Bryan Caplan and David Henderson

June 2007

A Monthly Archive (89 entries)

Data Mining: The Graphic Novel

Books: Reviews and Suggested Readings
Bryan Caplan
Check out The Right Number, an online graphic novel that effortlessly takes you from a charming vignette to an uber-creepy exercise in data mining. Not enough to make you give it a try? Let me add that it's by the... MORE

Freeman Dyson on Biotech and the Future

Energy, Environment, Resources
Arnold Kling
He writes, We can imagine that in the future, when we have mastered the art of genetically engineering plants, we may breed new crop plants that have leaves made of silicon, converting sunlight into chemical energy with ten times the... MORE

Health Care Op-Ed

Economics of Health Care
Arnold Kling
I have a piece in the Washington Times. I compare Michael Moore's "Sicko" with my wife's "documentary" of our daughter's college graduation last month. On one side of me at the graduation sat the director/co-star, a breast cancer survivor. On... MORE

P. J. O'Rourke has Competition

Political Economy
Arnold Kling
It comes from 'Mencius Moldbug,' who says the US is just a corporation. It is not a mystic trust consigned to us by the generations. It is not the repository of our hopes and fears, the voice of conscience and... MORE

Low-Trust Society?

Economics of Crime
Arnold Kling
Samuel Bowles and Arjun Jayadev write, We distinguished between those who directly or indirectly produce goods and services that we consume—who Adam Smith called productive labor—and those who we term guard labor: the police, private security guards, military personnel and... MORE

Richard Vedder, Sounding Reasonable

Economics of Education
Arnold Kling
Richard Vedder writes The more evidence that I see that I believe is creditable and meaningful, the more I am convinced of the following: * Too many students, not too few, are going to college; * College and universities are... MORE

Supreme Court Overturns Per Se Rule; "Crazies" Rejoice

Regulation and Subsidies
Bryan Caplan
Price-fixing is no longer per se illegal, at least according to the New York Times. Decades after the big academic debate on resale price maintainence (RPM), five justices are convinced:The court struck down the 96-year-old rule that resale price maintenance... MORE

Evolution and genetics aside, my understanding of natural science is very weak. Fortunately, examining the bets experts are willing to make is a great substitute for understanding what they are talking about. So when Robin Hanson reports that global warming... MORE

Overconfidence

Behavioral Economics and Rationality
Arnold Kling
At the conference where I gave my talk that mentioned recipes and ingredients, I met Edgar Capen, co-author of a classic paper that coined the term "winner's curse" for auctions. His main theme is that people under-estimate uncertainty. If someone... MORE

The Ingredients and the Recipes

International Trade
Arnold Kling
Hal Varian describes a study that gives insight into the details of globalization. Even though Chinese workers contribute only about 1 percent of the value of the iPod, the export of a finished iPod to the United States directly contributes... MORE

The Preponderance of the Evidence

Economic Philosophy
Bryan Caplan
Years ago I attacked the "reasonable doubt" standard of criminal justice, using the following hypothetical as a starting point: [I]magine that you are observing a trial for murder. Most of the evidence goes against the accused (who allegedly murdered a... MORE

Interview with Trent McBride, Including the Political Consequences of Immigration

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
Here's a print interview with Trent McBride of Distributed Republic. I had a lot of fun doing it, and there's little overlap with the (also very fun) Nick Schulz TCS interview. The highlight for EconLog readers will no doubt be... MORE

Why No Electronic Medical Records?

Economics of Health Care
Arnold Kling
Ezra Klein writes, To this day, I've never read a compelling explanation of why the nation's doctors and hospitals haven't broadly adopted electronic medical records. Has he not read my explanation, or does he not think it compelling? In case... MORE

Anti-Finance Bias

Political Economy
Arnold Kling
Greg Mankiw writes A student who regularly reads and comments on this blog asks me for career advice, from a social point of view: How does someone like Warren Buffett contribute to the economy? It seems investing in old line... MORE

A Political Prediction

Political Economy
Arnold Kling
My latest essay concludes, If politics were football, then I would say that the Clinton and Bush years saw little forward progress for either side. Clinton might have moved the ball toward the progressives' goal line, but only a few... MORE

My Best Interview Ever

Books: Reviews and Suggested Readings
Bryan Caplan
If Russ Roberts asks you to do a podcast for EconTalk, you'd be a fool to refuse. He gave me the most perceptive and engaging interview I've ever done. (And Robin Hanson tells me the same about his EconTalk podcast,... MORE

Transporting Success

Economics and Culture
Bryan Caplan
Over at Free Exchange, I ask "What's the best way to transport success?": Purely hypothetically, suppose you’ve written a pretty successful book published by Princeton University Press, and been favorably profiled in The New York Times Magazine and The Economist.... MORE

Closet Your Inner Economist?

