EconLog Archive
Politics and Economics
Public Opinion and Democracy: Some British Food for Thought
Pete Boettke often says that I believe that we get the government we deserve. My usual retort is “No, they get the government they deserve, and unfortunately I get the government they deserve too.” But in essence he correctly describes my view: The status quo is popular, and changes to the status quo are not. .. MORE
Politics and Economics
Who are the Empiricists?
Jonathan Chait devotes a long article to arguing that liberals are pragmatic and empirical. The contrast between economic liberalism and economic conservatism, then, ultimately lies not only in different values or preferences but in different epistemologies. Liberalism is a more deeply pragmatic governing philosophy–more open to change, more receptive to empiricism, and ultimately better at .. MORE
Politics and Economics
Thrift vs. Paternalism
In this essay, I argue that For those of us who value self-reliance and thrift, the economic trends suggest a need to increase saving and to invest heavily in human capital. For those who value paternalism and redistribution, those trends provide an excuse to “help” more people in more ways. This tends to exacerbate the .. MORE
Economics of Education
The Summers Speech
There has been a lot of controversy over Harvard President Lawrence Summers’ talk at an NBER conference about gender differences in faculty in science and engineering. Harvard has posted a transcript of the talk. One excerpt: The second problem is the one that Gary Becker very powerfully pointed out in addressing racial discrimination many years .. MORE
Income Distribution
Redistribution vs. Paternalism
Tim Worstall argues that big government is not compatible with only taxing the rich. For the fact is that the rich don’t have enough money to pay for all of the things that are being demanded from the State. We can see this quite clearly in the US in the way that things like Social .. MORE
Information Goods, Intellectual Property
Giles and Stereotype Accuracy
The weakest part of Martin Giles’ Why Americans Hate Welfare is his dismissive treatment of stereotypes. He cites a number of psychological experiments on the emergence of baseless stereotypes. But he at best downplays the growing literature on stereotype accuracy. For example, he does not even cite the excellent volume Stereotype Accuracy : Toward Appreciating .. MORE
Economic Growth
Capital vs. Institutions
Stephen Daley and Brian Hooks write, The reason some of the poorest countries in the world need microfinance is because deep-rooted institutional problems make the general financial sector unworkable. And until these problems are addressed, we are reduced to celebrating an appallingly small-scale solution to the biggest problem facing humanity today: abject poverty. For the .. MORE
Social Security
Social Security Political Economy
Tyler Cowen writes, Why might you think that the elderly deserve a greater share of resources in society? Here are some options… 2. The relevant political alternative is lower marginal tax rates for the well-to-do. Transfer resources to anyone but them, whenever you can… I suspect that some version of #2 is what motivates most .. MORE
Economic and Political Philosophy
Evolutionary Psychology and Economic Behavior
Will Wilkinson writes, What evolutionary psychology really helps us to appreciate is just what an unlikely achievement complex, liberal, market-based societies really are. It helps us to get a better grip on why relatively free and fabulously wealthy societies like ours are so rare and, possibly, so fragile. Evolutionary psychology helps us to understand that .. MORE
Economic Growth
Eastern European Economic Statistics Made Fun (Really!)
Tim Worstall provides some entertaining insight into the neverland of Communist and post-Communist economic statistics. It’s gotten rather trendy to say that former Communist countries are worse off than they were in 1989 or 1991. The main problem with these claims is that they take the original numbers at face value. Simple example: If the .. MORE
Microeconomics
The Seen and the Unseen: Wegmans, Manhattan, and Slow Growth
Economists have a favorite cynical explanation for the slow-growth movement: Property owners are trying to raise real estate prices by restricting supply. I’m no mind-reader, but I doubt that’s the real motive of most opponents of further development. But in any case, the effect of slow-growth on real estate prices is a lot less obvious .. MORE
Uncategorized
Euro-America
Joel Kotkin’s catch-phrase for summarizing America’s older cities is Euro-America Like many of their European counterparts, many, if not most, major American urban centers are at best demographically stagnant or even losing population, which is also the case in Paris, Milan, Rome, and Amsterdam. Indeed, since 2000 San Francisco, Boston, Minneapolis, Chicago, and Philadelphia have .. MORE
Economics of Health Care
Real Health Insurance
Extending the remarks I made earlier, in my latest essay I look at a recent study of medical-related bankruptcies and conclude that cost-reimbursement health insurance is ineffective and should be replaced by event-based insurance. Event-based insurance means receiving a lump-sum payment at the time of diagnosis. Thus, even if the treatment goes on for years, .. MORE
Economics of Health Care
Becker and Posner vs. Medicare
Richard Posner writes, As a matter of economic principle (and I think social justice as well), Medicare should be abolished. Then the principal government medical-payment program would be Medicaid, a means-based system of social insurance that is part of the safety net for the indigent. Were Medicare abolished, the nonpoor would finance health care in .. MORE
Game Theory
See Saw
The excellent Saw comes out on DVD this Tuesday. If you’ve got a cast-iron stomach, there is no better fictional exploration of the Prisoners’ Dilemma available. (If you don’t have a cast-iron stomach, may I suggest Pooh’s Heffalump Movie?) The premise of Saw is straight out of intro micro: two men wake up chained in .. MORE
Politics and Economics
Why I Don’t Hate Why Americans Hate Welfare
I suspect a lot of my friends would hate Martin Gilens‘ Why Americans Hate Welfare. Gilens takes a stab at the question: Why doesn’t the United States have a European-style welfare state? And his answer, to put it crudely, is racism. But unlike most people who feel this way, he has some data to back .. MORE
Business Economics
Mail Un-Rebates Revisited
I hope this got it out of my system. If mail-in rebates went away, then retailers would still have to earn their profits somehow. Either other shady sales practices would expand, or the retailers would have to raise prices. In my opinion, higher prices without the rebate game would be an improvement, because so much .. MORE
Fiscal Policy
Conservatives and the Bush Budget
David Corn writes, What I wonder about is the absence of conservative outrage over Bush’s budget numbers. Alex Tabarrok wrote, My prediction is that it will be easier to add $540 billion in Medicare spending than it will be to cut $5 billion in farm subsidies. Jane Galt wrote, Part of the [increase in estimated .. MORE
Economics of Health Care
Health Care Celebrity Death-Match
The latest Wall Street Journal blogger celebrity death-match features Russ Roberts and John Irons on health care. Here’s Russ: Because of various government subsidies, out-of-pocket spending is a little more than 10% of total health spending (thanks to Alex Tabarrok at Marginal Revolution for the link). The rest comes from the government and insurance. …Overall, .. MORE
Social Security
Social Security Risk
I did not take away much from the first day of Cato’s Social Security Bash. I guess my views on the subject are pretty well settled, so that for me the session served to illuminate what other folks are worried about than anything else. Unfortunately, I have to miss tomorrow’s session, where Ed Prescott talks .. MORE
Game Theory
The Economics of the Israeli-Palestinian Conflict
News of an Israeli-Palestinian cease fire reminds me of Tyler’s Cowen’s excellent game theoretic exploration of their long struggle. This essay is worth a thousand news stories on the subject, but I still think that Tyler misses the simplest explanation of this sad situation: out-of-sync tit-for-tat. Axelrod famously showed that in repeated Prisoners’ Dilemma games, .. MORE