by John Q on June 12, 2009
While Michèle Lamont is visiting us, and talking about cross-disciplinary comparisons and interactions, I thought I would raise a question about questions.
As background, my first “real” job was in a government research agency. Seminars were part of the process, and the norm was that senior staff would open the questions. In this context, it was almost invariably safe to ask “What are the policy implications”. That’s still true for some of the seminars I attend, but in others (economic theory, for example), such a question would be at best a faux pas, and the all-purpose question might be something like “Does this work in a monetary economy?”.
So, what are the all-purpose questions in different fields (or are there fields without such questions), and what, if anything does this reveal about those fields?
by John Q on June 10, 2009
The strong showing in the EU elections by Sweden’s Pirate Party is the outcome of yet another Pyhrric victory for the strong IP movement, which succeeded, a couple of months ago in securing prison sentences for the Swedish operators of filesharing site Pirate Bay. This galvanised about 7 per cent of Swedish voters into supporting the Pirate Party, which reflects the typical feelings of Internet users: hostile to intrusive and aggressive IP, concerned about privacy for individuals and households, in favour of transparency for corporations and governments. These feelings are, of course, diametrically opposed to those of the elite groups that have historically driven policy on these issues. In the light of this public reaction, and the absence of any corresponding electoral support for the IP lobby, governments everywhere will think twice before endorsing criminal prosecution of IP violators.
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by John Q on June 3, 2009
The economic crisis has, as we’ve been discussing, raised a lot of interest in Keynesian economics, but so far it’s been based more on the obvious bankruptcy of alternatives than on successful examples of Keynesian fiscal stimulus. Although there were some big financial bailouts late last year, few countries engaged in large-scale fiscal stimulus before the first few months of this year (Obama’s package was passed in February, and is only now being implemented, so we can’t expect to see evidence of impacts on GDP until late this year).
Australia went early and hard with a substantial cash handout to households in December 2008, followed by another round of cash stimulus delivered a month or two ago, and then a large-scale infrastructure program. The national accounts for the March quarter (which should include the effects of the first round of stimulus) have just come out, and show growth of 0.4 per cent, compared to a 0.6 per cent contraction in the December 2008 quarter[1]
On the face of it, this is a big success for Keynesian fiscal policy. And, there’s pretty general agreement that, despite some qualifications and plenty of concerns about the future, the prima facie interpretation is the correct one.
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by John Q on June 1, 2009
I’m working on a bunch of essays, book chapters and maybe even a book or two in response to the global financial crisis, making the general point that the sudden collapse of the neoliberal order has found social democrats unprepared for the shift from a long defensive struggle to the opportunity (and need!) to develop a progressive response to the crisis. As obvious examples, it’s necessary to reconstruct the global financial system and to ensure that the burden of the debts that are building up so rapidly is not borne by the poor, who did nothing to create the crisis. This piece (PDF) is an example of what I’m thinking.
I have plenty of ideas about policy (though of course I’m always interested in new ones). But, I don’t have much of a feeling for the political strategies that are needed, so I thought I would try the crowdsourcing thing, which has worked pretty well for me in the past.
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by John Q on May 30, 2009
I wasn’t all that surprised that Bryan Caplan didn’t like my interpretation of our bet on EU and US unemployment rates, which was that the combined rates of unemployment and incarceration in the US would exceed those in the EU over the next ten years. I was, however, surprised by the vehemence with which libertarian-inclined* commenters here and at my blog objected to this interpretation.
A string of them echoed Caplan’s argument that
From a labor market perspective, though, Quiggin’s incarceration adjustment would only make sense if you thought that most or all of the people in jail would be unemployed if they were released.
Caplan has missed my main point. I’m not suggesting that incarceration is disguised unemployment (though obviously it reduces measured unemployment). Rather, I’m saying that, like unemployment, incarceration should be regarded as a (bad) labor market outcome. If you want to evaluate the performance of the labor market, you need to look at both.
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by John Q on May 28, 2009
Bryan Caplan and I have now agreed on the settlement conditions for a bet on US_EU jobless rates while also agreeing to differ on the interpretation. The stake is $US100 and the agreed criterion is that, for Bryan to win, the average Eurostat harmonised unemployment rate for the EU-15 over the period 2009-18 inclusive should exceed that for the US by at least 1.5 percentage points.
Since the implied difference in the proportion of the population who are unemployed is almost exactly equal* to the difference in the proportion of the population who are incarcerated, I interpret my side the bet as follows
Averaged over 2009-18, the sum of incarceration and unemployment rates in the US will exceed that in the EU-15
Caplan wants to leave incarceration out of the discussion and focus only in unemployment. Since we’re agreed on how to settle the bet, there’s no problem with differing on how to interpret the result.
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by John Q on May 25, 2009
Bryan Caplan responds to the data on US and EU-15 unemployment by offering a bet.
The average European unemployment rate for 2009-2018 (i.e., the next decade) will be at least 1 percentage point higher than U.S. unemployment rate. The bet will be resolved when Eurostat releases its final numbers for 2018.
