Category: Uncategorized
Wednesday assorted links
1. China fact of the day: “Prefectures that experienced a more severe export slowdown witnessed a significant increase in incidents of labor strikes.”
2. Raising children with voice assistants. And Canada bans the keeping of whales and dolphins in captivity.
3. Why this professor does not retire at age eighty. A good piece, not to be taken entirely uncritically, of relevance to more people than just professors.
4. Dose of Gwern.
5. Airfares are getting cheaper.
6. Rachel Glennerster podcast on how to invest in the developing world. Has a transcript too.
RIP, Martin Feldstein
In addition to being a great economist, Marty was an institution builder. He was the early driving force behind the rise of the NBER, he led the development of empirical public finance as a respected field, and also very early on he pushed health care economics, both through his leadership at the NBER and through his own work and mentorship. He always was reaching out to help others, and Larry Summers, Jim Poterba, David Cutler, Raj Chetty, and Jason Furman were some of those he mentored. The economics of art museums was yet another topic he had a real interest in, and stimulated research in.
Marty also was one of my oral examiners at Harvard, and he asked only excellent questions. I thank him for judging my answers to be good enough.
My question about Haifa
When visiting Israel, I spent two days in Haifa, Israel’s third largest city at about 279,000. It seemed to me oddly empty, in a fractal sort of way. The supermarkets had very little on their shelves. There weren’t many supermarkets, or for that matter many restaurants. No part of town seemed to be truly densely populated. There was neither a center nor a thriving set of edge cities, not that I could see. There weren’t even many parts of town.
Nothing even remotely resembling a real bookstore, not outside of the university at least. So what gives? What is the proper theory of Haifa?
My trip to Israel
I was very pleased to have been sponsored by the Friedberg Economics Institute, who were wonderful hosts and put together great audiences on my behalf.
Here is my interview with Globes, which they helped to arrange, excerpt:
“We started this trade war with China by shooting in all directions. It would have been much wiser to form our alliances first, and then consider doing something versus China. I believe that the current trade war with China is unavoidable. It would have taken place even without Trump as president. There are too many cases of unfair trading by China, of Chinese companies operating unfairly and even spying, of stealing of US ideas, and preventing US or Western businesses from operating in the country. This dam had to burst sooner or later.
“What is happening now is not good for any country: not for the US, not for China, and also not for Israel, which like many other small countries will be harmed by the trade war. We’re in a situation in which everyone loses.
“The US is pressuring, and will pressure, Israel not to cooperate with China. It has already begun, and it will get worse. You can understand Washington – if you have the Sixth Fleet in Haifa and China controls part of the port, US concern is understandable. On the other hand, China depends on oil from the Middle East. It needs reliable partners in the region in order to ensure its regular supply, and Israel is the only country that meets this criterion. Imagine a future in which China exerts strong pressure on Israel to help it conduct its foreign policy. I think that it will be harder and harder for Israel to cope with Chinese pressure on the one hand and US pressure on the other.”
A variety of other topics are covered at the link.
*The Case for Space*
The author is Robert Zubrin and the subtitle is How the Revolution in Spaceflight Opens Up a Future of Limitless Possibility. I found this book fun, ambitious, and informative, even if I was not entirely convinced. Zubrin thinks big and bold in an exciting way, here is one bit:
Exploring Mars requires no miraculous new technologies, no orbiting spaceports, and no gigantic interplanetary space cruisers. We can establish our first small outpost on Mars within a decade.
There is not much talk of the stress space (or for that matter life on Mars) might place on the human body. Zubrin talks of Mars tours of four or six years or more.
Yet my biggest difference with Zubrin is this: I think of space and planetary exploration as presenting many surprising and difficult problems, ones which cannot be foreseen and fixed in advance by stocking a spacecraft with “just the right materials.” There are many sentences like this:
Mobile microwave units will be used to extract water from Mars’s abundant permafrost, supporting such agriculture and making possible the manufacture of large amounts of brick and concrete…
But when the problem of missing parts arises, or perhaps missing links between systems, you can’t run to the local hardware store. Try this one too:
Extracting the He3 from the atmospheres of the giant planets will be difficult, but not impossible. What is required is a winged transatmospheric vehicle that can use a planet’s atmosphere for propellant, heating it in a nuclear reactor to produce thrust.
