Bryan Caplan and David Henderson

Arnold Kling: November 2006

An Author Archive by Month (43 entries)

Discovering Alan Fiske

Behavioral Economics and Rationality
Arnold Kling
Columnist Andrew Cassel writes The rules of supply and demand aren't inherently more difficult to fathom than those that apply to, say, politics, or cooking, or sports. Yet while most people have no trouble wrapping their brains around these subjects... MORE

Tyler Cowen on Economic Turbulence

Growth: Consequences
Arnold Kling
He writes, Economists Clair Brown, John Haltiwanger and Julia Lane...note [that] job turnover and firm disappearance have positive effects, in the aggregate...As workers lose jobs in one niche or sector, they gain in another, moving on to better jobs and... MORE

Tyler Cowen on Mexican Immigration

Labor Mobility, Immigration, Outsourcing
Arnold Kling
He writes, Mexican immigrants used to have higher-than-average levels of education, but today the average male Mexican migrant has lower-than-average education by Mexican standards... A better immigration policy would tighten the border, while allowing in more legal immigrants from Mexico... MORE

Where Economists Agree

Politics and Economics
Arnold Kling
According to Robert Whaples, the overwhelming majority (87.5%) agree that the U.S. should eliminate remaining tariffs and other barriers to trade. Even more (90.1%) disagree with the suggestion that the U.S. should restrict employers from outsourcing work to foreign countries.... MORE

Families and Inequality

Income Distribution
Arnold Kling
My latest essay collects a lot of my thoughts on inequality. Since World War II, our economy has evolved in ways that reinforce the financial differences between strong families and weak families. As the earnings of women have risen, "assortive... MORE

The Stern Swindle

Energy, Environment, Resources
Arnold Kling
Concerning the discount rate assumptions used in the Stern climate review, Partha Dasgupta writes, suppose, following the Review, we set delta [the rate of subjective time preference] equal to 0.1% per year and eta [the elasticity of marginal utility with... MORE

Taxes vs. Philanthropy

Income Distribution
Arnold Kling
The New York Times' Louis Uchitelle writes, When it comes to wealth, one in every 325 households had a net worth of $10 million or more in 2004, the latest year for which data is available, more than four times... MORE

The Entrepreneurial Society

Books: Reviews and Suggested Readings
Arnold Kling
In my latest essay, I write, Continental Europe is set up to preserve large public sectors, large banks, and large corporations. For individuals, the promise is stable jobs, a stable business environment, and collective sharing of the costs of unemployment,... MORE

Journalism, Blogging, and Truth

Information Goods, Intellectual Property
Arnold Kling
David Warsh writes, Classified advertising, especially help-wanted and houses for sale, near-monopolies for daily newspapers for more than a century, have been especially hard-hit. Consolidation in the once-exotic world of trade magazines has been the rule. Significant revenues from other... MORE

Gary Becker on the Minimum Wage

Labor Market
Arnold Kling
He writes, Controversy remains in the United States (and elsewhere) over the effects of the minimum wage mainly because past changes in the U.S. minimum wage have usually been too small to have large and easily detectable general effects on... MORE

Energy in 2050

Energy, Environment, Resources
Arnold Kling
Ron Bailey looks at an article by MIT chemist Daniel Nocera. Nocera suggests, assuming heroic conservation measures that would enable affluent American lifestyles, that "conservative estimates of energy use place our global energy need at 28-35 TW in 2050." This... MORE

Distribution of Health Care Spending

Economics of Health Care
Arnold Kling
Looking at a graph of the distribution of health care spending, Ezra Klein writes, HSAs and their brethren like to pretend that by forcing caution on when you get a test for strep throat, we can significantly effect health costs.... MORE

Culture or Institutions?

