unpaid thoughts on the dismal science

Friday, August 02, 2002  
Paul Georgia says that an economics journal is publishing junk in "Global-Warming Nonsense". In the August issue of Ecological Economics, Stephen Schneider, the Stanford biologist turned climate scientist, says that saving the planet from global warming will cost virtually nothing. But Schneider gets his economics exactly backwards. He wants to impose massive costs now and claims that those costs are negligable because they won't be significant 100 years from now! An abstract of Schneider's article is available online here.
9:13 PM

James K. Glassman & John R. Lott Jr. report in "The Dow Congress" that:
research published last year by Christian Leuz of the Wharton School, Dhananjay Nanda of the University of Michigan, and Peter Wysocki of MIT found that U.S. firms "managed," or distorted, their earnings the least among companies in 31 countries studied.
So what's the rush to add more regulations that may do more harm than good?
9:03 PM

Paul Krugman's latest column is "Dubya's Double Dip?" No, it's not about ice cream cones, it's about the possibility of a second leg to the recession.
6:21 AM

Thursday, August 01, 2002  
Robert Shapiro turns in a nice backgrounder with "The Options Problem".
9:56 PM

"Tales of Manipulation and Design" is Hal R. Varian's article on recent work on the economics of auctions by Paul Klemperer.

Spotted on The Knowledge Problem.
9:37 PM

"Dow 36000 Revisited" is James K. Glassman's and Kevin A. Hassett's attempt to defend their book, Dow 36,000.

UPDATE: Brad Delong makes some good points in "Dow 36000 Once Again".
9:01 PM

Good news: "Drug Plan for Seniors Defeated".
12:18 PM

Wednesday, July 31, 2002  
In "The Super Market", Lynne Kiesling says:
Regulated transparency would not benefit companies, investors and consumers to the extent that the existing market mechanisms do. Imposing further regulated transparency beyond existing SEC regulations would weaken the network of private incentives that generate long-run efficiency through communicating information among firms, investors and consumers about their ideas, costs and resources. This web of private and public monitoring underpins the most liquid and profitable stock market in the world. We should not let legislation undermine these market processes.

11:44 AM

Nick Schulz calls Milton Friedman "The Happiest Warrior".
11:39 AM

David Boaz says, "Happy Birthday, Milton Friedman". Boaz mentions this tidbit that I had never heard before:
His advice was also sought around the world. Most famously, in the 1970s he advised the military government of Chile - for which he received years of abusive criticism - and the communist government of China - which no one seemed to mind. Happily, both governments listened, and both have become "economic miracles." Chile now has the most successful economy in Latin America, and China's path along the "capitalist road" has made it more prosperous than anyone could have dreamed in 1976, the year that Mao Zedong died and Friedman won the Nobel Prize.

6:32 AM

Happy 90th birthday to Milton Friedman! Go over to Free to Choose to wish him a happy birthday yourself.
6:22 AM

Walter Williams asks, "What or who is the market?"
6:14 AM

Thomas Sowell warns against price controls on drugs in "Bad Medicine". For Sowell, it's not just theory, it's personal:
As someone who knows what it is to be rushed to the nearest hospital emergency room by paramedics because I forgot to take my medication, I am grateful that today's clever political schemes for controlling the prices of pharmaceutical drugs did not exist in years past, when these medications were being developed. Otherwise, I might not be here.

6:12 AM

Tuesday, July 30, 2002  
Bruce Bartlett praises Milton Friedman:
Wednesday, July 31, marks the 90th birthday of Milton Friedman, the most influential economist of the second half of the 20th century. Almost single-handedly, he rejuvenated the free market among professional economists, after a long period in which planning and socialism held sway.
Friedman turns 90 tomorrow.
6:18 AM

The recent rescue of miners in Pennsylvania inspires Thomas Sowell to ask "At What Cost?" Everything has trade-offs:
Too often, individuals, organizations and movements seize upon one particular kind of cost or danger and try to block it by all means possible. But how many miners' lives are we prepared to risk, in order to spare any inconvenience to Caribou near the Alaskan oil reserves? Or to spare the delicate feelings of nature cultists who will wring their hands over oil drilling that neither they nor 99 percent of the American people will ever see?

6:13 AM

Paul Krugman takes on state governments in "Our Banana Republics".
6:07 AM

Monday, July 29, 2002  
OpinionJournal.com's "Best of the Web" points to an NBER working paper entitled "Education, Poverty, Political Violence and Terrorism: Is There a Causal Connection?" Contrary to what so many lefties would have one believe, it appears that poverty does not cause terrorism after all:
The evidence we have assembled suggests that having a living standard above the poverty line or a secondary school or higher education is positively associated with participation in Hezbollah. We also find that Israeli Jewish settlers who attacked Palestinians in the West Bank in the early 1980s were overwhelmingly from high-paying occupations. The conclusion speculates on why economic conditions and education are largely unrelated to participation in, and support for, terrorism.
Also, read "Education may be key to extremist actions".
8:07 PM

"A September 11 Profiteer" is a good article about price gouging in the wake of the terrorist attacks. It's perverse that the law would prosecute someone for trying to efficiently allocate scarce resources when that is the whole point of freely set prices.

Spotted on Samizdata.net.
6:21 PM

Sunday, July 28, 2002  
"Rudiger Dornbusch, Outspoken Economist, Dies at 60"

Spotted on Semi-Daily Journal.
9:31 PM

Jason Soon says that "The welfare economics of immigration law: A theoretical survey with an analysis of US policy" by Alan Sykes is an "an unashamedly Chicago School perspective" on immigration.
4:01 PM

Jane Galt points to a great six-part essay by by David M. Levy and Sandra J. Peart on "The Secret History of the Dismal Science":
It was this fact—that economics assumed that people were basically all the same, and thus all entitled to liberty—that led Carlyle to label economics "the dismal science."

2:36 PM

The New York Times talks to economists about impending reforms in "Broken System? Tweak It, They Say".
8:52 AM