Books: Reviews and Suggested Readings
Bryan Caplan
Here's some advice from Discover Your Inner Economist that I won't be following: Think of "the economics of the family" as The Truth That Dare Not Speak Its Name. If you are the economically informed member of your family, or... MORE

My next book will use the under-valued signaling model to make The Case Against Education. On his blog, Tyler hasn't been buying my story:If education is pure signaling, just give everyone a standardized test in seventh grade and then close... MORE

Why Do Book-Sellers Discount Popular Books?

Microeconomics
Bryan Caplan
I've heard the question before, but this time, it's personal: Amazon just sharply slashed the price of my book to $19.77. The standard answer is that the (absolute value of) elasticity of demand is higher for more popular books. The... MORE

Out of Your Opening Book

Business Economics
Arnold Kling
Here is a very worthwhile interview with businessman and libertarian benefactor Charles Koch. Q: What do you envision Koch Industries to be in 10 years? Mr. Koch: The future is unknown and unknowable. This is the perspective of a book... MORE

DeLong on Borjas on Immigration

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
DeLong concludes with a reasonable demand: [T]he thing to object to in the turn this entire debate has taken has been the failure to focus evenly on the consequences for all stakeholders in global migration--look at what happens to everyone,... MORE

Boo for Applause

Behavioral Economics and Rationality
Bryan Caplan
Almost everyone takes this for granted, but it still freaks me out: Audiences in presidential debates applaud just because a candidate says something they agree with. See for example the crowd's reaction when Giuliani scoffs at Ron Paul. You can... MORE

Ezra Klein writes, Michael Cannon and I would build very different systems, to be sure, but at base, we both believe the employer tie to be awful, and the insurers to suck, and the hospitals to be performing below expectations,... MORE

In which Max discovers a tic

Economics of Health Care
Arnold Kling
Max Sawicky noticed that I use the phrase "my guess" a lot. A few weeks ago, Julian Sanchez wrote, But it occurs to me that in addition to the phrases at large in the written culture of the society, there... MORE

One of my pet ideas is the Jock/Nerd Theory of History. If you're reading this, you probably got a taste of it during your K-12 education, when your high grades and book smarts somehow failed to put you at the... MORE

Greg Mankiw Steps in it Again

Labor Mobility, Immigration, Outsourcing
Arnold Kling
The Washington Post reports, Highlighting the challenge a far-flung campaign faces when it comes to message discipline, Romney has had to distance himself from his top economics adviser after Mankiw -- a Princeton-trained economist now teaching at Harvard -- voiced... MORE

Health Care Beliefs and "Sicko"

Economics of Health Care
Arnold Kling
My latest essay says, Illness deprives us of the sense of physical safety. Disease and injury are a throwback to the circumstances in which our physical environment is threatening and overwhelming. Thus, health problems tend to trigger our collectivist instincts.... MORE

Adaptive Efficiency

Cross-country Comparisons
Arnold Kling
Austan Goolsbee writes, Perhaps the greater amount of uncertainty and churn in the world economy in the 1990s is the new norm. Perhaps the 21st century will continually favor those who adjust best to changes. As Professor Van Reenen put... MORE

A Confession: What I Was Thinking the Morning of November 3, 2004

Books: Reviews and Suggested Readings
Bryan Caplan
November 3, 2004 - that's the day the world learned that Bush had been re-elected. I'd like to confess my first reaction to the results. Are you ready for some ugly narcissism? I hope so, because when I saw the... MORE

Thermostats or Muscles?

