Category: Uncategorized
*An Economist Walks into a Brothel*
That is the new Allison Schraeger book, the subtitle is And Other Unexpected Places to Understand Risk, and here is one excerpt:
In many ways, the brothel is like any other workplace. There are weekly staff meetings (in a departure from the tradition at most companies, the women often wear outlandish hats and drink tea), access to financial advisers, performance bonuses, and even corporate housing…
But where Hof [the owner-manager] provided value was by reducing risk for both buyers and sellers of sex.
The top-earning woman at that brothel pulls in about $600,000 a year, and about half of that goes to Hof. And to audition for the brothel, women have to invest about $1500 in upfront costs (travel, clothing), with no guarantee of a job at the end of the process.
Here is an NPR interview with Allison.
What should I ask Russ Roberts?
I will be doing a Conversations with Tyler with Russ, the master podcaster himself, but of course also a prolific author in multiple fields. So what should I ask him? Here is Russ on Wikipedia, here is Russ’s home page.
Friday assorted links
1. “The evening’s entertainment harshly criticizes capitalism, and at $2,000 a seat…” (NYT)
2. “Pledges to Notre Dame by rich stir resentment…” (NYT) More information here.
3. Has TikTok learned how to censor the internet?
4. Me on The Gist, Slate podcast with Mike Pesca. And Ryan Bourne reviews *BIg Business* in the Daily Telegraph.
5. Have we finally figured out how general anesthesia works?
6. Emily Oster on evidence-based parenting and breast-feeding (NYT).
Baseball umpires are not so great, and older umpires are much worse
This deep-dive analysis demonstrated that MLB umpires make certain incorrect calls at least 20 percent of the time, or one in every five calls. Research results revealed clear two-strike bias and pronounced strike zone blind spots. Less-experienced younger umpires in their prime routinely outperformed veterans, and umpires selected in recent World Series were not the best performers. Results showed a declining but still unacceptably high BCR score, but on a positive note, only a marginal inter-inning call inconsistency.
The most likely mistakes are made at the top of the strike zone. And older umpires really are worse:
Based on the research, professional umpires, similar to professional baseball players, have a standard peak. The study revealed that home plate umpires who made the Top 10 MLB performance list (2008-2018) had an average of 2.7 years of experience, and averaged 33 years of age with a BCR of 8.94 percent. None of these top performers had more than five years of experience or were older than 37…
In contrast to the overall top performers, research uncovered that umpires on the Bottom 10 MLB performance list (2008-2018) had an average experience level of 20.6 years, were 56.1 years of age, and had an average BCR of 13.96 percent. This group’s error rate was a staggering 56 percent higher than the top 10 MLB performers. Umpire Jerry Layne, with 29 years on the job and at age 61, sported the highest BCR, 14.18 percent. This performance research clearly indicates that more experience and age does not necessarily produce the best umpires.
Here is the full story, written by Mark T. Williams, who also did the data work, via the excellent John Chamberlain.
Thursday assorted links
1. Robin Hanson wants to publish tax returns.
2. How to charm Trump, Japanese style?
3. University rejects call to fire Camille Paglia.
4. Jennifer Doleac, first episode of Probable Causation podcast: “Episode 1 is now available! @chloergibbs talks about the intergenerational effects of Head Start on criminal behavior.”
5. Paul Krugman markets in everything, this one seems to be for real.
Wednesday assorted links
1. Robert Wiblin podcast with Mark Lutter and Tamara Winter.
2. College selectivity over time.
3. Switzerland signs Belt and Road deal with China.
4. Ross Douthat on Notre Dame (NYT).
5. The Economist on Joko Widodo.
6. “Not all Chinese warm to hotpot. Some older Sichuanese disown it altogether. They complain that it is causing an escalation of chilli-use in other dishes that drowns out subtle flavours. Chua Lam, a celebrity food critic based in Hong Kong, caused a stir in December when he wished hotpot would disappear from the face of the Earth. He dismissed it as “the most uncultured form of cooking”, requiring no real culinary knowledge.” It’s better in Chengdu (The Economist).
7. Business is not running the show in D.C. (The Economist).
Tuesday assorted links
1. Are patents responsible for declining business dynamism? (Not my view, but fyi.) Here is a paper blaming the slowdown on a deficiency in knowledge diffusion, I blame talent differentials in those cases.
2. “…measured productivity responds directly to competition.”
4. A short Time piece by me, excerpted and adapted from *Big Business*, on why current CEO pay is not outrageous. I do consider your most likely objections in the full chapter in the book.
5. Looking for Shakespeare’s library.
6. David Henderson on *Big Business: A Love Letter to an American Anti-Hero*.
Tax returns should not be made public information
That is the topic of my latest Bloomberg column, here is an excerpt:
This idea has been suggested recently by Binyamin Appelbaum of The New York Times and also Matt Yglesias of Vox. In Norway it has been policy since 1814 and Finland does something similar.
I’m afraid, though, that universal tax transparency would boost U.S. economic inequality, take away second chances and devastate privacy.
And:
Or think about the dating market. Tax transparency would give high-earning men and women a bigger advantage and hurt their lower-earning competitors. Do we really wish to do that in an age of growing income inequality and diminished upward mobility?
Is it better if your parents and all your friends can see how well your new job is going or how much in royalties your last book earned? As it stands, we exist in a slightly more comfortable social equilibrium where your close associates assume the best or at least give you the benefit of the doubt. Transparency of earnings would increase stress and make failure and disappointment all too publicly evident. Or entrepreneurs with long-term projects which are going to make it — but not right away — might face too many social or family pressures to quit.
