Bryan Caplan and David Henderson

November 2005

A Monthly Archive (50 entries)

Immigration on Trial

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
In a letter submitted to the Wall Street Journal, Cafe Hayek blogger Don Boudreaux observes: [O]pponents of openness often allege that immigrants come here to free-ride on taxpayer-supplied welfare. That this allegation is a canard is revealed by the innumerable... MORE

Collegiate Aristocracy

Economics of Education
Arnold Kling
My alma mater, Swarthmore College, sent out a mailing (I can't find it online) that begins, Swarthmore charges $41,280 per student in tuition and fees, and its endowment reached nearly $1.2 billion...Isn't that enough money for a small college...is it... MORE

I miss Michael Powell

Regulation and Subsidies
Arnold Kling
The FCC thinks that cable TV's bundling policies are bad, according to this report. Chairman Kevin Martin, reversing a course set by predecessor Michael Powell, told lawmakers on Tuesday that cable subscribers could benefit if given the option to pick... MORE

The Corruption Trap

Politics and Economics
Arnold Kling
Philip Keefer writes, political competitors who are unable to make credible promises to most voters will, upon taking office, underprovide public goods, overspend on transfers to narrow groups, and engage in significant rent-seeking. That is, the behavior of such politicians... MORE

A Glacial Rate Isn't Bad

Economics of Health Care
Bryan Caplan
We're gaining a point of subjective health every 333 years. But on second thought, that's not so bad. Another way to express the same fact is to say that we are aging by only 9.5 months every year.... MORE

Tim Harford Speaks

Books: Reviews and Suggested Readings
Bryan Caplan
Patri Friedman has posted his interview of the Underground Economist himself, Tim Harford, at Catallarchy. My main quibble is when Tim says: People who oppose the use of markets in healthcare can point to two genuine problems: illness is extremely... MORE

Objective Facts About Subjective Health

Economics of Health Care
Bryan Caplan
Lately economists have gotten awfully interested in subjective well-being, popularly known as "happiness." (Here's my take; here's Arnold's; and don't neglect Will Wilkinson's blog on the subject). And of course economists have long been interested in health - trying to... MORE

Bank Regulation and Public Choice Theory

Public Choice Theory
Arnold Kling
There are several gems in the latest Milken Institute Review. On the topic of bank regulation, James Barth, Gerard Caprio and Ross Levine give an excellent generic description of how the public-choice view of government differs from the assumptions that... MORE

India Fact of the Day

Growth: Causal Factors
Arnold Kling
From an article by Radha Chaurushiya in the Milken Institute Review. The information technology sector employs only one million people – a quarter of a percent of a labor force of more than 400 million. Output in the services sector... MORE

The 1920's and the 1990's

Economic History
Arnold Kling
Robert J. Gordon writes, The evolution of the economy after 2000 was, of course, entirely different than after 1929, and we have previously attributed this to the aggressive easing of monetary policy that sustained a major boom in residential construction... MORE

Captain Bligh: Bad Economist or Bad Psychologist?

Behavioral Economics and Rationality
Bryan Caplan
If you believe the movies, Captain Bligh caused the "mutiny on the Bounty" by being so harsh that his men decided that they had nothing to lose by kicking him off the ship. In other words, Captain Bligh was to... MORE

Cowen's Law

Politics and Economics
Arnold Kling
My latest TCS essay is built around one of my favorite Tyler quotes. I write, There are passionate Republicans and passionate Democrats. But I agree with Tyler Cowen that neither party is likely to seem attractive. I can give a... MORE

Wrong State for Market-Based Health Insurance

Economics of Health Care
Arnold Kling
My latest essay is now out from behind the subscription wall in the Weekly Standard. Massachusetts is considering health insurance reform to address the problems of the uninsured. The federal government is pressuring the state to do something or lose... MORE

The Big Lie

Information Goods, Intellectual Property
Bryan Caplan
I'm a trusting person by nature, so it's useful for me to reflect on how deceptive people can be. The following excerpt really helped focus my attention. It's from a speech given to the Associated Press in 1933 by Adolf... MORE

Can Entrepreneurship Be Taught?

Business Economics
Arnold Kling
My answer has always been "no." Read this post, from a venture capitalist. there are two ways to build a company. You can design it from scratch, figuring out exactly what you want to build, getting it all down on... MORE

Arnold's Intriguing Idea

Economic Education
Bryan Caplan
Arnold has a thought-provoking new hypothesis about "Why People Hate Economics": Paul Bloom's essay "Is God an Accident?" in the latest issue of The Atlantic, suggests that humans' belief in God, Intelligent Design, and the afterlife is an artifact of... MORE

Acyclical Creative Destruction

Macroeconomics
Bryan Caplan
Schumpeter famously praised the "creative destruction" of the market: The opening up of new markets, foreign or domestic, and the organizational development from the craft shop and factory to such concerns as U.S. Steel illustrate the same process of industrial... MORE

The Music Copyright Tax, Revisited

Information Goods, Intellectual Property
Arnold Kling
Alex Tabarrok writes The conclusion seems right to me - file-sharing increases social-welfare, so in theory a win-win solution is possible, but in practice the increase comes at the expense of music firms. That reminded me of Zimran ("winterspeak") Ahmed's... MORE

Are health economists naughty or NICE?

