Results for “air pollution”
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What do you owe the world, and what does the world owe you?

Steven Landsburg writes:

Even if you’ve just lost your job, there’s something fundamentally churlish about blaming the very phenomenon that’s elevated you above the subsistence level since the day you were born. If the world owes you compensation for enduring the downside of trade, what do you owe the world for enjoying the upside?

Progressive taxation, some would say in response!

Tim Harford, however, nails it:

…people lose their jobs all the time for reasons that have nothing to do
with foreign trade. I’d argue that they deserve some help. Why are jobs
lost to foreign competition so privileged?

I am most interested in Dani Rodrik on the same, most of all when writes:

The question of how we should respond to a trade-induced
change in income distribution is not one on which economists can offer
any expertise.  This is a question about ethics, values, and norms,
none of which is part of an economist’s training.  Landsburg’s take on
this is as good as mine–which is as good as that of any person on the
street.

Every now and then I feel a deep responsibility to rebut an argument.  In my view anyone doing policy economics has an obligation to learn more about ethics — much more — than the guy in the street would know.  Would someone doing experimental economics feel free of the obligation to learn some empirical psychology?  Would someone doing trade feel free of the obligation to learn some trade law, some history, and some political science?  No.  What’s the difference?  Economists like to separate the "positive" and "normative" aspects of what they do, but this distinction has not much impressed the moral philosophers who have looked at it nor has it impressed Amartya Sen.  The very decision to use economic tools emphasizes some considerations and excludes others.  The final policy analysis is not just pure prediction but rather it is also an implicit presentation and weighting of both different kinds of information and different values.  So if you are doing policy economics, it is imperative that you think about ethics at a very deep level, and read widely in ethics.  You are doing ethics whether you like it or not!  Furthermore I don’t doubt that Dani already has a deeper understanding of ethics than the (often very crude) man in the street.

That said, I don’t agree with the ethics Dani does discuss, noting that he must have felt he had some good reason to put forward the concerns he did and not others.  (As a rule of thumb I’ll note that those who profess the impassability of ethical terrain have just in fact traversed it.)  I don’t worry much about the procedural fairness if a poor country trades at better prices by paying its labor less or by polluting.  Low wages are precisely the wages we want to see bid up, and if there is a concern for the losers I would not call the issue a procedural one but rather one of outcomes.  And pollution can be a moral crime but attacking trade is not usually a good way to go after it.  Tax the pollution, not the trade.

Chiswick refutes Chiswick

Barry Chiswick, head of the economics department at the University of Illinois at Chicago and a respected scholar of immigration, had a surprisingly poorly argued op-ed in the NYTimes.  Here’s the opening paragaraph:

It is often said that the American economy needs low-skilled foreign
workers to do the jobs that American workers will not do. These foreign
workers might be new immigrants, illegal aliens or, in the current
debate, temporary or guest workers. But if low-skilled foreign workers
were not here, would lettuce not be picked, groceries not bagged, hotel
sheets not changed, and lawns not mowed? Would restaurants use
disposable plates and utensils?

On the face of it, this assertion seems implausible.

… If the number of low-skilled foreign workers were to fall, wages would increase.  Low-skilled American workers and their families would benefit…

Bizarrely, the rest of his op-ed explains why these statements are mostly wrong!  First, the lettuce:

A farmer who grows winter iceberg lettuce in Yuma County, Ariz., was
asked on the ABC program "Nightline" in April what he would do if it
were more difficult to find the low-skilled hand harvesters who work on
his farm, many of whom are undocumented workers. He replied that he
would mechanize the harvest. Such technology exists, but it is not used
because of the abundance of low-wage laborers. In their absence,
mechanical harvesters – and the higher skilled (and higher wage)
workers to operate them – would replace low-skilled, low-wage workers.

In other words, if the number of low skilled workers were to fall the lettuce would no  longer be (hand) picked and low-skilled American workers would not benefit from an increase in wages!

