Category: Travels

Digitalization and the value of various tourist locales

Miles, a loyal MR reader, writes to me:

I’ve spent a fair amount of time today at my desk in California looking at this, and it got me thinking about an interesting interplay between the tourism industry and the “digital revolution”:

(use the +/- buttons to zoom and drag to shift the view)

After finding people and understanding the scale of those mountains, I am in awe of Everest and the Himalayas, but feel absolutely no need to travel there. A digital representation has given me an amazing experience of a place on the other side of the world, and at least for this particular occasion, has convinced me never to go there (try to find the people climbing the upper portion of the glacier and you’ll understand why). So maybe some amazing (non deadly) location would convince me that I need to visit in person, but at some point, the digital experience gets so good that it’s a better, cheaper alternative to travelling. If in a few hundred years we can create digital experiences far more immersive than physical visits to locations, what experiences/amenities/etc will induce people to travel? Where will tourism die off (Himalayas), where will it increase (Paris)? As you say, solve for the equilibrium.

Thought it might make for an interesting discussion.

I predict that bustling, interactive locations — such as Guatemala — will do fine, and it is the static nature settings which will face a bit more competition.  That said, while I have never visited the Himalayas, I suspect the trip there involves a lot of bustling interaction with local cultures and that the final destination is in part an excuse for the process.  Keep also in mind that most of us do not in fact enjoy travel but enjoy only the memories of travel, with our minds playing a fairly active role as editor.  I doubt if the memory of visiting the digital image will ever compare, even if the image itself is more beautiful and more convenient than the reality of an actual physical site.  Finally, there is marketing to consider.  The digital image may market the original, just as the rather vivid LOTR movies have boosted tourism to New Zealand rather than replacing it.  So overall I still see tourism as a continuing growth industry.

Israel notes

The food is quite good, as is the gelato.  Don’t forget the Libyan, Ethiopian, and Yemeni offerings.

Poverty is more evident than I had expected, and one wonders whether extreme Israeli income inequality is a harbinger of a broader global future.  A simple, small bottle of mouthwash costs about $10.  It is surprising, for this American, to see beggars wearing yarmulkes.

How much of the high cost of living here is from inefficient retail and consolidation?  How much from “the Island effect”?  Since the locals feel the high costs too, we cannot rely on the productivity of the tradeables sector as an explanation.  As for the rent, when it comes to construction permits, Israel ranks #137 (!, pdf) on the World Bank’s Doing Business Index.  Yet the quality of the construction is often somewhat ramshackle, although I expect the Wall and the Iron Dome to last for some while.

Cost of living aside, I imagine living in Tel Aviv as quite pleasant, and I prefer it to most of the other Mediterranean cities I have visited.  The Israel Museum in Jerusalem displays its collection wonderfully.

This place is now a preliminary R&D laboratory for good U.S. TV showsHani Furstenberg is Israeli, it turns out, and Tel Aviv has been named the world’s #2 city for high-tech start-ups.

I am basing this following comment on a limited sample, but so far I have found this country to have a disproportionately large share of taxi drivers who are Jewish, at least compared to anywhere else I have visited.

The Segway seems to have some commercial viability in Israel.

Sometimes the security question consists simply of “Do you have a weapon?”  I do not.

Against my expectation, Jerusalem is a more populous city than Tel Aviv.

Natasha cannot pass for an American here.

Busan notes

Busan is the best success story I know for the Avent-Yglesias approach to urban density.  Imagine taking a city that looks like San Francisco, or more concretely Nagasaki, and letting millions of Koreans in to live there.

They served me the live, still-wriggling and squirming sea worm entree, which you are supposed to dip into sauce and push down your throat; it was neither the best nor the worst course of the meal.

White sashimi, dipped into hot bean paste, is the preferred manner of eating raw fish here; tuna, salmon, and eel are not popular.

On the beach, on a clear day, you can see Japan across the water.

In a nearby rural area, the populace would appear to go to Sunday church, dressed up in their finery, and then hang out at the museum and welcome center for the local nuclear power plant.

A day tour of Hyundai City, the special economic zone, the chemical-industrial complex (reminds me of New Jersey), and the new port is better than a day tour of Korean temples.  They are all targets for North Korean missiles.

The people I have asked predict reunification within ten to fifteen years.  They are ashamed to have such a brother in the family.

If you visit Korea you should come to Busan.

A Brief Visit to North Korea

Tyler is in North Korea, Alex is in South Korea.

Alex is in North Korea, Tyler is in South Korea.

