Bryan Caplan and David Henderson

March 2005

A Monthly Archive (52 entries)

The Anti-Malthusian

Growth: Consequences
Arnold Kling
Ray Kurzweil is always fascinating. We’ll ultimately disconnect the sensual and social pleasures of eating from the biochemical task of keeping an optimum set of nutrients in our bloodstream. That sounds like a very concise statement of the goal for... MORE

More Gas for Washington

Energy, Environment, Resources
Arnold Kling
The Washington Post reports, A who's who of right-leaning military hawks -- including former CIA director R. James Woolsey and Iraq war advocate Frank J. Gaffney Jr. -- has joined with environmental advocates such as the Natural Resources Defense Council... MORE

"Faith" Means Not Wanting to Believe What is True

Behavioral Economics and Rationality
Bryan Caplan
You may have heard the odd factoid that faith in government drastically increased immediately after 9/11. Impossible, you say? Surely when a great tragedy happens, the organization charged to prevent it will lose credibility, not gain it? The factoid checks... MORE

Pre-historic free trade?

Growth: Causal Factors
Arnold Kling
Jason Shogren, Richard Horan, and Erwin Bulte argue that free trade contributed to humans' outcompeting Neanderthals. Archaeological evidence exists to suggest traveling bands of early humans interacted with each other and that inter-group trading emerged, says Shogren. Early humans, the... MORE

Boskin on Social Security

Social Security
Arnold Kling
Michael Boskin writes, First, we should switch from wage indexing to price indexing, but raise benefits more rapidly for those with low earnings. This would eliminate most of the long-term insolvency, but do so in a manner that leads to... MORE

Feelings vs. Consequences

Economics of Education
Arnold Kling
Pre-kindergarten education is one of those policies that feels right to do-gooders. What are the actual consequences? According to an NBER report, early education does increase reading and mathematics skills at school entry, but it also boosts children's classroom behavioral... MORE

Et tu, Barro?

Social Security
Arnold Kling
Robert Barro writes, A serious analysis with asking why we have Social Security. If we were not so used to it, we would find it odd for the government to collect money from young workers and give it to the... MORE

Second Thoughts About Stats vs. Personal Experience

Information Goods, Intellectual Property
Bryan Caplan
I can't believe I took so long to discover Thomas Gilovich's excellent How We Know What Isn't So. I've read almost all of the semi-popular books in cognitive psychology, and this turns out to be one of the best. All... MORE

When people argue about whether immigrants are pulling down our standard of living, they rarely notice a simple but deep arithmetical fact: Everyone in a country can get richer as per-capita income falls. Proof by example: Suppose the residents of... MORE

Let Them Get Roommates

Economic Philosophy
Bryan Caplan
A fun fact about the U.S. versus Europe is that poorest 25% of Americans have more living space than the average European. But some Americans have been left behind. Our most deprived citizens often sleep three to a room, eat... MORE

Beyond Reform?

Economics of Education
Arnold Kling
The book Beyond the Classroom, by Laurence Steinberg, suggests that school performance depends on factors that are outside the control of the school. He focuses on the issue of student engagement. When highly engaged students are in class, they are... MORE

Measuring Shortfalls in Entitlement Programs

Social Security
Arnold Kling
How big? So-o-o-o-o big. Ask the Concord Coalition. If added to the rates needed for Social Security, the implied payroll tax rate necessary to cover the future costs of both Social Security and Medicare would be 32 percent in 2040... MORE

Does the Academy need a Reformation?

Economics of Education
Arnold Kling
In this essay, I write The Catholic Church in 1500 was a debased, corrupt monopoly. It collected onerous taxes, which people paid because they believed that there was no alternative if they wanted a decent afterlife. However, inwardly people seethed... MORE

A Chat With Falun Gong

Cross-country Comparisons
Bryan Caplan
Yesterday I had an interesting chat with an earnest young man who belongs to the Falun Gong movement. As best as I can tell, Falun Gong is the most serious of the opponents of Communist rule in China. Whenever I... MORE

Health Care Waste, Continued

Economics of Health Care
Arnold Kling
Interesting comments from Roy Poses at Health Care Renewal. He, er, poses an interesting question. Outside of medicine, the price of technologies drop as they age. Admittedly, there have been many incremental improvements in CT scans, but there have been... MORE

Speaking of Bubbles

Economic Education
Arnold Kling
The bubble in economics blogs continues to inflate. One of the newer entrants is Freakonomics, from Steve Levitt and Stephen J. Dubner. I am becoming more and more dependent on William Parke's Economics Roundtable. At some point, the number of... MORE

Bubble Talk

Finance: stocks, options, etc.
Arnold Kling
Steven Pearlstein writes, nearly every asset market you can think of is showing signs of bubblelike behavior. The reason is pretty clear: The global economy is awash in free cash. The article makes a number of interesting allegations, not all... MORE

