Bryan Caplan and David Henderson

January 2011

A Monthly Archive (126 entries)

Taking Consumer Surplus Seriously

Revealed Preference
David Henderson
In a comment on my December 21 post, "John Papola on Behavioral Economics," John Papola wrote: [W]hat is consumer surplus really and why does anyone take such an idea seriously? As someone who takes it seriously--I don't know of any... MORE

New from the NBER

Behavioral Economics and Rationality
Arnold Kling
1. (no ungated version found) Kevin S. Milligan and David A. Wise on factors affecting labor force participation of the elderly, an important issue relative to Social Security. 2. Justine Hastings and Olivia S. Mitchell on how savings behavior and... MORE

The Conscience of a Liberaltarian

Economic Philosophy
Bryan Caplan
Immigration restrictions are the single worst policy the First World imposes.  They're a massive violation of human freedom with awful consequences.  That's the main reason I write about the issue so frequently and so doggedly.But to be honest, I have... MORE

Correcting James Kwak

Finance: stocks, options, etc.
Arnold Kling
This post about Freddie Mac and Fannie Mae does not reach a fundamentally unsound conclusion. However, along the way, I think he gets a number of things wrong. First, a minor correction. He writes, Although they had been private, profit-seeking... MORE

What I'm Reading

Books: Reviews and Suggested Readings
Arnold Kling
Back on the Road to Serfdom, a collection of essays edited by Thomas E. Woods, Jr. The authors are mostly people you have not heard of, and the topics are varied. Per Bylund writes (p. 52), the Swedish model is... MORE

Rand the Intuitionist

Economic Philosophy
Bryan Caplan
Last week I saw the debate between my co-author Ilya Somin of the GMU Law School, and Will Thomas from the Atlas Society.  The topic: Are there conflicts of interest between rational people?  If you're inclined to respond, "Of course. ... MORE

Me on Twitter, My New Book on Amazon

Economic Education
Bryan Caplan
I'm now on Twitter as bryan_caplan.  For the first year or so, I'm going to use it to promote my views on kids and parenting, then see how things evolve.  My book on this subject, Selfish Reasons to Have More... MORE

Creative Destruction: Sumner Edition

Growth: Consequences
Bryan Caplan
In mid-2009, I asked, "Creative destruction: what's next?":Everywhere I look, firms are going out of business...What's going to happen now?  Most people probably accept the economically illiterate view that the empty store fronts will stay empty forever.  They don't understand... MORE

Great Stagnation or Lousy Data?

Growth: Causal Factors
David Henderson
Price controls really do matter. Any claim we make based on aggregate data is only as good as those data. Brink Lindsey has pointed out that, contrary to Tyler Cowen, the so-called Great Stagnation that Tyler writes about is not... MORE

Nick Rowe vs. Scott Sumner

Macroeconomics
Arnold Kling
Nick Rowe writes, Monetary disequilibrium theorists will disagree with those Keynesians. We add monetary exchange to the mix. We don't buy and sell output for labour. We don't buy and sell output for bonds. We buy and sell output for... MORE

The Rest of The Great Stagnation

Books: Reviews and Suggested Readings
Arnold Kling
I was planning to review Tyler Cowen's e-book while I read it, but then we lost power, and my Kindle was working while my Internet connection was not, so my comments on the entire rest of the book are below... MORE

Lindsey on the Great Slight Stagnation

Growth: Causal Factors
Bryan Caplan
I haven't read Tyler's much-discussed e-book, but he defended the main theses over a few lunches.  My prediction: When I get around to reading the book, my reaction to the numbers will mimic Brink Lindsey's:Tyler correctly points out that median... MORE

Brett Arends on CPI

Revealed Preference
David Henderson
Brett Arends has an article in the January 26 Wall Street Journal titled, "Why You Can't Trust the Inflation Numbers." His distrust is all in one direction: he thinks the Consumer Price Index understates inflation. My distrust is all in... MORE

Financial Crisis Inquiry Commission

Finance: stocks, options, etc.
Arnold Kling
Does anyone care about the report of the Financial Crisis Inquiry Commission? Keith Hennessey, Bill Thomas, and Douglas Holtz-Eakin write, Brookings Institution economists Martin Baily and Douglas Elliott describe the three common narratives about the financial crisis. The first argues... MORE