If we look a little tense it was because it was tense, perhaps even more than usual since just days before a North Korean soldier had killed two of his commanding officers while defecting to the South. North Korea also appears to be undergoing greater food shortages than in many years which no doubt adds to the tension. I had not realized, by the way, that you can see North Korea from a major highway in South Korea and the land is clearly stripped bare of trees which have been cut down for firewood and what little nutrition the bark offers.

Here are the North Koreans watching and photographing us to put into their permanent records.


Seoul notes

It is remarkable how well everything works here, even relative to expectations.  The economic ascendancy of South Korea has been more rapid than that of Japan, and for a larger group of people than Hong Kong or Singapore.  The initial level of education was much lower than in Japan.  The Korean social miracle is no less impressive than the Korean economic miracle.

By the way, can you explain the South and North in a single unified theory of culture and regimes?

French-Korean bakeries are extremely common here.

The Samsung Museum is of higher quality than the National Museum, including for patrimony pieces not just Warhol and Koons.

My hotel toilet is complicated and I am afraid to press the one button which simply says “Enema.”

I saw the two main Korean presidential candidates “debate,” both of them using communitarian redistributionist rhetoric with a rather flat delivery, preceded by and followed by a bow.  Toward the end one of them endorsed the work of Malcolm Gladwell, in front of Gladwell.

I am pleased to have spent one minute inside North Korea, with Alex, guarded by five South Korean martial arts experts and one U.S. soldier.

The question I hear most often is what I think of Gangnam style and the video.  The second is whether I am a Christian.

There are so many coffee shops here.  But why?

South Koreans have now dominated the game of Go for about fifteen years.

Seoul food notes

There is always a pumpkin, smoked duck, or clam and noodles dish you haven’t seen before.  The way to eat well here is to seek out the small restaurants, on the edge of residential districts, with no English language signs, which appear to not rely very heavily on the division of labor and which serve not too many dishes.  Bibim bap (shaken vigorously inside a lunch box, I might add) is like a fine risotto and the quality of cabbage alone makes Seoul a world-class city.

Particular restaurant recommendations are pointless, and in any case hard to track down.  Just follow basic principles.  The street food, by the way, is only so-so.

At one restaurant, as a kind of joke, I asked “What is best?”, not even expecting my English to be understood.  The waiter became very excited and opened the menu to a page entitled “Best food,” which listed five dishes.  I ordered two of them.

I see no reason to explore upscale dining here.  For surprise and uniqueness, I am not sure the world currently offers a better dining city than Seoul.  My most expensive meals are still falling below $20, averaging $10-$12, and they are occasionally below $5.

Beijing notes

It is a gargantuan, imperial city, and while there is always a walking path the point of walking is not always clear.  “The Middle Kingdom does Dubai.”  There is no need to tell me about all the parts of the city which do not look like Dubai, I have seen many of them, and furthermore Dubai has such parts as well.

An iPad, plus Baidu access to Chinese characters, makes it easy to ask questions of strangers.  Hardly anyone speaks even minimal English.  It is less harried than I had expected.  The sky rarely appears, at least in late July.  The contemporary art district, 798, is worth more than one visit.  I am not interested in seeing the Great Wall.  My hotel, rather than having a “Medical Devices” conference, has a meeting on “Australian Property Holdings.”

The main problems here are the air pollution, and that no one, including taxi drivers, seems to know how to get anywhere.  The rate of change is high and many people are from the provinces, so there is a real information gap.

The main upsides stem from what scale enables.  Even if you have been to many places, Beijing will manage to astonish you.

Most of all, I am struck by how Taiwan is more Chinese than is China.

Which are the best walking cities?

I will nominate London, Paris, and Buenos Aires as leading contenders.  New York is for me too familiar for me to judge objectively and so I exclude it.

Reasonable safety is a prerequisite, and then we have the following dimensions:

1. Chance of seeing a striking yet non-famous piece of architecture.  All three cities are strong here.

2. The right mix of broad boulevards and narrower streets.  Ditto.

3. The chance of spontaneously encountering good bookstores or excellent dark chocolate:  London wins the former, Paris and Buenos Aires win the latter.

4. Cheap, convenient cabs, and places to sit and drink sparkling water: Buenos Aires is #1 on these.

5. Strangers are willing to talk to you: Tough to call, though NYC would win hands down if it were in the running.

6. Strategic and frequent use of historic plaques: London wins; yesterday I saw “George Canning lived here” and “Clive of India lived here,” among others.