Institutional Economics
Arnold Kling
Someone at The Economist blog Free Exchange writes, Everyone now agrees that "institutions matter", but this is partly because "institutions" is a catchall word that can include almost anything anyone cares about, if one squints hard enough and tilts one's... MORE

Social Security Crisis Worldwide

Social Security
Arnold Kling
A report by the Center for Strategic and International Studies says, The UN projects that the ratio of working-age adults (aged 15 to 64) to elderly (aged 65 and over) in the developed world will drop from 4.5 to 1... MORE

Polygamy, Jealousy, and Social Peace

Labor Market
Arnold Kling
Bryan discusses a blog post by Gary Becker on polygamy. Randall Parker sent an email pointing to a response by Steve Sailer (I cannot figure out a permalink, you may have to search for it). Monogamy is a cartel formed... MORE

My Take of Milton Friedman

Political Economy
Arnold Kling
is this essay. On questions of public policy, Friedman's answer was always that it is better to allow individuals to make their own decisions than to impose government fiat. His opponents were always in the position of arguing that government... MORE

On Milton Friedman

Political Economy
Arnold Kling
Brad DeLong writes, Friedman was a pragmatic libertarian. He believed that -- as an empirical matter -- giving individuals freedom and letting them coordinate their actions by buying and selling on markets would produce the best results. It was not... MORE

So Larry Summers was Right?

Human Capital: Returns to entrepreneurs, skills, etc.
Arnold Kling
Donna K. Ginther and Shulamit Kahn write, Children create a marked divergence between men and women. For science as a whole, the presence of a pre-kindergarten aged child lowers women’s likelihood of having a tenure track job by 8.1 percent.... MORE

Milton Friedman

Economic Methods
Arnold Kling
Hearing of the death of Milton Friedman, I turned to this biography. What struck me was that Friedman won the Clark Medal, given to the economist under 40 with the most achievements, in 1951. At that time, he had published... MORE

James Webb's Macaca

Income Distribution
Arnold Kling
Senator-elect Webb writes, The most important--and unfortunately the least debated--issue in politics today is our society's steady drift toward a class-based system...America's top tier has grown infinitely richer and more removed over the past 25 years. It is not unfair... MORE

Should Empirics Determine the Curriculum?

Economic Education
Arnold Kling
Edward Glaeser writes, thorough general education requirement on the scientific approach to society would require two courses. First, students should take a course that teaches the crafting of rigorous hypotheses. ... Second, students should take a class on evidence and... MORE

Single Payer in the U.S.?

Economics of Health Care
Arnold Kling
'Jane Galt' writes, There are some serious constraints that I think would have to be considered by anyone trying to design a national health care package: 1) It cannot provide less, or less rapid, coverage than the typical American policy... MORE

Dr. Doom

Social Security
Arnold Kling
Jagadeesh Gokhale writes, As reported by its trustees, Social Security's total imbalance has increased from $10.4 trillion in 2004 to $13.4 trillion in 2006 - a jump of $3.0 trillion in just two years. And Medicare's imbalance has grown from... MORE

Atoms, Bits, and Growth

Growth: Causal Factors
Arnold Kling
David Warsh writes. Atoms make up the rival part of a particular good, that which may be possessed corporeally by just one person at a time -- a banana, say, or a Cuisinart, or a paperback edition of A Tale... MORE

Elitism or Populism: Pick Your Poison

Economic Philosophy
Arnold Kling
Bryan argues for elitism. In a modern democracy, not only can a libertarian be elitist; a libertarian has to be elitist. To be a libertarian in a modern democracy is to say that nearly 300 million Americans are wrong, and... MORE

Technocrats and Populists

Political Economy
Arnold Kling
Bryan writes, Politicians usually ignore wise advice. Is that a reason not to try to make them take wise advice? Coming from a libertarian (or someone who I thought was a libertarian a few weeks ago), is that a trick... MORE

Brad DeLong is Fantasy-Based

Political Economy
Arnold Kling
Brad DeLong writes My natural home is in the bipartisan center, arguing with center-right reality-based technocrats about whether it is center-left or center-right policies that have the best odds of moving us toward goals that we all share--world peace, world... MORE

Teaching Economics as Common Sense

Economic Education
Arnold Kling
Walter Williams writes Professors James Gwartney (Florida State University), Richard Stroup (Montana State University) and Dwight Lee (Georgia University), three longtime colleagues of mine, have recently published "Common Sense Economics." It's a small book, less than 200 pages, that addresses... MORE

Planning vs. Trial and Error

Institutional Economics
Arnold Kling
Tyler Cowen quotes Barry Eichengreen. Thus Europe, which had relied on extensive growth in the 1950s and 1960s, had no choice but to switch to intensive growth from the 1970s on. The problem was that institutions tailored to the needs... MORE