Roosevelt and the Puritans

Economic History
Arnold Kling
Razib Khan writes, Walter Russell Mead has a fascinating blog post up, The Birth of the Blues. In it, he traces the roots of modern American "Blue-state" liberalism back to the Puritans, the Yankees of New England. This is a... MORE

I am constantly amazed by bloggers and commenters who sneer that I do not understand macroeconomics in general or aggregate demand in particular. Often, the most sneering comments come from people who have no clue about the way economists use... MORE

Washington Snowstorm and Community

Economics and Culture
David Henderson
One of the things I hated most about living in Washington, D.C. during the two-and-a-half years that I was in the Reagan administration was the way almost everyone there "breathed, slept, and ate" government. Of all the people in the... MORE

Fighting With Numbers

Arnold Kling
Tyler Cowen writes, Here is coverage from Arnold Kling, though I think he (like some MR commentators) is spending too much time on impressions and not considering (at all) the numbers presented in chapter one. The numbers do not tell... MORE

Immigration: Reply to Ozimek

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
Adam Ozimek uses my own words against me to defend liberaltarianism from my critique:I disagree with Bryan's presumption that domestic distribution actually encourages that much of a restriction on immigration, or at least that the immigration restrictions we have would go... MORE

An Economic Insight on an Old Joke

Labor Market
David Henderson
Supply curves slope up. Here's the joke: Man to woman: Would you sleep with me for one million dollars? Woman: Sure. Man: How about for ten dollars? Woman: What do you think I am? Man: We've already established what you... MORE

The Great Stagnation, Chapter One

Books: Reviews and Suggested Readings
Arnold Kling
I will review Tyler Cowen's new Kindle single one chapter at a time. My father always said that the first iron law of social science is, "Sometimes it's this way, and sometimes it's that way." In other words, beware of... MORE

Open Immigration: How Many Would Come?

Labor Market
David Henderson
What I found most interesting in the comments on my latest post and in Bryan's response to my post was the wide range of views about how many immigrants would come to the United States in just a few years... MORE

Reply to David on Immigration

Economic Philosophy
Bryan Caplan
Last month I digested my position on the political externalities of immigration, but I'm happy to elaborate.  David writes:I could imagine that leading to an additional 300 million people coming into the United States within a couple of years. My... MORE

Questions on Immigration

Labor Mobility, Immigration, Outsourcing
David Henderson
While I agree with co-blogger Bryan that it would be desirable to let way more people into the United States, I haven't seen him answer in a satisfactory way some of the arguments against completely open borders. Assume that the... MORE

Open Borders Haiku

Labor Mobility, Immigration, Outsourcing
Bryan Caplan
Markets champ at bit To end global poverty But statists say no.... MORE

Light Blogging

Political Economy
Arnold Kling
I have very little time for blogging this week. Here are some things that would interest me if it were a normal week: 1. Ronald Bailey on various studies of how libertarians differ from others in terms of moral outlook.... MORE

The Great Depression with Great Brevity

Economic History
Bryan Caplan
Sumner:My research on the Great Depression convinced me that it was two depressions, occurring one right after the other.  A demand-side recession that began around September 1929, and a supply-side depression that began in July 21, 1933 (with another demand... MORE

David Gordon: Harvard University Press Leans Left

Economic Philosophy
David Henderson
The latest issue of Econ Journal Watch is out today and one of the articles is by David Gordon. It's titled, "The Ideological Profile of Harvard University Press: Categorizing 494 Books Published 2000-2010." In it, Gordon methodically goes through 494... MORE

The Stranger

Economic Philosophy
Bryan Caplan
What do you call a man you never met?  A stranger.What are you morally forbidden to do to a stranger?  You may not murder him.  You may not attack him.  You may not enslave him.  Neither may you rob him.What... MORE

More Liberaltarian Than Thou

Economic Philosophy
Bryan Caplan
Karl Smith calls this line from Will Wilkinson "liberaltarianism in one sentence":It's best to just maximize growth rates, pre-tax distribution be damned, and then fund wicked-good social insurance with huge revenues from an optimal tax scheme.Smith adds:A core hope of... MORE

The Problem with Schools

Economics and Culture
Arnold Kling
Bryan is not the first one to worry about schools. In 1962, John Holland Snow accused the educational establishment of subversion. I believe that an educational movement or philosophy which minimizes or denies the possibility of our people and institutions... MORE

