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July 2017

A Monthly Archive (52 entries)

Henderson and Cochrane on Climate Policy

Energy, Environment, Resources
David Henderson
Climate change is often misunderstood as a package deal: If global warming is "real," both sides of the debate seem to assume, the climate lobby's policy agenda follows inexorably. It does not. Climate policy advocates need to do a much... MORE

Macron, economic nationalist

Alberto Mingardi
Monsieur Macron has won the recent elections in France as, I would say, the more "market-friendly" option available, vis-à-vis the rampant economic nationalism of Madame Le Pen. Certainly, he won the election as the most "europhile" option available. And yet,... MORE

The economic news is not good

Politics and Economics
Scott Sumner
Ramesh Ponnuru has a characteristically excellent piece on recent controversies within the Trump Administration. But I'd quibble slightly with this observation: There was also an opportunity cost to Scaramucci's remarks. Trump administration officials sometimes complain that all the good news... MORE

"Capitalism" has become a fighting word in the battle between East and West and for men's minds everywhere; and, like all slogans, it means many things to many men. To some "capitalism" is a term of opprobrium, signifying the oppression... MORE

A Knight Tale

History of Economic Thought
David Henderson
In the picture above, I'm wearing the actual poker hat that Frank Knight wore when he worked on articles. Here' the tale of how that came to be. In the Spring of 2002, I was teaching a microeconomics class... MORE

Frank Knight's Case for Communism

History of Economic Thought
David Henderson
When I posted on Frank Knight's case for Communism the other day, I also put it on up on Facebook and had some people wondering about context. Those of us who are fans of Frank Knight don't think of... MORE

Do you really want to include capital gains?

Income Distribution
Scott Sumner
I frequently argue that income is a meaningless concept, as it includes capital gains (and losses) in asset values. Indeed the problem is even more basic, as income mixes labor income and all investment income, which is like adding apples... MORE

Three Thumbsuckers

Regulation
David Henderson
When I was writing a lot for Fortune in the late 1980s and early to mid-1990s, an editor of one of my articles casually referred to it as a "thumbsucker." I thought it was an insult, but he explained... MORE

Caplan in Paris

Economic Philosophy
Bryan Caplan
I'm speaking in Paris this Thursday for Students for Liberty.  Details here.P.S. Here's what I thought the last time I was in Paris nine years ago.... MORE

Joseph Rago RIP

Economics of Health Care
David Henderson
Wall Street Journal editorial writer Joe Rago died this week at the age of 34. If you read the Review and Outlook editorials--the unsigned editorials that are published on the left hand side of the editorial page and reflect the... MORE

Frank Knight on John B. Watson

History of Economic Thought
David Henderson
I dug out of my library a famous unpublished (until 1991) 1932 mimeograph (those under age 45 should look up that term) article by Frank H. Knight. The article is titled "The Case for Communism: From the Standpoint of... MORE

Sudan Sanctions and My Neighbor's Cat

International Trade
David Henderson
Diplomats here expect Washington to drop sanctions in the fall, as planned during the final days of the Obama administration, not least because they failed to achieve some key goals. "When the sanctions were implemented, the hope was that there... MORE

How Conscious Is Your Robot?

Behavioral Economics and Rationality
Bryan Caplan
Now that I've studied the article that inspired Robin's recent bet, I'm completely flabbergasted by his reaction.  Here's the key figure in the original paper, showing how respondents ranked the mentality of thirteen characters.The Experience factor explains 88% of the... MORE

Getting Around Economic Sanctions in Sudan

International Trade
David Henderson
When I started the Ph.D. economics program at UCLA in September 1972, one of the first things we graduate students heard that we should be doing different in our daily lives was to subscribe to the Wall Street Journal. If... MORE

De-Identifying Race and Ethnicity Reduces Bias

Unintended Consequences
David Henderson
But not in the way you might expect. What we found is that de-identifying applications at the shortlisting stage of recruitment does not appear to assist in promoting diversity in hiring. In fact, in the trial we found that overall,... MORE

Germany is not the problem

International Macroeconomics: Exchange Rates, International Debt, etc.
Scott Sumner
The Economist is probably the best magazine in the world, but a recent cover story on "The German problem" is just appalling: For a large economy at full employment to run a current-account surplus in excess of 8% of GDP... MORE

Murder: A Socratic Dialogue

Behavioral Economics and Rationality
Bryan Caplan
Glaucon: Have you heard the news, Socrates?  A scimitar-wielding Persian maniac just cut down three Corinthians in cold blood.Socrates: A ghastly crime.  But why are you telling me? Glaucon: Because it just happened! Socrates: So I gathered. Glaucon: In Corinth!  That's... MORE

Enough to Buy Back the Product

Business Economics
David Henderson
I was on an email discussion this morning with some free-market economists and some economically literate fans of free markets. One of them surprised me with this statement: I always tell my students the Henry Ford $5 a day... MORE

Is Russia's Government Hostile?

