EclectEcon

Well, Of Course...

Earlier I noted that the rapid rise in the US price of the Canadian dollar has left a sizable price differential between the US and Canadian prices of many goods, leading many Canadians to do more shopping in the US.



The price differential is narrowing only slowly as Canadian retailers are reluctant to take capital losses on their inventories purchased at higher prices -- a classic case of ignoring opportunity costs.



The result has been that Canada Post has been swamped with parcels being shipped from the US to Canadian consumers. From the Glob & Mule:

A surge in Internet cross-border shopping by Canadians trying to cash in on the soaring loonie is creating headaches for consumers, border agents and Canada Post.



There are already complaints of delivery delays as mail sorting centres try to dig out from heaps of Canadian Internet orders from the U.S. — and the holiday shopping season is barely under way.



Officials say the volume of parcels has choked three main international mail-sorting centres operated by Canada Post and the Canada Border Service agency in Vancouver, Toronto and Montreal.



There are reports of parcels from the United States languishing for days and even weeks at the centres before being released for delivery.



Bruce Cran of the Consumers' Association of Canada says he is getting plenty of complaints and is warning that the backlog is going to get worse.



Canada Post and the border service agency say they are working to speed up service and are urging consumers who plan to cross-border shop for the holidays via the Internet to place orders as early as possible.

Watch for other effects:

• Consumers will make even more use of private couriers and shipping firms (e.g. UPS, Fed-Ex, DHL, etc.
• Consumers will make more personal trips to the US to do their shopping.
• Border crossings will become even more seriously clogged.

Hypothesis: Phillips Curves are Shaped Like Their Countries

Peter Goodman recently referred me to this paper in the Queen's University Working Paper Series. It shows a plot of Japan's Phillips Curve using data from 1980 through 2005. The researchers noticed that if you do a mirror image of the plot, it looks very much like the map of Japan.



I think the same thing is true for Canada. Here is a plot of the Canadian Phillips curve data from 1948 - 1996 (from the Canadian edition of The Economic Way of Thinking):

Careful inspection of the plot reveals that the upper dots represent the arctic islands, and the large gap to the east appears right where Hudson Bay is. For comparison, consider this map of Canada (courtesy of the CIA):







Update: In the comments, Alan wondered whether I was implying with those dots in the upper left that Canada had staked a claim to Alaska to strengthen its claim to the passages in the Arctic Ocean.



I should have made clear that even though I reproduced an azimuthal projection map originally, I had in mind a mercator projection map (the kind

used by Google--who can argue with that authority?), like this:







With this map, it is clear that the higher dots all fall on Canada's islands in the Arctic. There is even a dot in the lower left to indicate Victoria, on Vancouvre Island.



Update #2: There is more confirmation of my hypothesis that a country's Phillips Curve is shaped like the country: Look at the Phillips Curve for the Czech Republic.



Update #3: More confirmation from The Netherlands.



Addendum: the Phillips Curve is named for the famous economist who discovered it, Professor Curve.

EclectEcon: At Least the Second-Best Economics Blog in Canada

Stephen Gordon, of Worthwhile Canadian Initiative, laments that there are only two economics blogs still going in Canada: his and EclectEcon. That means this blog is ranked at least second among all economics blogs in Canada. And by some rankings, it is number one.



All the staff associated with this blog will be out celebrating this news this weekend.

Was Anaximander the First String Theorist?

As I understand it, string theory is the result of attempts by physicists to find a theory of everything. The strings in the theory are very small, have various shapes or forms, and are the basis of all sub-atomic particles and the basis of all energy, too.



That sounds a lot like "apeiron", a philosophical-physical abstract hypothesized by Anaximander. From Wikipaedia,

For Anaximander, the principle of things, the constituent of all substances, is nothing determined and not an element such as water in Thales' view. Neither is it something halfway between air and water, or between air and fire, thicker than air and fire, or more subtle than water and earth.[8] Anaximander argues that water cannot embrace all of the opposites found in nature — for example, water can only be wet, never dry — and therefore cannot be the one primary substance; nor could any of the other candidates. He postulated the apeiron as a substance that, although not directly perceptible to us, could explain the opposites he saw around him.

