When giants like Paul Krugman and Niall Ferguson start to argue, they both sound compelling. Ferguson says that interest rates are rising because of the deficit, and Krugman retorts that Ferguson has forgotten his first-year economics. Fortunately, the data can speak, and it’s time to give them a voice. This is why I turn to my frequent collaborator, Eric Zitzewitz, who has an incredibly handy knack for getting financial data to speak clearly. Eric’s verdict? You’ll have to keep reading.
David Leonhardt’s carefully-researched column in yesterday’s Times breaks down the causes of the increasing budget deficit. The bottom line: Don’t blame the Obama agenda, “it is responsible for only a sliver of the deficits.”
A few days back I wrote a post claiming that “for all the work that goes into the Human Development Index, it just doesn’t tell you much that you wouldn’t learn from simple comparisons of G.D.P. per capita.” Subsequently Francisco Rodriguez, who heads research at the UN Human Development Report Office touched base to tell me that he thought I hadn’t told the whole story. Francisco is a terrific macroeconomist (in fact, he was the TA when I took my graduate macro classes at Harvard), and so he kindly agreed to write a guest post filling in the missing pieces.
So does a graph of broadband prices and quantities in different countries tell us about the supply curve or the demand curve?
By jingo, what a boom it was! So much so that I just noticed a local Philly contractor, perhaps more honest than most, who named his business “Bubble Builders.” In a sign of the times, I haven’t seen a single customer enter over the past few months.
With the housing bubble now truly behind us, you might imagine that Bubble Builders either needs a new name or a new line of business. What would you recommend?
There’s been some interesting recent commentary on the Human Development Index. But first, some background. This index is calculated each year by the U.N. Development Program as a summary indicator of “Human Development,” combining data on life expectancy at birth, adult literacy, educational enrollment, and average income (measured as G.D.P. per capita). And earlier this week, Catherine Rampell noted a recent effort by the SSRC-funded American Human Development Project to develop a Human Development Index, for U.S. states. Philosophically, it is an attempt to broaden the development debate beyond G.D.P. But does it succeed?
An interesting fact: The faster that a new baby name becomes popular, the faster it will die out. At least that’s the conclusion of a comprehensive study of naming patterns in both France and the U.S. by my Wharton colleague Jonah Berger and co-author Gael Lë Mens.
I was reading John Steinbeck‘s Cannery Row last night, and I was really struck by how the following passage speaks to the forces behind our current economic predicament: “It has always seemed strange to me,” said Doc. “The things we admire in men — kindness and generosity, openness, honesty, understanding, and feeling — are the concomitants of failure in our . . .
The Bonn-based Institute for the Study of Labor (IZA) has just announced that this year’s winner of its annual prize in labor economics is happiness researcher Richard Easterlin. This is a wonderful prize. Dick was the first economist to start taking subjective well-being data seriously. While this sort of research is now pretty mainstream, I have to imagine that it . . .
Andrew Cherlin has a new book coming out today called The Marriage-Go-Round. He’s a first-rate sociologist, and so I’m looking forward to reading it. But for now, he’s teasing us with the following striking fact: Take two children, one growing up with married parents in the United States, and one growing up with unmarried parents in Sweden; which child has . . .
There’s an interesting discussion over at Room for Debate on how the recession is affecting family life. A key question is whether recessions lead to a rise in divorce or not.
Here’s Betsey Stevenson (my frequent coauthor and significant other):
The economics meme of the day appears to be naming the current downturn. A while back, our friends at Economix solicited reader suggestions, of which my favorite was “The Great Deception.”
Here are two interesting follow-ups to Tuesday’s post, in which I described how basketball teams who are behind at half-time fare a bit better than might be expected. First, my friend Lionel Page points me to a related study of his, which analyzes tennis. Lionel uses a similar approach to arrive at a different conclusion, but I think his results . . .
O.K., I’ll admit that I’ve done plenty of hand-wringing about the state of economics. And now I’m going to do something about it. This morning, Brookings announced that David Romer and I will be taking over as the new editors of the Brookings Papers on Economic Activity. We’ve got some pretty big shoes to fill — left empty by Larry . . .
Here’s my favorite new fact about N.C.A.A. basketball: teams that are behind by one point at halftime are actually more likely to win than teams that are one point ahead. This striking finding comes courtesy of a terrific new paper by my Wharton colleagues, Jonah Berger and Devin Pope. Their findings are summarized in this graph, which collects info from . . .
