Monday, August 31, 2009
Sunday, August 30, 2009
This idea has a lot of support amongst liberals in France (or, at least certainly did in the rather left-wing economics department of the University of Grenoble UPMF). Attac (Association pour une Taxe Tobin pour l'Aide aux Citoyens) was an extremely popular organisation campaigning for such a tax with the aim of using the funds for development and other worthwhile causes.
Lord Turner, the chair of the FSA emphasised that he didn't think that the UK should unilaterally impose such a tax, although, Canada already has a similar one.
I must admit that I don't really know enough about it to form an opinion either way. It has crossed my mind in the past as to whether it might be a good way for the International Monetary Fund (IMF) to raise funds, which could then be used during financial crises. It would be a sort of insurance premium, and one of the main roles of the IMF is to promote financial stability.
Well done for getting to the bottom of that rather heavy finance post! You deserve to spend a few moments browsing People of Walmart :) (HT: Roving Bandit).
Friday, August 28, 2009
See the full blog here.
William Easterly discusses how aid could be increased in five simple principles for scaling up aid.
Research for Development reports on a new study that shows that climate change in causing malaria in highland areas in which it didn’t previously appear in east
Roving Bandit finds a blackboard blogger in Monrovia who writes news on a big blackboard for people who can’t afford newspapers and now has an online blog!
British companies are having problems recruiting because of new, paranoid and stupid immigration laws (sops to extremist anti-immigration parties). It’s one way to slow the African brain drain, I suppose…
Stumbling and Mumbling reports on a new Angus Deaton paper – religion is good for you! It makes you live longer and less likely to experience pain. If only it made it true!
Chris Blattman has some good news for young academics. Brains count for a lot in mate choice!
Finally, some fun with incentives from Economists do it with Models. “How is a fly in a urinal like the dashboard of a Prius?”
Wednesday, August 26, 2009
See the full blog here.
One of the wonderful things about a blog, is that you can write down thoughts which may or may not be interesting but without claiming to have done in-depth research or have in-depth knowledge – you are just ‘putting it out there’. So in that spirit of ignorance and lack of thought I’ve given to reforms in the
· There is potentially unlimited demand for ‘free’ healthcare. That is, people will demand anything that already exists, and research into potential new treatments (‘why should my [blank] die just because they won’t support research into [blank]?’
· However, as individuals, we really do strike a balance between health and other things in life – even if voicing that aloud makes us uncomfortable. I’ve had this argument with my mother on many occasions. She has worked in the NHS in all sorts of roles for most of her life. She likes to claim that there is nothing she puts ahead of her (or her children’s health). At some point though, I noticed she didn’t have the most comprehensive private health insurance available. Instead, she chooses to use that money for other things – not all of them healthy. She has therefore made some kind of trade-off, which is presumably utility maximizing. Roughly, she has chosen between one of two (for simplicity) bundles:
Bundle 1: 100% health insurance + lots of other nice things
Bundle 2: 90% health insurance + fewer other nice things
She has chosen bundle 2, and so is guaranteed lots of other nice things, but she has taken a risk of having an uninsured health shock.
· A national health system is basically a form of insurance. Since each individual cannot decide exactly how s/he wants to divide their resources between health and other nice things, some democratic process needs to be used and a social compromise reached.
· The bigger the share of national resources dedicated to health, the lower the risk of having a (socially) uninsured sickness is, but the fewer other nice things there are to go around. (Every additional medical technician trained is one fewer SUV maker or every additional medical lab is one fewer ‘fancy mobile phone’ research lab. Alternatively, for public funds, have one fewer school, or a few miles less road, or whatever. You get the idea.)
· Of course, despite my example, you cannot actually have 100% health insurance, but you could, in theory, dedicate all national resources except those needed for basic survival towards provision of existing care and research into new medication.
· How much should the state provide? Well, I don’t know. Anything on a continuum from zero to all public spending. It seems perfectly reasonable to me that different societies (countries) can choose different trade-offs between the amount of health risk and the amount of consumption of other nice things.
· My own preference would be for more public health care in the
· This is one reason why some of these crazy attacks on the British NHS have angered so many people in the UK (rarely have I seen such a united front by all political parties!) including a Twitter feed called welovetheNHS. The attacks are based on a lot of erroneous statistics. We know our system isn’t perfect, but we have decided through our own system our own set of preferences and trade-offs. That is our legitimate choice. The
· Other issues that might come into the debate:
o Are the people who are not covered by the
o Pharmaceutical companies might push up prices either for insurance companies or for Governments making the purchase. It is an empirical question as to which one keeps the prices lowest. It seems almost certain that European healthcare systems keep costs lowest and best value-for-money.
o Does that mean that US insurance premiums are subsidizing the profits and research of big pharmaceutical companies and European governments (and therefore people) benefit from prices that are lower than they otherwise would be and more medical research too? Maybe….. God bless the current American healthcare system! J
· Here is an interesting comparison of health expenditure and health indicators from around the world. Notice how successful
Saturday, August 22, 2009
My ODI colleague in Southern Sudan is blogging about prostitution here and here. A few years ago Levitt (of Freakonomics: A Rogue Economist Explores the Hidden Side of Everything fame) and Venkatesh wrote a really interesting empirical analysis of Street Level Prostitution in Chicago. Public holidays command price premiums and bring out ‘part time prostitutes’ who normally wouldn’t ‘do tricks’ but the 4th July price premium makes it worthwhile. Their work is now summarized in Trading Tricks: The Economics of Prostitution.