Also from Wikipaedia, on string theory,

String theory is a model of fundamental physics, whose building blocks are one-dimensional extended objects called strings, rather than the zero-dimensional point particles that form the basis for the standard model of particle physics. The phrase is often used as shorthand for Superstring theory, as well as related theories such as M-theory. By replacing the point-like particles with strings, an apparently consistent quantum theory of gravity emerges. Moreover, it may be possible to "unify" the known natural forces (gravitational, electromagnetic, weak nuclear and strong nuclear) by describing them with the same set of equations, as described in the Theory of everything.

It is all well-beyond my comprehension, but they sound pretty similar to me.

Home Video of Amazingly Complex Rube Goldbergism

check this out.

More on Pumpkins

Following up on my earlier posting about jack-o'lanterns, here is a valuable site for this weekend's pumpkin carving and/or Hallowe'en parties: Extreme Pumpkins

Nobel Peace Prize Committee to Disband

From TCS Daily:

Responding to overwhelming pressure from every civilized person on earth with any semblance of intelligence, the Nobel Peace Prize Committee today announced that it had voted to terminate its charter. Just prior to the unanimous vote, the Committee voted to rescind numerous past prizes - including the 2007 prize to itinerant comedian and performance artist Albert Gore of the United States - and award those prizes and all future prizes to the United States military.



"This about face by the Nobel Peace Committee," stated former Committee Chairman and former leader of the Norwegian Labor Party, Trygve Andreesen, "came after hundreds of millions of civilized people sent e-mails, letters, telegrams, text messages, voicemails and carrier pigeon messages demanding that we stop giving awards to Islamic martyrdom supporters like Jimmy Carter, frauds like Rigoberto Menchu and corrupt mass-murderers like Yassir Arafat."



"We got the message," said Ola Oppigardem, Committee Secretary and former leader of the Norwegian Labor Party. "The Gore prize was what did it. We acknowledge that the warming of the Earth's surface is an important issue that deserves careful scientific study, but we didn't realize that Gore was an egocentric Luddite who specializes in creating hysteria and false science. ..."



Two representatives accepted the Prizes on behalf of the U.S. military - former Senator Robert Dole (R-KS) and Senator Daniel Inouye (D-HI).



"Well, we never really expected any sincere gratitude from these Europeans," said Senator Dole, who was wounded in Europe during World War II fighting Nazis. "It's kinda nice and Elizabeth and I, we're really, almost sort of honored to be here to accept the award for people who actually do real work for peace."



Added Senator Inouye who was also wounded defending Europe in World War II, "I always thought the peace prize was a bunch of crap given to whiney, self-aggrandizing, busybodies by a bunch of self-important, narcissistic gullible, retired, left-wing, Norwegian, gasbag politicos. These awards may cause me to consider thinking about possibly reassessing my opinion."

Just in case you hadn't guessed, the wire service reporting this story is shown as "OSLO (SATIRENEWSERVICE)"

Cuisinarts, U.S. Prices, and Canadian Prices

Our Cuisinart finally gave out on us. It had been a wedding present and had served us well for the past 25 years.



Since we live some distance from most major shopping areas, Ms. Eclectic and I began shopping for a new one on-line. Here are the best prices we could find for a 14-cup capacity Cuisinart:



Future Shop: $349 Cdn, on sale for $299 Cdn.

Amazon.com: $199US



Does that make any sense, given that one Canuck buck is worth more than one US dollar? Why is there such a huge difference in prices? And why does it take so long for prices to adjust to movements of the exchange rate?



Former student, Scott, tells me that Chapters bookstore has a sign up saying that they are not making any extra profits because of the movement of the exchange rate but that the massive price differentials between Canadian and US prices (still) stamped on books is due to higher publishing and distribution costs in Canada.



