Some links on immigration

Let them come. (Economist)
Tap their earnings back home. (Economist)

Links on Macro stuff

Alternative macro indicators? (Economist)

The twitter version of Bernanke's Jackson Hole Speech: (1) high unemployment; (2) disinflation; (3) urgency; (4) it's not just structural; (5) we've still got ammo; (6) we're reloading; (7) short run fiscal stimulus still needed; (8) long run fiscal austerity always needed. (Freakonomics)

The twitter version of the long-term deficit problem: (1) Bush tax cuts. (Economix)

Can a double-dip be avoided? (Economist)

Pay incentives on Wall Street: get ready to go through this again soon. (VOX)

Is Bernanke Giving Us All the Bird?

This stock photo of Bernanke is a bit unsettling, no?

Some Links

Michelle Bachman's solution to high gas prices: another recession?
This always bears repeating. We live in one of the most peaceful times of the modern era.
Get up or pay!
The revenue-neutral carbon tax.
Diaspora bonds? Color me skeptical. Previous attempts to use active policy to sop up more of emigrants' surplus have not been so successful.
Biggest parenting mistakes ever? Mine, I'm sure, are still to come.
News flash: cash transfers dominate in-kind gifts.

Republican Tax Increases

Alex Tabarrok is on the Republicans today for wanting to increase taxes. I'm not in full agreement with him about tax increases in general (he thinks they should not be increased in general, and that less government and low taxes are roughly synonymous), but I wholeheartedly agree with the notion that the temporary payroll tax cuts proposed by Obama should not be allowed to expire.
Some things that puzzle me about the issue:
1. Payroll taxes are regressive (they affect lower-income workers more). Why would they want to raise payroll taxes during economic recession?
2. Payroll taxes are a direct impediment to private sector hiring. Why would they want to raise payroll taxes during economic recession?
3. One could argue that they aren't technically raising taxes; they're allowing existing cuts to expire, but the Republicans have argued that allowing tax cuts for the rich to expire would themselves be tantamount to tax increases. Why would they want to raise payroll taxes during economic recession?
4. Republicans have argued against cap and trade (not technically a tax) as well as against carbon taxes, both of which have been supported by economists of both parties as good ways to deal with emissions (subsidies for clean technologies that Republicans support are not as good) on the grounds that any tax on energy would disproportionately hurt low-income working Americans. So.... why would they want to raise payroll taxes during economic recession?
Lining up for payroll tax increases also seems to be a political no-win for Republicans politically. It only seems to cement the narrative that they don't really care about the economy itself, but rather that they represent the rich (sometimes at the expense of the poor).

Taxing Trades (This is not about tariffs)

I've thought about blogging this for a few weeks now, especially with all the talk about banning high frequency trading. I figure, if you think something is creating negative externalities (like high volumes of high frequency trades) then a small tax should help mitigate it, without as much of a negative impact on efficiency as an outright ban or fixed quantity restrictions.
I would apply similar logic to political contributions, but I'm sure some lawyer would argue that this would be taxing (and therefore restricting) speech.

The solution is growth (Daron Acemoglu - HBR Blog)? Will growth curb the debt problem or will debt reduction stimulate growth?

A neat randomization technique to facilitate truth-telling (Freakonomics).

As Greenspan says - we'll never be "forced" to default. Greece didn't have this option. Whither Euro? (Financial Times)

The downside of self-regulating occupational licensing boards (Jay Parkinson)

More policy options that would be dominated by a carbon tax. (Freakonomics)

Another way of looking at the value-added problem in trade statistics. Not all of the "Made in China" product's value should be counted as China's exports? But where do the profits really end up? (NYTimes)

I'm guessing the blockquote here is toungue-in-cheek. (Caplan) I worry about students who only learn a particular algorithm for applying knowledge to specific situations. Those students will be easily replaced by computers. Learn to think.

Some Links: Porn is good.

So, it at least looks doubtful that porn increases sexual violence; it may reduce it.