Economics of Health Care
Arnold Kling
The lead story in today's Wall Street Journal reports If a treatment helps people, should governments and private insurers pay for it without question? Or should they first measure the benefit against the cost, and only pay if the cost-benefit... MORE

Simonizing Economics

Energy, Environment, Resources
Bryan Caplan
When I was finishing up my book on voter irrationality, I had a lot of trouble tracking down any quotes confirming my belief that economists roughly buy into Julian Simon's views on the benefits of population. In the end, I... MORE

The Beauty of Marginalism

Cost-benefit Analysis
Bryan Caplan
HBO's new series Rome cost $100 M to make, and its ratings are about one-fourth of The Sopranos'. But it's getting renewed anyway. Bad business? No, it looks like good old-fashioned marginalism and avoidance of the sunk-cost fallacy. According to... MORE

Salvaging Secularization

Economics and Culture
Bryan Caplan
Sociologists have been saying funeral rites for religion for over a century. Either it's already dying out, or its just about to have a heart attack - a claim known as the "secularization hypothesis." My debating partner Larry Iannaccone and... MORE

Boudreaux Blog on Bloom Beats my Brains

Economic Philosophy
Arnold Kling
Reacting to a piece by Paul Bloom in the Atlantic Monthly, Don Boudreaux writes not only are we genetically predisposed to infer the existence of a supernatural designer of our physical world (or a supernatural bully, depending), but we’re also... MORE

Future of Health Insurance

Economics of Health Care
Arnold Kling
Donald Moran writes, As private insurance thins out toward a more catastrophic form, however, this dynamic can be expected to change, in two ways. First, facing a much larger share of the first-dollar cost of expensive therapies, patients will be... MORE

Gasoline Tax

Energy, Environment, Resources
Arnold Kling
In the September American Economic Review, Ian W. H. Parry and Kenneth A. Small write, The British government has defended high gasoline taxes on three main grounds. First, by penalizing gasoline consumption, such taxes reduce the emissions of both carbon... MORE

The Debate

Behavioral Economics and Rationality
Bryan Caplan
The turnout for the Iannaccone-Caplan Debate on Economics of Religion was excellent - about 300 people by my count. That's a striking illustration of interaction effects: as solo speakers either of us would have been lucky to draw 50 listeners!... MORE

James Hamilton on the Great Race

Economics of Health Care
Arnold Kling
He writes If Medicare and Medicaid spending continue to grow 3.1% faster than GDP, by 2150 the federal government would consume 370% of GDP. Hold on a sec. (See also, Robert J. Samuelson on AARP's America Is a Mirage)... MORE

Jane Galt's Self-Criticism

Behavioral Economics and Rationality
Bryan Caplan
One of the main reasons to study psychological biases is to help us stop making them, but even many specialists don't bother to try to reform their thought processes. But don't give up hope. Jane Galt is a role model... MORE

Dear Adbusters: While your publication seems to have little use for neoclassical economics professors, there is at least one topic where you have my sympathy. Like you, I find most advertising to be extremely painful. Commercial radio, with its shrill... MORE

Is Private Health Insurance Impossible?

Economics of Health Care
Arnold Kling
Mark Thoma channels Paul Krugman. It's nice to have Paul Krugman discuss a question that has been addressed repeatedly at this site, market failure in the provision of health and social insurance due to moral hazard and adverse selection This... MORE

Buying Habits, Race, and Income

Income Distribution
Arnold Kling
Alex Tabarrok writes, Expenditures on footwear by whites and other races: $274 Expenditures on footwear by blacks: $440. Chalk one up for the good Dr. Cosby. Alex is defending Bill Cosby against an attack by a Washington Post financial columnist.... MORE

Mandatory Health Insurance?

Economics of Health Care
Arnold Kling
The Boston Globe reports, Rhetoric surrounding the healthcare debate in Massachusetts has been largely shaped by plans to extend coverage to the poor. But two of the major initiatives under consideration by the Legislature would also, for the first time,... MORE

Debating Trade

International Trade
Arnold Kling
Angry Bear reports that some bloggers on the left have been having a debate on whether or not free trade is a good thing. In my view, those who think "not" are doomed to intellectual failure. One of the good... MORE

Budget Trends

Fiscal Policy
Arnold Kling
Steve ("the skeptical optimist") Conover writes The two trend lines, receipts and outlays, confirm what I thought I had seen two months ago. Federal tax receipts are growing much faster than federal spending outlays: 15.2% versus 8.5%, respectively. As a... MORE

Go to Church or Play a Game?