I don't believe them. If we had free trade in books, Ontario would be a big market, well-served from Detroit and Buffalo.



Instead, I think it just takes time for people and prices to adjust to the new and changing exchange rates. People may have rational expectations, but that does not mean we have instantaneous adjustments when things change.



Nevertheless, I'm eagrely waiting for international competition to put downward pressure on Canadian prices.



Referring to jaw-boning/grand-standing by Finance Minister John Flaherty, Catherine Swift was quoted in the Trono Globe and Mail:

Some businesses, such as Wal-Mart Canada Corp. and Zellers Inc., have already cut prices but a Canadian business leader said it will take some time for the majority of the country's firms – small businesses – to move through older inventory.



Catherine Swift, president of the Canadian Federation of Independent Business, said Mr. Flaherty should “know better” when it comes to lecturing entrepreneurs.



“It's simplistic to say, ‘Cut your prices.' It'll happen. It's a very competitive market. Our members have to stay current in terms of pricing. The market does work and the market will work – but to think it'll turn on a dime, that's pretty unrealistic. Some people are carrying older merchandise,” Ms. Swift said in an interview yesterday.

Of course from an economics perspective, it doesn't matter what businesses paid for their old inventory. What matters is what the businesses can sell it for in the current marketplace under current competitive conditions (and that is why economists strongly favour using LIFO instead of FIFO for valuing inventories). The fact that prices in Canada are slow to adjust mostly reflects the degree to which competitive forces take time (a month? a few months?) to react to changed conditions.

Invite Me To Be Your Graduation Speaker

This is a revised repost of an open solicitation I made several years ago:

Invite Me to Speak at Your School's Graduation Ceremonies

This is an open solicitation.

I would like to give the commencement address at your school.

Here are some reasons you should invite me:



1. I have a cap and gown that have been described as cool or sexy (click here to see a photo).

2. I look very professional and academic with my gray beard and glasses.

3. I have considerable experience listening to bad commencement addresses, so I know what not to do or say.

4. I am an award-winning professor, with considerable acting and speaking experience.

5. I promise not to cuss (unless you want me to).

6. I will charge no fees (until the demand increases considerably)

7. I will pay (some of) my own transportation expenses, within reason

8. You have your choice of opening lines (and topics):

• "Never apply latex paint over glossy alkyd enamel."
• "There are no refunds for losing lottery tickets."
• "If you're going to save the world, do it yourself — don't ask the gubmnt to do it."

Butterfield v. Forrester

I find it absolutely intriguing that when I do an internet search for Butterfield v. Forrester, most of the websites mentioning this case (1809, King's Bench, dealing with contributory negligence) are from economists teaching economic analysis of law. Did we ALL receive TWLDs from Henry Manne?



Note: TWLD = two-week-law-degree (so named by Steve Margolis). Every summer for decades, Henry Manne ran a two-week programme designed to cram almost all of first year law into a very intensive two-week course. We all seem to remember this case from Bob Summers' introduction to tort law.

If You Ate Today,Thank a Farmer the Market

During my commutes through rural Ontario, I have often seen two different signs that bug me because of their economic ignorance (and their whiney begging). The first, "Farmers Feed Cities" is one I have posted about before.



The second says "If you ate today, thank a farmer."



Why?



Why should I thank people who, acting to maximize their own utility, provide me with something I am willing to pay for? I would much rather thank "the invisible hand" of Adam Smith. I would much rather thank the private property rights system that provides incentives for people to produce so much food so inexpensively. I would much rather thank the common law system that enforces contracts made between willing individuals seeking gains from trade.



But I feel no particular sense of gratitude for the work done by people who think I owe them something more than they get from the market. And I especially feel no particular sense of gratitude toward those who think the gubmnt should subsidize their lifestyle.



And, needless to say, I have no political aspirations in this rural, farming community.



Addendum: Phil Miller has a good follow-up:

Turning the logic around, because of the ethanol subsidies received by farmers, you could also rightly add "If you paid high prices for your food and beer today, thank a farmer."