Corporations

Institutional Economics
Arnold Kling
I would like to try to answer the question that I ducked at the Disputation on Friday evening. That question was whether corporations should have the same rights as people. One panelist, Lisa Graves, answered "no" emphatically (to loud applause,... MORE

The Disputation

Political Economy
Arnold Kling
You can watch here. Move the slider to around 35 to 40 minutes in. I call it a disputation because, given the differences in religious beliefs, Tim and I were not really going to change any minds.... MORE

Comparing Mortgages

Finance
David Henderson
I'm in the midst of a refinance of my mortgage, a very straightforward one because our equity in the house is over 80 percent of even a low-ball estimate of value. I was talking to the bank representative early in... MORE

When I denounce Hayek's heinous writing style, many libertarians retort that Mises was even worse.  Their claim baffles me.  Yes, you can fault Mises' organization; do you really want to begin your treatise on economics with 89 pages of Kantian... MORE

House Price Behavior

Books: Reviews and Suggested Readings
Arnold Kling
I am going to react to three things: Nick Rowe talks about the fact that housing transaction volume is higher when prices are rising; Scott Sumner's latest attempted swindle; and the paper by Steven Gjerstad and Vernon L. Smith in... MORE

Unemployment and Wages: Find the Flaw

Labor Market
David Henderson
Here's a paragraph from a recent David Leonhardt story in the New York Times: In Germany and Canada, some companies and workers have averted layoffs by agreeing to cut everyone's hours and, thus, pay. In this country, average wages for... MORE

More Notes for a Debate

Upcoming Events
Arnold Kling
What have I gotten myself into?. You can watch tonight (Friday, January 21st) on C-span. I have never been booed before, but that seems likely. Tim Carney and I will play the role of Christians in this Roman lion theater,... MORE

The Great Reconfiguration, Again

Growth: Causal Factors
Arnold Kling
Jim Tankersley writes, The Great Recession wiped out what amounts to every U.S. job created in the 21st century. But even if the recession had never happened, if the economy had simply treaded water, the United States would have entered... MORE

Media Bias Bias

Behavioral Economics and Rationality
Bryan Caplan
Question: Why is bias in the media so much more on our minds than bias in the schools?  Both the media and schools are largely in left-wing hands - and the content reflects this fact.  But consider the stark contrast... MORE

Peter Thiel, Cowenian

Growth: Causal Factors
Arnold Kling
In an interview, Thiel says, the problem was that everybody had tremendous expectations that the country was going to be a much wealthier place in 2010 than it was in 1995, and in fact there's been a lot less progress.... MORE

Hayek in Tucson

Central Planning vs. Local Knowledge
David Henderson
On January 12, Congresswoman Nancy Pelosi stated the following about the Tucson shootings: Whether it's the people who responded immediately very courageously, whether it's the first responders who came to the scene in a matter of minutes, whether it's the... MORE

The Great Reconfiguration

Labor Market
Arnold Kling
Michael Mandel writes, This first chart shows the change in wage and salary payments by major industry from 2000-2009, adjusted for inflation, using BEA data. We see that healthcare and social assistance generated $210 billion in real wage gains from... MORE

Housing Finance Reform

Finance: stocks, options, etc.
Arnold Kling
Peter J. Wallison, Alex J. Pollock, and Edward J. Pinto write, Our alternative approach is to ensure that only prime quality mortgages, which comprise the vast majority of US mortgages, are allowed into the securitization system. The very low delinquency... MORE

Henderson on Stossel

Fiscal Policy
David Henderson
I was on the John Stossel show on Fox Business Channel last week to discuss my Mercatus study of how the Canadian government turned budget deficits into surpluses. It's called "Canada's Budget Triumph." Here's the segment I was in. It's... MORE

Notes for a Debate

Political Economy
Arnold Kling
On the topic of corporate power. Open to the public. This Friday evening, January 21st. 7:30 PM. Washington Plaza Hotel, 10 Thomas Circle, in NW Washington DC. Frederick Hall. My notes follow:... MORE

Fixing Montgomery County Education

Economics of Education
Arnold Kling
A commenter asked what I would do differently. Here goes: 1. Make sure that when teachers move into administrative jobs (other than principal), they take a huge pay cut. I do not mind paying a classroom teacher a big salary.... MORE

Poorer than we thought?

