Grading Presidents

Click here to read my column in Sunday's NY Times.

The Newshour on Bob Gordon's New Book

Econ Theory Summer Camp

Graduate students with an interest in economic theory will be interested in this opportunity, run by my colleague Eric Maskin.

History of Econ Summer Camp

Those with an interest in the history of economic thought might want to consider this summer program.  I have been told that the program is designed primarily for faculty members in economics, other social sciences, and the humanities, though three of the twenty-five slots are reserved for graduate students.

More Competition

Kennedy School prof George Borjas, an expert on the economics of immigration, is blogging again.

One for My Fellow Bostonians

Putting Oil Prices in Perspective

Given the huge decline in oil prices over the past year, I thought it might be useful to put the current price in some historical perspective. Below is the price of oil relative to wages. Roughly, the graph shows the number of hours a production worker needs to work to make enough to buy one barrel of crude oil. What is most striking to me how little long-term trend there is (despite great volatility) and that the current level is very much normal by historical standards.

Click on graphic to enlarge.

What I've Been Reading

The Opposite of Loneliness by Marina Keegan.  A collection of wonderfully written short stories and essays by a young and promising writer.

The book is uneven and, at times, would have benefited from a bit more editing and revision.  Tragically, however, that rewrite was impossible, because the author died in a car crash several days after her college graduation. This collection was published posthumously from the writing she did as a student at Yale and at the Buckingham, Browne, and Nichols School in Cambridge (where my younger son is now a student, which is how I first learned about the book).

A New Resource

My colleague Ariel Pakes alerts me to a new website that should be of interest to readers of this blog:

Microeconomic Insights provides accessible summaries of high quality microeconomic research which informs the public about microeconomic issues that are, or should be, in the public’s eye.  It aims to disseminate the results of published microeconomic research that either improves the foundations for economic policy-making or furthers our understanding of how economics interacts with the environment we live in.  Its goal is to bridge the gap between academic research and the public’s knowledge, thereby informing the public’s conversation on microeconomic issues.

One Cheer for Ted Cruz

Up to now, I have been skeptical about Ted Cruz. Yes, he is smart and articulate, and he is a graduate of two of my favorite universities. But politics is a team sport, and based on his time as a member of the Senate, Cruz does not seem much like a team player.  If he were ever to become president, he would need to become a team leader, not just an effective promoter of his own personal brand. He has a long way to go to convince voters like me that he is up to the job.

But let's put that concern aside.  I was much impressed by this article in today's Wall Street Journal, with the headline Ethanol Backers Mobilize Against Ted Cruz in Iowa Republican Race: Republican senator is first leading presidential candidate to oppose federal Renewable Fuel Standard.

The issue at hand is the mandate for the use of ethanol, which in Iowa is as sacrosanct as motherhood and apple pie.  Based on what I know about the issue, the case boils down to good policy versus good politics.  My understanding is that corn-based ethanol is not cost effective (as opposed to ethanol based on cane sugar as used in some other nations).  But if you are trying to win votes from corn producers in Iowa, corn-based ethanol is excellent politics.

It seems that Cruz is taking a bold stand opting for good policy here. Count me as impressed.

Neck and Neck with The Donald

From Amazon:





New Research on the Minimum Wage

From UCSD economist Jeffrey Clemens:

The Minimum Wage and the Great Recession: Evidence from the Current Population Survey

I analyze recent federal minimum wage increases using the Current Population Survey. The relevant minimum wage increases were differentially binding across states, generating natural comparison groups. I first estimate a standard difference-in-differences model on samples restricted to relatively low-skilled individuals, as described by their ages and education levels. I also employ a triple-difference framework that utilizes continuous variation in the minimum wage's bite across skill groups. In both frameworks, estimates are robust to adopting a range of alternative strategies, including matching on the size of states' housing declines, to account for variation in the Great Recession's severity across states. My baseline estimate is that this period's full set of minimum wage increases reduced employment among individuals ages 16 to 30 with less than a high school education by 5.6 percentage points. This estimate accounts for 43 percent of the sustained, 13 percentage point decline in this skill group's employment rate and a 0.49 percentage point decline in employment across the full population ages 16 to 64.