And Sparky has even more:

What motivates all of them is the desire to earn a living, to trade with people they do not know. The growth of our standard of living depends in great part on being able to trade not with just the people you know but those you don't, not out of friendship or love but one's own self-interest. The institutions that develop to permit this, and to widen that circle of strangers, are what we collectively call "the market".

Justice vs. Social Justice

Any time I hear someone use the phrase "social justice", I cringe. Nearly every person who uses that phrase has in mind some redistribution of society's wealth from those who are better off to those who are worse off. For them, "social justice" means "more nearly equal, ex post — after the fact; it means equality of outcome.



Justice should mean something different. Justice should mean equal treatment and equal opportunity. Justice should be an ex ante concept, not an ex post concept. It should have nothing to do with equality of outcome.



I once a attended a conference contrasting the views of Hayek and Pope Leo IX on social justice. In the end it seemed to me the primary difference was that the pope thought there should be a very high social safety net; Hayek argued that a higher social safety net meant there would be some serious disincentives for productivity. The higher social safety net might make the poor better off today, but it means there will be far more poor people in the future.



I'm not anti-redistribution. However, I tense up whenever I hear the phrase "social justice" because it is usually being uttered by some elitist interventionist eagre to create more bureaucracy and control more of our lives. Most people who preach "social justice" have no concept of programme assessment and programme evaluation to try to determine the effectiveness of their pet projects. And they rarely are willing to listen to economists and to examine the incentive effects of redistribution schemes.

To All Potential Economics Graduate Students

I tend to encourage good graduate students to attend George Mason University, not MIT. Here is why.

To me, the problem with the Stiglitz-MIT view is that they do not share the Masonomics view of the real nature of government failure. It is not just that special interests can gum things up. It is that however things get gummed up, they are persistently gummed up in an institution that is insulated from market competition.

It is reassuring to know that there is still a place that carries on the intellectual traditions and perspectives that we used to find at Chicago, UCLA, and Virginia (and Washington and Texas A&M). These traditions simply acknowledge that gubmnt failure is a constant problem that must be expected; that incentives always exist for gubmnt employees and bureaus to build the size of gubmnt and intervene in ways that do not always make other people better off. Here is Arnold Kling's original piece about economics at GMU. And here is an excerpt:

At the University of Chicago, economists lean to the right of the economics profession. They are known for saying, in effect, "Markets work well. Use the market."



At MIT and other bastions of mainstream economics, most economists are to the left of center but to the right of the academic community as a whole. These economists are known for saying, in effect, "Markets fail. Use government."



Masonomics says, "Markets fail. Use markets."

And with the growing recognition throughout the profession that students trained at GMU are both smart and capable, graduates from there will become increasingly desired hot prospects on the job market.



Update: Also check out what Phil Miller says,

Moreover, there are incentives for private folk to try to get favors etc. from politicians and bureaucrats. These people are a class of rent-seekers: people who seek a transfer of wealth from one person to another person without giving them something in return. While rent-seekers are rightly scorned, they are not the only ones at fault: government plays a roll as well.

[h/t to Craig Newmark and to Cafe Hayek]

Real Business Cycles and Ribbed Condoms

What could those two topics possibly have in common? Gabriel Mihalache thinks there is a connection.

Not a Box Elder

Ms. Eclectic asked me to trim this tree because it was blocking the sunlight to her other plants. So I decided to cut it into the shape of a cube:

It looks like hell from the side and back, though:







Sort of a 3D Edgeworth Box? Not really.

Hava Nagila

Watching this gave me shivers.







[h/t to Judith]

Today Is My Birthday

No matter how hard I try, I cannot convince my mind and emotions that I am any older than about 17.



....... welllll,... maybe 40 ........



but no older than that, for sure.



And yet my body and my memory keep yelling at me, insisting that I am over 80.



