Bryan Caplan and David Henderson

October 2006

A Monthly Archive (67 entries)

Found: A False Stereotype About Fundamentalists

Economics and Culture
Bryan Caplan
Larry Iannaccone notwithstanding, the main stereotypes about fundamentalist Christians check out. But yesterday at lunch I heard a startling alleged counter-example from Alex Tabarrok, and I've confirmed it with the GSS: Contrary to stereotypes, fundamentalists are as likely to get... MORE

See Saw III... If You've Got Nothing Better to Do

Economics and Culture
Bryan Caplan
I'm a huge fan of the original Saw, and the first sequel was also quite good. The latest installment is watchable, but it's too heavy on gore and not strong enough on story and characterization. The only novelty of Saw... MORE

Health Care Policy for Pets

Economics of Health Care
Arnold Kling
John Ford writes, It seems that Ipswich Hospital in England wants to capitalize on its underutilized XRT facilities to treat animals -- presumably on a fee-for-service basis. ...I'm thinking that the calculated price per unit treatment will be less for... MORE

Climate Change

Energy, Environment, Resources
Arnold Kling
The latest analysis is known as the Stern report. From chapter one, on climate science: Climate models use the laws of nature to simulate the radiative balance and flows of energy and materials. These models are vastly different from those... MORE

Middle-Class Squeeze

Income Distribution
Arnold Kling
Larry Summers writes, As the great corporate engines of efficiency succeed by using cutting-edge technology with low-cost labour, ordinary, middle-class workers and their employers – whether they live in the American midwest, the Ruhr valley, Latin America or eastern Europe... MORE

The Draft: Who Pays the Price?

Microeconomics
Bryan Caplan
Arnold writes: The draft is a cruel tax, but the volunteer army does create a disconnect between the people who are fighting and the people for whom they are fighting. What are the effects of this "disconnect" supposed to be?... MORE

Wording the Questions

Politics and Economics
Arnold Kling
Seeing Greg Mankiw's reference to the World's Smallest Political Quiz put me in a puckish mood to tweak the questions. Alternative versions (Arlo's versions?) are in parentheses. Government should not censor speech, press, media or Internet (People should be allowed... MORE

Dochia On Analytical Egalitarianism

Microeconomics
Bryan Caplan
Econlog reader (and former Avian Flu blogger) Silviu Dochia writes: I'm with Scott Clark on this one. Levy’s point has nothing to do with nature vs. nurture. Then why the Smith and Mill quotations, which are specifically about nature vs.... MORE

Scott Clark, an Econlog reader, responds to my critique of analytical egalitarianism: The way I viewed analytical egalitarianism when i was in Levy's class was not that everyone is the same as everyone else. But when analyzing and making policy... MORE

California Energy Tax Proposal

Energy, Environment, Resources
Arnold Kling
Paul Romer writes, Greg Mankiw correctly points out that the tax in Prop 87 is not a Pigovian tax--that is, a tax on oil for the purpose of reducing oil consumption to socially optimal levels. However, the revenues from Prop... MORE

Baffled by "Analytical Egalitarianism"

Microeconomics
Bryan Caplan
There's a peculiar doctrine coming out of George Mason in recent years. It's called "analytical egalitarianism," and has been energetically promoted by my brilliant colleague David Levy, his co-author Sandra Peart, and quite a few others. (See here and here... MORE

Envy and Resentment

Income Distribution
Arnold Kling
Fortune's Matt Miller writes, Here's my outlandish theory: that economic resentment at the bottom of the top 1 percent of America's income distribution is the new wild card in public life. Ordinary workers won't rise up against ultras because they... MORE

An Illustration of Premium Medicine

Economics of Health Care
Arnold Kling
Gina Kolata does some careful reporting in the New York Times. Researchers at New York-Presbyterian Hospital/Weill Cornell Medical Center report that they can save the lives of millions of people by detecting lung cancer early and treating it immediately, when... MORE

Tyler: A Plague on Both Your Houses

Economic Methods
Bryan Caplan
Tyler on refereeing: A properly critical and useful "accept" report is harder to write. Don't look for excuses to quickly reject a potentially good paper. Tyler on being refereed: If you get careless, sloppy, or downright outrageous referee reports, it... MORE

The P-I-E Model

Growth: Causal Factors
Arnold Kling
Jens Erik Gould reports in the New York Times, Years of rampant violent crime is not only robbing Latin America of significant private investment, but in some cases is stealing up to 8 percent from national economic growth, economists and... MORE

Dissing Ethanol

Energy, Environment, Resources
Arnold Kling
John Baden writes, First, the energy content of ethanol is low when compared with gasoline or diesel. While diesel contains around 140,000 Btu per gallon, and gasoline 115,000 Btu, denatured ethanol contains only 78,000 Btu per gallon. We can’t cheat... MORE