B.A. loses points for imperfect safety and also capital confiscation, though it has by far the warmest weather of the trio.  Overall I am inclined to pick London as first, perhaps because I prefer English to French for bookstores.  Paris offers fewer surprises, even if it has a higher average level of beauty.  Paris is also worse for spontaneous cheap dining in restaurants, though it has far better food stores for urban picnics.  Berlin is perhaps the best city right now for living, but it is too spread out, and with too many broad boulevards, to be the best walking city.  It is an excellent city to take a cab in.

Walking cities on the rise: Istanbul.  I suspect it’s long been splendid, it’s now reaping the gains of being modern.

Underrated walking cities: Moscow, Mexico City, Toronto, parts of northern England, Los Angeles.

Overrated walking cities: Budapest, Krakow, Munich.

Best city to take the subway through: Tokyo.

If I had to pick a fourth in line: Barcelona.

Gallego travel notes

The ATM gives you a choice of eight languages, including Catalan, Gallego, Valencia, and Euskara.  At first the street signs appear to be in Portuguese, but that is a trick.  Other times the dual Spanish and Gallego phrases on the signs are exactly the same.

Gallego as a province [Galicia] reminds some of Nantes, France, and the surrounding area, or of parts of southern Chile.

If you put together Keynesian economics and public choice theory, you get a very nice and indeed downright spacious airport in Santiago de Compostela.  More infrastructure here will not jump start growth.

Counterintuitively, Santiago avoids the destruction of its authenticity by relying on tourism.  The city has been a major tourist destination since at least the 9th century A.D., so the arrival of tourists — many of them have religious motives — is how the city’s past is preserved.  It is the people who stay at home who are ruining the place.

Vigo, the largest city in Gallego, has lovely sea views, lots of refrigeration facilities in its port, and superb seafood.  It is slow on a Sunday, especially for its size.  Percebes looks like this, and it is a must-try.

“A Coruña is one of only eight pairs of cities in the world that has a near-exact antipodal city.”  That would be Christchurch, New Zealand.  A Coruña is supposed to be the most prosperous city in Gallego, yet it is scary how many abandoned or boarded up buildings are in the heart of downtown.

The city’s Roman lighthouse is still in use, and it is the world’s oldest active lighthouse.

It is very green in Gallego and it rains a lot, though not as much as in Bergen, Norway.

I strongly recommend a trip to Gallego.  There are numerous reasons to go, and few reasons not to go, the only really good one being that you may wish to go somewhere else.

Why has Foreign Aid Been Untied?

The more cynical among us have sometimes thought that rather than recipient welfare the purpose of “foreign” aid is to provide a cover for domestic aid. Foreign aid pork, i.e. using foreign aid to subsidize special interests in the donor country has certainly been common. Historically, most foreign aid has been tied; that is, the recipient was required to spend the money on the donor country’s exports. Relative to cash, tying raises prices and reduces choice and recipient welfare–the deadweight loss of Christmas problem.

US food aid is a classic example. US food aid tends to peak after a glut. It’s cheaper for us to give food away when we have lots and not coincidentally giving food away after a glut helps to keep prices higher, benefiting US farmers. It’s precisely when food is plenty, however, that prices are low and aid is less needed. When food is scarce, prices are high and aid is more needed but then we would rather sell our food than give it away. In addition, we typically require food aid to be transported on US ships which raises costs. Finally, the food we give away is not always best suited to the recipient’s preferences or needs.

For a public choice theorist the fact that foreign aid benefits domestic special interests is not at all surprising. What is surprising is that tied aid is way down. Great Britain banned most tied aid in 2002 and indeed tied aid is down across all of the major OECD donor countries. Food aid and technical assistance are still tied but these aid categories are down and untied grants and loans are up. In 1984-1986, for example, about 60% of aid was tied and today only 10-25% of aid is tied (depending on source).

Why has aid become untied? Could this be a case of improved public policy due to lobbying from the aid industry? It is interesting to note that although tied aid is down in the US, the US continues to tie a lot of aid, considerably more than the Europeans. One explanation may be that the decentralized US political system gives more weight to local domestic interests so tied aid continues to sell here despite opposition from most aid groups.

Special interests are also not the only explanation for tied aid. Tied aid can reduce corruption in the recipient country. If donors have become less worried about corruption, perhaps because governance has improved in the developing world, this could offer a public interest explain for an increase in untied aid.

Overall, I find it puzzling that foreign aid has become untied as the major beneficiaries appear to be poor foreigners with little political power.