Growth: Consequences
Arnold Kling
Evidently Tyler Cowen will offer that message in an "e-book single." From the description: In a figurative sense, the American economy has enjoyed lots of low-hanging fruit since at least the seventeenth century: free land; immigrant labor; and powerful new... MORE

Robert Murphy Thinks I Fell for a Swindle

Austrian Economics
Arnold Kling
He writes, Contrary to Sumner, there is no huge reallocation of construction workers (from January 2006 to April 2008) that Kling or the Austrians must explain. Scott Sumner used housing starts to suggest that most of the decline in housing... MORE

The Enchantment of the Democratic Process

Political Economy
Arnold Kling
Mark Thoma writes, the real question is why so many people have stopped believing that the state has the authority to be the arbiter of last resort in a pluralistic society. Read the whole thing, which starts out as an... MORE

Worth Reading

Austrian Economics
Arnold Kling
William Easterly on Hayekian order. Impossible to excerpt.... MORE

The Looting of a County

Political Economy
Arnold Kling
Montgomery County, Maryland, where I live, is one of the nation's richest counties, thanks to its proximity to the capital of the empire. A local newspaper reports, The core belief for Prouty and members of the MCEA is that the... MORE

Why Don't Big Firms Fire the Sick?

Economics of Health Care
Bryan Caplan
My friend in the insurance industry once let me in on a little secret: De facto, though not de jure, virtually every big firm is also a health insurance company with an exclusive clientele: Its own labor force.  Once a... MORE

If They Had Asked Me

Labor Market
Arnold Kling
The New York Times asks various folks for their view of why jobs have not come back during this recovery. I recommend taking a longer view of the process. I think that a major reconfiguration of the U.S. economy has... MORE

Tunisia: Tullock's Model Fits

Public Choice Theory
David Henderson
The first time I met Gordon Tullock, as I tell here, was in the fall of 1971 when he gave a paper at a conference at the University of Western Ontario. The paper was titled "The Paradox of Revolution." Here's... MORE

A True Conversation on the Political Externalities of Immigration

Behavioral Economics and Rationality
Bryan Caplan
Will immigrants from dysfunctional countries move to the West, become citizens, then vote to kill the goose that lays the golden eggs?  I've addressed this common fear before - see here, here, and here for starters.  But recently, I discussed... MORE

Thoughts on Immigration

Labor Mobility, Immigration, Outsourcing
David Henderson
I don't have much to add to Bryan's thoughts on conservative "overlordship" re immigration. But I do want to reply to some points that his commenters raised. . Commenter Tom Dougherty argues that even though landlords, employers, and grocers are... MORE

Paul Seabright on Free-Market Ideology

Finance: stocks, options, etc.
Arnold Kling
He writes, The reason why it was so easy to sell securities rated triple-A -- like the higher tranches of the now notorious collateralized debt obligations -- was not that every potential buyer was a true believer in the theory... MORE

Reconfigurations

Growth: Consequences
Arnold Kling
Consider the following hypotheses. 1. The Great Depression and World War II ended the last vestiges of the Jeffersonian agricultural economy in America. The yeoman farmer disappears. 2. The current recession is accelerating a transition away from the industrial era... MORE

The Overlords of Immigration

Economic Philosophy
Bryan Caplan
In his Cato Unbound essay "Against Overlordship," my colleague Dan Klein argued that the heart of the modern liberal position is the idea that the citizens of a country collectively own their country:Although they may not be fully conscious of... MORE

Missing Politics

Politics and Economics
Bryan Caplan
Two decades ago, I asked a libertarian professor, "Is there any socialist analog of the Institute for Humane Studies?"  "Sure," he replied.  "Harvard University, Columbia University..."  Does anyone know of a less flippant response to my question?In a similar vein,... MORE

Nick Rowe notes that Spain and Ireland also have seen unusually high productivity, and hence high unemployment, relative to output during this recession. Here's my guess. It's because all three countries had a big fall in construction. But what's so... MORE

For Discussion

Politics and Economics
Arnold Kling
From Mario Rizzo: The unreasonableness, or so it seems, of our political culture is, to a large extent, a product of the kind of special interest redistributionist society we have built. Read the whole thing. My thoughts: 1. I have... MORE

Tyler's impressed that spending and output are up, but employment isn't.  But the simplest story is just that employment is becoming a lagging indicator.*  Consider: After the last "jobless recovery," the unemployment rate still fell to 4.9% by the end... MORE

