“A new market for weddings” — Market makers in everything
Here is a new service:
Over 250,000 weddings are called off every year.
We purchase cancelled weddings and resell them to new couples.Sellers recover deposits and upfront costs hassle-free.
Venues and providers enjoy uninterrupted business as usual.
Buyers find beautiful, pre-planned weddings at a fraction of the price.Register with us and help us build a new market for weddings.
For the pointer I thank John Farrier.
Assorted links
Crack cocaine and education
From William N. Evans, Craig Garthwaite, Timothy J. Moore:
We propose the rise of crack cocaine markets as an explanation for the end to the convergence in black-white educational outcomes beginning in the mid-1980s. After constructing a measure to date the arrival of crack markets in cities and states, we show large increases in murder and incarceration rates after these dates. Black high school graduation rates also decline, and we estimate that crack markets accounts for between 40 and 73 percent of the fall in black male high school graduation rates. We argue that the primary mechanism is reduced educational investments in response to decreased returns to schooling.
The ungated version is here.
Paradoxes of Internet Regulation–Korea Edition
Google’s maps of Seoul are peculiar, they offer public transit directions but not driving directions. Turns out that this is due to Korean law (the Measurement Act) which prohibits the export of Korean map data without obtaining government approval. (The distinction appears to be that driving directions are “new” maps and thus unapproved while transit directions are fixed and can be approved in advance of generation.)
Local versions of Google satellite imagery are also much lower resolution in South Korea due to military restrictions. Google has argued that by satisfying the law within a country it satistifes that country’s law, a policy rule on Google’s part that I applaud, but this policy does lead to the paradox that the images of South Korea available in South Korea are not as high resolution as those available in North Korea!
More generally, however, the bigger Google gets the more countries it has a physical presence in (servers, sales staff and support etc.) and thus the more leverage individual countries, especially large countries, will have to degrade the services that Google offers not just within-country but to the world.
An excellent blog post on the various Nobel literary contenders
From Literary Saloon, you can read the post here.
Addendum: Mo Yan has won, one of his best-known novels is Red Sorghum.
Controversies over economics and genetics
To critics, the economists’ paper seems to suggest that a country’s poverty could be the result of its citizens’ genetic make-up, and the paper is attracting charges of genetic determinism, and even racism. But the economists say that they have been misunderstood, and are merely using genetics as a proxy for other factors that can drive an economy, such as history and culture. The debate holds cautionary lessons for a nascent field that blends genetics with economics, sometimes called genoeconomics. The work could have real-world pay-offs, such as helping policy-makers to set the right level of immigration to boost the economy, says Enrico Spolaore, an economist at Tufts University near Boston, Massachusetts, who has also used global genetic-diversity data in his research.
But the economists at the forefront of this field clearly need to be prepared for harsh scrutiny of their techniques and conclusions. At the centre of the storm is a 107-page paper by Oded Galor of Brown University in Providence, Rhode Island, and Quamrul Ashraf of Williams College in Williamstown, Massachusetts. It has been peer-reviewed by economists and biologists, and will soon appear in American Economic Review, one of the most prestigious economics journals.
The full story is here. The previous MR post on the dispute, which includes a link to the paper, is here.
The growing urban prosperity of North Korea
Assorted links
1. Is economics becoming more mathematical?
2. Can algorithms help explain art and what you like?
4. Caplan reviews the new James Flynn book.
5. The wisdom of slime trails.
6. New update on Honduran charter cities, lots of detail. Or try this link if that one doesn’t work.
Reason TV Interviews Alex on MRU
Multiple equilibria?
That’s what I think of when I see that picture.
Trust was broken, most of all in the financial system, but like a wet spill this has soaked into many parts of the economy and polity.
Labor hiring is an investment, and we must move to higher levels of investment for the labor market to recover. For the most part, that is no longer a problem of nominal stickiness, as the quality of jobs has been varying for years, along with some wage adjustments. The nominal wage stickiness fairy was dominant in 2009 but is today just another spirit.