A couple of links on migration:

Where is everybody? Some difficulties in migration research and some new data sources (VOX).

Less Mexicans migrating (PeopleMove)?

Is the market crazy? (Freakonomics) I don't think so. I'm not surprised at a decline in stocks with the uncertainty about the debt and, more importantly, about debt politics. Political uncertainty can be an important factor in economic performance, but over the long run superior property rights, contracting, and civil liberty will root out the short run uncertainty wrought by partisanship.

What are the Tea Partiers' interests? (Economix)

Playing by the real rules of Monopoly. (Game Night)

Cocktail Party Economics.

Emission trading begins to go international. (Economist) For any "cap and trade" scheme to be effectively binding, it must be globalized; else I still prefer a tax, for that and other reasons.

Gender bias and agricultural technology. (Economist)

Media - back to coffee houses? (Economist)

A sad outcome for property rights theories of environmental protection.

Quick summary: Tim DeChristopher, environmentalist and former economics major at Utah bids on oil and gas permits and wins some while pushing the prices of others up; gets sentenced to 2 years in prison.

I've long thought that if environmentalists wanted to reduce environmental damage, one they should do is bid on (and buy) some of the permits to extract resources or otherwise pollute the environment. If the government's position is that this is criminal behavior, then it strengthens the case for Pigouvian taxation.

Some Random Links

An interesting short piece on the Isreli-Palestinian conflict (Haushofer, et al.)
A shamelessly self-interested link - somebody buy our house!
Is there a great divergence? (Rodrik)
Summary of an interview by Felix Simon with Larry Summers. Sentences to ponder:

The Treasury bond rate, Treasury note rate for ten years is 2.85 percent. Nobody is failing to invest because 2.85 percent is too much. They are failing to invest because there are no customers in their store. They are failing to invest because their factories are sitting empty. They are failing to innovate because they’re not sure how large the market for the product will be.

We don't need a C.E.O. A country is not a business. We need a policy expert. (Economix)

Economics for kids? (Freakonomics)

Banerjee on Poverty. (Economist)

Debt impacts of new policies GWB vs. BHO.

Price effects of WalMarts versus Sam's Clubs

An interesting discussion on Freakonomics. Basically, what is happening is that when a WalMart enters a market, existing retailers compete, and prices fall; when a Sam's (or Costco) enters the same market, prices rise. Why?

Phillips makes the argument that it's a mostly a product differentiation issue, i.e. that the monopolistically-competitive retailers are competing by distinguishing on variables like appearance, cleanliness, service, and convenience. I don't buy it, because they already do that with a WalMart around.

Instead I think it has to do with the pricing strategy of the club stores vis-a-vis non-club stores, and which consumers are attracted to each (and revealed as such to the competitors). Club stores price discriminate. They charge a membership fee, and then charge lower prices on marginal purchases. Smaller grocers don't have the size or clout to charge membership fees. Thus, they attract much more price-elastic consumers. The remaining consumers are considerably less responsive to price. At the same time, these leftover consumers are revealed to value the intangibles like service and appearance more. Small stores are free-riding on the informative role of the membership fees.

Some links

Increasing taxes a little and funding health reform may do more good (at least in the short run) than cutting spending. Someone remind folks that tax revenues are already at 50 year lows as a percentage of GDP.

A similar (but maybe a bit less firm) conclusion here.

More similar conclusions from Krugman on modern Keynesianism (on VOX not his hackish blog).

A couple of cool statistics links:

Paydays are a killer?

Billion Prices Project

Some institutional links:

Gender bias and agricultural technology

Cursed by resources or institutions?

Why continuing to be a Royals fan (among other things) is good for me.

Exports are overrated?

Education and Democracy

The Economist (see also HERE) asks why there is no apparent causal (or even correlative) relationship between education and democracy. They claim, "It is possible, however, that education reinforces authority and the power of ruling elites; indeed, it may often be designed to do precisely this." This seems entirely plausible to me.

