The Wisdom of Whores

She explained, as if to an enthusiastic but slightly dim child, that a waria who is hanging around on a street corner to be interviewed by a research team is a waria who is not with a client.  ‘You are talking to all the dogs, obviously’.

Not something I learned in the lecture halls of London…but Ines is quite right.  Our sample is biased towards the ‘dogs,’ who get picked up less than the cuter girls.  So the study results underestimate the true number of clients per seller…

Ines’s comments…prodded us into changing the sampling strategy…now we work with the powers-that-be (the mami, the pimps, the brothel owners) to arrange off-hours time for data collection.  The principle….is that you are not cutting into people’s work time, so there is less chance of talking only to the remnant sex workers who can’t get a client.

Transparency

…the modelling, done by the world-renowned Hadley Centre at the Met
Office but using emissions calculated by the Stockholm Network,
highlighted three problems: ‘Current policy comes in too slowly, it
internationalises too slowly and it binds developing countries too
late.’

Privately, many climate scientists believe it will be impossible to
meet the 2C target, but they are reluctant to say so because they do
not want to discourage moves to cut emissions.

Here is more and that is from The Guardian not National Review.  I believe that some parts of the world will be in for a very rough ride.

By the way, while I was in Japan I read that a) about half the world’s people are consuming subsidized energy, not taxed energy, and b) Chinese energy-users are typically paying about half of the world price.  Recent energy price increases in India have induced riots.  Those are all signs of the magnitude of the problem.

Hail Will Wilkinson!

I think the “nation state-as-primary-moral-community” assumption at
bottom of most modern liberal arguments for the welfare state (and in
many libertarianism-in-one-country arguments, for that matter) is
morally backward. But I also have a fairly conservative theory of
incremental social change. Whether or not all our institutions are
legitimate – and certainly they are not – they are also very good in relative terms, both historically and contemporaneously. My
immediate interest is in taking steps to make those institutions better
in a way that opens up to the possibility of expanding liberty and
thereby well-being the world over.

He is getting better and better all the time.  The link is here.

The dumbing down of Borders

You leave the country for a few weeks and you come back to ruin.  I’ve visited two Borders stores since my return and both have done away with their new books tables.  In one case the table is still there but has about one-quarter as many books on it if that.  The very best-selling books now get four to six piles on the table — or more — rather than leaving space for a greater number of titles with one stack a piece.  The front of the store offers many more paperback books and many more bestsellers that have been doing well for months.  Many bookshelves are gone altogether and replaced with non-book, non-CD, non-DVD items, such as expensive writing journals and gift cards.  It’s much more like a Barnes and Noble.

In sum, the front of a Borders store no longer produces much information about the new titles on the market and it is no longer a good place for the well-informed to browse.  I’ve yet to compare what’s stocked on the shelves but I am not hopeful about the trend.  It’s hard to believe that the front of the store is the only site of ruin.

On the brighter side, maybe Borders Magic Shelf will prove of use.  But check it out here — so far it doesn’t compare to browsing a well-stocked new books table nor for that matter Amazon

This Global Show Must Go On

Here is my NYT column on globalization, excerpt:

Despite all these gains, the prevailing intellectual tendency these
days is to apologize for free trade. A common claim is that trade
liberalization should proceed only if it is accompanied by new policies
to retrain displaced workers or otherwise ameliorate the consequences
of economic volatility.

Yes, the benefits of a good safety net
are well established, but globalization is not the primary source of
trouble for most American workers. Health care problems, bad schools
for our children or, in recent times, bad banking practices have all
produced greater disruptions – and these have been fundamentally
domestic failings.

What’s really happening is that many people,
whether in the United States or abroad, are unduly suspicious about
economic relations with foreigners. These complaints stem from basic
human nature – namely, our tendency to divide people into “in groups”
and “out groups” and to elevate one and to demonize the other.
Americans fear that foreigners will rise at their expense or “control”
some aspects of the economy.

