L’affaire Strauss-Kahn underscores my view that we economists are as immoral—but also as principled—as any other professionals. Innocent until proven guilty, and all that; but I now know of, or even know personally, economists who have engaged in sexual assault, embezzlement, murder and, of course, clearly immoral acts that are not criminal.
Yet it is also true that we are as generous as any other group. As Yezer, Goldfarb and Poppen showed in the Journal of Economic Perspectives, 1996, learning economics makes you no less charitable in your actions (although not in what you profess) than does studying any other discipline. And each of us can recount instances of personal charity and sacrifice by well-known economists, often on behalf of younger, less well-known colleagues.
As with so many other pairs of individual characteristics, the correlation between morality and, in this case, occupational choice is very low.
Going through security at U.S. airports is a continuing nuisance. One technology improvement that I saw at Brussels Airport is simple: the conveyor on which you place your computer, bag, etc., slopes downward toward the x-ray machine, so that there is no need to drag bins and bags along the conveyor. Moreover, there is an adjacent conveyor that tilts backward toward the rear of the belt on which the staff can place a pile of used bins.
These devices save passenger time and are labor-saving for the security company too — no need for the workers to drag the bins by hand or hand-truck to the rear of the belt. Are we slow to innovate (how un-American that would be!) or does cheap semi-skilled labor reduce the incentive to substitute capital for labor?
On the airport bus in Helsinki, a Finnish woman asked my wife, “What is the biggest difference between Europe and the U.S.?” There are lots of possible answers, but the most striking to me is the tremendous diminution of mutual trust in the U.S. over the past few decades. Why does this matter economically? Because a number of economists have shown recently that income levels and real growth depend upon trust—trust greases the wheels of exchange.
I bought a round-trip ticket for a short train trip in the Netherlands, paying full price. Later I asked a colleague if there are discounts of any kind. Yes, she said, as long as you travel after 9 a.m. I assume this illustrates peak-load pricing, so I asked about traveling in the evening rush hour. It turns out the discount is good any time after 9 a.m.—there is no peak-load pricing for evening rush.
The price of gasoline is currently outrageous in the Netherlands, about €1.60/liter (about $8.80 per U.S. gallon). What do residents do? They arbitrage, so that if they’re headed south they plan to drive through and fill up in Luxembourg, where the price is “only” about €1/liter. This is a bad idea, unless your trip would take you near there anyway. Also, because there are often long lines of liked-minded arbitrageurs waiting to fill up, this is a bad idea if your time is valuable.
One of my biggest thrills as a kid in the 1950s when we visited New York City was to go to the Horn & Hardart Automat. The last one closed in 1991—and I haven’t seen anything similar in the U.S. since. But: Walking around Eindhoven, Netherlands, there was the automat concept visible in the doorway of an eatery. Why here in the Netherlands, but not in the U.S.?
Photo: David Campbell 2 Kings VII discusses an incident in which the people of Israel are besieged and food prices are skyrocketing. A military officer scoffs when “a man of God” predicts that barley will soon sell for ½ shekel and fine flour for 1 shekel (very low prices). The officer is shortly trampled to death after the populace goes . . .
We took our visiting 12-year-old granddaughter out to dinner last night, and she insisted on ordering edamame, which I too love. I discovered it at age 60 and would never have seen it in the U.S. at age 12 in 1955. Earlier in the day, I had bought a cherimoya at the local grocery store.
A new paper stipulates that robbers are unusually ugly. That finding makes sense—ugliness might intimidate victims and make the crime easier to commit. So too perhaps for police ugliness intimidating crooks.
The Dodd-Frank reform bill includes a provision that prohibits companies from using conflict minerals (gold, titanium, tungsten), the mining of which yields profits that have financed wars in the Congo.
The demand for calories increases with age, both because one’s income rises and because one’s taste for good, caloric food has been developed over many years of good eating. I didn’t know what an Esterhazy cake was 40 years ago, but now I can’t resist one if it’s on the menu!
Are good-looking people happier than their unattractive counterparts? A new study says… they are indeed. But the reason why is different for men than it is for women.