Snooping through the tax system would definitely happen. Evidence from Norway indicates that in 2007, 40 percent of Norwegian adults checked somebody’s tax information online, higher than the penetration of Facebook in Norway. Anonymity of the snooper was removed in 2014, and visits fell dramatically (88 percent by one measure), but still you can imagine paying others to snoop for you or the information eventually getting out over time.
The result of tax-record publication was that “this game of income comparisons negatively affected the well-being of poorer Norwegians while at the same time boosting the self-esteem of the rich,” according to Ricardo Perez-Truglia, a UCLA economics professor writing last week in VoxEU. There’s even a smartphone app that creates income leaderboards from the data on your Facebook friends.
Just as personal freedom and economic freedom are not so easily separable, the same is true for personal privacy and financial privacy. Are there actually people out there worried about Facebook privacy violations who wish to make all tax returns public and on-line?
New results on the China shock, furthermore the China shock is largely over
Using Census micro data we find that the impact of Chinese import competition on US manufacturing had a striking regional variation. In high-human capital areas (for example, much of the West Coast or New England) most manufacturing job losses came from establishments industry switching to services. The establishment remained open but changed to research, design, management or wholesale. In the low human-capital areas (for example, much of the South and mid-West) manufacturing job-losses came from plant closure without much offsetting gain in service employment. Offshoring appears to drive these manufacturing job losses – the Chinese trade impact arose primarily in large importing firms that were simultaneously expanding service sector employment. Hence, our data suggest Chinese trade redistributed jobs from manufacturing in lower income areas to services in higher income areas. Finally, the impact of Chinese imports appear to have disappeared after 2007 – we find strong employment impacts from 2000 to 2007, but nothing since from 2008 to 2015.
That is from a new paper by Nicholas Bloom, Kyle Handley, André Kurmann, and Philip Luck. Via Bryan Caplan.
Monday assorted links
1. Emily Hamilton on the Elizabeth Warren housing bill.
2. “… a $10 million boost in NIH funding leads to a net increase of 2.7 patents.” — Good or bad? Or can you tell?
3. Interview with Paul Coates.
4. Books on economics and philosophy.
5. Just how bad is crony capitalism anyway? A short excerpt from *Big Business*.
The new who gives a damn politics
It’s also worth noting that talk is going around DC that the US and China may keep the original $50B in tariffs, but that the Trump Administration has asked the Chinese to move theirs away from targeting the GOP base to less politically sensitive sectors, even proposing alternative industries to the Chinese side.
That is from Bill Bishop, who edits the email newsletter Sinocism, which I find essential and pay real money to read. Here is additional Bloomberg coverage.
What I’ve been reading
1. Peter Doggett, CSNY: Crosby, Stills, Nash & Young. A good management study of a creative foursome doomed to split and splinter pretty much from the beginning. Oddly, their best work still sounds good to me, even though I never hear much new in it with repeated listenings. That is a rare combination.
2. David Brooks, The Second Mountain: The Quest for a Moral Life. David’s best book this century, it has many subtle points. It is a “wisdom book,” noting that not everyone likes wisdom books.
3. Harold Bloom, Possessed by Memory: The Inward Light of Criticism. Bloom is now 89 I believe, but unlike in some of his recent shorter books this one seems as thoughtful as much of his best later work. Yes, it is a bunch of largely separate, short, multi-page essays on topics of Bloom’s choosing, but at this point that is optimal. It won’t convince the skeptic, but if you are on the fence I say yes, though try The Western Canon first.
4. Fuchsia Dunlop, The Food of Sichuan. A much-expanded version of her earlier Land of Plenty. No, I haven’t touched this one yet, but if the word self-recommending ever applied, it is here. If you don’t already know it, here is my earlier CWT with Fuchsia Dunlop.
5. John Barton, A History of the Bible: The Book and its Faiths. Anglican, British, highly reasonable, full of useful information, I read it all the way through. Barton teaches you the Bible is not always easy to understand and why that is. Already out for ordering on UK Amazon.
Daniel S. Milo, Good Enough: The Tolerance for Mediocrity in Nature and Society, on a quick browse seemed to have interesting points.
Sunday assorted links
1. “All-day Chelsea restaurant the Wilson has debuted a new menu — except it’s only for dogs. The dog food was put together by culinary director Jeff Haskell and includes fancy (and wildly expensive) dishes like a 16-ounce grilled ribeye steak ($42), pan-roasted salmon ($28), and grilled chicken breast ($16). It’ll be available on the restaurant’s side patio for now, but will expand to the front terrace once the weather is warmer. See the full menu below.” Link here.
2. The strange death of Tory economic thinking.
3. Images of Pedro Figari paintings.
4. No great stagnation for the complacent class.
5. Northern Irish cultural pride. By Megan McArdle.
6. You’d better not encourage radical Chinese scientists (NYT).
Saturday assorted links
Friday assorted links
1. Wolves return to the Netherlands after 140 years.
2. Points about politics, true ones, from Matt Y.
4. Markets in everything: “You can now hire someone to drink your bubble tea in China.”
5. “Canada: one Indigenous group accuses other of cultural appropriation in award row.”
6. There is no great stagnation: “A quieter airplane toilet flush may soon be on its way.“