A working paper by Bang and Mitra shows that, once we control for certain other factors, the impact of education on growth is even ambiguous. What other factors, you ask? Gender equity/bias. One explanation here is that in countries that have high rates of education among men (but not among women) education is doing precisely what the Economist suggests - fortifying the established position of the traditional elites.

Is it time to rethink the way university lectures are delivered?

Maybe. I'm all for efforts to make the learning environment more interactive. I'm less certain that there's a single way to do it best, or that even doing it at all will be "efficient" for the bigger schools. A few things:
1. Students will benefit from being confronted with (and even struggling through) a multitude of diverse teaching styles. This might sometimes include "boring" lectures. They will face different leadership styles in their jobs and will should be prepared for the fact that the world doesn't revolve around them.
2. GIGO (garbage-in-garbage-out). Regardless of teaching style, students will ultimately get out of a class only what they put in.
3. Experiential learning is good for reinforcing theories and principles if used in a complementary fashion, but can't substitute for learning the theories and principles themselves.
4. Disfluency. In some ways making the material more quickly understood does not make the material better understood. Sure, it will be fun, and likely boost a professor's course evaluations, but there is research that shows a little bit of struggle (on the students' part) can go a long way.

More Random Links

Can democracy precede (human, and hence economic) development? (VOX)
Just scroll down to the last graph. How long can the "big government" narrative be sold? Government isn't that big; transfers are just high because of the recession and taxes are horrendously low for the same reason, as well as the 2001 & 2003 tax cuts. (Menzie Chinn)
Some "odd"ities from InTrade. (Freakonomics)
"[H]ow many students struggle with elasticity formulas because they struggle to manipulate and understand fractions?" (Worthwhile Canadian Initiative)

A Mixed Bag of Links

HIV/AIDS on the decline: Education, drugs, and activism credited. (Economist)
Do law-abiding gun owners generate positive externalities? (Economix) I do not read this piece as an argument against most proposed restrictions, such as registration per se or waiting periods, or even bans on certain types of weapons.
Taxing pollution: The tax a sensible conservative should favor (Economist)
Tyler Cowen on Academic Publishing (Kosmos)

Some links on immigration and trade (and a couple on statistics)

So, what we can get from this is: (1) immigrants are favorably selected (relative to education levels in their home countries - nothing new); (2) this is not always a bad thing for the home countries in the long run. It does not lead to the conclusion that immigrants should be deliberately cherry picked by some artificial policy mechanism.
Banking in the US is finally catching up with resources already available to Africa.
Finance and trade: A historical perspective. (Vox)
Gambling: chance or skill? (Freakonomics)
Some interesting polling data on perceptions about homosexuality. (Economist/Democracy in America) Makes me think the "gay marriage trick" won't work in 2012 like it did in 2004.
Semi-random link on self-publishing a book. (Freakonomics)

Some links on institutions and failed states

The long-lasting effects of corrupt institutional history. (Vox; more here)
Oil (resources?) and democracy. (Vox)
Failed states, poor institutions, and poverty. (Freakonomics)

Some links on trade and immigration

Free Trade Agreements may be good, even if there is trade diversion. This is true, and we have known it theoretically for a while. This post summarizes some empirical evidence supporting it. (Jim Anderson, Vox)
US trade policy and Doha: Multilateralism is less important to US trade policy these days and bilateral agreements are starting to take precedence. Is this good? (Fred Bergsten, Vox)
US trade policy in the 21st century: strategic trade mistakes of the past redux? (Richard Baldwin, Vox, part I; here is part II)
Migration restrictions and the flow of immigrants. It seems plausible that one conclusion from this article is that immigration restrictions do almost nothing to curtail the quantity of immigrants, might even increase the number of immigrants in the US (by lengthening stays of would-be short term or seasonal migrants who now incur higher border crossing costs), and mainly serves to transfer rents to criminals. (Drew Keeling, Vox)
The curious case of the CIS. (Dilip Ratha, People Move)