Behavioral Economics and Rationality
Arnold Kling
If I were to write an intellectual biography of Tyler Cowen, one topic I would cover would be free variables vs. set points. Something is a free variable if we can set it at whatever level we choose. Something has... MORE

Jason Furman on Taxes

Tax Reform
Arnold Kling
Jason Furman sent me an email that I think provides some good background on the economics of taxation. So let me welcome his "guest blog."... MORE

Who Wants Tyler To Be A Millionaire?

Books: Reviews and Suggested Readings
Bryan Caplan
Quick followup on my first guest post for the Economist: I wrote this on Sunday night, when the Amazon rank for Discover Your Inner Economist was about #40,000: Fun as Lott, Frank, and Landsburg’s books are, I don’t expect to... MORE

Tyler Cowen Practices Reverse Psychiatry

Books: Reviews and Suggested Readings
Arnold Kling
For readers who pre-order his forthcoming Discover Your Inner Economist, Tyler Cowen offers access to a secret blog. I did not go for this inducement, but nonetheless found myself holding an advance copy, sent by the publisher. More thoughts below... MORE

MRV update

Political Economy
Arnold Kling
Nick Schulz interviews Bryan Caplan. An excerpt, SCHULZ: William Buckley once said "I would rather be governed by the first 2000 names in the Boston phone book than by the Harvard faculty." Do you disagree? Why? CAPLAN: I'd definitely rather... MORE

Watch the Platforms, Not the Winner

Politics and Economics
Bryan Caplan
I've said it before, and I'll say it again: The well-educated have relatively reasonably beliefs about policy. Puzzle: If you look at voting behavior, education does little to make people more Democratic or more Republican. So what difference does it... MORE

More on the Height of Bravery

Economic Methods
Arnold Kling
A commenter on my post on the slowdown in America's height gains refers to Michael R. Eades, who points out that the original research was pretty much self-refuting. It should be real easy to determine whether the above sociological jibberish... MORE

North on Adaptation

Institutional Economics
Arnold Kling
My second essay on Douglass North is now up. To most economists, the agricultural revolution and the late Industrial Revolution are technological events. That is, the technology "arrived" and spread, leading to social change. Douglass North instead suggests that these... MORE

My Tax System

Tax Reform
Arnold Kling
Jason Furman chides me for not describing my ideal tax system. I once wrote, let me offer the Bleeding-Heart Libertarian approach to income redistribution. Conceptually, it would involve abolishing public education, all forms of free or subsidized health care, and... MORE

Answering Jason Furman

Tax Reform
Arnold Kling
He defends the corporate income tax. All taxes are ultimately paid by people. Just who those people are in the case of corporate taxes is a complicated and controversial question. But in almost any theory, those people are, on average,... MORE

In yet another extremely fair review of my book, Jason Furman ends with a confession: Although largely immune to the widespread biases about economic issues that Caplan attributes to the unwashed masses, I find that I suffer from what he... MORE

Internet and Ideology

Political Economy
Arnold Kling
Russ Roberts writes Seems to me the essence of the web is a decentralized world, a world whether information and power and ideas and solutions don't have to be top-down but are more likely to be bottom-up. It would seem... MORE

The Height of Brave Interpretation

Economics of Health Care
Arnold Kling
Paul Krugman gets excited over research by John Komlos and Benjamin E. Lauderdale. They write, Results: US heights have stabilized at mid-century and a perio0d of stagnation set in with the birth cohorts 1955-74, concurrent with continual rapid increases in... MORE

Happiness Research in Five Minutes: Sylvester and the Magic Pebble

Books: Reviews and Suggested Readings
Bryan Caplan
It's a great day when my four-year-old sons and I agree on a book. (While we're on that subject, Happy Father's Day!) Our latest pick: William Steig's Sylvester and the Magic Pebble. This charming picture book will teach you more... MORE

Plenty to Like in Freedomnomics

Books: Reviews and Suggested Readings
Bryan Caplan
The Levitt-Lott feud is already the stuff of legends. By billing his latest book as "A Rebuttal to Freakonomics and More," Lott has made it clear that the feud's not over. If you're like me, squabbling is a big turn-off,... MORE

