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A paper by two economists tracks politically loaded phrases used by Democrats and Republicans. For instance, the Republicans use “illegal aliens” while the Democrats speak of “veterans health”. Full list of loaded phrases is here and the original paper is here.
Although Nintendo finds itself in third place in the video game console wars behind Sony and Microsoft, the company is doing really well financially while Sony and MS are maybe breaking even with their efforts. “Nintendo knew that it could not compete with Microsoft and Sony in the quest to build the ultimate home-entertainment device. So it decided, with the Wii, to play a different game entirely.”
Tariffs on imported sugar and ethanol imposed by the US government keep our sugar expensive and is keeping the US from using more efficient methods of saving energy and, oh, by the way, helping the environment. This excerpt from the last two paragraphs of the piece is a succinct description of what’s wrong with contemporary American politics:
Tariffs and quotas are extremely hard to get rid of, once established, because they create a vicious circle of back-scratching-government largesse means that sugar producers get wealthy, giving them lots of cash to toss at members of Congress, who then have an incentive to insure that the largesse continues to flow. More important, protectionist rules flourish because the benefits are concentrated among a small number of easy-to-identify winners, while the costs are spread out across the entire population. It may be annoying to pay a few more cents for sugar or ethanol, but most of us are unlikely to lobby Congress about it.
Maybe we should, though. Our current policy is absurd even by Washington standards: Congress is paying billions in subsidies to get us to use more ethanol, while keeping in place tariffs and quotas that guarantee that we’ll use less. And while most of the time tariffs just mean higher prices and reduced competition, in the case of ethanol the negative effects are considerably greater, leaving us saddled with an inferior and less energy-efficient technology and as dependent as ever on oil-producing countries.
Maddening. Partisan politics is a not-very-elaborate smokescreen to distract us from this bullshit.
Surprising factoid from an article on legalizing kidney sales: “America already lets people buy babies from surrogate mothers, and the risk of dying from renting out your womb is six times higher than from selling your kidney”. (via mr)
There’s evidence that the dot com bubble wasn’t all that bad. A study found that “the attrition rate for dot-com companies was roughly 20% a year, which is no different from what occurred during many other industries, such as automobiles, during their early boom periods” and that the market could have supported more smaller niche companies during that time. Also of note: the Business Plan Archive “collects and preserves business plans and related planning documents from the Birth of the Dot Com Era so that future generations will be able to learn from this remarkable episode in the history of technology and entrepreneurship”.
Profile of economist Kevin Murphy, who none other than Steven Levitt calls “the smartest guy in the field”.
At PopTech a few weeks ago, Lester Brown, who has been a leading advocate of environmentally sustainable development for almost 30 years, spoke about the impact of the increasing production of ethanol. As more corn gets used for making automotive fuel, that reduces the amount of grain available for food production. As demand rises, so will the price…no matter what people are using the corn for, be it fuel or food. The countries that will really suffer in this scenario are those that import lots of grain for food.
When Brown said this, I immediately thought of Mexico. When you consider the food culture of Mexico, one of the first things to mind is corn. Corn (maize) was likely first domesticated in Mexico and remains the cornerstone of Mexican cuisine; in short, corn is far more Mexican than apple pie is American. In 1491, his excellent book on the pre-Columbian Americas, Charles Mann tells us that despite corn’s high status, Mexico is increasingly importing corn from the United States because it’s cheaper than local corn:
Modern hybrids are so productive that despite the distances involved US corporations can sell maize for less in Oaxaca than can [local farmer] Diaz Castellano. Landrace maize, he said, tastes better, but it is hard to find a way to make the quality pay off.
Those great tortillas you had at some local place while on vacation in Mexico? There’s an increasing chance they’re made from US corn. Mmm, globalizious! Of course, Mexican farmers are getting out of the farming business because they can’t compete with the heavily subsidized US corn and Mexico is losing control over one of their strongest cultural customs. Now that ethanol is changing the rules, there’s a bidding war brewing between Americans who want to fill their gas tanks and Mexicans who want to feed their children. Odds are the tanks stay fuller than the stomachs.
For reference, here’s what increasing ethanol production has done to the price of corn over the past three months:
And that’s despite a fantastic US corn harvest. The graph is from this article in the WSJ, which contains a quick overview of the effects that the growing ethanol industry might have.
The Malthusian trap is “a return to subsistence-level conditions as a result of agricultural production being eventually outstripped by growth in population”.
Hot on the heels of Muhammad Yunus receiving the Nobel Peace Prize for 2006, the New Yorker has an overview of the various approaches to microfinance and microcredit.
Video of a Steven Levitt talk on the economics of gangs and why gangbanger is not such a good vocation (for one thing, the job pays less than McDonald’s). The board of directors stuff made me think of the co-op on The Wire.
The economic case against philanthropy: charity is selfish. “Those organizing fund-raising drives for the United Way tend to be disproportionately real estate agents, insurance brokers, car dealers, and other people with something to sell.”
Tyler Cowen takes a closer look at the recent “600,000 deaths in Iraq” claim. “We all know that the political world judges Iraq by the absolute badness of what is going on (which means Bush critics find a higher number to fit their priors), but that is an incorrect standard. We should judge the marginal product of U.S. action, relative to what else could have happened. In that latter and more accurate notion of a cost-benefit test, U.S. actions probably appear worst when deaths are rising over time, and hitting very high levels in the future.”