Despite all the painful evidence, much of me refuses to admit the truth. I am still eagrely immature, and I still enjoy learning and doing new things. But my body screams when I try to do things I used to be able to do. I still think I can breakdance or play football... until I try.



And it isn't all due to "deconditioning", either.

A-Bedeling We Shall Go

I am the Esquire Bedel for The University of Western Ontario. What that means is that even though I am on sabbatical this academic year, I returned to UWO to carry the ceremonial mace during the convocations that were held yesterday and today. [Photo and more here and maybe a better photo here].



For a description of what goes on during convocation at this university and especially of the university mace, click here.

Economists Care about the Poor; It's Just That We Think Incentive-Based Solutions Are Important

The C.D. Howe Institute released a study yesterday showing that poverty has declined in Canada over the past decade or two.

Contrary to the dismal picture that some recent studies have painted, the income security system is not broken, he [John Richards] says. Policies of the last decade got much right. In 1996, nearly 16 percent of all Canadians fell below the Low Income Cut Off, the traditional measure of poverty in Canada. In 2005, less than 11 percent of Canadians did so. In the same period, the poverty rate among children in female lone parent families fell from 56 to 33 percent; among single men from 38 to 32 percent; among single women from 47 to 37 percent. Among these three vulnerable groups, there was a steady increase in median incomes, primarily due to greater market earnings, not to increases in net transfers....



Professor Richards concludes that the impact on employment among those at high risk of incurring poverty should always be a consideration when assessing proposed policy reforms, and policies that create greater incentives to enter the workforce make sense.



While the overall poverty situation is improving in Canada, there are still pockets of poverty that appear resistant to policy interventions, he notes. He identifies six dossiers that require attention: education among the poor; Aboriginal poverty; the mentally ill and physically handicapped; those living in ghetto-like urban neighbourhoods; high effective tax rates on the “near poor”; and in-work benefits (such as earning supplements).



Refined interventions are required, not broad new transfer programs, he concludes.

How Sick Do You Have to be NOT to post on Facebook?

On Wednesday, I received a Facebook friend request from one of my students. The very next day I received e-mail from him saying he'd been sick for the past few weeks and hadn't been able to study for the midterm scheduled for that day. hmmmmmm.



And now I see from Facebook that he planned to attend two different parties that very night, one of them in another city. Double hmmmmm.



addendum #1: I also see from Facebook that this student claimed to be be "studyin" and "studyin like a champ" on two different days a week before the midterm exam. Triple hmmmmm.



addendum #2: another unthrilling aspect of Facebook is seeing the parties your granddaughter plans to attend this weekend.

Good News from the BBC?

Jack just sent me this:

LONDON (AFP) - The BBC announced approximately 1,800 job cuts over the next six years in a statement released by the broadcaster on Thursday.

I know I am dreaming, but I hope most of the cuts are among the leftist senior assignment editors and editors (and among all the lefties in the field).

Academic Freedom.....if the topic is politically correct...

From Canada.com, via Brian Ferguson, is an article about how a researcher at the University of Alberta had his funding cut off and then was terminated because people did not like the topic of his research: the substitutability between smokeless and regular tobacco. His story helps explain one of the reasons I am a paid-up lifetime member of SAFS (The Society for Academic Freedom and Scholarship).

If you planned to attend the Conference on Academic Freedom and Research Integrity on Monday at Edmonton's Shaw Convention Centre, take note: It has been cancelled. The reason? Several academics, apparently, did not approve of the subject matter.



The forum was organized by Carl Phillips, a University of Alberta professor with a deeply personal interest in the issue. That's because he studies something many of his colleagues hate: tobacco - specifically, the health benefits of smokers switching to smokeless tobacco. And he's suffering for it.



In June, his faculty voted to cut off his industry research funding, though the university long ago cleared the funding as ethically clean. Shortly after, Prof. Phillips says he received a letter. Since he no longer had funding, his department said, he was being terminated.



"Despite the fact there was no actual evidence the money was running out," he says, noting that the vote was unofficial and probably non-binding without administration's consent. "Not to mention there are all kinds of other sources I could have gotten money from."