Faith in Leaders

Political Economy
Arnold Kling
In my latest TCS essay, I write, Democracy does not lead to particularly good choices. Most successful institutions in society are not democratic. ...For me, the value of democracy is that it provides a check on government officials. The fact... MORE

An Outside Perspective on GMU

Economic Methods
Bryan Caplan
"[N]obody could ever figure out our own political leanings by reading our papers." That's how Andrew Gelman sees his research. In contrast, when Gelman visited GMU, "One thing that struck me about the people I met there was that their... MORE

Staffing of Schools

Economics of Education
Arnold Kling
Andrew Coulson writes Teachers make up 72 percent of on-site staff in Arizona’s independent education sector, but less than half of on-site staff in the public sector. In order to match the independent sector’s emphasis on teachers over non-teaching staff,... MORE

When Ayn Rand Villains Ruled the Earth

Economic History
Bryan Caplan
A leading criticism of Ayn Rand's novels is that her villains are unbelievable. No one runs around proclaiming their devotion to the opposite of what John Galt believes. People who say this should read more about the '30's and '40's.... MORE

The Value of a College Education

Economics of Education
Arnold Kling
David Wessel writes, Although the best-paid college grads are doing well, wages of college grads have fallen on average, after adjusting for inflation, in the past five years. The only group that enjoyed rising wages between 2000 (just before the... MORE

Greg Mankiw Pumps for a Higher Gas Tax

Energy, Environment, Resources
Arnold Kling
He writes, We should raise the tax on gasoline. Not quickly, but substantially. I would like to see Congress increase the gas tax by $1 per gallon, phased in gradually by 10 cents per year over the next decade. He... MORE

Survey Pre-Test: Who in Government Has Power Over What?

Politics and Economics
Bryan Caplan
A few months ago, readers of this blog gave helpful comments on the first draft of the Caplan-Somin survey about who in government has power over what. Now we're ready to pre-test. If you've got the time, please take this... MORE

Rothbard on Szasz

Behavioral Economics and Rationality
Bryan Caplan
Here's some well-aged Rothbard: I'm sure I would find neither Hitler, Wilson, Nixon, nor the Ayatollah charming dinner or cocktail party companions. But surely I am not to be permitted to transform these aesthetic judgments into a "value-free science" that... MORE

The Math Bubble

Economic Methods
Arnold Kling
Bryan wonders, Ten years ago, ultra-mathematical theorists were the kings of the economics profession. Now they seem to be nigh irrelevant. Clever and relatively open-minded empiricists rule the roost. Cementing the trend, few of the students coming out of top... MORE

Memetic Suicide

Behavioral Economics and Rationality
Bryan Caplan
Ten years ago, ultra-mathematical theorists were the kings of the economics profession. Now they seem to be nigh irrelevant. Clever and relatively open-minded empiricists rule the roost. Cementing the trend, few of the students coming out of top programs are... MORE

Medicare-for-all Fantasy

Economics of Health Care
Arnold Kling
As promised, I offer my rebuttal to Jacob Hacker and others who see Medicare expansion as the way to "fix" the health care system. According to the 2006 report of the Medicare Trustees, the unfunded liability in Medicare over the... MORE

Fantasy Agendas

Politics and Economics
Arnold Kling
Tyler Cowen wants to means-test Medicare, get rid of farm subsidies and other corporate welfare, legalize more high-skilled immigrants, join Greg Mankiw's Pigou Club (meaning a tax on the use of evil fossil fuels) and get rid of the corporate... MORE

Culture and Health Care Costs

Economics of Health Care
Arnold Kling
David Leonhardt discusses the common complaint, why is it that the U.S. spends so much on health care and has no greater longevity than other countries? He writes, So something beside administrative costs is at work here, and it involves... MORE

Ethanol Enthusiasts

Energy, Environment, Resources
Arnold Kling
Lester B. Lave and W. Michael Griffin write, Brazil, together with some Caribbean nations, is exporting some 200 million gallons of ethanol to the United States annually. But the United States doesn’t make it easy. Brazil pays a 2.5% duty... MORE

I Heart Steven Pinker, continued

Behavioral Economics and Rationality
Arnold Kling
He writes It is no coincidence that humans are special in their ability to outsmart other animals and plants by cause-and-effect reasoning, and that language is a way of converting information about cause-and-effect and action into perceptible signals. A distinctive... MORE

California Dreaming

Energy, Environment, Resources
Bryan Caplan
California's latest crazy initiative helps James Hamilton get in touch with his inner Bastiat: The only reason I can imagine for a specific tax on California oil producers is the apparent belief by the proponents of the tax that these... MORE

New Phelps Phan

Labor Market
Bryan Caplan
The prize for Phelps left me cold - until I learned that he said this: One can hardly imagine, I think, how poor we would be today were it not for the rapid population growth of the past to which... MORE

The day after I met Ezra Klein and gave him my 10-minute spiel on systematically biased beliefs about economics, he provides a neat example. (My influence? I can dream, can't I?) Discussing findings from a new Kaiser survey on health... MORE

Economics Book Recommendations

Books: Reviews and Suggested Readings
Arnold Kling
from the B-school at Carnegie-Mellon. My top three from the list would be David D. Friedman's Hidden Order, for lively examples and breadth of coverage; Malkiel's A Random Walk Down Wall Street, for its explanation of how economic theory applies... MORE

Better than Health Insurance?