Employers are reluctant to hire stale labor, at any real wage, because they fear the associated morale problems. (Or at the requisite real wage, disability pay or idleness is a more attractive option for the worker.) This is partly fear, partly rational statistical discrimination. Employers will hire stale labor only when an extreme boom requires them to. Such an extreme boom must be seen as grounded in perceived increases in real wealth and justified increases in trust. That probably won’t come anytime soon, but we are inching our way back to it and someday it will come again. Solving the stale labor problem requires a very different path of recovery than solving the nominal wage stickiness problem.
In one very real sense, the economy is well below potential output (though less than many people think, due to the great stagnation). In another very real sense, that gap cannot be exploited in the short run by reflationary policy. Once again, it requires a reestablishment of trust. Trust is more easily broken than repaired.
In one very real sense, there is a significant demand shortfall. Yet repairing that demand shortfall requires many building blocks. Nominal reflation (which I favor) is only one of those building blocks. The others are rooted in trust and perceived real wealth, which are both slower to repair and require different policy instruments, plus the mere passage of time.
Under the multiple equilibria view, it is possible for employment and the real wage to recover together, albeit slowly. Under the nominal stickiness view, median real wages still need to take yet a further whack; oddly it is the Keynesians who are committed to the most extreme form of a TGS thesis.
It is time to integrate macroeconomics with institutional economics.
Imprisonment and infant mortality
Here is a new study by Christopher Wildeman (pdf):
This article estimates the effects of imprisonment on infant mortality using data from the United States, 1990-2003. Results using state-level data show consistent effects of imprisonment rates on infant mortality rates and absolute black-white inequality in infant mortality rates. Estimates suggest that had the American imprisonment rate remained at the 1973 level—the year generally considered the beginning of the prison boom—the 2003 infant mortality rate would have been 7.8% lower, absolute black-white inequality in the infant mortality rate 14.8% lower. Results using micro-level data from the Pregnancy Risk Assessment Monitoring System (PRAMS) show that recent parental incarceration elevates early infant mortality risk, that effects are concentrated in the postneonatal period, and that partner violence moderates these relationships. Importantly, results suggest that recent parental incarceration elevates the risk of early infant death by 29.6% for the average infant in the sample. Taken together, results show that imprisonment may have consequences for population health and inequality in population health and should be considered when assessing variation in health across nations, states, neighborhoods, and individuals.
Jodi Ettenberg’s *Food Traveler’s Handbook*
I am a big fan of this book. The Amazon link is here, and the Kindle edition should be coming in less than a week.
What’s the chance of rain?
…the for-profit weather forecasters rarely predict exactly a 50 percent chance of rain, which might seem wishy-washy and indecisive to consumers. Instead, they’ll flip a coin and round up to 60, or down to 40, even though this makes the forecasts both less accurate and less honest.
That is from Nate Silver’s new and excellent The Signal and the Noise: Why So Many Predictions Fail — But Some Don’t. The profile of Robin Hanson appears on p.201.
Assorted links
2. Cheapskates, pessimists, and food trucks, by me, on countercyclical assets.
3. On Spufford’s theology, with a link to chapter one.
4. Rogoff on technological unemployment, and interview with John List.
5. How the word “entitlement” became a negative.
Lunch with Tyler in Seoul
Tyler and I are here in Seoul for different conferences but we arranged to meet for lunch in Insadong. I arrived early and found a restaurant which didn’t look at all like it was frequented by tourists. Feeling pleased, I met with Tyler and indicated my suggestion.
“Looks ok,” he said, not sounding enthused.
“But Tyler,” I replied slightly miffed, “look inside, no one is smiling or laughing. It must be good.”
“Excellent point,” he conceded “but come look at this place” and he proceeded to walk behind a row of stores and down a small alleyway pointing to a tiny restaurant, “Do you see the sign?” I read the sign he was pointing to, “No English.”
“Ah,” I replied, “a good signal” and, after looking inside, “and no chairs either.”
Needless to say, the meal was delicious.