Behavioral Economics and Rationality
Bryan Caplan
I am tooling up for my debate on the economics of religion with Lawrence Iannaccone. Studying data from the General Social Survey, it's clear that people who attend church more are a bit happier. On a three-step scale (very happy/pretty... MORE

How Not To Interview

Labor Market
Bryan Caplan
Leadership Secrets of Attila the Hun wisely tells us: "Every Hun has value even if only to serve as a bad example." In this spirit, a coven of grad students has produced videos of nine really bad interviews to illustrate... MORE

The State as Parent

Politics and Economics
Arnold Kling
In my latest essay, I write Under the welfare state, government usurps the role of the family in education, health care, and saving for retirement. As economic historian Robert Fogel has pointed out, these are the fastest-growing segments of our... MORE

The Language Barrier

Cross-country Comparisons
Arnold Kling
Sucheta Dalal writes about India: Salary differences between equally qualified (non-professional/technical) candidates can be as high as 400 to 500 per cent. In fact, the more fancied jobs in airlines, hotels, media, banks and financial services only to those who... MORE

Chomsky Sci-Fi: They Live

Economics and Culture
Bryan Caplan
Way back in 1988, I saw John Carpenter's They Live, and last night, I watched it again. The plot: Aliens have infiltrated our society, and are brain-washing us by infusing pop culture with subliminal messages like "Obey," "Consume," "Watch TV,"... MORE

"Do the Opposite": Hanson on Externalities and Zoning

Regulation and Subsidies
Bryan Caplan
A while back, I wrote: In a classic episode of Seinfeld, George Costanza realized that his instincts were fundamentally wrong, and vowed to "do the opposite": George: Elaine, bald men, with no jobs, and no money, who live with their... MORE

France, UK productivity puzzle

Cross-country Comparisons
Arnold Kling
Theodore Dalrymple writes, A French employee works 30% fewer hours than a British worker, and a much smaller percentage of the French population than the British works at all, yet total French output is very nearly equal in value to... MORE

Taxing OPEC

Energy, Environment, Resources
Arnold Kling
Andrew Samwick points to a paper by Jayanta Sen that suggests that it is in the interest of oil consuming nations to tax oil. Sen writes, a tax on crude would transfer wealth of $100+ billion a year from foreign... MORE

The Case for Tax Reform

Tax Reform
Arnold Kling
Politically, of course, it's dead in the water. But Andrew Chamberlain and Patrick Fleenor show why it makes economic sense. The current system requires six tax rates ranging from 10 percent to 35 percent to raise the $912 billion in... MORE

Campaign Finance Reform

Politics and Economics
Arnold Kling
Gary Becker writes, Part of the hostility to campaign contributions reflects a general hostility to advertising found among intellectuals in all spheres, including many economists. This hostility greatly underestimates the importance of advertising in providing information, in helping new products... MORE

"Free to Build": The Best Hope for Libertarian Populism

Regulation and Subsidies
Bryan Caplan
The last big populist movement that libertarians could and did embrace was the tax revolt of the late 70's and early 80's. Since then, there's been a long dry spell, at least in the U.S. And if you know much... MORE

Keyhole Surgery with The Undercover Economist

Books: Reviews and Suggested Readings
Bryan Caplan
I'm joining the chorus of fans of Tim Harford's new book, The Undercover Economist. There's something good on practically every page, and though I furrowed my brow in skepticism every few pages, too, that's a pretty good batting average. As... MORE

Happiness and Evolution

Behavioral Economics and Rationality
Arnold Kling
I would like to join the chorus of praise for Will Wilkinson's new blog on happiness and public policy. For example, this post: Nesse goes on to point out that a few (of the far too few) longitudinal studies have... MORE

Sea Inside of Happiness

Behavioral Economics and Rationality
Bryan Caplan
Will Wilkinson is pointing his rapier wit at happiness research with his new Happiness and Public Policy blog. It's a fascinating subject. Who would have guessed, for example, that quadriplegics are, on average, happy? Incidentally, if you want to see... MORE

Health Care is Zero-Sum?

Economics of Health Care
Arnold Kling
Kevin Drum writes The bottom line is that if HSAs are a better deal for healthy people, then inevitably they're a worse deal for sick people. And if you take healthcare seriously, it's sick people you should be concerned about.... MORE

Where Would You Prefer that Women Be Oppressed?

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
In September, Arnold wisely asked: On the issue of poverty and immigration, which Robert J. Samuelson raised, I would ask, "Where would you prefer that people be poor?" That is, do we want to insist that poor Hispanics should remain... MORE

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