Four of the 26 students in my Economics of Life class proposed delaying submitting their draft term project reports by one week. I emailed the whole class and gave them one day to let me know if they disapproved of this postponement.
The question was how heavily to weight the negatives — those who disapproved — compared to those who wanted to postpone.
I was talking with some folks at LSU who were working on a proposal to exempt textbooks from sales taxes in Baton Rouge, currently a whopping 9%. I’m all in favor of cutting sales taxes, which are generally not progressive; but textbooks are a luxury good—college education is disproportionately undertaken by the offspring of higher-income families. Why subsidize higher-income college students still further?
Because we are so short of faculty, I have a section of 30 honors students in my lecture class along with the 500 regular students. Although the 30 also have a recitation with some additional assignments, five-sixths of their grade is based on the same tests, quizzes, and short essay as the other students.
Each year I receive about 10 introductory economics textbooks from publishers. The purpose is to induce me to adopt the book in my 500-student principles class…
Students apparently consume mass quantities of the performance-enhancing drug Adderall during exam time. Normally the price is $3 for 10 mg., but it rises during exam week to at least $5. One student reports that in his suburban Dallas hometown drug dealers, realizing this price variation, speculated by buying up large supplies of the drug at $3 and dumping them on the market during exam time, hoping to sell at $5.
I went to the local pool-supply store this weekend to buy chemicals for our hot tub, and, unlike two years ago, it was closed, and only open on weekdays.
I went back on Wednesday and asked why they were closed. The owner replied, “When everybody and their uncle started selling chemicals, it didn’t pay us to be open on weekends anymore.”
This season the University of Texas at Austin’s football team is scheduled or has already played against such athletic powerhouses as the University of Louisiana-Monroe (59-20), the University of Texas-El Paso (64-7), and the University of Central Florida (on November 7). Most other top-flight teams are also scheduled against Division I schools that they are likely to wallop. Why? Very simple–a team must win 6 games to qualify for a post-season game; and scheduling a few teams that are nearly certain to be beaten makes the post-season minimum requirement easily attainable.
A very common ailment in Korean summers and falls is pinkeye (conjunctivitis), and the problem had been getting much worse in the past two years. My Korean co-author tells me, however, that the H1N1 virus has created a positive externality in Korea.
Texas allows you to transport open but covered bottles of wine in your car. Even when there are only two of us at dinner, rather than buying a glass of wine for each, we buy the whole bottle and take home what’s left.
Contributions are down, and an unusually large number of religious-based schools have closed.
My initial thought was that those religious organizations that encourage tithing would have fewer problems; but a bit more reflection might suggest the opposite. If every member of a religious group always tithed, the income elasticity of demand for religion would be +1.
My wife and I were speculating on how long last Friday’s Rosh Hashanah service would last. We both figured on two hours, but my wife said, “Services always last longer than you expect.”
The parking meter has been almost unchanged since I started driving in 1959: one meter per space; put your money in the slot.
In my driving in Northern Europe I never see parking meters; I buy a piece of paper at a parking automat (typically one per block), put it on my dashboard. Why the difference?
Last week’s horrific killings at the Ciudad Juarez drug treatment center were front-page news in Texas. The murders are partly the result of what happens in a market when restrictions on supply are imposed in a related market.
A local artist paints landscapes and various Austin sights, including the Texas Tower (the university’s main building). He must pay the university a flat fee per year for the right to sell paintings of University property, emblems, or even anything containing the burnt-orange color. All are copyrighted. Also, if his sales rise above a certain level, he must pay the University 10 percent of his extra revenue.
Deuteronomy 23:25-26 reflects the limits on altruism:
When thou comest into thy neighbor’s standing corn, then thou mayest pluck ears with thy hand; but thou shalt not move a sickle unto thy neighbor’s standing corn.
In the movie District 9, the aliens (“prawns”) have developed a tremendous addiction to cat food. A Nigerian gangster lives in the prawns’ preserve and has a monopoly on the sale of cat food to the prawns. How can he maintain his monopoly and what barriers are there to entry by other sellers?