What about lawn mowing and hotel cleaning?

Facing higher costs, some homeowners would switch to grass species
that grow more slowly, to alternative ground cover or to flagstones.
Others would simply mow every other week, or every 10 days, instead of
weekly…

Few of us change our sheets and towels
at home every day. Hotels and motels could reduce the frequency of
changing sheets and towels from every day to, say, every third day for
continuing guests, perhaps offering a price discount to guests who
accept this arrangement.

And how about this for a pathetic attempt to get the environmentalists on board the anti-immigration bandwagon?

Less frequent lawn mowing and washing of hotel sheets and towels would reduce air, noise and water pollution in the bargain.

Note how reduction in services, denied in paragraph one, has now become a virtue!

Chiswick also points out that:

With the higher cost of low-skilled labor, we would import more of some
goods, in particular table-quality fruits and vegetables for home
consumption (as distinct from industrial use) and lower-priced
off-the-rack clothing.

That is correct, but this is another reason why restricting the immigration of low-skilled workers will not much increase the wages of low-skilled Americans.

Chiswick makes statements in his op-ed like the "increase in low-skilled workers has contributed to the stagnation of wages for all such workers."  But unlike my Open Letter he never tries to quantify these assertions.  Yet he surely knows that an 8% decline is on the high end of such estimates and a zero percent decline on the low-end.

Quantifying, however, would put the immigration and wages issue in perspective which is that immigration is at worst a small contributor to the decline in the wages of low-skilled workers.  Indeed, economists are agreed that technology, not immigration, is by far the more important force which is why any serious attempt to raise the wages of low-skilled workers must begin with efforts to raise skills.

In my TCS article I said:

Immigration makes immigrants much better off. In the normal debate
this fact is not considered to be of great importance — who cares
about them? But economists tend not to count some people as worth more
than others, especially not if the difference is something so random as
where a person was born.

Chiswick, however, lets the economists down.  He never once mentions the benefits of immigration to the immigrants.

One more idea for Bush

Last week I presented twelve ideas for a domestic economic policy Republican vision for a Bush second term. I appreciate all those who wrote with additional ideas, or who suggested they might write in my name for President.

I will add one additional proposal:

13. Cut the number of pages in the daily Federal Register by half.

The American economy is drastically overregulated. But do not get me wrong here. I do not wish to gut important environmental regulations, many of which supply valuable public goods. To take one example, my benefits from the ban on low-quality gasoline probably exceed the costs I pay for all other regulations. Try spending a week in Mexico City in December if you are not convinced.

But I do wish to gut the median regulation issued by the Department of Agriculture, or by the Federal Communications Commission, to name two examples. Browse through a typical issue of the Federal Register to find other candidates for elimination.

It is fair to ask where I would make regulation stronger. First, I would do more to tax pollution. Taxes on purely productive activities should be correspondingly lower.

Animal cruelty also leaps to mind; currently we do very little to limit cruelty to animals in factory farms. I don’t take an extreme animal rights point of view, but animals do count for something. There are billions of them held in captivity, and our treatment of them counts as a great shame.

How much consensus is there in economics?

Some economists believe that we should bicker less among ourselves. Instead we should devote more resources to convincing the public on matters where most economists already agree. I have mixed feelings toward this attitude. Even if more instruction would improve economic performance, I am concerned it would damage our long-run ability to track truth. Plus for me it would make economics less fun. I, for one, would not devote my life to being a missionary for the theory of free trade and comparative advantage.

That all being said, how much do economists in fact agree? Check out this paper. The authors survey 1000 economists from the AEA roster; the data cover both 1990 and 2000. Here is one result:

…there was strong agreement with the propositions that restraints on free trade reduce welfare…and that market-determined exchange rates are effective…There was also strong disagreement with the propositions that increasing globalization threatens national sovereignty in environmental and labor standards…that U.S. trade deficits are a result of nontariff barriers…and that the increasing inequality in the U.S. distribution of income is caused by the pressures of a global economy.