AS vs. PSST, again

Labor Market
Arnold Kling
The debate is hotting up, as our friends across the pond would say. Some random comments. 1. The Washington Post reports that some on the left want to see older workers encouraged to retire, to make room for young workers.... MORE

Denmark

Institutional Economics
Arnold Kling
Scott Sumner writes, Denmark is much more decentralized. The same sort of policies adopted in Denmark would work less well in the US, because we are much more centralized, and hence far less democratic (if you define democracy properly, where... MORE

For Economics Teachers

Growth: Causal Factors
Arnold Kling
We call this the I, Toaster video. It would be a great discussion starter for an economics class, just because it does not intend to teach an economics lesson. Thanks to Don Boudreaux for the pointer.... MORE

Bet on Inflation

Monetary Policy
David Henderson
Two days ago, I bet a former student of mine, Thomas Strenge, on the inflation rate for the next year. He's betting that the CPI-U between December 2010 and December 2011 (reported January 14, 2011 and January whatever, 2012) will... MORE

Scott Sumner Fights Dirty

Macroeconomics
Arnold Kling
He looks at data. Housing starts peaked in January 2006, and then fell steadily for years: January 2006 -- housing starts = 2.303 million, unemployment = 4.7% --April 2008 -- housing starts = 1.008 million, unemployment = 4.9% --October 2009... MORE

Two Notes on PSST

Macroeconomics
Arnold Kling
1. Some folks on the right are bothered by the term "sustainable" in patterns of sustainable specialization and trade. They seem to be afraid that I am some sort of tree-hugging wuss. Or that I think patterns of trade need... MORE

What Type of Unemployment?

Macroeconomics
Arnold Kling
Brad DeLong writes, It seems fairly clear to me that calling this "structural change" is somewhat of a misnomer. Structural change is when workers find jobs in expanding industries. That happens overwhelmingly during booms. For workers to lose jobs in... MORE

The Euro

Optimum Currency Areas
Arnold Kling
Paul Krugman writes a pre-mortem. You still hear people talking about the global economic crisis of 2008 as if it were something made in America. But Europe deserves equal billing. This was, if you like, a North Atlantic crisis, with... MORE

A Nation of Cowards: The Case of World War II

Behavioral Economics and Rationality
Bryan Caplan
David says I "overstate" the extent of human cowardice.  If, per the title of his post, I claimed that people "always" avoid war, he'd be right.  But these are my original words:Yes, the man in the street often says he's... MORE

PSST vs. the Aggregate Production Function

Macroeconomics
Arnold Kling
Regular readers know that I am trying to nudge them toward a different paradigm in macroeconomics. I want to get away from thinking of economic activity as spending, and instead move toward thinking of it as patterns of sustainable specialization... MORE

Do People Always Avoid War?

Labor Market
David Henderson
In two separate blog posts, co-blogger Bryan addresses my comments on pacifism and then argues that people generally avoid fighting. I think he makes good points but he way overstated. First, Bryan stated: My prediction: If someone suddenly tried to... MORE

Reflections on Freedom in New York

Business Economics
David Henderson
I'm stuck in New York after my early a.m. flight out was cancelled. Because the hotel I was in had no rooms available for tonight, I had to find another hotel. Fortunately, the Holiday Inn Express three short blocks away... MORE

The Plight of the Marginal College Grad

Economics of Education
Arnold Kling
Richard Vedder and co-authors analyze the numbers. More than one-third of current working graduates are in jobs that do not require a degree, and the proportion appears to be rising rapidly...60 percent of the increased college graduate population between 1992... MORE

I Chose Liberty

Books: Reviews and Suggested Readings
Bryan Caplan
Walter Block's book of libertarian autobiographies is finally in print - and available as a free pdf to boot.  Many of your favorites spill their hearts out therein, including me, Tyler Cowen, Pete Boettke, Judge Napolitano, and even Gordon Tullock... MORE

Foreclosure Mess

Institutional Economics
Arnold Kling
Megan McArdle asks, why aren't libertarians proposing solutions for the foreclosure crisis? Actually, I have written, What has emerged in recent weeks as "the foreclosure scandal" represents the collision of this 21st-century computerized, global financial system with an 18th-century legal... MORE

FP2P Kindle Price Cut

Books: Reviews and Suggested Readings
Arnold Kling
For those of you who have been holding out on obtaining the Kindle edition of From Poverty to Prosperity because of the exorbitant cost, you are in luck. Amazon finally cut the price below $10.... MORE

Are Governors and Mayors Scapegoats for the Fed?