Economics of Health Care
Arnold Kling
Ezra Klein writes, if consumers, as they've repeatedly proven, don't want insurance, but instead want insulation, why shouldn't we seek to make that work (as it does in a variety of other countries and systems). Consumers do love to be... MORE

Reduction to Banality

Behavioral Economics and Rationality
Bryan Caplan
Last week, Tyler Cowen blogged on a story about a special ed program that uses electric shocks to make students to behave. His post included the somewhat cryptic remark that "I view this as a reductio ad absurdum on Bryan... MORE

Robin Hanson on Health Care

Economics of Health Care
Arnold Kling
He sent this email to me and to others: Imagine someone claimed that casinos produce, not just entertainment, but also money. I would reply that while some people have indeed walked away from casinos with more money than they arrived... MORE

Mark Thoma on Health Insurance

Economics of Health Care
Arnold Kling
He says, Do health markets suffer from substantial market failure? My assessment of these markets says the answer is yes and, in particular, the most difficult problem to solve, adverse selection, is the most serious problem plaguing these markets. My... MORE

Why is Education so Primitive?

Economics of Education
Arnold Kling
Alex Tabarrok asks "Why is Medicine so Primitive?" One reason is that medicine is the largest area of the economy still dominated by artisanal production. I will be blunt: We need assembly line medicine, medicine that is routinized, marked and... MORE

Judge This Book By Its Cover

Books: Reviews and Suggested Readings
Bryan Caplan
I'm in love with the jacket for my book - coming in April, 2007. Kudos for the Princeton University Press art department. Leave it to Robin Hanson, of course, to point out that the jacket is more optimistic than the... MORE

Surveying on the Cheap: Role-Playing an Average American

Politics and Economics
Bryan Caplan
Near the end of "Is There a Free-Market Economist in the House?," Dan Klein and Charlotta Stern say: "Economists, then, are free-market compared to other social scientists. What about compared to ordinary Americans? Unfortunately, no one has a good handle... MORE

One Manifesto, Two Responses

Political Economy
Arnold Kling
University of Chicago Law Professor's ten principles of liberalism drew two responses in today's TCSdaily. Professor Stephen Bainbridge writes, the progressive communitarian's basic flaw is his willingness to invoke the coercive power of the state in ways that deny the... MORE

I Don't Heart Cass Sunstein

Business Economics
Arnold Kling
But I agree with what he writes here. The general point is much broader. Baseball involves a lot of money; people have strong incentives to make the right decisions. But even experienced people make systematic errors--and it took a Billy... MORE

I Heart Steven Pinker

Economic Philosophy
Arnold Kling
Recently, he took on George Lakoff, and he got off this one-liner: One can just imagine the howls of ridicule if a politician took Lakoff's Orwellian advice tried to rebrand "taxes" as "membership fees." ...If you choose not to pay... MORE

State and Local Unfunded Liabilities

Social Security
Arnold Kling
Chris Edwards and Jagadeesh Gokhale write, According to the Federal Reserve Board, state and local credit market debt has risen rapidly in recent years, from $313 billion in 2001 to $568 billion in 2005. But unfunded obligations from state and... MORE

Most Economists Have Two Hands

Politics and Economics
Arnold Kling
Daniel B. Klein and Charlotta Stern write, Supporters of free-market principles, we maintain, would score at least a 4.0 on the 18-question policy index presented here, and strong supporters would score at least a 4.5. By contrast, the mean for... MORE

Online Gambling Getting Riskier

Regulation and Subsidies
Bryan Caplan
I'm mildly surprised to learn that parts of the U.S. government are actually trying to crack down on online gambling. Robin Hanson pointed me here and here. If ever there were a time to sarcastically ask, "Don't you have anything... MORE

What Do You Want to Be Free to Choose?

