Saturday, March 24, 2012

What would YOU do?

Armored truck driving on highway, back door unlatched.

Money spills out, swirling around in the air.

What would YOU do?

A lot of people stopped, dropped, and grabbed.

I would have driven on, but I'm not sure my reason is morally admirable. I would have assumed that the amount of money I might expect to grab was not worth the twin risks of (a) getting hit by a speeding car and (b) getting arrested for stealing cash.

Nod to the LMM.

Mungowitz drops the ball

Perhaps due to his Pisco intake, or his fear of being caught up in an similar situation in South America, my esteemed co-blogger really buried the lede yesterday in his short note about UNC professor Paul Frampton.

I rise this morning to revise and extend my colleague's remarks.

This January, Frampton was arrested in Buenos Aires for boarding a plane with a suitcase containing a fair amount of Bolivian marching powder. He claims innocence and I believe him because, judging by his statements in this article, his drug of choice is LSD (that is to say, homie be trippin').

First off, he appears to believe he is working somewhere other than where he is working:

“The university has done nothing, absolutely nothing, to help me,” he said. “You would expect a university of that caliber would do everything possible to get me out of prison.”

He also has a theory of why mighty UNC is not helping; the provost is too jealous to do his duty!

Carney had long been jealous, he said, because Frampton had earned tenure much more quickly and because Carney’s academic accomplishments were paltry compared to his own.

 “I am one of the most published physicists, and really he hasn’t done much that is of interest,” Frampton said, Carney had taken advantage of Frampton’s helpless position to stop his pay and hinder any notion of the university helping him.

The university has put him on a leave of absence and stopped paying him because he's not teaching his class.

 But Frampton says that this is unfair because the class was already being cancelled due to low enrollment (1 student signed up and 5 is the minimum class size)!


There is one part of the story that does make me thing Frampton may be guilty (remember he's been in jail since January 23rd:

Frampton said he was actually working more than 40 hours a week in prison, and had already written four scholarly papers this year.

Friday, March 23, 2012


A Friday Focus Feature, on the University of North Carolina. We'll go from the locally messed up to the internationally messed up.

Local bizarrity: So, the EYM has a nice bike. Locked it up, near the Pit, 11 am. Comes back at 2 pm, both wheels have been stolen, and (this is the cool part) a "new" heavy duty lock has been added. So now the bike is locked twice, once with the EYM's lock and once with a lock placed there by .... who? The thief. Presumably so the thief can come back at leisure and finish the job by cutting the EYM's lock off and taking the frame. The EYM calls the local five-oh, who helpfully say (1) he cannot cut the alien lock off, because they are "not sure" it's his bike. (2) they will allow him to cut it off in a "few days" (not clear how many, or what the criteria for this decision are). Of course, this means he has no way of guarding the bike. After the thieves come back and take it, I suppose the five-oh will say, "What bike? There's no bike here? What are you complaining about?"

State/National bizarrity: Herman Cain continues to campaign, though it is not clear for what. Mr. Cain made an appearance at UNC Chapel Hill on Thursday. He was quoted as saying: “Look at me, I grew up in Atlanta, Ga., in the ’50s and ’60s, during the times when this nation had segregation and Jim Crow,” Cain said. “And today, not only was I able to run for president of the United States of America, I have a bus out there with my picture on it.” So there you have it: the civil rights movement, at its core, was a fight for the right to have a bus with your picture on it.

International bizarrity I: Frampton comes apart. Physics prof gets arrested for cocaine smuggling (two kilograms!) in Argentina, offers the defense of "professional jealousy." Yep, those snooty Argentine cops are famously upset if you have more journal articles than they have.

International bizarrity II: UNC student (and then student President) Eve Carson was murdered during a robbery a few years ago. But she lives on.... as a photo used to advertise how safe and fun it is to go to university in the US! Yes, kids in India see this:
Apparently the company has apologized, and removed the ads. Still, when you steal some photo off the internet to use for advertising foreign colleges, you should make sure the subject was not a murdered foreign college student.

Climate change, fossil fuel use, and public opinion

Do alternative energy sources displace fossil fuels?