Since then, the Harvard PhD says he's been subject to repeated and intrusive audits, been charged by colleagues with ethical violations and has had research projects cancelled for what he says are the flimsiest of excuses. "Even with Holocaust deniers, or when someone says the Taliban are wonderful, even in those cases, they get the sufficient respect that somebody stands up and points out that these people don't know what they're talking about. But nobody's ever said I'm wrong. Nobody has actually challenged the premise of my research. They basically just tried to shut the whole thing down without having to address the substance of it."



So, he and a handful of sympathetic colleagues arranged to air the issue of exactly how much freedom scientists have on campus these days. The conference would feature several professors who had faced similar problems. And it was planned for the Edmonton conference centre, at the same time and just down the hall from an international anti-tobacco conference "so that we could have sessions where we invited people from that conference over to make case for their attempts to suppress academic freedom," Prof. Phillips explains. But organizers of the National Conference on Tobacco or Health, he says, threatened to break their contract with the centre after they caught wind of his plan.



"The conference facility came to me and begged us to let them out of their contract because they were being put in the middle and they were convinced that this obviously much larger, much richer conference was going to pull out if they hosted us." Since not having the anti-tobacco attendees nearby defeated the purpose anyway, Prof. Phillips regretfully obliged.



Stifling tobacco research may not be something that most Canadians would get worked up about. But it is of a piece with a broader suffocation of university research or discussion of things considered politically incorrect, argues Peter Suedfeld, a psychology professor at the University of British Columbia.

Even if I disagree with some scholars (e.g. most socionomologists), I staunchly believe that universities, of all places, are where we should thresh out controversial ideas. To avoid groupthink, it is imperative that academic freedom be defended in such instances.

Myopic Forecasting?

A professor in grad school told me to forget about building models to forecast economic variables. He said,

Find out what the variable is today. Predict that value for the next month or quarter and you won't go far wrong.

His point was that

1. Big-time models are expensive and high opportunity costs (if you think model-builders have valuable alternative uses)
2. Big-time models, despite the major investments in them, were not outpredicting simple myopic predictions much, if at all.

It was rumoured that when Alan Greenspan was Chair of the Council of Economic Advisors, he had a five-equation model that he used and that was just as good as the FRB-MIT 473-equation model (or however many equations it had).



And so it should come as no surprise that (from a review by Michael Kinsley in NYTimes) [h/t to Greg Mankiw],

You gotta love a guy whose idea of an important life lesson is: “I have always argued that an up-to-date set of the most detailed estimates for the latest available quarter is far more useful for forecasting accuracy than a more sophisticated model structure.” Words to live by.

I.e., reducing errors in measurement would have more and bigger payoffs than building better models.



Nowadays most economists use myopic first-differencing to make their-seat-of-the-pants forecasts: predict the growth rate of most flow variables (e.g. GDP, etc.) will continue. It's not a bad way to make rough predictions. But if it works, what does that say about rational expectations??



Another way that many (most?) business economists make their forecasts, though, is at least as interesting. A business economist shared this technique with me several years ago:

Subscribe to at least 20 forecasting services and take an average.

Update: Phil Miller says that when he was hired to do forecasting, he also always adjusted his forecasts according to what other forecasters had predicted:

Back in the day when I used to do forecasting, I used a big simultaneous equation SAS model to generate my forecasts for GDP, personal income, etc. for the US and for personal income, employment, etc. for Missouri, Kansas City, and St. Louis. The growth rates for the National Income Product Accounts often would turn up to be some ridiculous number. So I compared what I had to what the Blue Chip Economic Indicator folks (a survey of forecasters) said and I made some adjustments to my national forecasts based on the average "Chipper" growth rates.



Now I prefer the Magic 8 ball and a dart board.