Microeconomics
Bryan Caplan
Here's a question for libertarians (though of course others should feel free to answer): What currently illegal thing do you personally really want to be free to do? Set aside "not pay taxes"; that's too easy. For me, anyway, the... MORE

Nobel Laureate Phelps Speaks

Cross-country Comparisons
Arnold Kling
Rather, he writes a provocative, important piece in today's Opinion Journal (via the Wall Street Journal). There are two economic systems in the West. Several nations -- including the U.S., Canada and the U.K. -- have a private-ownership system marked... MORE

I Distrust Robert Putnam

Behavioral Economics and Rationality
Arnold Kling
I think that an academic web site should consist of links to papers, not self-promotion. Putnam's page does the reverse. About his latest PR success, it says, Robert D. Putnam gave a talk on this issue as the Skytte Prize... MORE

I'm not sure that I've ever been really sad to see a store go out of business. Until today, when I saw the signs up at Tower Records. What is there to do except listen to Morrissey (or maybe Götterdämmerung)?... MORE

Phelps and the Nobel

Macroeconomics
Arnold Kling
I once joked that Edmund Phelps would have won the Nobel Prize if he were Scandinavian (I probably made that joke when Finn Kydland was annointed). Today, Phelps won it, anyway. Phelps was mentioned in econlog blog posts for his... MORE

Columbus: The Far Left is Dead Right

Economic History
Bryan Caplan
By the time Christopher Columbus appeared in Lisbon in 1477 an Old World slave trade was thriving in the eastern Atlantic between West Africa, the Atlantic islands, and Europe. In his famous letter on his first voyage he informed Ferdinand... MORE

Has Bentall Explained Madness?

Books: Reviews and Suggested Readings
Bryan Caplan
I finally got around to reading Richard Bentall's Madness Explained. It's a fun book, but as expected, it falls short of its ambitious title. Bentall's been criticized as a Szaszian, and it's easy to see why. Like Szasz, Bentall is... MORE

What's Wrong With Fraternalism?

Economic Philosophy
Bryan Caplan
You share as many genes with your siblings as you do with your parents and your children. Yet not only is there no legal responsibility to help your brothers and sisters; even the perceived moral responsibility is pretty weak. Socialists... MORE

Bad News on Employment

Labor Market
Arnold Kling
Russ Roberts notices the really big news about employment. Here's the last paragraph: The good news was that job gains for both July and August turned out to bigger than previously estimated, taking some of the bite out of September's... MORE

Health Care Innovation

Economics of Health Care
Arnold Kling
Tyler Cowen reminds us that the U.S. is the leader. In real terms, spending on American biomedical research has doubled since 1994. By 2003, spending was up to $94.3 billion (there is no comparable number for Europe), with 57 percent... MORE

BMI: Lessons from D&D

Economics of Health Care
Bryan Caplan
A lot of social scientists are now interested in the effects of the BMI, or Body Mass Index. In the metric system, your BMI is equal to your weight in kg divided by your height in meters squared. If you... MORE

How Electronics Retailers Make Money

Business Economics
Arnold Kling
The Washington Post says, Neither Circuit City nor Best Buy discloses how much of its bottom line comes from extended warranty sales. But analysts have estimated that at least 50 percent and in some lean years 100 percent of profits... MORE

The Smoot-Hawley Fence

Labor Mobility, Immigration, Outsourcing
Arnold Kling
Be careful what you wish for on border security and illegal immigration. Here is one story. Carnes ended up with less than 100 workers and fell two weeks behind, with bits and pieces of the fields unpicked. His income fell... MORE

Offshore Tutoring

Economics of Education
Arnold Kling
This was bound to happen. Her 13-year-old daughter, Taylor, is one of 1,100 Americans enrolled in Bangalore-based TutorVista, which launched U.S. services last November with a staff of 150 "e-tutors" mostly in India with a fee of $100 a month... MORE

Behavioral Vaccine

Behavioral Economics and Rationality
Arnold Kling
This article interested me, on many levels. the new vaccines employ the body's natural immune system in an innovative way. Instead of building antibodies to destroy germs as traditional vaccines do, they construct antibodies that lock onto nicotine and cocaine... MORE

Presenting Health Statistics

Economics of Health Care
Arnold Kling
Darshak Sanghavi writes A 31 percent reduction in heart attacks, after all, seems impressive. Yet this pervasive way of describing clinical trials in medical journals—focusing on the "relative risk," in this case of heart attack—powerfully exaggerates the benefits of drugs... MORE

Democracy's Vices

Political Economy
Arnold Kling
Michael Munger writes, On many kinds of policy, where one unique alternative must be selected from among many, and the legitimacy of that choice is at least as important as the choice itself, democracy has no equal. One defense budget,... MORE

What is Recycling?

Energy, Environment, Resources
Arnold Kling
Don Boudreaux writes, But I do discard paper plates - for the same reason I recycle my china rather than discard it: it would be wasteful to do otherwise. After all, I could recycle paper plates. Careful washing would enable... MORE

The Lipinsky Memoir

Economic History
Bryan Caplan
My online Museum of Communism has a new exhibit: The memoirs of Romuald Lipinsky. Lipinsky was deported from Poland to Siberia by the Soviets when he was 15 years old. Last year, he told me his tale of woe and... MORE

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