Results for “becker”
166 found

China fact of the day

by  Tyler Cowen in

In parts of China, black ants are sold by the bagful to be steeped in tea or soaked in liquor as a natural remedy for ailments such as arthritis.

Wang sold packages of ants to the investors for up to as much as 10,000 yuan ($1,290) when they were only worth 200 yuan, China Central Television reported.

Here is the story, the sentence is death.  The total con is estimated at $387 million, what would Gary Becker say, in any case that is a lot of imaginary ants.

Should we ban trans-fats?

by  Tyler Cowen in

Gary Becker does a quick cost-benefit analysis in his head:

With a small taste benefit from the use of trans fats– the New England Medicine Journal article I cited earlier does admit positive effect of trans fats on
"palatability"– the total cost of the ban would equal or exceed total
benefits.  For example, suppose 1 million persons on average eat 200
meals per year in NYC restaurants with trans fats.  If they value the
taste of trans fats in their foods only by 35 cents per meal, the taste
cost to consumers of the ban would be $70 million per year.  Then the
total cost of the ban would equal the benefits from the ban.

If you click on the link, you’ll see some good arguments against paternalism as well.

Interview with Milton Friedman

by  Tyler Cowen in

Here it is.  Excerpt:

Germany’s problem, in part, is that it went into the euro at the
wrong exchange rate that overvalued the deutsche mark. So you have a
situation in the eurozone where Ireland has inflation and rapid
expansion while Germany and France have stalled and had the
difficulties of adjusting.

The euro is going to be a
big source of problems, not a source of help. The euro has no
precedent. To the best of my knowledge, there has never been a monetary
union, putting out a fiat currency, composed of independent states.      

Thanks to www.2blowhards.com for the pointer.

Addendum: Here is an interview with Gary Becker, who talks about Friedman, John Nash, Dostoyevsky, and Brokeback Mountain.  Thanks to Freakonomics blog for the pointer.

Should You Treat Your Marriage Like a Job?

by  Tyler Cowen in

Scott Haltzman, a psychiatrist and Brown University professor, has been studying marriages good and bad for a long time, both in his clinical work and via his Web site, http://www.secretsofmarriedmen.com/ . His new book, "The Secrets of Happily Married Men" collects what he says are the guy behaviors that lead to happy marriage…

Haltzman believes conventional marital therapy often tries to make men more like women — you know, getting in touch with their feelings, talking about their feelings, feeling their wives’ feelings, etc. But this approach is doomed to failure, he says, largely because men and women are equipped with such different hardware from the neck up…

Use the male habits and male skills that serve him well at work, at play, in competition, in the field and in other venues where he thrives. View marriage as your most important task, Haltzman urges men, and pursue success as you would anything else that matters. The assumption is it’s a lot more pleasant, and the payoffs far greater, to live with a woman who is satisfied, secure and feeling loved compared to one who is none of the above. Make this your job, he says.

Here is the full article, noting that some of the specific recommendations ("gather data" on your wife) are excessively mechanical. 

The key question: if a man at times undervalues a happy marriage and happy wife, how can he act to undercut or avoid this weakness of character?  If you think male infidelity is the main potential problem, "taking pride in your instrumental rationality" is not going to do the trick.  Alternatively, you might think that male emotional withdrawal is the main problem, in which case instrumental rationality, and subsequent attention, might be an acceptable (partial) substitute for many women.

Under another scenario, the problem is that men stop trying because they feel their wives expect too much.  If you are damned anyway, at the margin why bother?  This book is useful for telling men their efforts can matter, even if they can’t.  The very act of trying confers a positive externality upon your wife.

The recommendations of this book assume that you screw up the means-ends relationship with your wife, rather than undervaluing the end of a happy marriage (or overvaluing some other competing end).  Misesians, Beckerians, and other partisans of rational economic man shouldn’t bite.  Behavioral economists, step on board.

Comments are open…and you can buy the book here.

Why the War on Drugs is hard to win

by  Tyler Cowen in

Here is a summary of forthcoming work by Gary Becker, Michael Grossman, and Kevin Murphy:

In an important new study, world-renowned economists–including a Nobel
Prize winner and a MacArthur "genius"–argue that when demand for a
good is inelastic, the cost of making consumption illegal exceeds the
gain. Their forthcoming paper in the Journal of Political Economy is a
definitive explanation of the economics of illegal goods and a
thoughtful explication of the costs of enforcement.

The authors demonstrate how the elasticity of demand is crucial to
understanding the effects of punishment on suppliers. Enforcement
raises costs for suppliers, who must respond to the risk of
imprisonment and other punishments. This cost is passed on to the
consumer, which induces lower consumption when demand is relatively
elastic. However, in the case of illegal goods like drugs–where demand
seems inelastic–higher prices lead not to [TC: much?] less use, but to an increase
in total spending.

In the case of drugs, then, the authors argue that excise taxes and
persuasive techniques –such as advertising–are far more effective uses
of enforcement expenditures.

"This analysis…helps us understand why the War on Drugs has been so
difficult to win…why efforts to reduce the supply of drugs leads to
violence and greater power to street gangs and drug cartels," conclude
the authors. "The answer lies in the basic theory of enforcement
developed in this paper."

Here is an earlier version of the paper.