Canada's Trade Surplus

Stephen Gordon, writing at Worthwhile Canadian Initiative, has a very revealing graph (reproduced here):

The upper, dashed blue line represents Canada's trade surplus with the US from 2002 until the present; the lower, solid blue line represents Canada's trade surplus with the rest of the world. From 2002 until about two years ago, Canada's trade surpluses remained roughly constant and positive. Put bluntly, we were sending more of our goods and services to foreigners than they were sending to us.



Two years ago, the surpluses started to decline a bit, but they are still surpluses! Canada is still sending more goods and services to foreigners than they are sending to us.



And this high demand for Canadian stuff just keeps putting upward pressure on the Canuck buck, as shown by the red line in the graph. There's a tendency to think that because the Loonie is appreciating, our trade surpluses will decline, but that phenomenon (analogous to a movement along a demand curve) is more than offset by the continued growth in demand (shift of the demand curve) caused by rising oil and commodities prices.



Digression: Stephen also has some poignant insights about The Bank of Canada in his recent postings -- well worth reading.

Fiscal Irresponsibility, a la Gordon Brown

Tim Worstall summarizes it succinctly, saying "To Spend Is To Tax":

It’s not just the tax rises, it’s also the rise in borrowings: and, even more than that, the rise in promises of future spending (on pensions and the like) which are not being accrued.



Future taxes have gone up by vastly more than current ones have.

Lessons for Alberta from the UAE:How to Distribute Oil Wealth with Minimal Distortions of Incentives

Alberta, like the United Arab Emirates, has considerable oil wealth. The politicians in Alberta, like the Shieks of Abu Dhabi, Dubai, et al., want to stay in power, and believe that sharing the oil wealth with the citizens will help them stay there.



And both places face a similar problem: how to share the wealth without creating serious distortions of incentives. Taxes can be eliminated, and doing that will probably promote efficiency. But after that what? "Free" education and "free" health care? Both will be overused if prices are not allowed to play a rationing role. Free utilities? Same thing.



John Chilton, The Emirates Economist, has more:

The UAE is a very rich country and it is only natural that the wealth owned by the government/rulers is shared with the citizens. Where economists begin to worry is when the size of the transfers creates adverse incentives. For example, suppose you get more from the government if you earn less. This cuts your incentive to work. Or suppose the underpriced utilities causes you to waste water and electricity — there are more efficient ways to make transfers. Or suppose that government jobs are not demanding and pay much more than the private sector — where's the incentive to choose the private sector rather than engaging in rent seeking activities (wasta) to get a government job? Or suppose you a guaranteed a government job as long as you have any college degree — where is the incentive to excel in college?



It's not the size of the transfers. It's their design.

For more on this topic, see this, which I wrote earlier.

More on the Leftist Domination of the Nobel Peace Prize

The joint-award of the Nobel Prize for Peace to US failed-Presidential candidate, Al Gore, is a dangerous disgrace, although one entirely to have been expected. ... ‘global warming’ is now the PC “clamour of the times”, especially in Old Europe - and Norway is Very Old Europe. The temptation to give George W a kicking just can’t be resisted. Moreover, this new secular religion of the liberal elites must have its saints to carry the Green Flag, however questionable their qualifications. The names of recent Nobel Peace laureates read like a list of bien pensant characters from the political left: Jimmy Carter (surely one of the worst of US Presidents) (2002); Yassir Arafat (1994); and Rigoberta Menchu (1992). Al Gore joins a highly predictable bunch. ...

In Europe especially, ‘global warming’ is the chosen trope of the political classes. It is a powerful Barthesian myth, and its aim is to exclude all other constructions of knowledge from debate. Al Gore’s ‘elevation’ is simply part of this process of exclusion, namely the trampling down of any dissent by an increasingly assertive, self-referential, grand narrative in the style of Marxism. This must not be allowed to happen. [emphasis in the original]

The above is from this blog [h/t to Melanie Phillips].

How to Study: Practice, Practice, Practice

Phil Miller has a quote about how to study, from Tyler Cowan's latest book. Since my students have midterm exams on Thursday, this advice is apt: do problems; make sure you can do problems; answer questions; anticipate questions.