Behavioral Economics and Rationality
Bryan Caplan
Here's a passage from the discussion section I'm writing for "Systematically Biased Beliefs About Political Influence": Normal 0 MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin:0in; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New... MORE

One story of the 1930's, which I discussed recently, is that agricultural workers were displaced by tractors and other forms of mechanization. I find this an interesting story, and I went on to I post Who Will Write This Paper?... MORE

War: What Is It Here For?

Behavioral Economics and Rationality
Bryan Caplan
Albert Jay Nock's classic essay "Peace the Aristocrat" begins promisingly: The peace advocates are notably disposed to rest their case with proving that war is irrational, illogical, horrible, and costly; and they appear to think it quite enough to do... MORE

Colander on Complexity

Economic Methods
Arnold Kling
Since I brought up the topic, a commenter pointed me to the Wikipedia article on complexity in economics, and that in turn referred to David Colander. [complexity theory] is highly mathematical, and, as I stated above, accepts the need for... MORE

John Green on Freedom

Regulation
David Henderson
It has become so standard, when a family has had a tragedy, for a family member to advocate some further restriction on freedom even if that restriction would create more tragedies than it would prevent. It's kind of understandable. When... MORE

Who Will Write This Paper, No. 2?

Labor Market
Arnold Kling
Title: Fixed Worker Costs and the Distribution of Leisure Abstract: In an earlier paper, we showed that a change in technology can lead to an increase in leisure. In this paper, we explain how an increase in leisure can be... MORE

Forecasting for a Swing

Economic Methods
Arnold Kling
Joe Keohane writes about Nouriel Roubini, For a prophet, he's wrong an awful lot of the time. In October 2008, he predicted that hundreds of hedge funds were on the verge of failure and that the government would have to... MORE

Complication vs. Complexity

Macroeconomics
Arnold Kling
In an interview, Ben Ramalin says, We treat complex things as if they were merely complicated... distinguished between complicated systems, which can be modeled mathematically, and complex systems, for which there is no mathematical model which can say, if X... MORE

The Labor Market for Philosophers

Labor Market
Bryan Caplan
Michael Huemer isn't just my favorite living philosopher; he's also amazingly perceptive about the real world.  The latest example: His FAQ on "Should I Go to Grad School in Philosophy?"  Highlights:7.    But I'm really smart, so I'll be one of the... MORE

Henderson on John Stossel's Show

Upcoming Events
David Henderson
Today I'm flying to New York to tape a segment tomorrow for John Stossel's show on Thursday, January 13. It's on the Fox Business Network @ 9:00 p.m. and midnight EST Thursday and @ 9:00 p.m. and midnight EST on... MORE

An increase in U.S. aggregate labor demand reflected in rising job vacancies has not been accompanied by a similar decline in the unemployment rate. Some analysts maintain that unemployed workers lack the skills to fill available jobs, a mismatch that... MORE

Temptations to Cruelty

Family Economics
Bryan Caplan
The most bizarre thing about Amy Chua's essay is that she combines contempt for drama with fanatical devotion to music.  School plays are too frivolous for words:[N]o Chinese kid would ever dare say to their mother, "I got a part... MORE

Does Asian Parenting Cause Asian Success?

Family Economics
Bryan Caplan
Scholars familiar with twin and adoption research will be sorely tempted to summarily dismiss Yale Law professor Amy Chua's recent defense of Chinese parenting.  It's hard to find a stauncher defender of what Judith Harris called "the nurture assumption."  Chua:A... MORE

McArdle Waves the White Flag

Fiscal Policy
David Henderson
In a post on a serious proposal to almost double the Illinois state income tax, Megan McArdle writes: The income tax increases, on the other hand, are both workable and necessary. Conservatives will holler, but Illinois is not going to... MORE

The Attitude

Politics and Economics
Arnold Kling
David Cole writes, We, the Real Americans, in order to form a more God-Fearing Union, establish Justice as we see it, Defeat Health-Care Reform, and Preserve and Protect our Property, our Guns and our Right Not to Pay Taxes, do... MORE

