1. How well does government work? Economists call for evaluations.
2. UMass Amherst grad student Thomas Herndon finds coding errors in key debt-load paper by Reinhart and Rogoff.
3. Price dives: gold, cupcakes, and chicken wings.
4. Databases that track employee theft.
A new paper by Raúl López-Pérez and Eli Spiegelman investigates “truth preferences” — i.e., preferences for being honest versus lying. Their goal was to study whether economics students lie more as a result of their education. Or do liars self-select? From the paper:
Does studying economics give people “maximizing” habits of thought, and thus cause them to behave more in line with its own predictions, or do people already inclined towards such behavior tend to self-select into economics?
A computer test structured with a slight incentive to lie was administered to 258 students at The Autonomous University of Madrid. The screen showed two colors, and participants were paid 14 euros for declaring blue and 15 euros for declaring green to another person, regardless of the actual color shown on screen. So what happened? According to the authors, the business and economics (“B&E”) majors gamed the system.
At least for me, there are not too many questions that would lead me to respond, “For $25 million, no way, but for $50 million I’ll think about it.” Twenty-five million dollars is so much money that it’s hard to think about what you would do with it. It sure would be nice to have the first $25 million. I’m . . .
An article in today’s Wall Street Journal asserts that, while various life skills seem to deteriorate as people get older, our skill at making personal-finance decisions doesn’t peak until the ripe age of 53. “Baseball players are said to peak in their late 20’s,” writes David Wessel. “Chess players in their mid-30’s. Theoretical economists in their mid-40’s. But in ordinary . . .
Here is the beginning of our first “Freakonomics” column in the New York Times Magazine: Adam Smith, the founder of classical economics, was certain that humankind’s knack for monetary exchange belonged to humankind alone. “Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog,” he wrote. “Nobody ever saw one animal . . .