Richard York, Nature Climate Change, forthcoming

Abstract: A fundamental, generally implicit, assumption of the Inter-governmental Panel on Climate Change reports and many energy analysts is that each unit of energy supplied by non-fossil-fuel sources takes the place of a unit of energy supplied by fossil-fuel sources. However, owing to the complexity of economic systems and human behaviour, it is often the case that changes aimed at reducing one type of resource consumption, either through improvements in efficiency of use or by developing substitutes, do not lead to the intended outcome when net effects are considered. Here, I show that the average pattern across most nations of the world over the past fifty years is one where each unit of total national energy use from non-fossil-fuel sources displaced less than one-quarter of a unit of fossil-fuel energy use and, focusing specifically on electricity, each unit of electricity generated by non-fossil-fuel sources displaced less than one-tenth of a unit of fossil-fuel-generated electricity. These results challenge conventional thinking in that they indicate that suppressing the use of fossil fuel will require changes other than simply technical ones such as expanding non-fossil-fuel energy production.


Declining public concern about climate change: Can we blame the great recession?

Lyle Scruggs & Salil Benegal, Global Environmental Change, forthcoming

Abstract: Social surveys suggest that the American public's concern about climate change has declined dramatically since 2008. This has led to a search for explanations for this decline, and great deal of speculation that there has been a fundamental shift in public trust in climate science. We evaluate over thirty years of public opinion data about global warming and the environment, and suggest that the decline in belief about climate change is most likely driven by the economic insecurity caused by the Great Recession. Evidence from European nations further supports an economic explanation for changing public opinion. The pattern is consistent with more than forty years of public opinion about environmental policy. Popular alternative explanations for declining support – partisan politicization, biased media coverage, fluctuations in short-term weather conditions – are unable to explain the suddenness and timing of opinion trends. The implication of these findings is that the “crisis of confidence” in climate change will likely rebound after labor market conditions improve, but not until then.

Nod to Kevin Lewis

Thursday, March 22, 2012


Some links. No theme, no unifying idea, just some links.

The myth of the myth of the independent voter

A parade of idiots. You want to stop watching, but...

Street scenes from Santiago

This week's random and spurious medical correlation: red meat reduces depression

Making fun of rednecks is fine, but not welfare recipients? Then a silly response to same. Fox with its own strange interpretation. And Bill Maher finding it funny to laugh at poor people, rather selectively given his later indignation.

Mission accomplished

One of the (few) nerve-wracking parts of my job is placing students. This year, we had two PhD students in development on the market. Mrs. A advised one and I advised the other. They both got 20+ interviews at the AEA (the national economics conference and job market) meetings and 6 campus visits out of those interviews. Now, both have accepted tenure track jobs with decent salaries and teaching loads and good support for travel and research.

We try to make sure our students have teaching experience and (ideally) a publication before going on the market. We run multiple practice interviews for them before the AEA meetings and practice job talks before their campus visits.

Even though the ultimate burden is on the student, I always feel pretty squirmy until they get a job. I am barely comfortable being responsible for myself, let alone someone else's career.

Now I can sink back to my normal level of apathetic lethargy.

US Gov Does Not Read This Blog, Apparently

I thought we had covered this. Suppose you think: (a) saving environment through green energy is very important, so we need to use it as much as possible, and (b) solar power is an efficient and valuable technology.

Then why-O-why would you put tariffs on cheap solar panels?

Answer: This is not an environmental policy at all. It is an industrial policy (thinly) disguised as an environmental policy. We have decided that US corporations need to receive lots of extra dollars from consumers, and from taxpayers, so they will have enough cash to contribute to the Obama reelection campaign.

Now, I happen not to believe (a) works very well, and I know for a fact that (b) is false. But I am trying to accept the premises of the other side: EVEN IF you believe those two things, this policy makes no sense.

Nod to Anonyman

Wednesday, March 21, 2012

Shout it from the rooftops!

Simply fantastic essay in The Atlantic by Teju Cole. A must read.

Here's a nice bit:

Joseph Kony is no longer in Uganda and he is no longer the threat he was, but he is a convenient villain for those who need a convenient villain. What Africa needs more pressingly than Kony's indictment is more equitable civil society, more robust democracy, and a fairer system of justice. This is the scaffolding from which infrastructure, security, healthcare, and education can be built. How do we encourage voices like those of the Nigerian masses who marched this January, or those who are engaged in the struggle to develop Ugandan democracy?

Hat tip to Bill Easterly

Community Radio Stations Run by the Federal Government

This has got to be a parody, right? No one can be so deluded as to believe that "community" radio stations run by the federal government, and a huge new cadre of thought police, is a good idea.