Against Adolescence

Economics of Education
Arnold Kling
Robert Epstein says, I believe that young people should have more options—the option to work, marry, own property, sign contracts, start businesses, make decisions about health care and abortions, live on their own—every right, privilege, or responsibility an adult has.... MORE

Neuroscience: Don't Be Intimidated

Behavioral Economics and Rationality
Bryan Caplan
These days, psychiatrists favorite fig leaf for counter-intuitive claims is to hide behind neuroscience. "You think that serial killers are just evil people? Well, obviously you haven't seen these MRIs showing the serial killers have more/less of some brain chemical."... MORE

A Review to Be Envied

Books: Reviews and Suggested Readings
Bryan Caplan
The best sentence I read this week: Brian Doherty has done for twentieth century libertarianism what Tacitus did for first century Rome.That's from Jerome Tucille's review of Radicals for Capitalism. If you haven't read it, you should.... MORE

Myth of the Rational...

Political Economy
Arnold Kling
Very interesting article by Ron Bailey. researchers polled 1,850 Americans about their attitudes toward nanotechnology. Eighty-one percent of those polled had heard nothing at all (53 percent) or "just a little" (28 percent) about nanotechnology. Nevertheless, after being offered a... MORE

Prescriptions for Democracy

Economic Philosophy
Bryan Caplan
The book review in the Economist says that "Mr Caplan is better at diagnosis than prescription." I have to agree. In fact, my diagnosis implies that administering a cure will be very difficult. The irrational majority will oppose any reforms... MORE

Confucianism vs. Irrational Voters

Political Economy
Arnold Kling
Daniel A. Bell writes, The Confucian view is that political leaders should be the most talented and public-spirited members of the community, and the process of choosing such leaders should be meritocratic, meaning that there should be equal opportunity for... MORE

See One-Man, One-Vote Questioned on National TV

Politics and Economics
Bryan Caplan
More educated people think more like economists; in fact, more educated people pretty much have more reasonable views across the board. Furthermore, by a happy coincidence, more educated people are more likely to vote. Once my book gets to policy... MORE

Tyler on Ben

Business Economics
Arnold Kling
Tyler Cowen praises Ben Casnocha in Tyler's New York Times column. But why has America produced so many successful young entrepreneurs? Ben Casnocha, 19, author of the new book “My Start-Up Life: What a (Very) Young C.E.O. Learned on His... MORE

Sense and Nonsense on Tax Reform

Tax Reform
Arnold Kling
Jason Furman, Larry Summers, and Jason Bordoff write We believe these principles should command wide assent as policymakers consider tax reforms, whether incremental or far-reaching: 1. Fiscal responsibility requires addressing both taxes and spending. 2. Rising inequality strengthens the case... MORE

Ratio of Violent to Drug Offenders in Jail

Economics of Crime
Bryan Caplan
These official stats surprised even me. Back in 1980, State correctional facilities had 9 violent criminals for every drug offender. By 2003, that ratio was 2.6:1. Clearly, the War on Drugs launched during my teen years was not just rhetoric... MORE

Why Do the Poor Commit More Crime?

Economics of Crime
Bryan Caplan
Most economists have a glib answer: The worse your legal options, the better crime looks. But the more I think about this response, the weaker it seems. Here's a striking fact about crime: A lot of it is almost never... MORE

Demographics and Income Distribution

Income Distribution
Arnold Kling
Stephen Rose writes, Demographic changes are the most important factors in explaining where productivity growth went. In essence, the United States used some of its growth dividend in the form of more people living alone. Read the whole paper. The... MORE

Hanson Convinces Me that Astrology Is a Science

Economic Methods
Bryan Caplan
The well-educated like to mock astrology; I've done it myself. But today over lunch, Robin Hanson convinced me that it's unfair to do so. There's nothing wrong with studying the predictive power of astrological signs. The only problem is concluding... MORE

A Pigou-Hanson Synthesis for Global Warming

Energy, Environment, Resources
Arnold Kling
Ross McKitrick writes climate models predict that, if greenhouse gases are driving climate change, there will be a unique fingerprint in the form of a strong warming trend in the tropical troposphere, the region of the atmosphere up to 15... MORE