When did the Industrial Revolution start?

by  Tyler Cowen in

Had I mentioned that the Journal of Political Economy is my favorite academic journal?  In the December 2005 issue, the still under-valued Gregory Clark writes:

I use building workers’ wages for 1209-2004 and the skill premium to consider the causes and consequences of the Industrial Revolution.  Real wages were trendless before 1800, as would be predicted for the Malthusian era.  Comparing wages with population, however, suggests that the break from the technological stagnation of the Malthusian era came around 1640, long before the classic Industrial Revolution, and even before the arrival of modern democracy in 1689 [TC: was that when it came?].  Building wages also conflict with human capital intepretations of the Industrial Revolution, as modeled by Gary Becker, Kevin Murphy…and Robert Lucas.  Human capital accumulation began when the rewards for skills were unchanged and when fertility was increasing.

Here is an earlier but longer version of the paper.  Here is an on-line version of his book on growth.  Here is a previous MR post on the long, slow nature of the Industrial Revolution.

Who are the world’s top intellectuals?

by  Tyler Cowen in

Cast your five votes here, plus you can see how old each candidate is and how many of these names you have read or heard of.  Several economists, such as Krugman, Becker, Sen, Summers, and Bhagwati, are included in the polling; Hernando de Soto and Richard Posner make the list as well.  For other nominees, how about Derek Parfit and Milton Friedman?  Philip Roth?  The politically incorrect Michel Houllebecq?  Bruno Latour?  Marvin Minsky or Hans Moravec?  I am glad to see Pramoedya Toer on the list.  How about the Google people?  An early blogger?

Rebuilding New Orleans: what does it signal?

by  Tyler Cowen in

Read a critique of rebuilding here, Richard Posner raises doubts as well.  Ed Glaeser notes:

"We have an obligation to people, not to places," says Edward Glaeser, a Harvard professor who specializes in urban economics. "Given just how much, on a per capita basis, it would take to rebuild New Orleans to its former glory, lots of residents would be much [better off] with $10,000 and a bus ticket to Houston."

My predictive view is closest to that of Joel Garreau: the core tourist sites of New Orleans will be restored, but like Galveston, Texas (hurricane of 1900), the city will not return to its previous prominence.  How many major corporations had their headquarters there as it was?  You could service the port with a city half of New Orleans’ previous size or less.

For better or worse, the necessity of signaling "political will" suggests a significant rebuilding effort will be made.  What kind of rebuilding must we do to convince ourselves we have tried hard enough?  I see a few options: 

1. The rebuilding effort will give central attention to culture, a main source of pride in the city.  That being said, the actual rebuilding will complete the transformation of New Orleans into a dead museum of past glories.  The city’s poor neighborhoods — which bred many of the ideas — will never be the same and in fact had already lost much of their creativity.

2. The rebuilding effort will give central attention to race.  This will attempt to convince voters that our government really does care about poor blacks.  The attempt will fail.

3. The rebuilding effort will give central attention to spending money for the sake of spending money.  When that does not suffice to restore the city, many Americans will blame the residents, thinking back on the looting and collapse of order.

None of these efforts will in fact signal that we are ready for the next disaster headed our way.

The Founding Fathers of Law and Economics

by  Tyler Cowen in

…the most neglected side of law and economics is empirical.  In most areas of law and economics, there is a dearth of empirical studies…  Recently, I surveyed articles published in the Journal of Legal Studies (the leading ‘new’ law and economics journal) during the 1972-2002 period, and found that 39 percent of the 571 articles had some empirical content [TC: a Chicago code word for "econometrics"?]…In contrast, 71 percent of the 604 articles published in the Journal of Law and Economics, (a leading economics journal in industrial organization) during the 1972-2002 period were empirical.  Similarly, 70 percent of the articles recently published in the Journal of Political Economy contained substantial empirical analysis.

That is William Landes, writing in The Origins of Law and Economics: Essays by the Founding Fathers, edited by my colleagues Charles Rowley and Francesco Parisi.  Other contributors to this important volume include Coase, Tullock, Becker, Epstein, Posner, Buchanan, Demsetz Williamson, and others.  Read more here.

Should Londoners abandon public transport?

by  Tim Harford

Collectively, of course not. But for the selfish individual is it worthwhile? It turns out that the quarterly road deaths in London last year averaged 54. 52 people were murdered in the July 7th attacks (and four times more people travel by tube or bus than drive, cycle or walk). Leaving public transport is only going to be safer if the terrorists strike much more often in future.

How likely is that? Since we were all told that attacks were inevitable in the end, the horrible fact that they finally happened shouldn’t really change our estimate of the chance that they will happen again. Experiences in New York and Madrid suggest that a sustained campaign is hard. Let’s hope so.

Aside: Gary Becker and Yona Rubinstein have a paper on the response to the fear of attacks. It seems that defying terrorists is a fixed cost, willingly paid by frequent users of planes, buses or cafes but declined by casual users. That accords with my experience: I have no worries about returning to live in London permanently, but am pleased that my baby daughter will be travelling in a car on our imminent visit.

What Steve Levitt reads

by  Tyler Cowen in

Malcolm Gladwell "the greatest living storyteller" but has no interest in the rest of the magazine; reads Mr. Gladwell’s stuff online.

Yahoo Finance. "I handle my financial portfolio like it’s a big gambling account." Appreciates array of free info, and "when I started five years ago, it was better developed than others."

Three blogs by economists: MarginalRevolution.com by George Mason University professors Alex Tabarrok and Tyler Cowen, Berkeley professor Brad DeLong’s Semi-Daily Journal and the Becker-Posner Blog, by the U of C’s Gary Becker and U.S. Appellate Court Judge Richard Posner.

At bedtime, newsmagazines and People. "I can rarely convince myself that there are books worth reading. And at one point I became brainwashed by my father that it was unmanly to read fiction – so I read Time and Newsweek instead."

Here is the story, and thanks to Laurel for the pointer.