What else do we have?

Macroeconomic propositions usually met with “moderate” to “substantial” consensus, but never “strong” consensus (the paper defines these terms more rigorously). And over the last ten years the consensus on macroeconomics has lessened (this result runs counter to my intuitions; I think there is now fairly broad consensus on something between loose price level targeting to mild inflation. Of course that is just monetary policy, not all of macro.) Economists have moved slightly closer to some supply side ideas but are more skeptical about the macro stimulus properties of fiscal policy.

Pollution taxes are very popular, and economists are starting to buy the Card-Krueger argument that minimum wage hikes don’t much damage employment.

Read the whole piece, it has more content than I have presented.

And will the Internet and distance learning drive down the demand for professors? There we see strong disagreement. I might add that I see future demand as more robust than Alex does and I can’t bring him around to my point of view.

Get paid to car-pool

Nuride is Friendster for slugs, i.e. an internet based system for arranging car pools. Drivers input their travel plans online making it much easier to find someone who is going where you want to go at a time that is convenient for you. Why should drivers do this? They and their passengers are paid for their troubles. How does Nuride make a profit? Nuride is selling the reduction in congestion and pollution to local governments. Economists have long pointed out that drivers impose a cost on other travellers – the flip side is that car poolers create a benefit for other travellers. Thus, Nuride is providing a way for governments to implement the optimal Pigouvian subsidy/Coasian transfer.

So far, only a small-scale test of Nuride has been made with employees of AOL but they recently came to GMU to promote the idea and hope to have a fairly extensive Northern Virginia system operating soon. The plan sounds a bit BC (before crash) to me but I’m always happy to see more examples of entrepreneurial economics.

Thanks to Diego Aycinena for the pointer.

Can climate engineering limit global warming?

Maybe so, according to Futurepundit. Here are some options (not all of this represents Futurepundit’s words, some is from his links):

Proposed options for reducing carbon dioxide pollution currently include underground burying of liquefied carbon dioxide; disposal in the sea; fertilising its absorption by marine algae; reflecting the sun’s rays in the atmosphere; and stabilizing sea-level rise. These and other macro-engineering ideas will be evaluated against a strict set of criteria, including effectiveness, environmental impacts, cost, public acceptability, and reversibility. All of these options go beyond the conventional approaches of improving energy efficiency and reducing carbon intensity by using more renewable energy sources, and may be needed in addition to these conventional approaches.

And further out on the limb:

… the scientists backed more way-out systems for reflecting the sun’s rays back into space. Plan A would float thousands of bubble-making machines across the world’s oceans to send huge amounts of salt spray into the atmosphere. The trillions of tiny droplets would make the clouds bigger, whiter, and more reflective — enough, in theory, to shut down several decades worth of global warming.

Plan B would flood the stratosphere with billions of tiny metal-coated balloons, “optical chaff” to backscatter the sun’s rays. Most sophisticated of all, Plan C would assemble giant mirrors in orbit, ready to be positioned at will by a global climate controller.

The BBC reports on 4 major categories of conceivable climate engineering approaches.

* “sequestering” (storing) carbon dioxide, for example in the oceans, by removing it from the air for storage, or by improved ways of locking it up in forests
* “insolation management” – modifying the albedo (reflectivity) of clouds and other surfaces to affect the amount of the Sun’s energy reaching the Earth
* climate design, for example by long-term management of carbon for photosynthesis, or by glaciation control
* impacts reduction, which includes stabilising ocean currents by river deviation, and providing large-scale migration corridors for wildlife.

Here is another article on the topic. I’ll never be competent to assess these proposals, but they could be among the most important scientific innovations we come up with. Global warming may well be real and the result of human activity, follow Chris Mooney. For better or worse I’ll predict the world won’t much cut its CO2 omissions in the near future, so we need to look toward other solutions.