Douglass North at Length

Institutional Economics
Arnold Kling
From my latest essay. In textbook economics, the only external environmental factors that affect the individual are technology and prices. Social norms, habits, and rules play no role. North shows that institutions are fundamental determinants of poverty and prosperity. This... MORE

Ignoring Cost-Benefit Analysis

Institutional Economics
Arnold Kling
The Washington Post reports, The practice of estimating the costs and benefits of U.S. government regulations is "frequently done poorly," with scant evidence that it makes a difference on policymaking. That's the dismal finding of a recent report concluding that... MORE

The Crux of Health Care Reform

Economics of Health Care
Arnold Kling
Clive Crook writes, Much more needs to be done to push employers out of the health insurance market. Most of the reforms now being touted, by Democrats and Republicans alike, aim to do the opposite. ...You could give everybody a... MORE

Economics of College and Sports

Economics of Education
Arnold Kling
Skip Sauer writes, I find the current state of sports a bit puzzling. I spoke at a local function yesterday and was asked the question whether pro sports were "pricing themselves out of the market." This was once an old... MORE

Has the Internet Helped the Socially Awkward?

Economics and Culture
Bryan Caplan
Would you feel uncomfortable striking up a conversation with a stranger? How about over the Internet? If you're like me, you're a lot more outgoing over the Internet than you are in real life. At the same time, though, I... MORE

Victims of Communism Dedication Tomorrow

Economic History
Bryan Caplan
The Victims of Communism Memorial will be dedicated tomorrow in Washington, D.C. This is a great chance to set the record straight, and remember the greatest totalitarian disaster of human history. I wish they had worthier headline speakers than a... MORE

We Have a Winner: Hayek as if Orwell Mattered

Austrian Economics
Bryan Caplan
Here's a sweet rewrite of a typical Hayekian paragraph (Hat tip: Reg Hall): The successful application of science in our society has fostered the belief that the society itself can be similarly manipulated to our benefit. We need powerful arguments,... MORE

Richman on How to Break the Catch-22

Behavioral Economics and Rationality
Bryan Caplan
From Sheldon Richman's review of my book: Caplan's solution is to "rely more on private choice and the free market." Good idea, though you'd have to get people to vote for that, so I'm not sure how effective that will... MORE

Bio-Economics in the Courtroom

Microeconomics
Bryan Caplan
True story: Twin brothers Raymon and Richard Miller are the father and uncle to a 3-year-old little girl. The problem is, they don't know which is which. Or who is who. The identical Missouri twins say they were unknowingly having... MORE

Who Wants to Marry Someone with Self-Control Issues?

Behavioral Economics and Rationality
Bryan Caplan
One of the topics Landsburg tackles in More Sex is Safer Sex is the puzzle of self-control. Why do people on diets "lock their refrigerator doors"? Landsburg's answer: "a taste for self-control confers a reproductive advantange"; or to put it... MORE

Summers to the Dark Side?

Income Distribution
Arnold Kling
David Leonhardt's story on Larry Summers makes it sound like Larry has moved to the dark side. Summers says. “And I think now the challenge is, again, to protect a basic market system based on open trade and globalization, to... MORE

Brad DeLong's Health Care Prescription

Economics of Health Care
Arnold Kling
He proposes, 20% Deductible/Out of Pocket Cap: The IRS snarfs 20% of your family economic income. 5% of it is an increase in taxes (but that replaces your and your employer's current health insurance premiums). 15% of it goes straight... MORE

Does Learning Economics Radicalize the Right?

Behavioral Economics and Rationality
Bryan Caplan
While I was away, I missed a provocative post by Brad DeLong. Leftists need to study economics, but rightists all-too-often have an adverse reaction: By contrast, the neoclassical toolkit can be absolute poison for people right on center. It functions... MORE

Is Voter Irrationality a Catch-22?

Behavioral Economics and Rationality
Bryan Caplan
If voters are as irrational as I say, isn't political reform a hopeless cause? Will Wilkinson and I discuss this (and many other issues) over at Bloggingheads. Think about it this way: To mitigate the damage of irrational majority rule,... MORE

Why Oh Why Can't Hayek Write Better?