Can they? Excerpt:

Instead of slowly grinding down thousands of repeater station applications that leave no room for community radio, the FCC essentially threw most of those applications away by limiting who can apply, how many filings a single entity can make, and which markets can consider new repeaters — all of which frees up the regulatory body to examine applications for new community stations. The regulatory agency still gave some deference to corporate broadcasters, however, by allowing them one shot at revising their applications to fit the new guidelines.

That means “as early as this fall, as in 2012, there will be opportunities for local community groups to plan and start their own independent radio stations,” Doyle said. “This is what we’ve fought for [over] more than a decade, and the FCC has opened the door to that.”

While there aren’t any official numbers yet, several “radio geeks” who spoke to Raw Story off the record estimated that as many as 10,000 applications for community radio stations could be filed in the coming years.

Prometheus activists and local radio affiliates all over the country played a dramatic role in helping shape media coverage of the “Occupy” movement last year, providing a sharp contrast to the often detached approach taken by mainstream, corporate sources. Their influence was broad enough to remind many listeners that community radio — an otherwise rare commodity in the U.S. — is often the dissenter’s best friend.

Though the FCC’s decision may not sound all that important, it really is. For the first time in decades, Americans living in major cities will soon be hearing the voices of their friends and neighbors flooding the airwaves — a far cry from the typical morning DJ fart jokes and the same “top hit” songs endlessly droning on a looping playback.

I agree that radio sucks. But it sucks because most people want to listen to something that sucks. All the efforts to put sensitive people on the air have failed because no one wants to listen to that crap.

Sensitive people already have NPR and MSNBC to congratulate them on how sensitive they are. Rush Limbaugh, whatever you think of him, SAVED a.m. radio. It would be dead as a medium by now unless conservative talk shows had risen up to save it. And it will be dead once the government decides to create a state-run media. The economies of scale in producing content are just too large. There is no chance of small, local groups producing anything.

Then, when a.m. radio does die, our government will blame it on changing technology, not on crushing regulatory restrictions.

Tuesday, March 20, 2012

The House of the Rising Sun--Tesla

Apropos of nothing, I predict that reactions to this video will divide largely along gender lines. Women will mostly think, "That's pretty stupid." And men will mostly think, "Where can I get one? And can I use it as a combination stereo/security system?"

Truly Massive Solar Fail

Turns out solar power is not profitable, and in fact it's a big money loser.

The only reason it was ever profitable was truly massive subsidies. Now, just cutbacks, not elimination, just cutbacks, on the subsidies will spell the end of the solar industry in Europe. It was in all the papers.

If an activity is profitable, it produces more in value than it uses up in costs. If an activity is NOT profitable, it uses up more in resources than it produces in value.

If the only reason an activity is profitable is artificial subsidies, financed by money taken from taxpayers at gunpoint, against their will, then the "positive profits" signal is fake, and the activity still uses up more resources than it produces in value.

Finally, any activity, no matter how wasteful, can be made "profitable" with large enough subsidies.

People could have bought solar panels on their own, voluntarily, if it made economic sense to do so. Why would being forced to buy solar panels makes sense? And, if the government takes away huge amounts of my income, and lets me have some of it back if I purchase an extremely wasteful technology, in what way is that a voluntary transaction?

The solar "industry" is composed largely of rent-seekers and brigands, combined with enough genuinely committed (though mistaken) true believers to give the whole noisome mess moral cover. The thing that's hard to understand is why anyone would believe that a technology that uses up more resources than it produces is "environmentally friendly."

The cure is worse than the disease

What do you do when you find 10 human heads? Send 12 policemen to look for the bodies.

What do you do when those 12 policemen are murdered?.............

Legalize drugs?

It is amazing what damage the US anti-drug policy is having in other countries. According to the linked article, over 47,000 people have died in drug violence in Mexico during the sexenio of Felipe Calderon.

Our drug laws are responsible for a horrible toll of carnage and disfunction in Latin America.

St. Paddy's Day: Round Up Your Mates!

Warning:  NSFS*

*Extremely insensitive. Not Safe For the Sensitive

Support for Green Power Slipping

NYTimes poll finds support for green power slipping, in some cases falling sharply.

Got an email accusing me (!), and "people like me"(!!) for causing this.  Ma'am, I doubt that.

