Monday, July 28, 2014

Monday's Child

1.  We just want to help you.  But we need to know a lot about you.

2.  In the future, everyone will be fined for 15 minutes.  We'll fine you if you water, we'll fine you if you don't.  How much is "too much"?  We'll fine you if you ask.

3.  Violence is wrong.  But sometimes, a 72 year old man has just had enough.  Buzz Aldrin punches an idiot.  And the idiot needed to be punched.

4.  Roko's Basilisk.

5.  Drive free....until we repossess. Incentives matter, part 2045671.

moremoremore

Sunday, July 27, 2014

Somewhere on the road between Norman and Santa Fe

Angus recently drove from Norman to Santa Fe.

And this sign was vandalized.


Coincidence?  Oh, I don't THINK so.

Human Capital


Human Capital and Industrialization: Evidence from the Age of Enlightenment 

Mara Squicciarini & Nico Voigtländer 
NBER Working Paper, June 2014 

Abstract: While human capital is a strong predictor of economic development today, its importance for the Industrial Revolution is typically assessed as minor. To resolve this puzzling contrast, we differentiate average human capital (worker skills) from upper tail knowledge both theoretically and empirically. We build a simple spatial model, where worker skills raise the local productivity in a given technology, while scientific knowledge enables local entrepreneurs to keep up with a rapidly advancing technological frontier. The model predicts that the local presence of knowledge elites is unimportant in the pre-industrial era, but drives growth thereafter; worker skills, in contrast, are not crucial for growth. To measure the historical presence of knowledge elites, we use city-level subscriptions to the famous Encyclopédie in mid-18th century France. We show that subscriber density is a strong predictor of city growth after 1750, but not before the onset of French industrialization. Alternative measures of development confirm this pattern: soldier height and industrial activity are strongly associated with subscriber density after, but not before, 1750. Literacy, on the other hand, does not predict growth. Finally, by joining data on British patents with a large French firm survey from 1837, we provide evidence for the mechanism: upper tail knowledge raised the productivity in innovative industrial technology. 

Nod to Kevin Lewis

Saturday, July 26, 2014

Whales

I can just see the LMM doing this with me, in kayak, off the coast of Argentina.

Well, she might WATCH it, from a beach chair, ON the coast of Argentina.


Marriage at the Margin


Can Pro-Marriage Policies Work? An Analysis of Marginal Marriages 

 Wolfgang Frimmel, Martin Halla & Rudolf Winter-Ebmer
Demography, August 2014, Pages 1357-1379

Abstract: Policies to promote marriage are controversial, and it is unclear whether they are successful. To analyze such policies, one must distinguish between a marriage that is created by a marriage-promoting policy (marginal marriage) and a marriage that would have been formed even in the absence of a state intervention (average marriage). We exploit the suspension of a cash-on-hand marriage subsidy in Austria to examine the differential behavior of marginal and average marriages. The announcement of an impending suspension of this subsidy led to an enormous marriage boom among eligible couples that allows us to locate marginal marriages. Applying a difference-in-differences approach, we show that marginal marriages are surprisingly as stable as average marriages but produce fewer children, children later in marriage, and children who are less healthy at birth.

Friday, July 25, 2014

Pension-Smoothing

Pension-smoothing is a silly gimmick.  But it's a red herring.

Okay, yes, pretty much no one thinks it's a good idea.

It's dumb.  And wasteful.

Of course, the real solution is to raise taxes on gasoline, right?  Though that wouldn't solve the problem of people driving less, or the "problem" of more fuel efficient cars. (Problem?)

No, the real solution is to stop looting the highway trust fund for pork barrel projects, and use it for maintenance.  At present, 40% of the Fed's highway trust fund goes to "earmarked programs."

Stop that.  Easy peasey.

Here's the thing:  the states are supposed to pay for maintenance of the highway system.  And the STATE taxes are more than double the Fed excise tax.  The states you would expect (CA, CT, MI) all charge more than TRIPLE the Fed rate.  And these states all loot that money and use it to buy votes from developers and corporations.

There's this canard:  the rate of gas taxes has fallen, adjusted for inflation.  Well, the Fed tax rate has fallen, because all they do is use it to build bridges to nowhere.  It's just a slush fund for payoffs to campaign contributors.  The average rate of state gas tax was 20 cents/gallon in 2002.  It's 31 cents/gallon in 2014.  That's a 55% increase, in 12 years.  Inflation is only a 33% increase over that period.  The point being that state gas taxes have increased more than 20%, adjusted for inflation, since 2002.  Why do we need to raise gas taxes?

The answer is that politicians use your tax money to buy votes.  And they can never, ever have enough.  Votes, that is.

Just spend the actual money that we already raise on roads.  Take the 40% of the Fed highway trust fund that's spent on pork, and spend it on maintenance.  Stop enabling the states to use gas taxes for anything except roads.  We collect plenty of taxes for roads.  We just don't use it for roads.

Gas taxes are a pretty good example of a "user fee."  You pay more if you use more, and the money can be used to provide the service.  Except that, to paraphrase Gary Trudeau, "But the highway trust fund was just sitting there!"

Tenure and the Caterpillar

Found this great caterpillar, on the LMM's car.  Note the giant false head, unseeing "eyes," and upright posture.  When threatened, it rears up and tries to look all bad-ass, when in fact it's a soft little useless wimp.



Unfortunately, my good friend Michael Thomas imagined that there is some connection between this beast and the beast called "The Tenured Professor."   Click for an even more tenured image.

Ow.  Problem with the analogy, of course, is that caterpillars pupate and turn into pretty butterflies.  Tenured profs turn into....Keith Poole.  Double ow.

Wednesday, July 23, 2014

D-Drez lays down some smack

So, this guy was pretty sure of himself.  Got all up in here and talking big.  I thought I was going to have to respond.  I mean, the guy's "data" is "a woman sent me a letter."  Really?

But D-Drez took care of it.  Better than I could have anyway.