Austrian Economics
Bryan Caplan
I've returned from the Institute for Humane Studies' Liberty and Society seminar at Wake Forest University. Back in 1991, I was one of the students; now I'm faculty. Funny thing: The older I get, the more the writing style of... MORE

Immigration Quota Management

Labor Mobility, Immigration, Outsourcing
Arnold Kling
Russ Roberts writes, There's going to be a point system to determine who gets one of the precious 380,000 visas that are up for grabs. Highly educated people get points. People with skills that are in high demand, whatever that... MORE

From a paper in the American Economic Review May 2007, by Anne Carroll, Hope Corman, Kelly Noonan, and Nancy E. Reichman. A maternal physical health condition that predated pregnancy reduces the likelihood that the child loses insurance by 6 percentage... MORE

The Tug-of-War over Capitalism

Political Economy
Arnold Kling
From my latest essay. Those of us on the pro-capitalist (P) side tend to approve of the price system, because we think it helps send signals. Those on the anti-capitalist (A) side see prices as corrupt. For example, when the... MORE

Marriage and Caste

Income Distribution
Arnold Kling
Shelley Lundberg and Robert A. Pollak write, The marriage-rate trajectories of the more- and less-educated began to diverge in the mid-1980s. Although college-educated men and women marry later than those with less education, they are now substantially more likely to... MORE

I Get Noticed

Economics of Health Care
Arnold Kling
James Pethokoukis thinks that Rudy Guiliani has fallen under my spell. what Giuliani is doing is far more radical than his folksy debate answer suggests. Essentially, he is calling for the complete abolition of the current way healthcare insurance operates... MORE

Depression Economics

Economic History
Arnold Kling
My latest essay says, most of the ignorance that plagued policymakers during the 1930's was conceptual. They did not understand the difference between lost resources and under-utilized resources. They did not understand the relationship between financial markets and markets for... MORE

All Depression, All the Time

Economic History
Arnold Kling
Russ Roberts interviews Amity Shlaes. From the notes: NRA even ruled out a consumer's picking out best chickens from a batch—just had to take first ones that came to hand. But consumer and business choice are very important. Concept was... MORE

Outstanding Book, Standout Price

Books: Reviews and Suggested Readings
Arnold Kling
Randall E. Parker's The Economics of the Great Depression costs $125. The contents of the book are outstanding--more on that further on in this post. But the price stands out even more. I believe that one can construct an economic... MORE

Concerns About the Immigration Bill

Labor Mobility, Immigration, Outsourcing
Arnold Kling
James Miller writes, Unskilled Immigrants + Large Welfare State = Higher Taxes I would add Congress + Hundreds of Legislative Pages = Unintended Consequences Up the Wazoo I don't know what the consequences of the law will be, but I... MORE

The Great Depression

Economic History
Arnold Kling
From my latest essay. I would have thought that 1929 should have looked pretty good to people living in the depths of the Depression. But one of the many interesting lessons of Amity Shlaes' new history of the Great Depression... MORE

Paul Ormerod

Economic Methods
Arnold Kling
More than one reader has asked me about Paul Ormerod. Is he an example of an economist who has been unjustly overlooked by the mainstream?... MORE

Douglass North, On One Foot

Institutional Economics
Arnold Kling
Bryan asks, Ayn Rand famously summarized her philosophy while standing on one foot. Arnold, would you be willing to summarize North's "well-developed and persuasive answer" under the same constraint? Anyone else? Before doing that, I want to mention that the... MORE

Intellectual Arrogance

Economic Methods
Arnold Kling
Brad DeLong writes, My view is that the neoclassical economics toolkit can be very, very useful--no, stronger than that, is very useful and necessary--for everybody from the center on left. ...By contrast, the neoclassical toolkit can be absolute poison for... MORE

North on One Foot?

Growth: Causal Factors
Bryan Caplan
Arnold intrigues me:I've said before that the economics that I think gets no love is that of Douglass North, notwithstanding his Nobel Prize. One of the most interesting questions in economics is why we are so wealthy today compared to... MORE

Mindfulness and Mindlessness

Behavioral Economics and Rationality
Bryan Caplan
One common objection to my theory of rational irrationality is that it is psychologically implausible. Am I really saying that people first figure out the truth, then decide whether the material consequences of disregarding the truth outweigh the psychic costs... MORE

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