As an economist, I am supposed to have something intelligent to say about the current financial crisis. To be honest, however, I haven’t got the foggiest idea what this all means. So I did what I always do when something related to banking arises: I knocked on the doors of my colleagues Doug Diamond and Anil Kashyap, and asked them . . .
My son Nicholas, age 5, recently discovered the internet. Last week I got him an account at Club Penguin, a website for kids. Since then, he has spent hours at a time on Club Penguin. He refuses to come to meals. He throws tantrums if forced to stop. Even when enticed with activities he used to find enjoyable, like terrorizing . . .
I was reading a bedtime story to my daughter Sophie when I stumbled upon the following haiku by Jack Prelutsky, told from the perspective of a mouse: If not for the cat, And the scarcity of cheese, I could be content. Perhaps I am just a sucker for the word scarcity, but there was something in this haiku that really . . .
Jason Felch and Maura Dolan of the Los Angeles Times recently wrote a fascinating piece about a controversy that has arisen regarding the use of DNA in identifying criminal suspects. The article starts like this: State crime lab analyst Kathryn Troyer was running tests on Arizona’s DNA database when she stumbled across two felons with remarkably similar genetic profiles. The . . .
Photo: Bogdan Suditu Princeton economist Alan Blinder recently proposed a new government program he christened “Cash for Clunkers” in an article in The Times‘s Business section. Under the program, the government would buy back old cars at above market prices and scrap them. According to Blinder, this would accomplish a policy trifecta: 1) help the environment by getting the most . . .
Alex Tabarrok over at Marginal Revolution has an interesting post on media coverage of the recent Science paper that argued against gender differences in math test scores. Tabarrok says that the media misreported the story and Larry Summers is still right.
I almost never read business books anymore. I got my fill of them years ago when I was a management consultant before I went back and got a Ph.D. Last week, however, I picked up Good to Great by Jim Collins. This book is an absolute phenomenon in the publishing world. Since it came out in 2001, it has sold . . .
I spent three years at Harvard in the Society of Fellows. I had no obligations there except to spend my Monday nights eating fancy meals in the company of some of the world’s most brilliant thinkers: Nobel Prize-winning scientist Amartya Sen, philosopher Robert Nozick, etc. Dinner was always accompanied by expensive wine from the society’s wine cellar. Photo: Rhett Redelings . . .
The Supreme Court recently struck down the gun ban in Washington, D.C. A similar gun ban in Chicago may be the next to go. The primary rationale for these gun bans is to lower crime. Do they actually work? There is remarkably little academic research that directly answers this question, but there is some indirect evidence. Let’s start with the . . .
Photo: Rhett Redelings On a recent United Airlines flight I was surprised to see that their new planes are equipped not just with lap belts, but shoulder restraints as well. This just cannot make any sense. First, planes virtually never crash. Second, when they do crash, it is unlikely that a shoulder restraint will be the deciding factor in whether . . .
Hats off to economist Roland Fryer, Joel Klein, the rest of the folks in the New York City Department of Education, and Droga5 for taking home the Titanium Lion prize at the Cannes Lions advertising festival for their work on “Million.” Million is the innovative NYC schools program that puts a specially designed cellphone into the hands of every NYC . . .
There is a mini-controversy on the University of Chicago campus surrounding the announcement of plans to raise money for a Milton Friedman Institute here at the university. Some non-economists are concerned that the Friedman Institute will push a right-wing agenda and tarnish the reputation of the university. Some who knew Friedman well have the opposite worry: that the Institute won’t . . .
We’ve blogged a few times about Zillow (here and here), a website that is trying to shake up the real estate industry. I’ve made radical predictions about the future of the real estate industry. I’m hoping that Zillow will help make those prophesies come true. So to do my part (and because I am as susceptible to flattery as the . . .
When I first stumbled onto the name voyager at the Baby Name Wizard a few years back, I felt like I was seeing the future. It was the sort of web tool that folks dream about. I had exactly the same feeling when I recently visited Gapminder.org. They have an interactive data tool called “gapminder world” that is truly remarkable . . .
People who make millions of dollars doing one thing often come to view themselves as being experts in subjects far afield from those in which they made their wealth. Because they have so much money, others tend to humor them and tell them they are brilliant in the hopes of currying favor, so they don’t get realistic feedback. (The same . . .