Jerry Hausman on Wal-Mart

Growth: Causal Factors
Arnold Kling
At the MIT economics alumni event this morning, Jerry Hausman spoke about his research on Wal-Mart. He says that Wal-Mart lowers prices to consumers primarily by bargaining down the prices charged by suppliers, such as Procter and Gamble. It also... MORE

Robert Hall, Health Care Spending, and Longevity

Economics of Health Care
Arnold Kling
At an MIT economics alumni event today, I had a brief discussion with Robert Hall on health care spending. He argues that (a) health care spending is going to approach 50 percent of GDP by the end of this century,... MORE

Comparing Effectiveness of Health Care Procedures

Economics of Health Care
Arnold Kling
Gail R. Wilensky proposes creating a research center devoted to comparing the effectiveness of medical procedures. The most obvious and direct way to finance at least the public portion of a comparative effectiveness center is through a direct appropriation by... MORE

Is Elitism the Answer?

Politics and Economics
Arnold Kling
As Bryan just said, he has a new essay summarizing his forthcoming Myth of the Rational Voter. I agree with some of his diagnosis: if you underestimate the benefits of immigration, or the evidence in favor of the theory of... MORE

Climate Engineering

Energy, Environment, Resources
Arnold Kling
A number of readers have sent in links to articles suggesting that climate engineering may be feasible. For example, T.M.L. Wigley writes, Future climate change may be reduced through mitigation (reductions in greenhouse gas emissions) or through geoengineering. Most geoengineering... MORE

Becker on Latin American Crime

Institutional Economics
Arnold Kling
Gary Becker, a Nobel Laureate in part for his work on the economics of crime, discusses Latin America's problem. I would recommend that they use both the "stick" and the "carrot" to fight crime. The "stick" included apprehending more criminals,... MORE

Election Prediction: Voting will be Irrational

Behavioral Economics and Rationality
Arnold Kling
One of Bryan Caplan's faves, Michael Huemer, writes, Normally, intelligence and education are aides to acquiring true beliefs. But when an individual has non-epistemic belief preferences, this need not be the case; high intelligence and extensive knowledge of a subject... MORE

My Favorite Example of a Biased Statistic

Economic Methods
Arnold Kling
In a column pointing to research findings on a variety of topics, William Saletan includes The richer the country, the lower the ratio of male-to-female promiscuity. In no country is the ratio of male-to-female promiscuity measured in an unbiased manner.... MORE

David Cutler on Health Care

Economics of Health Care
Arnold Kling
I went to Cato to hear leading health care economist David Cutler and others discuss Pay for Performance (if you go to the link in a couple of days, you should be able to view the event). Beforehand, Robin Hanson... MORE

Diego Comin, William Easterly, and Erick Gong write, The finding of this paper is a simple one: centuries-old technological history still matters today. The most surprising part of the finding is just how old the history can be and still... MORE

Labor Quality and the Wealth of Nations

Growth: Causal Factors
Arnold Kling
Tyler Cowen writes, Gregory Clark, an economics professor at the University of California, Davis, identifies the quality of labor as the fundamental factor behind economic growth. Poor labor quality discourages capital from flowing into a country, which means that poverty... MORE

The Cost of Accidents

Regulation and Subsidies
Arnold Kling
Aaron S. Edlin and Pinar Karaca Mandic write, This study is an attempt to provide better estimates of the size (and sign) of the aggregate accident externality from driving. To begin, we choose a dependent variable, insurer costs, that is... MORE

How to Fight Global Warming

Energy, Environment, Resources
Arnold Kling
I elaborate on the idea of using man-made climate change to fight climate change, whether man-made or not. Climate engineering, or what I call Operation Sunscreen, would mean trying to alter the heat absorption properties of the atmosphere. The goal... MORE

Channeling de Soto in Iraq

Institutional Economics
Arnold Kling
Peter Schaefer writes, all societies have rules otherwise they would descend into anarchy. And the basis of all consensual laws (as opposed to imposed) is the customary or informal rule-sets that have been evolving with the society. These rule-sets must... MORE

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