I don’t usually write about macro things. But a journalist asked me about the duration of unemployment, and I checked out how this recession compares to previous ones.
Central Texas is having its worst drought in 50 years, and since May we have been limited to twice-a-week lawn watering. With things getting worse, on August 24 the limit goes to once per week. I’ll abide by the limit, but I’ll set my sprinklers to run longer each session than during the twice-a-week watering.
A Slate article mentions that the annual price of a hot-dog stand license near the Metropolitan Museum of Art in New York City is $362,201. Licenses are very limited and are bought at auction. The price presumably reflects the economic rent associated with the particular site (the price would be a lot lower in the middle of Central Park). Yet at a fixed cost of $1,000 per day, how can a hot-dog vendor make enough money to cover his variable cost, including the value of his own time?
I’m watching Deadwood, the remarkably well-written HBO series of a few years ago. In Episode 16, several wealthy townspeople, including the hotel owner, are spreading rumors that the gold field claims will soon be voided.
Kvetch, kvetch, kvetch. Classes start in three weeks, and the bosses have mandated a revolution at UT-Austin: We can no longer give only A, B, C grades, but must give +/- grades too, such as A, A-, B+, etc. With 600 students this Fall, I can imagine a big change in griping.
We teach that people make decisions comparing marginal benefit to marginal cost. We labor economists apply this to decisions about work, telling students to compare the return (the wage) to the opportunity cost (the value of non-market time).
We parked our car at the Austin airport for six days, and my brother then picked it up to use during his three-day visit to my mother. He left it in airport parkinglot when he flew off three days later, a few hours before we returned.
My guess is that many senior discounts are anachronisms from times when seniors were scarce and generally poorer than the average American. I don’t expect senior discounts to disappear during the recession, when firms are competing especially hard for customers; but I wouldn’t be surprised to see many disappear in the next boom, as I believe they should.
Texas has a very high sales tax at 6.25 percent, and Austin adds on 2 percentage points. I’ve always thought we were high in this category.
Before our current vacation in Colorado, I was pleased to notice that its sales tax rate is only 2.9 percent. On my first purchase in Steamboat Springs, though, the tax rate was 8.4 percent — the town adds 5.5 percentage points to the state rate.
I read in a local newspaper about a bordello in Germany, where prostitution is legal, that charges customers a fixed fee: a bit over 100 euros ($140) for an evening of drinks, food, and entertainment.
This kind of pricing is common to amusement parks (Disneyland, for example), ski lifts, all-you-can-eat restaurants, and elsewhere. It is a way the firm can minimize the transactions costs of pricing each service and also, if the fixed price is set properly, extract the entire consumer surplus.
I’m alone in Europe, living in an apartment and cooking for myself. I bought a bottle of decent red wine for the remarkably low price of $2.99 and am consuming about one-fourth of it with each dinner (instead of the one-fifth or one-sixth of a bottle I would drink with each dinner at home).
Have I substituted toward wine, moving down the demand curve because the price is lower than at home? Or am I drinking more because I am alone and miss my wife? has my demand curve for wine merely shifted out due to my solitary lifestyle?
The product sold is a combination of good tennis and beauty — and consumer satisfaction is increased by more of both. Event planners would like the top-seeded players to be the most beautiful; absent that correlation, they believe customers are willing to trade off some tennis quality to watch more attractive players. Are they catering to customer discrimination, or are they merely indulging consumer preferences?
My Dutch friends tell me that they read foreign (non-Dutch) novels that are translated into English rather than into Dutch.
Their English is very good, but their Dutch is clearly better. So, I ask, why read in English?
An exceptionally neat new working paper
points out that parents’ time spent with kids has increased hugely since the early 1990’s, particularly among highly educated parents. This is a remarkable fact, and surprising; these are the same parents whose value of time (their wage rate) has increased relative to that of all parents, as, unsurprisingly, have their hours working for pay (since we know that labor supply responds to wage rates). They thus have less non-work time available and are spending even more of it with their kids. Why the surprising result?
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