One approach is to appease these
sentiments by backing away from trade just a bit, or by managing it, so
as to limit the backlash. Giving up momentum, however, isn’t
necessarily the right way forward. If we are too apologetic about
globalization, we can feed core irrationalities, instead of taming
them. The risk is that we will frame trade as a fundamental source of
suffering and losses, which would make voters more nervous, not less.

Do read the whole thing.  A few further points of note:

1. Virtually all of the "second best worrying" about trade could be applied also — in fact more so — to technical progress.  Or to trade across the fifty states.  Yet when it comes to foreigners, the worries acquire a more dangerous credibility.  That is the real second best problem, not any theorem you might derive about trade and externalities.

2. I don’t see the evidence that marginal strengthenings of the safety net will diminish anti-foreign statements.  Yet this has become an article of faith among the globalization "middle roaders."  A crude look at the cross-sectional evidence does not indicate a clear pattern.  France and Germany have a strong safety net but they are skeptical about economic globalization; Sweden and the Netherlands are more sympathetic.  Switzerland, with a weaker safety net, is pro-globalization for the most part.  Like Will Wilkinson and unlike Bryan Caplan, I am for a safety net but often a bigger safety net makes people even more fearful of loss and change.  Note it is the Bismarckian welfare state, the world’s most advanced at the time, which turned to The Dark Side during the 1930s.  I’m hardly suggesting causality here but it didn’t halt the process either.

3. Yes I know about Denmark but job retraining programs in the U.S. hardly have a stellar record.

4. When it comes to improving the quality of economic adjustment, the overwhelming priority should be to delink health insurance from having a job.  I doubt if that will decrease skepticism about foreigners, however.

5. Most of the world’s wealthy economies are, if only because they are smaller and less diversified in terms of resources, more open than is the United States.  They do just fine and by no means do they all spend more on social welfare than does the United States.

6. Cite Samuelson and Stolper all you want, here is yet another paper showing that outsourcing has not been placing significant downward pressure on American wages.

7. China is now the world’s leading supplier of photovoltaic cells. 

But it is really the first point that is the key.

Addendum: Brad DeLong comments extensively.

The carbon footprint of food

Ezra reports:

…two Carnegie Mellon researchers recently broke down
the carbon footprint of foods, and their findings were a bit
surprising. 83 percent of emissions came from the growth and production
of the food itself. Only 11 percent came from transportation, and even
then, only 4 percent came from the transportation between grower and
seller (which is the part that eating local helps cut).

In other words, when it comes to food the greenest things you can do, if that is your standard, is to eat less meat and have fewer kids.

Why oh why can’t we have a better press corp?

A May 31 Metro article about the Scripps National Spelling Bee misspelled last year’s winning word. The correct spelling is serrefine.

The paper, The Washington Post, had chosen the obviously incorrect "serrifine."  Here is my source.

Addendum: Whoops!  I have corrected my spelling error.  At least I wrote the mistaken spelling of the newspaper correctly rather than vice versa, force of habit took over I suppose.

“What’s Wrong With You?”

Don’t get sick anywhere but at home:

…doctors in Tanzania complete less than a quarter of the essential checklist for patients with classic symptoms of malaria, a disease that kills 63,000-96,000 Tanzanians each year.  The public-sector doctor in India asks one (and only one) question in the average interaction: "What’s wrong with you?".  In Paraguay, the amount of time a doctor spends with a patient has nothing to do with the severity of the patient’s illness…these isolated facts represent common patterns…three years of medical school in Tanzania result in only a 1 percentage point increase in the probability of a correct diagnosis…One concern with measuring doctor effort through direct observation is that the doctor may work harder in the presence of the research team.

That is from "The Quality of Medical Advice in Low-Income Countries," by Jishnu Das, Jeffrey Hammer, and Kenneth Leonard, in the Spring 2008 issue of the Journal of Economic Perspectives.  The editor is now Andrei Shleifer and this issue is one of the best in a long time.