My other worry is that if we do not find it profitable to inhabit rural Nevada, Mars might stay empty as well. Zubrin does make a detailed economic case for the value of space, though to my eye much of it falls on satellites. Asteroids have valuable minerals, such as uranium, and that might spur mining operations, powered by nuclear fusion. But is that really the cheapest way to get more uranium, in any case I suspect its price and value would fall rapidly with quantity.
Zubrin puts forward the interesting hypothesis that life in space will encourage a great deal of political freedom:
Historically, the easiest people for a tyrant to oppress are nominally self-sufficient rural peasants, because none of them are individually essential…In a space colony, nearly everyone will be individually essential, and therefore powerful, and all will be capable of being dangerous to those in authority.
Hard to verify, but worth a ponder.
Under another scenario, arks full of large, smart salamanders, genetically programmed to build incubators by instinct, will settle the galaxy at “a speed exceeding 20 percent the speed of light.”
There are many interesting ancillary points, such as using the length of the growing season to estimate global warming, or how pp.284-285 offer an ambitious take on the spin-off benefits from the space program so far, or pp.294-295 on exactly why taking out an asteroid with bombs is so hard.
With plenty of caveats of course, but recommended, the author of this one is never coasting.
Monday assorted links
1. Other people are happier than we are inclined to think. Around the whole world.
2. The debate over travel photos, with a cameo by me.
3. What is public and private these days?
4. Is liberalism failing because it rejected Christianity?
5. Not altogether an endorsement (the cryptocurrency culture that is South Africa).
Something is wrong with construction
Changing sectoral trends in the last 6 decades, translated through the economy’s production network, have on net lowered trend GDP growth by around 2.3 percentage points. The Construction sector, more than any other sector, stands out for its contribution to the trend decline in GDP growth over the post-war period, accounting for 30 percent of this decline.
That is from a new working paper by Andrew Foerster, Andreas Hornstein, Pierre-Daniel Sarte, and Mark W. Watson, “Aggregate Implications of Changing Sectoral Trends.”
Kevin Erdmann, telephone!
Has the division of labor hindered knowledge integration and productivity growth?
…we suggest that this division of innovative labor has not, perhaps, lived up to its promise. The translation of scientific knowledge generated in universities to productivity enhancing technical progress has proved to be more difficult to accomplish in practice than expected. Spinoffs, startups, and university licensing offices have not fully filled the gap left by the decline of the corporate lab. Corporate research has a number of characteristics that make it very valuable for science-based innovation and growth. Large corporations have access to significant resources, can more easily integrate multiple knowledge streams, and direct their research toward solving specific practical problems, which makes it more likely for them to produce commercial applications. University research has tended to be curiosity-driven rather than mission-focused. It has favored insight rather than solutions to specific problems, and partly as a consequence, university research has required additional integration and transformation to become economically useful. This is not to deny the important contributions that universities and small firms make to American innovation. Rather, our point is that large corporate labs may have distinct capabilities which have proved to be difficult to replace.
That is from Ashish Arora, Sharon Belenzon, Andrea Patacconi, and Jungkyu Suh, “The Changing Structure of American Innovation: Some Cautionary Remarks for Economic Growth,” recommended, an excellent paper spanning several disciplines. I would myself note this is further reason not to split up the major tech companies.
Sunday assorted links
1. What D.C. as a state really would be like.
2. On the physical (im)possibility of light sabers.
3. Barter and isolation in Venezuela.
4. Ross Douthat on liberal proceduralism and its possible failings (NYT).
5. Arnold Kling on generalists.
6. Austan Goolsbee predicts Uber and Lyft will raise prices (NYT).
*Dignity: Seeing Respect in Back Row America*
That is the new book by Chris Arnade, insightful throughout and with excellent photos. Excerpt:
McDonald’s wasn’t just central to my friends, it was important to everyone in the neighborhood. It was always packed with families and older couples, especially on weekend mornings. In the evenings, it was filled with teenagers or young couples going out.