Asian Parenting Bleg

Family Economics
Bryan Caplan
Are there any genetically informed studies of the effects of Asian parenting?  Google Scholar has zero hits for the union of "Asian parenting" and "shared environment."  And in all my years of reading this literature, I can't recall a single... MORE

Let the Debate Begin

Political Economy
Arnold Kling
So says Uwe E. Reinhardt. Even the word private in "private charitable giving" is not completely accurate. A more accurate term would be "private donations coupled with involuntary, tax-financed public subsidies." If progressives want to attack private charity because they... MORE

Advantage Kant

Economic Philosophy
Bryan Caplan
Tyler (via Ken Feinstein) says I should raise my opinion of Kant.  After reading this paragraph, I can only say: Done!The usual touchstone of whether what someone asserts is mere persuasion or at least a subjective conviction, i.e., firm belief,... MORE

What is Cornucopia? Boudreaux vs. DeLong

Energy, Environment, Resources
David Henderson
Blogger and GMU economics professor Don Boudreaux has challenged blogger and Berkeley economics professor Brad Delong to a bet. Brad has turned down the bet and proposed his own bet, a bet that Don has not accepted. It seems to... MORE

Who Will Write This Paper?

Labor Market
Arnold Kling
Perhaps Cowen and Lemke. Here is my sketch: Title: Technology Shifts and Unemployment Abstract: We present a model in which shifts in technology cause unemployment. There are two types of workers, which we call Type C and Type S. A... MORE

The Case Against Latin

Economics of Education
Bryan Caplan
The great Frederic Bastiat was an eloquent enemy of Latin in the curriculum.  In the Middle Ages, he admits, "There were only Latin books; writing was done only in Latin; Latin was the language of religion; the clergy could teach... MORE

Cowen and Lemke on Unemployment

Labor Market
Arnold Kling
They write, The fact that the United States has pre-crisis levels of output with fewer workers raises doubts as to whether those additional workers were producing very much in the first place. If a business owner fires 10 people and... MORE

Upcoming Seminars

Economic Education
Bryan Caplan
I'll be lecturing at the Students for Liberty conference in DC (February 18-20) and the Institute for Humane Studies Liberty and Society seminar in Philadelphia (June 11-17).  Hope to see you there.... MORE

Unemployment: Why Don't Employers Fish More?

Macroeconomics
Arnold Kling
I am trying to sort out my thinking on unemployment in the Recalculation Story. I think that a basic question is this: when workers lose jobs because a sector needs to shrink, this creates a pool of unemployed workers. Why... MORE

What Will You Do If Someone Tries to Kill You?

Economic Philosophy
Bryan Caplan
I largely agree with David Henderson's remarks on foreign policy (here, here, and here), but his initial post makes a rather improbable claim.  Here's David:As I once said, after someone in a roundtable discussion had called me a pacifist, "If... MORE

Engage Pacifism

Economic Philosophy
Bryan Caplan
It's time for a belated reply to Arnold's critique of pacifism.  I wish Arnold would engage the three-premise argument I actually made, but I'll take what I can get.  Here's Arnold:I just cannot buy into pacifism as some libertarians express... MORE

Second Thoughts on Economics

Economic Education
Arnold Kling
Just in time for the annual meetings of the American Economic Association, Russ Roberts writes, modeling economic behavior using the tools of the physical sciences in hopes of attaining the holy grail of a full-blown, accurate, model that can track... MORE

John Goodman on Magnitude of Health Problem

Economics of Health Care
David Henderson
We now know how many people have the problem most often cited as the reason for last years' health overhaul legislation. Answer: 8,000 No, that's not a misprint. Out of 310 million Americans, only 8,000 people have the problem given... MORE

Falkenstein vs. Sumner

Finance: stocks, options, etc.
Arnold Kling
Scott Sumner writes, I define "finance" as the business of allocating capital, which is a bit different from how it shows up in the national accounts. For instance, I believe the CEOs of major non-financial companies are being paid (in... MORE

I am sorry, but I do not believe it is relevant to ask how educated they are. Using sanitation workers as an example, I would put it this way. If you do not have enough sanitation workers because you cannot... MORE

The Locavore's Dilemma

International Trade
David Henderson
The Feature Article on Econlib this month is "The Locavore's Dilemma" by Jayson L. Lusk and F. Bailey Norwood, both agricultural economics professors at Oklahoma State University. Its subtitle, "Why Pineapples Shouldn't be Grown in North Dakota," is, of course,... MORE