Nod to Anonyman.

Monday, March 19, 2012

Concha y Toro, and the Balcony of Pleasantness

It's vegetarian night at the corner of La Gloria and Apoquindo.

Bought a big wad of espinaca, remembering the rule that "one pound of spinach cooks down to exactly nothing." Loaded it with garlic, bean sprouts, and spices, and cooked it up. Had some nice farmer's cheese and brown bread, and ate my dinner....

...while having some Concha y Toro carmenere, and looking out from the balcony. The CyT is hardly a great wine, but then here in Santiago it only costs $3.20....for a 1.5 LITERs.

When you add it to this view, and the 78 degree dry evening air, with a breeze...well, to quote Jimmy Buffet: "I was in love! With the whole world! Animate, inanimate, cone head, no cone, it don't matter."

Swap meet

Ah, Italy. When it rains, it pours. The Italian government recently paid a few billion euros to Morgan Stanley to unwind some interest rate swap positions it took in an ill-fated attempt to hedge its borrowing costs.

The excellent SoberLook has the full story, including the kicker that Italy still has over 150 billion Euros in open positions that are undoubtably "underwater" for them.

As SoberLook pointed out in a much earlier post about Harvard's swap woes, there are cheaper ways to buy insurance against increased funding costs.

Prophets of the KPC?

I've been droning on (and on) about how the Fed has backed themselves into a weird position where if the economy keeps growing decently, they will have to backtrack on one of their two promises.

Promise #1 is 2% inflation. Promise #2 is a doozy: no short term interest rate hikes until the second half of 2014!

Increasingly, others are growing more skeptical of promise #2.

In CNBCs survey of "67 economists and equity and fixed income managers", it found that "nine out of 10 market participants don’t believe the Fed will wait that long. In fact, 54 percent believe the first Fed interest rate hike will come by 2013."

I wonder what The Bernank and crew are thinking? Are they banking on a recession to save their "credibility"? Do they think there is enough weasel room in the wording of promise #2 that they can claim compliance no matter when they raise rates? Do they regret getting pressured into making promise #2?

People, which is more likely to happen, the Fed keeping promise #2 or Congress allowing the planned sequestrations to go through without any changes?

Hat tip to LeBron.

Sunday, March 18, 2012

Eyes wide shut

A big trend in economics these days is the Randomized Control Trial (RCT), often referred to by its enthusiasts as the "gold standard" of evidence. An intervention is tested by randomly assigning it across a chosen sample and computing the average treatment effect. An analogy is often made to clinical trials in medicine, but there is (at least) one important difference. Most drug trials are "double blind", where participants do not know if they are in the "control" group or the "treatment" group.  By contrast, most RCTs are not double blind. Participants know what group they are in.

And, as a fascinating new paper points out, this knowledge can produce "pseudo-placebo effects" in RCTs. That is to say, the expectation of receiving the treatment can cause people to modify their behaviors in a way that produces a significant "average treatment effect" even if the actual intervention in not particularly effective.

The paper illustrates the point by undertaking two different RCTs on cowpea seeds in Tanzania. One is a traditional study where the control group knows they are getting traditional seeds and the treatment group knows they are getting modern seeds. The second is double blind; neither group knows what seed it is getting.

The traditional RCT shows a significant  over 20% increase in yields from the modern seed. But the double blind RCT shows that virtually all of that improvement comes from changed behavior, not from any inherent effectiveness of the modern seed.

Specifically, the average treatment effect in the double blind RCT was zero! And when the harvests in the control groups across the two RCTs were compared, the blind control group showed a significant over 20% increase over the traditional RCT control group which knew they were getting the traditional seeds. This is the "pseudo-placebo" effect and it explains the entire average treatment effect in the traditional RCT.


In other words, the significant effect found in the traditional RCT was not due to better seeds, it was due to actions taken by the farmers who thought they were getting better seeds (they planted them in larger plots with more space between the plants on better quality land). These farmers' expectations were wrong (in post experiment surveys, over 60% of them said they were disappointed in the yields), and the significant effect in the traditional RCT would not survive over time because the farmers, having adjusted their expectations downward would stop taking the actions that produced the "success".

People, can I get a "YIKES"?

Hat tip to Justin Sandefur.

Santiago de Chile

I'll be in Chile for more than a month. El otoño there in the southern cone.

My sincere thanks to JPC for setting this up.