Monday, February 28, 2011

Barro on Unions

Robert doesn't like them.  An excerpt:
There is evidence that right-to-work laws—or, more broadly, the pro-business policies offered by right-to-work states—matter for economic growth. In research published in 2000, economist Thomas Holmes of the University of Minnesota compared counties close to the border between states with and without right-to-work laws (thereby holding constant an array of factors related to geography and climate). He found that the cumulative growth of employment in manufacturing (the traditional area of union strength prior to the rise of public-employee unions) in the right-to-work states was 26 percentage points greater than that in the non-right-to-work states.

Sunday, February 27, 2011

An Econ Conference for Undergrads

Conferences for econ profs are too common to mention here, but conferences for undergrads are more rare.  So let me call attention this conference at Georgetown. Application deadline is just a couple weeks away.

Empiricists versus Theorists

Friday, February 25, 2011

MIT Symposium

A few weeks ago, I spoke at an MIT symposium along with several other macroeoconomists (some of whom you will surely recognize).  If you have a spare couple of hours, you can watch it here.  I start at about 1:05.

Wednesday, February 23, 2011

Tax Fact of the Day

"The U.S. effective corporate tax rate on new investment was 34.6 percent in 2010, which was the highest rate in the OECD and the fifth-highest rate among 83 countries. The average OECD rate was 18.6 percent, and the average rate for 83 countries was 17.7 percent."

Tuesday, February 22, 2011

Econ Summer Camp

Grad students with an interest in the history of economic thought might want to consider this summer program.

Update: Here is a summer program for undergrads.

Tax Fact of the Day

"The worst place to die is New Jersey with a combined effective estate and inheritance tax rate of 54.1%."


Monday, February 21, 2011

Gita Gopinath

The Ec10-mobile is dead!

Over the past decade, Harvard students have seen me tooling around campus in my light blue 2002 BMW 3-series with the Ec 10  license plate.  How I loved that car!  But sadly, it is now gone. 

On Friday evening, as I was driving straight through an intersection, a 17-year old driver in an SUV heading the opposite direction made a left turn right in front of me.  We crashed head-on.  Fortunately, no one was hurt, but the car is most likely beyond repair. :(

Is the Fed printing money?

Yes and no.  Jim Hamilton explains.

Friday, February 18, 2011

Reinhardt on Trade

Princeton economist Uwe Reinhardt has some observations about free trade, picking up where I left off in my recent Times column.

Thursday, February 17, 2011

President Obama's Budget

Via Keith Hennessey (Click on graphic to enlarge.)

Wednesday, February 16, 2011

Ed Glaeser on The Daily Show

Tuesday, February 15, 2011

Death by Price Control

Chapter 7 of my favorite textbook has a case study about whether there should be a market for kidneys. A similar issue is now making its way through the U.S. court system.

Smog-Eating Roof Tiles

Here is a cute example of a positive externality:
A California company is selling a “smog-eating” concrete tile roof that it says neutralizes the nitrogen oxides spewed by automobiles.
Boral Roofing says each year, one of its concrete tile roofs on a typical 2,000-square-foot house can break down the same amount of nitrogen oxides as a car’s engine typically produces during 10,800 miles of driving.
When sunlight hits the roof, it activates titanium dioxide, which breaks down the nitrogen oxides in the air into oxygen and nitrates, the company say. The tiles’ smog-fighting ability was proved in extensive laboratory testing and field studies conducted by a European Union consortium of academic and industry experts from 2002 to 2006.
The tile adds about $800 to the cost of the average 2,000-square-foot house.
Question for class discussion: What should government policy be regarding these new roof tiles?

Monday, February 14, 2011

The new edition is here!

The 6th edition of my favorite textbook has now rolled off the presses.  You can buy at it Amazon here. (Amazon appears not to have it in stock just yet, but it should very soon.) If you are an instructor considering it for one of your courses, you can get information about the new edition by contacting John Carey.

Just in time for Valentine's day.  Order it now, and you can tell your Valentine that the world's best economics textbook is on its way!

Saturday, February 12, 2011

The Case against "Winning the Future"

Jobs, Jobs, Jobs

In this article, Allen Sanderson, who teaches introductory economics at the University of Chicago (using my favorite textbook, of course), takes on the political rhetoric about job creation.