Checking out of the local supermarket yesterday, my wife was thanked for bagging her own groceries. She stopped, then realized that in the U.S. supermarkets have baggers, while the local supermarkets that we shopped at in Germany did not.
My mom passed away recently, and we’re planning a memorial service in her home city, where none of us three offspring lives. There are lots of expenses: the service; food afterwards; planes and hotels for all of the children, grandchildren and any great-grandchildren who can come.
Ah, lunch at Fortnum & Mason in London — without doubt, the most posh place we ever have lunch at. By the time we get to dessert, we only have enough stomach room to split a piece of chocolate torte.
The globalization of the economics profession is remarkable. I was chatting with a new Ph.D. from the Technical University of Dortmund, Germany. He did his undergraduate work in Shanghai, China; he went to Denver, USA, to attend the American Economic Association job market; and he just had a job visit to Monash University in Australia. Thus, his educational background and job activities span 4 continents!
The Texas legislature seems likely to pass a law allowing people to carry concealed weapons on campus. Having observed enough shootings of professors by students in the U.S. over the past 45 years, I think this is a dreadful idea.
At a seminar in Germany last week, a statistical difference illustrated a crucial E.U.-U.S. difference in politico-economic attitudes. In the U.S., we define the poverty line as absolute: three times the income needed for a minimally nutritious food budget. In Europe, the poverty line is based on relative income, typically 50 percent of the median income.
My Department chairman is mystified: You would think that with the crisis in public budgets, the demand for new economics faculty members would have shifted leftward. Similarly, with graduate students having delayed entry into the market, the supply of new Ph.D.s this year would have shifted rightward. Together, these changes should have lowered the price (wage) that the market pays new Ph.D.s.
The Caffé Nero outlet in London I visited recently has different prices for take-out and in-store cups of coffee — £1.65 for take-out, £1.75 for in-store. Given the costs of space for tables to sit at, and the need to own and wash cups and saucers, the price difference must be way too small to make this cost-based price discrimination.
I’m lecturing at the University of Essex and going from office to office chatting with people about their research. This is hard physical labor — I repeatedly go down one or two flights of stairs in this rabbit warren, walk down a hall, up the stairs in the adjoining building, then back down another hall. What a waste — why?
An Economist at the Museum: how do curators trade? The transactions of exhibiting paintings.
Minneapolis allows single-occupancy cars to use its HOV expressway lanes for a price, which is typically between $1.50 and $2.50 on I-35W during morning rush-hour between the airport and downtown. The price seems to be higher when traffic in the other lanes is heavier — the city is sensibly applying peak-load pricing.
The Economist reports that the city of Shanghai has been auctioning car license plates. The average auction price has recently been $6,900, truly remarkable considering average family income in China, and even in Shanghai. The number of plates given out in 2011 will be reduced further in an attempt to reduce gridlock and pollution (both of which my experience several years ago in Shanghai suggests are world-class).
I’m back in Germany, the land of serious recycling. We separate much of our excess into bio, packing, paper and everything else (“all the rest, and only that,” as the instructions in our apartment state). Of course, this doesn’t include the three types of glass – white, green and brown – that are to be carried to a set of common receptacles two blocks from our apartment.
As did its recent acquisition, Northwest Airlines, Delta is doing on-line auctions of seats that must be vacated if the plane is overbooked.
Marginal decisions to increase the net of revenue minus costs arise in non-profit organizations as much as in companies. The designers of a recent book, Peter Leeson’s The Invisible Hook (Princeton University Press, 2009), recognized this in picking a cover.
We’re taking a bike tour through the Everglades, and the guide mentioned one of the airboat “captains,” who did something seemingly irrational.
It really annoys me! I review papers for scholarly journals and, if I agree to undertake the task, have never taken more than six weeks to get the job done. But sometimes my own papers are held by scholarly journals for a year, as the journal waits on reviews by one or more delinquent reviewers.
An article on the BBC and elsewhere notes that witches and astrologers are now recognized occupations in Romania and no longer part of the underground economy. Practitioners’ incomes are now taxable-and practitioners are now covered by the country’s pension and health insurance schemes. Some witches have cast spells to overturn the new regulations, while others like the new benefits more than they dislike paying the new taxes.
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