 percent.
…Fischer tells me there are four reasons for this success: reducing government spending dramatically (from 51 percent of GDP in 2002 to 42 percent in 2011); reducing the national debt significantly (from 100 percent of GDP in 2002 to 75 percent in 2011); maintaining a conservative and responsible financial system; and fostering the conditions required for Israeli high-tech to continue to flourish.
There is then a discussion of how Israeli R&D and starts-ups are so strong and how dynamic the tech sector is. Fischer then turns to the problems:
“We have four problems,” he says. “Our education system has deteriorated, and it endangers our ability to sustain technological excellence. The employment rate among ultra-Orthodox men is only 45 percent. Most Arab women do not work. Fewer than twenty business groups control much of the local market and thus restrict competition. Right now the high-tech miracle helps to conceal these four problems that are weighing down the wider economy. But in the long term, these problems endanger Israel’s ability to remain prosperous and successful.”
That is from Ari Shavit’s excellent new book My Promised Land: The Triumph and Tragedy of Israel, reviewed here.
IBM’s Watson will be made available in a more powerful form on the internet
Companies, academics and individual software developers will be able to use it at a small fraction of the previous cost, drawing on IBM’s specialists in fields like computational linguistics to build machines that can interpret complex data and better interact with humans.
That is a big deal, obviously. The story is here.
A theory of good intentions
Paul Niehaus has a new paper, and here is the abstract:
Why is other-regarding behavior so often misguided? I study a new explanation grounded in the idea that altruists want to think they are helping. Frictions arise because perceptions and reality can diverge ex post, especially when helping remotely (as for example with international development projects). Among other things the model helps explain why donors have a limited interest in learning about effectiveness, why charities market based on need rather than effectiveness, and why beneficiaries may not be able to do better than to accept this situation. For policy-makers, the model implies a generic trade-off between quantity and quality of generosity.
When in doubt, self-deception about helping is the next best thing to helping itself, and cheaper to produce. If I recall properly, the original pointer was from Michael Clemens.
The Sad Losers of Politics
Pierce, Rogers and Snyder find that political partisans are more upset about an election loss than a random sample of parents were upset by the Newtown shootings.
Partisan identity shapes social, mental, economic, and physical life. Using a novel dataset, we
study the well-being consequences of partisan identity by examining the immediate hedonic
impact of electoral loss and victory. We employ a quasi-experimental regression
discontinuity model that minimizes many of the inferential biases associated with surveys.
First, we find that elections strongly affect the well-being of partisan losers (for about a
week), but minimally impact partisan winners. This is consistent with research on the goodbad
hedonic asymmetry. Second, the well-being consequences to partisan losers are intense.
To illustrate, we show that partisans are affected two times more intensely by their party
losing the U.S. Presidential Election than both respondents with children were to the
Newtown Shootings and respondents living in Boston were to the Boston Marathon
Bombings. We discuss implications regarding the centrality of partisan identity to the self
and its well-being, and the methodological contribution.
The authors suggest that the happiness effects of political losses are surprisingly large but they would have done better to compare elections with something people really care about, sports (and here). Sports and politics share the same irrational attachment to a team, the only difference being that the rivalries and hatreds of the former rarely lead to as much death and destruction as the latter.
I feel fortunate to have never been emotionally invested in the winner of any election. It’s all a carnival of buncombe to me–a giant robbers cave experiment for the amusement of those in the know.
Addendum: the authors make one error, on the eve of the election the Iowa political markets were not predicting a close election but a strong Obama win (the authors confuse the vote share market with the winner take all market.)
Hat tip: Paul Kedrosky.
The new service sector jobs
Motivation and inspiration will become more important jobs, and this time the story is from China:
Life coaching is big business the world over, perhaps nowhere more so than in the US. China is still a newcomer, with self-help books and motivational talks beginning to gain traction just 15 years ago. But as in so many other areas of the Chinese economy, the gap is closing quickly. The “success studies” industry, as it is known in China, is dominating bestseller lists, filling conference halls and generating phenomenal wealth for star speakers…
On this occasion, though, Chen [a major motivational coach] needs no extra help. The audience is raring to go. Bursting on to the stage, he asks: “Who wants to be number one?” All 1,500 hands fly up in the air. Then a dose of realism: “You’re dreaming. Only 3 per cent of you will succeed. And to get there, you need the right coach. You need to be in a circle of winners.” A slideshow follows, pictures of Chen posing next to or somehow squeezing himself into the frame with Barack Obama, Bill Clinton, Formula 1 driver Michael Schumacher, basketball star Michael Jordan and more. He replays a phone message from Huang Xiaoming, a Chinese actor, thanking Chen for his coaching.
The message – that Chen is a winner and that his tutelage is a prerequisite to success – proves startlingly effective. At the end of his speech, he gives the audience a two-minute countdown to sign up for a special deal to join his circle of winners: Rmb29,800 [TC: 6.12 Rm to one U.S. dollar] for a year’s access to his Shanghai club and more self-improvement courses. About 150 people seize the opportunity, dashing up to the front of the room. Chen’s assistants form a ring around them with handheld bank card swiping machines, ready to collect their money on the spot.