Many people know about the World Series of Poker from the television coverage on ESPN. Mostly they just show the “Main Event” on TV. Hoa Nguyen from worldseriesofpoker.com. The main event has a $10,000 buy-in and lasts for two weeks. Leading up to the main event, there are dozens of other tournaments, some of which are going on right now. . . .
I just ran my horse racing model for the Belmont Stakes. It predicts that Big Brown will go off at odds of 1/5…even lower than his morning line odds of 2/5. I estimate that a $2 bet on Big Brown has an expected value of $1.81. Although the expected value is negative (you will lose an average of 19 cents . . .
If your eBay user name is lpinok, then the answer is $55.71. This seems to defy all logic. The item description is: “Just a $50 gift card to Target … .” Why would anyone pay more than face value? (Hat tip: David Hansen)
My father has a lot of ideas. Some of them are pretty good. Others get me into a lot of trouble. Back in July of 2005, my dad had an idea I thought was interesting enough that I passed it along to the staff of Barack Obama. This is well before Obama was running for president — back when he . . .
I love to read books written by police officers about being police officers, and books written by criminals about being criminals. In the latter category, I highly recommend Brutal by Kevin Weeks and Phyllis Karas. Kevin Weeks was Whitey Bulger‘s right-hand man. He is loyal, loves to punch people in the face, and doesn’t mind committing the occasional murder. It . . .
A few years back Dubner and I wrote a piece on Slate heralding a remarkable young economist, Emily Oster. She has continued to do great work. She also has done something incredibly rare for an academic economist: she has admitted she was wrong. In places like India and China, there are many “missing women.” In other words, the sex ratios . . .
A recent Lancet article argued that obesity is contributing to global warming because the obese consume more calories. Since making food releases carbon, that means an obese person, on average, is worse for global warming than a skinny person. (Not to mention the extra methane the obese might release, but that is my father’s area of expertise, not my own.) . . .
Inequality is growing in the United States. The data say so. Knowledgeable experts like Ben Bernanke say so. Ask just about any economist and they will agree. (They may or may not think growing inequality is a problem, but they will acknowledge that there has been a sharp increase in inequality.) Photo: Jim, Wal-Mart Supercenter in Suwanee, Georgia. According to . . .
The breakdown of Eight Belles in this year’s Kentucky Derby, just a few years after Barbaro‘s broken leg in the Preakness, has a lot of people worried about the safety and welfare of thoroughbreds. Statistics on the frequency of horses breaking down are elusive. The closest thing to official statistics I could find comes from an Andrew Beyer column, in . . .
When it comes to creativity and storytelling, my sister Linda Jines got all the talent. She, for instance, is the genius who thought up the title “Freakonomics.” In what we hope will be the first in a long line of guest blog posts, today she toasts my father on his 73rd birthday. Levitt’s father in his balaclava. Edina, Minnesota January . . .
I love Chrysler’s new incentive program that guarantees consumers who buy one of their new cars or trucks won’t pay more than $2.99 a gallon at the pump for the first three years they own the vehicle. When you sign up, you get a special credit card that can only be used to buy gas. When you swipe it, $2.99 . . .
The Chinese think they can keep it from raining on the National Stadium during the Olympics. The Chinese Weather Modification Office employs nearly 53,000 people — it would have been simpler to just build the stadium with a roof. But mandating that the Chinese people cease and desist may prove an easier task for the Chinese government than telling Mother . . .
Robert Jensen Over the last two days, Robert Jensen has described his hunt for the ever-elusive Giffen good. Like all action adventure stories, this one has a happy ending. Jensen then goes on to explain the important implications of his findings for food policy in the developing world. Raiders of the Lost Arc Elasticity, Part III By Robert Jensen What . . .
Robert Jensen In the second installment of his adventure story about searching for the elusive Giffen good, Robert Jensen describes some of the setbacks they suffered along the way. Raiders of the Lost Arc Elasticity, Part II By Robert Jensen Let me start at the beginning to explain how our search for a Giffen good evolved. About five years ago, . . .
A few years back the Wall Street Journal dubbed me the Indiana Jones of economics. Robert Jensen In reality, that title more rightfully belongs to Robert Jensen, an economist at Brown University who is doing some of the most interesting and adventurous economics studies these days. Jensen has documented how cell phones revolutionized fish markets in India, how simply telling . . .
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