Foreign Policy
David Henderson
One of the things that I think affects people's view about the Trump administration vis a vis Russia is their view of Russia. In a recent article, my friend Steve Chapman, columnist at the Chicago Tribune, writes: If this was... MORE

Game of Thrones is back. The HBO series (not to mention the novels by George R.R. Martin) is an exciting part of our popular culture, but it is also obviously about power plays and, er, politics. So, for once,... MORE

Em Bet?

Behavioral Economics and Rationality
Bryan Caplan
After discussing a ten-year-old paper on empirical philosophy of mind, Robin proposes a remarkable bet:I'm also pretty sure that while the "robot" in the study was rated low on experience, that was because it was rated low on capacities like... MORE

Sorry, I don't get the joke

Monetary Policy
Scott Sumner
In January 2008, the US economy had fallen into recession and Ben Bernanke was already supportive of fiscal stimulus: Ben S. Bernanke, chairman of the Federal Reserve, has told lawmakers that he can support tax cuts or spending measures to... MORE

Democratic ideology unchained

Books: Reviews and Suggested Readings
Contributing Guest
by Hartmut Kliemt Nancy MacLean's book Democracy in Chains (Viking 2017, henceforth "DIC") informs a surprised academic public to whom such a thought never would have occurred without her creativity that the late James M. Buchanan has throughout his... MORE

Farrell and Teles on Nancy MacLean

Public Choice Theory
David Henderson
A deep, historical study of public choice would be welcome, and Buchanan's role in the development of the thought and organizational infrastructure of the right has generally been overlooked. Unfortunately, the book [by Nancy MacLean] is an example of precisely... MORE

What Bernanke was up against

Monetary Policy
Scott Sumner
David Levey directed me to a post by Douglas Campbell describing the climate of opinion within the Fed during the Great Recession: Even as the economy was tanking in 2008 and 2009, Bell writes that "Warsh adopted a skeptical and... MORE

Amazon Prime's Contribution to Northern Canada

Business Economics
David Henderson
The consensus in Iqaluit seems to be that everyone with a credit card has an Amazon Prime membership. That's because people can often find groceries cheaper online than in local stores, despite government food subsidy programs. "Amazon Prime has done... MORE

Imperialism in A Generation of Materialism

Books: Reviews and Suggested Readings
Bryan Caplan
I highly recommended Carlton Hayes' A Generation of Materialism, 1871-1900.  It chronicles a great tragedy.  During this period, the economic, technological, and scientific fruits of the Enlightenment reached historic highs.  But intellectual appreciation of the Enlightenment rapidly drowned beneath the... MORE

Liu Xiaobo, RIP

Liberty
Scott Sumner
I was saddened to hear that Liu Xiaobo passed away today. He fought for classical liberal principles in China, and was imprisoned for his efforts. In 2010 he was awarded the Nobel Peace prize. Here are a few of the... MORE

Milton Friedman on Black Markets

Price Controls
David Henderson
In a June 8, 1947 NBC radio discussion titled "The Future of France," Alfred Cobban, visiting professor of political science at the University of Chicago, Milton Friedman, associate professor of economics at the University of Chicago, and Louis Gottschalk,... MORE

Statutory Rape and Availability Bias in Virginia

Behavioral Economics and Rationality
Bryan Caplan
My home state of Virginia does not have a Romeo and Juliet law.  If an 18-year-old and a 17-year-old have consensual sex, the 18-year old is guilty of statutory rape.  As a result, I can easily see parents of teenage... MORE

Gary Cohn as Fed chair?

Monetary Policy
Scott Sumner
Politico claims that Gary Cohn is likely to be appointed chair of the Federal Reserve. I have very mixed feelings about this choice. Let's start with the choice itself, separate from the administration that is expected to nominate him. I... MORE

That's a question that EconTalk host Russ Roberts poses to University of Chicago philosopher Martha Nussbaum in this week's EconTalk episode.* Roberts expresses his concern that we've lost sight of character development in the modern age, and wonders whether... MORE

Stop Thinking Like a Tourist

Behavioral Economics and Rationality
Bryan Caplan
The year is 1997.  You visit a lovely rural town in North Dakota.  Population: 3000.  You take a bunch of pictures with your analog camera to treasure the sweet memories.Twenty years later, you return.  The lovely rural town is now... MORE

Friedman in 1946

Labor Mobility, Immigration, Outsourcing
David Henderson
Mr. Schultz: Friedman, how do you summarize what we have said this afternoon? Mr. Friedman: Two very different kinds of techniques are available for lessening the income inequalities of the world. On the one hand, we can use direct techniques--the... MORE

