Category: Uncategorized
More rooftop-ready results on reservation wages
These are from Alan Krueger and Andreas Muller (pdf):
This paper presents findings from a survey of 6,025 unemployed workers who were interviewed every week for up to 24 weeks in the fall of 2009 and spring of 2010. Our main findings are: (1) the amount of time devoted to job search declines sharply over the spell of unemployment; (2) the self-reported reservation wage predicts whether a job offer is accepted or rejected; (3) the reservation wage is remarkably stable over the course of unemployment for most workers, with the notable exception of workers who are over age 50 and those who had nontrivial savings at the start of the study; (4) many workers who seek full-time work will accept a part-time job that offers a wage below their reservation wage; and (5) the amount of time devoted to job search and the reservation wage help predict early exits from Unemployment Insurance (UI).
Here is a popular summary of some of the results, including the recommended Figure 4.1 (p. 47 in the paper):
… today’s job seekers seem more picky. According to an analysis of surveys of 6,000 job seekers, the minimum wages that the unemployed are willing to accept are very close to their previous salary and drop little over time, says Mr. Mueller. That could help explain in part why they have so much trouble finding work, he says.
I conclude that some people aren’t very good at looking for jobs and further some people are not very good at accepting job offers.
This paper has many other excellent points and results, see for instance pp.27-29.
For the pointer I thank the excellent Andrew Sweeney.
Bad bank, bad bank
Bank of America Corp. (BAC), the biggest U.S. lender by assets, is segregating almost half its 13.9 million mortgages into a “bad” bank comprised of its riskiest and worst-performing “legacy” loans, said Terry Laughlin, who is running the new unit. “We are creating a classic good bank, bad bank structure”…
…“It’s a way to get investors focus on the good,” said Paul Miller, a former examiner with the Federal Reserve Bank of Philadelphia and analyst at FBR Capital Markets in Arlington, Virginia. “It’s a way to talk about good things and ignore the bad.”
That was in March 2011. Here is August 2011. Here is a chart.
Assorted links
1. Die Welt on Ireland, and the FT on Ireland, lots of Irish comments here.
2. The illusion of asymmetric insight, good starting point for understanding the blogosphere.
3. Scorsese trailer for the George Harrison movie to come.
4. Is the Iranian economy improving?
5. How to get 211 tons of gold to Venezuela.
6. How likely are ob-gyns (of various religions) to provide abortions?
Would shoplifting create jobs?
Matt says yes. Having fewer goods on the shelves prompts retailers to replenish their inventories, which spurs economic activity. You don’t even need to break any windows! But there’s more to it than that. As Matt points out, a key question is what storeowners expect to be the future rate of shoplifiting. If a lot of shoplifting is expected, costs of supply go up and output will shrink, with some offsetting employment boost in the security guard sector. In other words, the shoplifters who do the most good are those who don’t get caught and who in fact leave no trace. If you are caught shoplifting, insist that you have no compatriots or allies and that you are a fully atypical individual and therefore that no Bayesian updating should go on about the likelihood of future retail crime. Don’t dress or talk like a shoplifter! (Be creative.) Similarly, it is best if the invading aliens insist that they too are bothered by the Fermi paradox.
If it’s a durable good monopolist, the shoplifter is destroying/restricting output, benefiting the shop owner, raising prices, and helping the economy only in the strangest of the liquidity trap models. The benevolent shoplifter will seek out the more competitive markets or perhaps grab ripe strawberries, put down those hardcover books.
Shanghai ranking of world universities in the social sciences
I can’t vouch for the method, but the top ten are quite plausible: Harvard, Chicago, MIT, Berkeley, Columbia, Stanford, Princeton, Yale, U. Penn, and NYU. The top twenty and thirty are plausible too. GMU, by the way, turns up at #41. Economics/Business rankings are here, with a nearly similar top ten.
For the pointer I thank Dan Houser.
Assorted links
Assorted links
1. La Nacion interview with me.
2. Why they smuggle U.S. drugs into Mexico.
3. What would Lord Monboddo say (video)?
Portfolio effects?
Here is much more, interesting throughout, hat tip to The Browser.
From the comments
It seems like market forecasts of low real yields 30 years into the future support TGS. How long does it take for long-run money neutrality to win out? If the yield curve showed low yields 100 years out, would that dissuade those looking for a monetary solution?
That is from fmb. Here are the real yield rates.
Assorted links
1. What went wrong with the reconstruction of Haiti? A long feature article, mostly good though it is wrong, and arguably insane, to criticize the development models of Haiti’s past as too “business friendly.”
2. Michael Clemens: where are the free trillion dollar bills?
3. Is something strange going on in Hungary?
Assorted links
1. The economics of speech (video).
2. Harold Bloom recommends Five Books, and diagnoses the Tea Party.
3. Guy keeps Manhattan parking spot for 11 years, feeds the meter every day for $36, via Annie Lowrey.
Assorted links
1. Advice for a budding neuroscientist.
3. Korean markets in everything, and umbrella markets in everything.
4. Will the U.S. again become the world energy capital?
5. Der Theoretiker des Stillstands, Handelsblatt profile of me. And how a German politician apologizes for an affair with a 16-year-old (in German), no hope for the eurozone, hat tip Yana. In English, Kenneth Silber reviews TGS.
Assorted links
Markets in everything
For the pointers I thank John Thorne, Trey Miller, Courtney Knapp, Catherine Rampell, and Chris Blattman.
In defense of Texas jobs performance?
I have now read Matthias Shapiro (not a Perry supporter by the way) and he seems to have the best treatment so far. One excerpt:
Since the recession started hourly wages in Texas have increased at a 6th fastest pace in the nation.
Another:
We can see that Texas has grown the fastest, having increased jobs by 2.2% since the recession started. I want to take a moment and point out that second place is held by North Dakota. I added North Dakota to my list of states to show something very important. North Dakota currently has the lowest unemployment rate of any state at 3.2%. And yet Texas is adding jobs at a faster rate than North Dakota. How can this be?
The reason is that people are flocking to Texas in massive numbers…
As you can see, Texas isn’t just the fastest growing… it’s growing over twice as fast as the second fastest state and three times as fast as the third. Given that Texas is (to borrow a technical term) f***ing huge, this growth is incredible.
People are flocking to Texas in massive numbers. This is speculative, but it *seems* that people are moving to Texas looking for jobs rather than moving to Texas for a job they already have lined up. This would explain why Texas is adding jobs faster than any other state but still has a relatively high unemployment rate.
This piece encompasses, and responds to, all of the “Texas critiques” we have seen so far. And there are good graphs at the link. For the pointer I thank Nate Silver, a tough cookie when it comes to data; he calls it a “great piece.”