Hanson Link Fix

Information Goods, Intellectual Property
Bryan Caplan
My initial link for Hanson's working paper was incorrect. It's now been fixed. If you couldn't find it before, here it is. My apologies.... MORE

Terrorism Betting Markets: Inquiring Minds Know

Information Goods, Intellectual Property
Bryan Caplan
A new working paper by Robin Hanson observes: "When a controversy erupts in the media, and widely differing views are expressed, it is natural to wonder which opinion is the one more favored by those who are most informed about... MORE

Health Care Waste

Economics of Health Care
Arnold Kling
How much of our health care spending is wasted? In this essay, I argue that the waste is less than many people believe. I do not believe that health-care reformers should be taken seriously when they suggest that spending on... MORE

Tariffs, Quotas, Games, and Drugs

International Trade
Arnold Kling
Gary Becker makes the case against the drug war. After totaling all spending, a study by Kevin Murphy, Steve Cicala, and myself estimates that the war on drugs is costing the US one way or another well over $100 billion... MORE

What is a Modern Recession?

Macroeconomics
Arnold Kling
Robert Hall writes Unemployment rises not because of a bulge of layoffs but because workers entering job search—from previous jobs, from school, and from home activities—experience unusual difficulty in finding jobs. Among other things, this means that stories on layoffs,... MORE

Hitler's Argument for Conquest

Labor Market
Bryan Caplan
What was Hitler's argument for attacking other countries? You might think he didn't have one, but he did. His argument is frankly Malthusian: Our population is growing, and we will run out of food unless we get more land. (My... MORE

The Three Percent Solution

Social Security
Arnold Kling
The Washington Post had a story about a new paper by Robert Shiller, which can be found here. He says that the recommended "life cycle account," which mixes stocks and bonds in proportions that change as one gets closer to... MORE

Postmodernism: Private Vice, Public Virtue?

Politics and Economics
Bryan Caplan
I stumbled across an atypically insightful essay by Noam Chomsky, "What Is Wrong With Science and Rationality?," in the colorfully-named collection Market Killing. You can read a nearly complete version of the essay here. Chomsky pushes two theses in this... MORE

Inevitable Tax Increases

Fiscal Policy
Arnold Kling
In the latest WSJ blogger celebrity death match, Max Sawicki says Social Security and Medicare spending will increase faster than GDP, requiring increases in taxes, and there is not a damn thing anyone can do about it Tyler Cowen responds,... MORE

Social Security and Intransitivity

Politics and Economics
Arnold Kling
Bryan's post on the doubtful empirical usefulness of social intransitivity is probably right. Nonetheless, suppose that on Social Security there are three political viewpoints--Democratic, Republican, and nonpartisan--and three policy options--status quo, private accounts, and fiscal medicine. By fiscal medicine, I... MORE

Riker and the Mathematician's Fallacy

Politics and Economics
Bryan Caplan
The last chapter of William Riker's classic work, Liberalism Against Populism, contains some of the strangest statements I have read in quite a while. Background: Riker is deeply impressed by the literature on social intransitivity. As Arrow and others showed,... MORE

Bleg: Terminal Health Care Spending

Economics of Health Care
Arnold Kling
There are studies that reportedly show that a large share of health care spending comes in the last year of life. For example, this abstract gives a figure of 22 percent of total health care spending. (UPDATE: looking at the... MORE

Health Care Technocrat

Economics of Health Care
Arnold Kling
Doctors' prescriptions for health care tend to conflict with economists'. In this essay, I take on the proposals made in The New Republic by Dr. Arnold S. Relman. In a free market, consumer sovereignty and competition tend to create instability... MORE

De Soto Interviewed

Institutional Economics
Arnold Kling
Hernando De Soto offers his views in this interview it takes you 549 days to get a license to operate a bakery in Egypt and that is with a lawyer. Without a lawyer, it takes about 650 days. In Honduras,... MORE

Coping Classes

Behavioral Economics and Rationality
Bryan Caplan
Unhappy? My advice is to focus on your work. It helps you forget your woes, and once your life has improved, you've got something to show for your time of troubles. A fascinating passage from Robert Lane's The Loss of... MORE

David Cutler and Health Care

Economics of Health Care
Arnold Kling
A nice profile in the New York Times. To make coverage universal, Cutler advocates a $6,000 credit for poor families (and less, on a sliding scale, for others, tapering off to a small credit for people earning $50,000 and up).... MORE

Sin City opens on April 1, I haven't been as enthuiastic about a movie trailer since The Return of the King. And it's got a cool backstory too. Director Robert Rodriguez dropped out of the Directors Guild of America (DGA)... MORE