Thursday, February 10, 2011

A Portrait

Wednesday, February 09, 2011

Incentivizing Customers to Monitor Workers

A blog reader sends in this photo, taken in a souvenir shop in Kruger National Park in South Africa.

Tuesday, February 08, 2011

Economics Video Contest

The St. Louis Fed is running a video contest on the importance of an independent central bank.  Winner gets a free lunch with Ron Paul.

Actually, $1,000.

Update: If fiscal rather than monetary policy is your thing, check out this video contest.

On Comparative Advantage, Imperfect Markets, and Boston Weather

Seth Gitter asks, very sensibly, why did I spend time shoveling snow from my own roof a few days ago, rather than relying on the invisible hand to do it for me?  Shoveling is, after all, not my comparative advantage. 

His speculation is right: I could not immediately find someone else to do it.  Everyone my wife and I called had a queue of roof work to do.  (Question for class discussion: Why didn't the price rise to clear the market?)  Eventually, however, we did get to the front of the queue, so I could get off the roof and return to teaching and writing.  But not before the huge ice dams pulled down a gutter on one side of my house.

By the way, as I look out the window right now, it is snowing again.  Anyone know of any job openings for middle-aged economists in warm climates?  Maui would be nice.

Monday, February 07, 2011

A Behavioral Econ Business Plan

Chapter 22 of my favorite textbook includes a discussion of behavioral economics, and ec 10 students enjoy a guest lecture on the topic by David Laibson.  This article describes how some recent Harvard students are using the ideas of behavioral economics to design a better type of gym membership.

Sunday, February 06, 2011

The State of U.S. Manufacturing

Saturday, February 05, 2011

The Lucky Break of Rent Control

For those instructors teaching about the economics of rent control (Chapter 6 of my favorite textbook) or the Coase Theorem (Chapter 10), this article about buyouts of rent stabilized tenants should generate a good class discussion.

Friday, February 04, 2011

The Jobs Report

Thursday, February 03, 2011

One for My Photo Album

From last week's conference at MIT:

Photo by Dominick Reuter for MIT

Update: One of my Harvard colleagues suggests a caption contest and proposes the first two entries.  Readers should feel free to email me others, and I will add them to the list.  My favorite in in bold.
  1. "He really is a socialist!"
  2. "I'm thinking of writing a principles text."
  3. "Freshmen really are a faster study than Presidents."
  4. "Goolsbee wanted me to ask you how to adjust the lumbar support on his office chair."
  5. "Buy GE."
  6. "I voted for Obama."
  7. "Your tie hasn't matched my outfit this well since your wedding."
  8. "CDO's were my idea...."
  9. CR: "Lend me twenty bucks for cab fare home."  GM:"I'll give you 15. You can model the other 5."
  10. "I'm sorry, Greg, but I just don't think Brad wants to be friends."
  11. "'Mr. President,' I said, 'if I were you, I wouldn't sign this thing into a law'. 'Really? Then I won't sign it!', he answered." Christina Romer tells her dream of how she stopped the President from signing the Healthcare Bill.
  12. “I was wondering, Greg, where does that bottled water fit in your ten principles?”
  13. "Water or diamonds, Greg?"
  14. "I'm going green. I use cap-less bottles now and assume away the spills!"
  15. "Greg, hasn't the government increased taxes enough to prevent you from attending these conferences?"
  16. "I understand what you're saying, but let me show you the supply side of things."
  17. “And then I told him WTF doesn’t stand for Win the Future.”
  18. "Really, snow on your roof?  We don't get that in Berkeley."
  19. "Seriously, the weather in Boston is not REALLY that bad. So, the job swap is still on?"
  20. "I wish we had hired you to explain our policies in plain English.  Instead, Paul Krugman is the closest thing we have to a spokesman."

Wednesday, February 02, 2011

Donald Marron on Tax Reform

Moral Hazard

With the tremendous amount of snow we have had lately, my roof has started to develop some ice dams.  So a little while ago, I climbed out onto the roof to shovel off as much snow as I could.  The conversation as I exited through the window went something like this:

My wife: Be careful.

Me: I will.

My wife: It's slippery out there.  I don't want you to fall.

Me: Well, remember that I have a lot of life insurance.

My wife: Ha. Ha.

Me: But I don't have nearly as much disability insurance.  So if I do have an accident, make sure the fall kills me.

Fix the Economy, Win $15,000