Time travel back to 1000 A.D.: Survival tips

Londenio, a loyal MR reader, asks:

I wanted to ask for
survival tips in case I am unexpectedly transported to a random
location in Europe (say for instance current France/Benelux/Germany) in
the year 1000 AD (plus or minus 200 years). I assume that such
transportation would leave me with what I am wearing, what I know, and
nothing else. Any advice would help.

I hope you have an expensive gold wedding band but otherwise start off by keeping your mouth shut.  Find someone who will take care of you for a few days or weeks and then look for employment in the local church.  Your marginal product is quite low, even once you have learned the local language.  You might think that knowing economics, or perhaps quantum mechanics, will do you some good but in reality people won’t even think your jokes are funny.  Even if you can prove Euler’s Theorem from memory no one will understand your notation.  I hope you have a strong back and an up to date smallpox vaccination.

Readers, do you have any other tips?  Is there any way that Londenio can leverage his knowledge of modernity (he is, by the way, a marketing professor) into socially valuable outputs?  Would prattling on about sanitation and communicable diseases do him any good?

The incentives for violence in hockey

Here is my source.  Here is the paper.  Here is the abstract:

The level of violence in the National Hockey League (NHL) reached its highest point in 1987 and has reduced somewhat since then, although to levels much larger than before the first team expansions in 1967. Using publicly available information from several databases 1996–2007, the incentives for violence in North American ice hockey are analyzed. We examine the role of penalty minutes and more specifically, fighting, during the regular season in determining wages for professional hockey players and team-level success indicators. There are substantial returns paid not only to goal scoring skills but also to fighting ability, helping teams move higher in the playoffs and showing up as positive wage premia for otherwise observed low-skill wing players. These estimated per-fight premia, depending on fight success ($10,000 to $18,000), are even higher than those for an additional point made. By introducing a “fight fine” of twice the maximum potential gain ($36,000) and adding this amount to salaries paid for the team salary cap (fines would be 6.7% of the team salary cap or the average wage of 2 players), then all involved would have either little or no incentives to allow fighting to continue.

In other words, there are substantial incentives for violence in hockey.

NotSneaky on remittances

Will Wilkinson has the scoop.  NotSneaky writes:

Bottom line is that most of the so called “gains from remittances” are
straight up gains from IMMIGRATION. Or in other words, they are gains
from the fact that some person from a poor household in a poor county
has managed to make their way to a rich country and now has a richer
income. Strictly speaking the gain from remittances is just the gain
from INTER-HOUSEHOLD reallocation of income between the migrant and
those who stay behind, not the overall increase in household income due
to migration.

This is oh so tricky and of course we must refer back to the 1920s debates on the "transfer problem," involving Keynes, Ohlin, and others, so ably surveyed by Jacob Viner’s Studies in the Theory of International Trade.

Let’s say a Mexican in Texas sends pesos in his pocket back home.  His family benefits and he gets the warm glow but for the nation as a whole that’s just inflation and a redistribution of wealth.  How about if he sends dollars back home?  Well, he converts through pesos, the real Mexican exchange rate appreciates, and Mexican exporters are penalized, to some extent offsetting the family gains.

How different are the two cases?  Ha!  That would make a nice exam question. 

Does it matter if the receiving family plans to spend the money on imports or does that not matter?  Does it matter if the big hotels in Cancun — tourism is Mexico’s largest export sector — are foreign-owned?  The clock is ticking…

Ultimately NotSneaky has the correct intuition that the gains are to be found in the immigration itself, not the subsequent transfer.  Beware double counting.  Here is my previous post on remittances but please note the comments on this post are for remittance talk, not a general discussion of immigration.

What I’ve Been Reading

1. Henning Mankel, Depths.  I loved this story.  Have I mentioned that Mankell is one of my favorite contemporary writers?

2. Nick Lane, Power, Sex, Suicide: Mitochondria and the Meaning of Life.  One of the best popular science books I’ve read in the last few years.  Among other matters he explains why curing aging isn’t so easy, why eukaryotes seem to have evolved only once, and why it often should be "The Selfish Cell" and not always "The Selfish Gene."  His book Oxygen is excellent as well.