David Beckworth interviews Steve Horwitz

Monetary Policy
Scott Sumner
David Beckworth's podcast series continues to produce fascinating interviews. Today I'll discuss a recent interview with Steve Horwitz. Many of Steve's views coincide with market monetarism, although in a few areas his views lean more in the Austrian direction. Here... MORE

Walter Block's Reductio ad Absurdum

Competition
David Henderson
Hey, Kevin Durant, quit being a ball hog; pass it to Lebron. I was thinking of writing a post about the absurdity of the recent EU antitrust case against Google, but Walter Block beat me to it with a reductio... MORE

Swift and Stevenson on economics

Books: Reviews and Suggested Readings
Scott Sumner
In a recent post, I argued that people don't understand what's going on in the world because they learn through stories, not statistics. I recently came across the following in an essay written by Robert Louis Stevenson: Labouring mankind had... MORE

A correction on a previous post on Luddite theories

Labor Mobility, Immigration, Outsourcing
Scott Sumner
In a previous post I argued: Andy Puzder was one of the few Trump appointees that I sort of liked (I say "sort of", because even he had ethical issues.) He was pro-immigration and anti-minimum wage. But in the end... MORE

Making Dental Care and Health Care Less Expensive

Economics of Health Care
David Henderson
First the good news: Take Maine state Rep. Richard Malaby (R-District 136), who sponsored a bill in 2014 to let mid-level dental professionals--known as dental therapists--provide additional care for the state's poor, rural areas. Though the bill eventually passed,... MORE

Verizon vs. USPS

Competition
David Henderson
First, I erred. My own recent experience with Verizon, while personally heartening, is not good enough evidence on how large for-profit firms respond when a customer is treated badly. Two commenters said it particularly well. Commenter Tom Jackson writes:... MORE

A Lawyer's Perry Mason Moment

Law and Economics
David Henderson
In a post a few days ago, I wrote: When I was involved in a legal case as an expert once, one of the lawyers and I exchanged our stories about the closest we had ever seen to a... MORE

The Financial Times has a story with a headline that caught my attention: The eurozone's strange low-wage employment boom Alexandru is one of the luckier ones. A 24-year-old who emigrated to Italy from Romania at the age of 12, he... MORE

Minimally Convincing

Economic Methods
Bryan Caplan
Two high-quality studies of the disemployment effects of the minimum wage are getting a lot of attention.  The first looks at Seattle.  Punchline:This paper evaluates the wage, employment, and hours effects of the first and second phase-in of the Seattle... MORE

Murphy on Private Production of Roads

Central Planning vs. Local Knowledge
David Henderson
Most Americans recognize the efficiency of private enterprise in providing goods such as computers and cars. Yet for various reasons, when it comes to roads, most people recoil from the idea of private production. Indeed, many people think that... MORE

I've done a number of posts pointing to the folly of using the Phillips curve to predict inflation in the US. People are making the same mistake in Japan, assuming that a stronger labor market will lead to higher inflation:... MORE

They Were Terrible

Behavioral Economics and Rationality
Bryan Caplan
Suppose you identify with a large, unselective group - a nationality, religion, ethnicity, political party, etc. An historian comes along and shows that this group once committed a monstrous atrocity - say mass murder.  This leaves you with four options.1.... MORE

Lies, true lies, and statistics

Growth: Consequences
Scott Sumner
We've all been hearing a lot about "fake news", although we may not agree as to which side of the ideological spectrum is peddling these lies. But there is another problem as well---news that is accurate, but extremely misleading. Indeed... MORE

Verizon Victory!

Competition
David Henderson
Last week I posted about my very upsetting experience with Verizon. A few days later, a regular reader of EconLog, who tells me he has learned a lot from reading EconLog, wrote me about the issue. He has a fairly... MORE

How long can the China boom continue?

Cross-country Comparisons
Scott Sumner
[I wrote this post 10 days ago. Tyler Cowen blogged on the same subject today, so I figure I better post it before it becomes old news.] China's been booming since it started moving away from communism in the late... MORE

It's not often that I rise to democracy's defense.  But the last section of an otherwise thoughtful piece by Robin Hanson compels me.  Robin: 3. When people think about changes they'd like in the world one of their first thoughts,... MORE

Free trade is on the march

International Trade
Scott Sumner
The Financial Times reports that the EU and Japan are about to sign a free trade agreement. Japan and the EU are set to sign a sweeping free trade deal next week after talks in Tokyo made significant progress on... MORE

I grew up watching Perry Mason. Almost invariably, the person on the stand with under 5 minutes to go in the show was the one who was guilty and, again, almost invariably confessed while on the stand. It didn't take... MORE

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