The Myth of Time Preference

Austrian Economics
Bryan Caplan
How come interest rates are always positive? Austrian economists have a stock answer: it's because of time preference. All else equal, we prefer satisfaction sooner rather than later. If we did not have time preference, we would never consume anything,... MORE

The Hopeful Science

Growth: Consequences
Arnold Kling
Richard Cooper writes, Development as a global policy objective dates from the 1940s. Relative to expectations then, the world economy performed outstandingly well during the second half of the 20th century. Worldwide growth in average per capita income exceeded two... MORE

Motives and Consequences

Regulation and Subsidies
Arnold Kling
Hedge Fund Guy writes, Costs of lending are always passed on to the consumer. No one is forced to lend (well, there is the Community Reinvestment Act, but that's a quid pro quo, and an exception), so lenders will either... MORE

Was Herbert Spencer Reincarnated as Julian Simon?

Growth: Consequences
Bryan Caplan
I've come across an essay by Herbert Spencer that is eerily reminiscent of the work of the late great Julian Simon. Writing in the late 19th-century, Spencer proposes the following relationship between objective conditions and public opinion: "[T]he more things... MORE

Caplan Now a Co-

Econlog Administrative Issues
Arnold Kling
Bryan Caplan's stint as guest blogger is over. His new gig is as co-blogger. Please welcome Bryan to what Steven Kirchner calls--in a hilarious post by the way, you must read it--The Bubble in Economics Blogs.... MORE

Movie Economics

Business Economics
Arnold Kling
Tyler Cowen posts on one of my favorite topics, movie economics. a multiplex will charge the same ($9.50 in my case) for the number one movie and for a flop. Nor is the price more expensive for Saturday night, or... MORE

Finance, Risk and Growth

Growth: Causal Factors
Arnold Kling
A reader of my piece on math and economics connected me to this 1998 Forbes cover story on Reuven Brenner. Forbes Global: Finance is central to your view of creating wealth. Why is it so important? Brenner: Because finance is... MORE

Solve Tyler's Puzzle

Microeconomics
Bryan Caplan
Tyler Cowen has a number of hypotheses about why all movies cost the same price. As a frequent movie-goer, I'd like to know, but I don't find any of his answers too convincing. A lot of the problem gets solved... MORE

The Larry Summers controversy (see here and here) is probably going to make it even harder to do no-holds-barred research on the fascinating subject of gender identity. But fortunately, academia is probably still too competitive for obscurantism to triumph. Evolutionary... MORE

Economic Debate

Politics and Economics
Arnold Kling
Brad DeLong writes, I am cranky, and annoyed. And I am not asking for very much. All I want is: * No more claims that we know that carving-out Social Security revenues to fund private accounts will have no damaging... MORE

Internet Governance

Institutional Economics
Arnold Kling
Alex Simonelis writes, Certain protocols, and the parameters required for their usage, are essential in order to operate on the Internet. A number of bodies have become responsible for those protocol standards and parameters. It can be fairly said that... MORE

I finally saw The Aviator, and it's hard not to scream "Scorsese was robbed!" Larry White has already done a great job of analyzing the bread-and-butter economics of the story. What's fascinating to me, however, is the exploration of Hughes'... MORE

Bleg: looking for SAS help

Economic Methods
Arnold Kling
I recently came across the Medical Expenditure Panel Survey, which seems like a fascinating data set. I would like to do some basic cross-tabs of some of the data. However, I am not a SAS jockey. Moreover, some of the... MORE

Income Volatility, Saving, and Risk Pooling

Income Distribution
Arnold Kling
On my earlier post on income volatility, D-aquared asked why smaller risk pools would be efficient? His point is that if the problem is volatility, risk can be diversified away. If 10 families pool their savings, volatility will be lower... MORE

Why Be Normal?

Information Goods, Intellectual Property
Bryan Caplan
Economists love to pour cold water on new ideas: "If your plan is so great, why aren't people already doing it?" And usually we're right to do so. Most of the economy's backseat drivers aren't fit to run an apple... MORE

Math and Economics

Economic Education
Arnold Kling
In a wide-ranging essay, I question the dominance of math in advanced economics. The raising of the mathematical bar in graduate schools over the past several decades has driven many intelligent men and women (perhaps women especially) to pursue other... MORE

Income Volatility

Income Distribution
Arnold Kling
The Los Angeles Times reports In the early 1970s, the inflation-adjusted incomes of most families in the middle of the economic spectrum bobbed up and down no more than about $6,500 a year, according to statistics generated by the Los... MORE

Robin, Radon, and Regulation

Regulation and Subsidies
Bryan Caplan
When the typical economist tells me about his latest research, my standard reaction is "Eh, maybe." Then I forget about it. When Robin Hanson tells me about his latest research, my standard reaction is "No way! Impossible!" Then I think... MORE

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