Betting is usually unwise, but nonetheless I’m willing to take Bryan on, with one amendment. I will take the bet provided that people in prison are counted as unemployed. By my estimate, that raises the US rate by about 1.5 percentage points and the the EU-15 rate by about 0.2 percentage points. That is, assuming current imprisonment rates remain unchanged, the bet is that the Eurostat measure of unemployment (which excludes prisoners) should be no more than 2.3 percentage points higher in the EU-15 than in the US.
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by John Q on May 22, 2009
by John Q on May 19, 2009
As governments and the WHO wrestle with the decision on whether to divert resources from the production of seasonal flu vaccines to develop a vaccine against H1NI (swine) flu, I thought I’d repost this piece from 2005, suggesting an expansion of vaccination against seasonal flu, in part to expand production capacity to prepare for problems like this.
Thinking a little more, and with the idea of global public goods in mind, it seems obviously in the enlightened self-interest of developed countries to go beyond domestic vaccination programs and contribute both vaccine supplies and organisational resources to encourage routine vaccination in poor countries, as well as ensuring a further expansion of production capacity.
The same goes, I think, for more extensive use of antivirals like Tamiflu, which apparently have the nice property that the flu virus does not develop resistance to them.
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by John Q on May 12, 2009
Brad DeLong links to my post on the obsolescence of New Keynesian macro, and concludes
I have to call this one for Krugman, Clark, Akerlof, Shiller, and Quiggin and against Blanchard’s vision of growing knowledge and analytical convergence
I’ve been reasonably successful as Australian academic economists go, but, based on my journal contributions, I would have rated the likelihood of reading the phrase “Krugman, Clark, Akerlof, Shiller, and Quiggin” only marginally higher than that of being romantically linked with Angelina Jolie. Blogging really does have its rewards.
While the aesthetic defence of religion offered by Terry Eagleton might appeal to a small fraction of the intelligentsia, a far more common belief is that, regardless of truth value, religious belief makes people better citizens, and should therefore be encouraged.
Although this claim has various components, the most obvious social benefits of religious belief, and the biggest source of concern about the adverse consequences of unbelief, is the doctrine of an afterlife in which good actions will be rewarded and bad ones punished. Back in the 19th century, lots of people were really worried about this and, even in the 21st it’s a common theme in US discussions of religion.
But do we really need religion for this?
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I’ve been following discussions of solar energy on-and-off for quite a while, and it has always seemed as if it would be quite a long time, even assuming an emissions trading scheme or carbon tax, before solar photovoltaics could be a cost-competitive source of electricity without special support such as capital subsidies or feed-in tariffs set above market prices.
But looking at the issue again today, I’m finding lots of claims that this “grid parity” will be achieved in the next few years, and even one company, First Solar, that claims to be already at grid parity with a 12 MW plant in Nevada completed last year. Obviously, Nevada is a particularly favorable location, and there is plenty of room for judgement in cost estimates. Still, looking at a lot of different reports, it seems clear that, with a carbon price of say $50/tonne (about 5 cents/kwh for black coal and 7 cents/kwh for brown coal), solar will be cost-competitive with coal for most places in Australia without any need for fundamental technical improvements.
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by John Q on April 30, 2009
The Australian , commonly referred to as the Oz, is Australia’s only national general[1] newspaper. It’s also been, for some time, a national joke, particularly among bloggers, for its continuous War on Science, particularly as related to climate change, and for its propensity to melt down in response to criticism from blogs and media critics.
Last week, I added a bit of fuel to the fire with a column in the Australian Financial Review attacking the delusional thinking behind claims that the science of climate change is a hoax, fraud or conspiracy, which included the following passage:
While most media outlets give at least some space to these conspiracy theorists, the central role has been played by The Australian. Not only its opinion columnists (with a handful of honorable exceptions) and its editorials, but even its news reporting is dominated by the idea that mainstream science is on the verge of being overturned by the efforts of a group of dedicated amateurs, publishing their findings not in the peer-reviewed literature but through blogs, thinktanks and vanity presses
That looked a bit different when it came out of the quote mine.
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by John Q on April 26, 2009
One way to think about the political impact of the GFC is to look at the range of political positions it’s rendered untenable. This range is large, encompassing, in the US context, everyone from Bill Clinton to Newt Gingrich. More generally, it covers anyone who embraced the claim that a US-style economic system, as of, say, 1995-2005, was the best that had ever been seen anywhere, and could only be improved by making government smaller and/or more business-like.
Minus the US-specific triumphalism, this range includes the positions held by most major political leaders in the developed world at the time the crisis erupted, notably including both George Bush and Barack Obama. It covers anyone who saw the growth of the financial sector and the explosion of global financial transactions as beneficial and who regarded with equanimity phenomena like the growth of inequality and the decline of trade unions which both resulted from and reinforced these trends. Virtually everyone holding this view downplayed or disregarded the looming crisis until it exploded in late 2008.
A critical assumption underlying these views was that the system was stable enough to maintain equilibrium without substantial government intervention and without collapsing into crisis. As far as I can tell, no one seriously argues this in relation to the current financial crisis. There are those who argue that the kind of massive intervention we’ve seen shouldn’t be undertaken and/or will only make things worse. But, AFAIK, no one seriously suggests that, without intervention the system could right itself fairly fast and return to the situation prevailing in, say, 2006.
What are the implications of the collapse of such a large section of the political landscape, both for those who formerly occupied it, and for the rest of us?
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