Interesting story from Steven Levitt: stuck in a Vegas poker tournament with a $3000 first prize but needing to go to the airport to catch the last flight of the night, he starts playing very aggressively in order to win big or lose everything so that he can leave. (via gulfstream)
A pair of economists looked at the number of parking tickets accrued by diplomats at the UN (tickets for which they are not charged) to determine each country’s corruption level. “Since, as their study reports, there is ‘essentially zero legal enforcement of diplomatic parking violations,’ the authors hypothesized that any cross-national variation in parking-violation rates should flow from culture alone.” The worst offenders were the Kuwaitis, followed by Egypt. Diplomats from Canada, Israel, Norway, Sweden, and Denmark had 0 parking tickets. Here’s the whole paper. (thx, susan)
For those unlucky enough not to get a slot, running in a marathon can be achieved by buying somone else’s bib or just photocopying a friend’s. Bibs for the upcoming NYC marathon are going for a few hundred dollars on eBay and Craigslist. (via clusterflock)
Malcolm Gladwell on how the demographics of companies affects their financial health. At the time of its bankruptcy in 2001, Bethlehem Steel “had twelve thousand active employees and ninety thousand retirees and their spouses drawing benefits. It had reached what might be a record-setting dependency ratio of 7.5 pensioners for every worker.” More from Gladwell on the piece here and here.
Fascinating charts of how the US Senate votes on issues from a liberal-conservative perspective and a social issues perspective. More charts here. You’ll notice that the lines on the graphs are mostly straight up and down which means “it’s all economic; all the noise about social issues never actually flows thru into the legislative agenda.” That is, the Senate decides issues, even social issues, based mostly on economics.
During the depths of the dot com bust, Julian Dibbell looked online for a job and found one as a commodities trader in the Ultima Online virtual world. During one particularly productive month, he made almost US$4000. Dibbell has a book coming out about the experience, Play Money: Or, How I Quit My Day Job and Made Millions Trading Virtual Loot. In addition to being available at bookstores in meatspace, Play Money will also be on sale in the virtual world of Second Life in the currency of that world (Linden dollars). From the press release:
In-game versions of Play Money designed by Second Life coder/publisher Falk Bergman are available for L$750. These copies can be signed by Dibbell at his in-Second Life interview with journalist Wagner James Au on July 27th. For the Second Life resident who needs something a bit more tactile, L$6250 buys a real-life copy of Play Money, shipped with care to the buyer’s real life address, in addition to the standard in-game version.
(At the time of this press release, Linden dollars are trading at approximately L$300.00 to the US$1.00. Adjusted to US dollars, an online copy costs US$2.50, and the price of a real-life copy bought in-game is around US$20.85.)
Dibbell will be signing his virtual books in Second Life on July 27th. Caterina read Play Money and has some thoughts on its relation to her work/play at Ludicorp. And here’s a preview of Chinese Gold Farmers, a documentary on gold farming sweatshops in China.
The Metropolitan Museum of Art is raising its ticket price to $20 (from $15). The fee is recommended…you can pay nothing if you wish.
Will Moore’s Law slow down due to a lack of research funds? I’ve wondered for awhile whether Moore’s Law didn’t have more to do with the economics of the semiconductor industry than with engineering limits.
Larger portions of food cause people to eat more. Anyone who has eaten at Chili’s and observed the girth of their clientele already knows this. Related: I remember seeing some research that showed as the size of an HTML textarea increases, the more words people write in it. (via mr)
Update: A self-refilling soup bowl experiment suggests that “visual cues of portion size may influence intake”. (thx, justin) Also, adding lanes to heavily traveled roadways increases traffic; that is, supply increases demand.
Research shows that the lifetime earnings of graduates who enter the job market during recessions are lower than their boom-time colleagues. “Even a decade or more later, the class of 1988 was still earning significantly less. They missed the plum jobs right out of the gate and never recovered.”
Big Mac index, meet the Coca-Cola index. The more wealthy, democratic, and the higher the quality of life, the more likely a country’s inhabitants are to drink Coke. See also Starbucks as economic indicator.
The World Bank has a comprehensive package on World Cup 2006 and its relation to economics, including an economic analysis of who’s gonna win and how the Cup influences economies in the winning/losing countries.
Update: Goldman Sachs has a 50+ page report on World Cup 2006 and economics [PDF link] as well. (thx, beau)
A quick study shows that stocks of simply named companies do better than those of more complexly named companies. Even companies with pronounceable ticker symbols did better than those with unpronounceable symbols.
Social, political, economic, cultural, historical, and technological timelines of the world from 1750 to 2100. Having all the timelines in one view is nice, but the zoomable interface is clunky.
Lottery idea: instead of earmarking revenues for education, why not use the money for individual retirement accounts? The piece includes this startling fact: “Some 20 million Americans spend at least $1,000 a year on lottery tickets”. !!!!
At the current exchange rate, over 50% of the transactions in Lindens (the unit of currency in the game Second Life) are for US$0.07 or less. Micropayments, anyone?
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