There weren’t really many other options. McDonald’s was one of the few spaces in Hunts Point open to the public that worked. While wonderful and well-intentioned nonprofits serve Hunts Point, whenever I asked anyone where they wanted to meet or grab a meal, it was almost always McDonald’s.
Arnade indicts “the elitists,” whereas I would lay heavier blame on alcohol and drug abuse. Many much poorer people never touch the stuff, and furthermore I would have added a comparison with America’s dark-skinned, not entirely popular Muslim immigrants, the non-drinking ones most of all. There is indeed something wrong with much of American culture, and we need to think harder about what that might be. Neither sympathy nor empathy changes that fact, and I am happy to be one of the elitists under indictment. I would rather write what I think than try to make other people feel better, or to support my favored politics, and perhaps that attempt is doomed in any case? Is it more or less condescending to hold the poor to high standards?
Tomas Philipson as the new CEA chair?
Supposedly so, here is the Politico article. Here are previous MR posts on his research.
*Godzilla: King of the Monsters* (spoilers in this post)
Carp all you want, I thought it was pretty damn good. The innovations: monsters have economic value, there are property rights in monsters (for a while), communication really matters, the environmentalists are the bad guys, and nuclear power saves the world. The stagnation: Asian people, and only Asian people, have TFP about monsters.
You can’t judge these movies by normal standards, like those silly critics do, instead you have to ask:
1. How good are the monsters and the monster fight scenes?
2. Does it give the monsters a decent backstory and mythological lore?
3. Does it pay suitable homage to the original movies?
4. Does it have the right number of obscure monsters, arbitrarily added to the canon, as if we know all along who and what they are supposed to be?
5. Do you learn something about how the film-producing country views its own science and bureaucracy?
6. Perhaps YIMBY will come to Boston after all.
Mothra steals the show, A- I say, don’t @ me on this one. The Japanese movie Shin Godzilla, which appeared about two years ago, is pretty good too, especially on #5.
Friday assorted links
1. Arnold Kling on the decline in labor’s share.
2. New results on RNA-based memory and even Lamarckianism of a sort.
3. Plastic bags designed to embarrass their users (the culture that is Vancouver).
4. What is it like to have a six-fingered hand?
5. Laurence B. Siegel reviews *Big Business: A Love Letter to an American Anti-Hero*.
Israel is a triumph of neoliberalism
That is the topic of my latest Bloomberg column, here is one excerpt:
From about 1973 to 1985, Israel had very high rates of inflation at one point reaching over 400%. That was the result of excessively loose monetary policy. Over time, printing money at such a clip took in successively less government revenue, as Israelis adjusted to the inflation and worked around it by holding less cash and denominating their contracts in foreign currencies. The inflation stopped giving macroeconomic benefits, even for government revenue, and Israel moved toward a regime of lower inflation and fiscal strength, to the benefit of the country’s longer-term growth.
This is a classic episode of MMT — “Modern Monetary Theory” — getting it wrong, as argued by Assaf Razin in his recent study of Israeli macroeconomic history. Under MMT, monetary policy can cover government spending, and fiscal policy can regulate price levels. Israel wisely followed more mainstream approaches.
And:
Even many of the microeconomic developments in Israel fit standard models. As you might expect, given the aridity of the region, Israel has had longstanding issues with water supply. Yet today water is not a huge practical problem in Israel, though it requires constant attention. Under the Israeli water regime, which has strong governmental support, high prices and well-defined property rights encourage conservation and careful use. Remarkably, the Israeli population basically quadrupled from 1964 to 2013, but water consumption barely went up. Israel has become a world leader in dealing with water problems, and in turn the country has become an exporter of sophisticated systems for water management.
There is much more at the link, and note Israel is neo-liberal only in some ways, see this earlier link I put up (which I link to in the piece).
Thursday assorted links
1. Australia-only markets in everything: Microsoft-affiliated new Xbox-branded body wash, shower gel, and deodorant.
2. William Nordhaus on the economics of the disintegration of the Greenland ice sheet.
4. Rosenblatt and Klein debate liberalism (video).