The fascinating FT article, by Simon Rabinovitch, is here, possibly gated. Of course the greater is income inequality, the easier it will be to market such services, because the promised gain from leaping the divide will be that much greater.
The problem
One reason that many Americans believe Medicare does not contribute to the deficit is that the majority thinks Medicare recipients pay or have prepaid the cost of their health care. Medicare beneficiaries on average pay about $1 for every $3 in benefits they receive…However, about two-thirds of the public believe that most Medicare recipients get benefits worth about the same (27%) or less (41%) than what they have paid in payroll taxes during their working lives and in premiums for their current coverage.
Here is more, via Amitabh Chandra.
Mormons go Keynesian (?)
That is his title, not mine, I would instead refer to doubling down. Matthew Crandall reports:
Despite high profile investments and for profit businesses owned by the LDS church, it is primarily dependent on member donations (tithing, or 10% of one’s income) for its operational budget. Tithing revenue has currently flat-lined due to demographic and geographical factors both inside and outside of the United States. As baby boomers retire, their incomes decrease significantly. Families are having fewer kids and younger people are taking longer to get going in their careers. This coupled with high unemployment for the last five years or so (and likely the next five years or more) all have a negative impact on tithing revenue.
Geographically more and more members are joining from poorer places in the world (Africa for example) and even in the rich parts of the world, like Western Europe, it is immigrants who are more likely to join who tend to be relatively poor. This also has negative consequences for tithing revenue.
Meanwhile demands on tithing revenue continue to increase. New missions need new mission homes and rapid church expansion in many remote areas means more chapels and temples that need to be built. Run-away costs in higher education make subsidies at BYU, BYU-Idaho, and BYU-Hawaii go up as well. The spreading of the gospel to every nation and tongue also means an increase in spending on translation and publishing. What strategy does the church have to combat this problem?
…Overall, the church has not engaged in harsh austerity measures. Rather, it has implemented Keynesian economic principles of targeted spending that it hopes will result in church growth and hence a growth in tithing revenue.
For example the resent “surge” in missionary force will likely increase the number of missionaries from around 58,000 to 90,000 by the end of the year. Currently there are already more than 75,000. This resulted in the creation of 58 new missions which will result in a significant increase in expenses for the church.
Presumably the view is that the “[non-animal] spirits” are on their side. The article is interesting throughout, and for the pointer I thank Paul Edwards.
*Big Gods*
The author is Ara Norenzayan and the subtitle is How Religion Transformed Cooperation and Conflict. I found this book insightful, well-written and to the point. The book itself lists some of its key propositions:
1. Watched people are nice people.
2. Religion is more in the situation than in the person.
3. Hell is stronger than heaven.
4. Trust people who trust in God.
5. Religious actions speak louder than words.
6. Unworshipped Gods are impotent Gods.
7. Big Gods for Big Groups.
8. Religious groups cooperate in order to compete.
The book’s home page is here.
Chinese insurance markets in everything
People in 41 cities in China can insure their enjoyment of the full moon during the Mid-Autumn Festival from Monday.
An internet-based insurance product was launched by Taobao Insurance under the Alibaba Group, China’s largest online shopping platform, together with Allianz China General Insurance Company.
Internet users can insure themselves against inconveniences during their moon gazing at the Mid-Autumn Festival, and will be paid off if they cannot see the moon because of poor weather on the day.
Residents of cities of Shanghai, Guangzhou and Shenzhen can pay a premium of 20 yuan (US$3.24) and receive 50 yuan (US$8) from the insurer if they cannot see the moon.
People living in 41 cities of China, including the three cities above and the country’s capital of Beijing, can pay a premium of 99 yuan (US$16) and receive 188 yuan (US$31) if they fail to see the moon through poor weather. Everyone who purchases the insurance will get a box of mooncakes as well.
Here is more, and for the pointer I thank Jonathan Zhou.
A Puzzle in Divorce Law
It’s easy to see why a divorce law might arise that allows men relatively easy divorce, as in the Old Testament which lets men divorce almost at will (as written, interpretations differ) but gives women no right to divorce at all. It is also easy to see why a society might adopt mutual consent under which both parties must agree in order to get a divorce or no-fault unilateral rules in which either party can get a divorce without the consent of the other. What is difficult to understand, however, is why a society would adopt divorce laws that make it difficult to get a divorce even when both parties want a divorce. Who benefits from such rules? And yet this was the common situation in England and the United States up until say the end of the 19th century. In England, for example, it took an Act of Parliament to get a divorce. One might argue that such rules benefit children but aside from the questionability of the premise this view would also have to answer how it is that children have political power?
Hat tip to Sasha Volokh for bringing the question to mind with an apropos quote on divorce from a 19th century British judge.