Speaking of Science Funding

Business Economics
Arnold Kling
I attended a set of two panels this morning at the American Association for the Advancement of Science, touting "convergence," meaning joint work involving engineering and the biological sciences (with other disciplines as well). The scientists were talking their book,... MORE

Labor Market Commentary

Labor Market
Arnold Kling
Two pointers from the indispensable Mark Thoma. 1. Catherine Rampell writes, A large fraction of displaced workers who have found new jobs have had to switch careers, and most of those career-changers have downgraded to a lower-paying job, according to... MORE

My Proposal for a Code of Ethics for Economists

Economic Methods
Arnold Kling
There has been much discussion of late of a code of ethics for economists, with a focus on disclosing personal interests. I would go in a different direction. My code of ethics would consist of one line: Take into account... MORE

Health Care: Costs, Spending, and Choices

Economics of Health Care
David Henderson
Social Security is widely believed to protect its recipients from inflation because benefits are indexed to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). However, the CPI-W may not accurately reflect the experience of retirees for... MORE

Robin Hanson on the Singularity

Growth: Consequences
Arnold Kling
Self-recommending, until I get the 90 minutes to listen. I have heard Robin talk on this subject, and he is fascinating.... MORE

An Assignment for Progressives

Finance: stocks, options, etc.
Arnold Kling
First, read Peter Wallison's op-ed. Congress should assure that housing does not again make itself a ward of the government. Then, write an essay that consists of something other than ad hominem attacks on Wallison. Instead, write an essay that... MORE

Paragraphs to Ponder

Economics of Health Care
Arnold Kling
From the New York Times: Because payroll taxes and firing costs are still so high, businesses across Southern Europe are loath to hire new workers on a full-time basis, so young people increasingly are offered unpaid or low-paying internships, traineeships... MORE

Michael Barone on Thomas Bruscino

Books: Reviews and Suggested Readings
Arnold Kling
Again from the Claremont Review of Books, again gated. One enormous divide--far wider than it is today--was between North and South. Between 1865 and 1940, when more than 30 million foreign immigrants moved to the North, only about one million... MORE

Harvey Mansfield on Kenneth Minogue

Books: Reviews and Suggested Readings
Arnold Kling
From the Claremont Review of Books, but gated. Thus the fundamental problem in western democracy now, as Minogue sees it, arises from inequality not in wealth but in wisdom or competence...The intellectual elite behind the politico-moral project that he opposes... MORE

Hazlett on Kahn

Regulation
David Henderson
My friend and fellow UCLA alum, Tom Hazlett, has a beautiful appreciation of Fred Kahn in the Financial Times (HT to Don Boudreaux). Tom is one of the best writers in economics. I learned so much from this relatively short... MORE

Further Advice for a Future Regulator

Cost-benefit Analysis
David Henderson
Tyler Cowen posted a while ago about some advice for a future regulator. I thought the best comment adding advice was this one: Do your best to fight for freedom by attempting to combat any proposed new regulations and undermine... MORE

The Perils of Amateur Epidemiology

Economic Methods
Arnold Kling
Robin Hanson cites one paper that says that higher unemployment reduces mortality, perhaps because of healthier eating, while another paper says that higher unemployment reduces the consumption of fruits and vegetables. He writes, Either we can cross "eat healthier" off... MORE

Arnold Kling with a Minus Sign

Political Economy
Arnold Kling
I don't know any other way to describe Peter Wilby. Unfortunately, private charity doesn't always have the same priorities as public policy. In the UK, the most popular causes are children, animals, cancer and lifeboats. Overseas causes, for relief of... MORE

Reply to My Critics on Foreign Policy

Economics of Crime
David Henderson
I asked a hypothetical question in my previous post today. I'm glad that Prakhar Goel, one of the three people to whom I addressed the question, was willing to participate. Thank you, Prakhar. And, unlike commenter TA, I don't think... MORE

Question for My Foreign-Policy Critics

Economics of Crime
David Henderson
In the comments on my post yesterday, Prakhar Goel, Patrick R. Sullivan, and Shayne Cook were critical of my views on U.S. foreign policy. All three implicitly or explicitly seemed to favor the U.S. government's attack on Afghanistan in 2001.... MORE

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