The point is this: most people do not study very effectively. They study to feel they are trying. They study to feel better about themselves. They do not always study to succeed in their chosen field. They spend hours staring blankly at sheets of paper and nodding about what they understand. Students should spend more time trying to solve problems or answer questions, usually under simulated exam conditions and with a clock ticking. Tick, tick, tick... that's the way to go, and yes, the whole point is that it hurts.

Why I Don't Have a Blackberry

It's called a "pre-commitment strategy". I know that by not having a Blackberry (or Palm Treo), I am less likely to indulge all my addictions and end up like this.

'Hello, My Name Is Bob, and I Check My Email While on the Toilet'

... A society dominated by digital interruption, by the urgent, has the potential to be less polite, less focused, less productive, less safe, and arguably less intellectual. That does not disregard the good of digital technology but rather questions how people are deciding to use it. Rudeness, inattention, procrastination, and superficiality are not new problems. Unfortunately, these tendencies are becoming more acceptable because we've been convinced of the importance of our digitally connected lives.



In many recovery programs, one of the first steps to overcoming an addiction is to admit there is a problem, "Hello, my name is Bob and I check my e-mail while on the toilet." That may sound comical but without acknowledging the worship of the urgent, there can be no change. Man must re-build the walls of his digitally infiltrated castle. He must find his place of quiet, of solace, of meditation, and of focus. The important must supersede the urgent once again; it starts with the off switch.

Also, by not having a Blackberry or Motorola Q or whatever, I am less likely to fall prey to "ringxiety" or "fauxcellarm":

Many mobile phone addicts and BlackBerry junkies report feeling vibrations when there are none, or feeling as if they're wearing a cellphone when they're not....



Research in the area is scant, but theories abound about the phenomenon, which has been termed "ringxiety" or "fauxcellarm."



Anecdotal evidence suggests "people feel the phone is part of them" and "they're not whole" without their phones, since the phones connect them to the world, said B.J. Fogg, director of research and design at Stanford University's Persuasive Technology Lab.



"As human beings, we're so tapped into our community, responsiveness to what's going on, we're so attuned to the threat of isolation and rejection, we'd rather make a mistake than miss a call," he said. "Our brain is going to be scanning and scanning and scanning to see if we have to respond socially to someone."...



"Dilbert" cartoonist Scott Adams wrote on his blog, dilbert.org, that he feels the phantom vibrations, "about 10 times per day" and thinks "'Ooh, it's an e-mail with good news!' So far, the only good news is that my pocket is vibrating, and that's OK because it gives me hope that the condition might spread to the rest of my pants."

Ya yah Yeah.

Whatever.



The real reason for me has been that I know I'd rack up gazillions of dollars in airtime bills if I had portable, hand-held internet access.

Eclectic Miscellany

• Rondi Adamson has a column at the Trono Star this weekend about the demise of the Western Standard. Her column pulls no punches (she never does with her writing) and should be required reading, probably even more for people on the right than for the leftists out there.
• Mike Moffat was married yesterday.
• He won't win it this year, but there is a very good chance that some day in the future, Preston McAfee will win the Nobel Prize in economics for his work in auction theory. I see Bill Polley agrees with me that there is a good chance Bhagwati will win it this year.
• I think I must be the oldest person on Facebook:
  -- None of the 574 people with whom I graduated from high school (Muskegon, MI) is on Facebook. The last time I looked, no one from the previous year's class or the succeeding year's class was there either.
  -- None of the several hundred people with whom I graduated from Carleton College (Northfield, MN) is on Facebook. Ditto on previous and succeeding year's classes.
  -- None of the people with whom I attended Chicago Theological Seminary is on Facebook.
  -- If I'm not the oldest person there, I am surely among the oldest 0.5%.
• Speaking of Facebook, my older son wrote there that he is now 33% older than he was a quarter of a century ago his life ago [sorry for the transcription error, Kip]. I just realized that I am, too. It must run in the family.