The abstract of a recent paper by Colander, Föllmer, Haas, Goldberg, Juselius, Kirman, and Sloth: The economics profession appears to have been unaware of the long build-up to the current worldwide financial crisis and to have significantly underestimated its dimensions once it started to unfold. In our view, this lack of understanding is due to a misallocation of research efforts . . .
Dartmouth’s Eric Zitzewitz is one of my favorite co-authors, and a whiz at tracking financial markets. And when he mentioned to me last week that a close look at the options markets told an interesting tale of fear, I asked him to share his observations. Here goes. Quantifying the Nightmare Scenarios By Eric Zitzewitz A Guest Post There’s no shortage . . .
Following up on yesterday’s post about quantifying political speech, Dartmouth’s Michael Herron — who is a first-rate political scientist and data hound — points out that Obama was the first president to speak about “data” in his inaugural address, and only the second to mention “statistics.”
Doug Mills/The New York Times Our friends at speechwars.com have put together a really fun tool to help you mine their database of the full text of all State of the Union Addresses (even though this wasn’t technically such an address) as well as inaugurals. It’s a fun way of tracking which issues have occupied the minds of our leaders. . . .
A while back, I wrote about the Game Theorist blog, in which my friend Joshua Gans writes about his adventures as an economist-parent (or equally, as a parent-economist). Each role seems to teach him something about the other, and his passion for both is infectious. He has collected much of this material in his new book Parentonomics, which has recently . . .
An interesting article by Gregory Clark on the post-crisis status of macroeconomics includes the following money quote: Recently a group of economists affiliated with the Cato Institute ran an ad in The New York Times opposing the Obama‘s [sic] stimulus plan. As chair of my department, I tried to arrange a public debate between one of the signatories and a . . .
Over at CoreEconomics, Joshua Gans points out that Steve Levitt’s research is no longer judged to be normal economics. Or at least his work doesn’t belong with the “normal papers.” From the “content alert” for the latest edition of the European Economic Review: Or perhaps it’s our friend John List who is “special.”
When your co-author is your colleague and also your significant other, confusion often follows. Take this recent post by Arnold Kling on the causes of inequality, where he says: I think that Betsey Stevenson/Justin Wolfers marriages are another big factor. That is, when highly educated men start looking for wives who are stimulating companions as opposed to kitchen-floor moppers, this . . .
I finally got around to viewing the PETA (People for the Ethical Treatment of Animals) ad that NBC decided to ban from its Super Bowl coverage. I had imagined a rather sordid broccoli-loaded affair. But it turns out it was just like a Victoria’s Secret spot, only a bit more nutritious. The point of the ad was that “Vegetarians have . . .
As the Senate and the House look to reconcile competing stimulus plans, the big debate is whether to emphasize government spending or tax cuts. A new paper by the New York Fed’s Gauti Eggertsson argues that the risk of deflation should tilt the balance to government spending. Our current problem is deficient aggregate demand. The government can raise total spending . . .
The latest recession indicator: more people are searching Google for “coupons” than for “Britney Spears.” And it’s not that Britney is getting less popular. By this measure, the recession began in March 2008. Check out the full time series, here. (Hat tip: Google’s Chief Economist, Hal Varian, via my co-author Bo Cowgill.)
For the past month or so, I’ve made it a habit to ask fellow economists how the response to the financial crisis has been improved by the past few decades of macroeconomic theorizing. Dozens of conversations later, I don’t have much to report. Today’s big question is whether government spending can pull us out of this recession. We want to . . .
A regular blog reader, Mitch Kosowski, sent along an interesting question: “Is ignorance truly bliss? Are people with lower intelligence happier than those with higher intelligence?” Let’s start with a quick literature review. Here are the findings reported by Simpson, L. (2001): Lisa Simpson: “As intelligence goes up, happiness goes down. See, I made a graph. I make lots of . . .
It’s social change alright: 26 percent of working wives out-earned their working husbands in 2006, up by nearly half from 20 years ago.
Now that many more women are graduating college than men, higher-earning wives are going to become the new normal.
I typed this from 10,000 feet, while on my way to the annual econ gabfest known as the ASSA meetings. I was lucky enough to score an upgrade to first class, and as I settled into my seat I was informed about the most astonishing cost-cutting measure: U.S. Airways has taken the coat hangers out of its planes.
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