I have recently been discussing some research on sexual attitudes amongst university students in Lesotho with someone who has done some interesting comparative research on prostitution in Lesotho and Ghana. He found that in Ghana all of his (admittedly small) sample (of 10) prostitutes said that they would always use a condom. In Lesotho however, prostitutes charged between an extra M100 and M250 for not using a condom. This is despite the fact that the risk of catching HIV in Ghana is much lower than in Lesotho; the CIA World Factbook puts the rate at 1.9% in Ghana compared with 23.2% in Lesotho.
The behaviour, of course, influences the prevalence and the prevalence should influence behaviour. It seems though that there might be an element of inevitability about catching HIV in Lesotho, whilst in Ghana this might not be the case.
Why then, charge extra for not using a condom in Lesotho?
My guess is that the savvy prostitutes are automatically price discriminating! That is, they are splitting up their market and charging different customers different amounts depending upon their willingness to pay. This is exactly the same as giving discounts to students or to pensioners, or charging businesses more than individuals. The idea is to modify slightly the service in order to charge people closer to their marginal value. Or alternatively, to price differently to different groups depending upon their price elasticity. Genius!
My own experience
I lived in Paris once upon a time. In order to get home from my nearest metro station, I had to walk under a bridge and I could choose the path on either side.
On one side were always a small group of very beautiful prostitutes (note prostitution is legal in France). They were always very polite and friendly towards me and never hassled me. On the other side however, was a group of prostitutes who, shall we say, had seen better days. These never stopped harassing me and just wouldn’t leave me alone. (I must admit, I started to wonder who should be offering whom money.) I usually chose the slightly longer walk passing the nice ones.
Wednesday, August 19, 2009
… in the Journal of Happiness Studies (what a great title for an academic journal, no?!).
It is called Crime and Happiness amongst Heads of Household in Malawi and it is written with my friend and Bath colleague, Tim Hinks. A working paper version is available here. The abstract is below:
This paper uses 2005 Malawian data to investigate the link between crime and happiness in Malawi. Detailed descriptive statistics reveal that crime is a gendered issue and econometric analyses show that males and females respond differently to different crime variables. In particular, for males being attacked has a negative impact on happiness and neighbourhood crime rates have a U-shaped effect on happiness with happiness at its lowest when 11.2% of respondents in a neighbourhood reported being a victim. For females only a subjective feeling of insecurity impacts negatively on happiness.
Monday, August 17, 2009
I wasn't planning on making this blog multi-lingual, but my ODI colleague, Thomas, in Burundi wrote an interesting blog on gift-giving. Since my PhD was largely an econometric analysis of remittances, I found his experiences pretty interesting and wrote the below response. See his entry (in French) here.
Voici un commentaire que j’ai fait sur un blog de Thomas (Zoulous blancs), mon collègue ODI au Burundi. Il a écrit un blog intéressant sur la culture du don dans ce pays et ses expériences là-dessus ainsi que les difficultés que doivent faire face les étrangers qui n’ont pas l’habitude d’en participer. Voir De chacun selon ses moyens.
Ma réponse :
Nous avons la même chose ici au Lesotho. Dans mon département, il y a un groupe de peut-être 10 personnes qui se donnent de l’argent chaque fois que quelqu’un meurt. Sauf si c’est elle qui a perdu quelqu’un, c’est toujours la même personne qui passe par les bureaux pour recueillir de l’argent. La première fois qu’elle est venue dans mon bureau, je lui ai demandé combien il faut donner. Elle a répondu que c’est de mon choix *mais* elle m’a montré le papier où c’était écrit combien a donné chacun. J’étais quand même censée à suivre l’exemple des autres.
Tout le monde a donné M20 (environ 2 euro*) sauf le chef qui a donné M100 (environ 10 euros). Elle m’a dit que tout le monde doit voir combien ont donné les autres. Pourquoi ?
C’était une décision difficile. A la fois, je touche plus d’argent, et je veux pas faire comme si je suis the chef. Quoi faire ? J’ai donné M20 comme les autres, et c’est ce que j’ai fait chaque fois depuis, mais je sais toujours pas si c’est la bonne chose à faire ou pas.
Au niveau du don – C’est pas mal comme livre, Mauss. J’ai fait un doctorat sur les envois de fonds au Malawi et je le trouve très intéressant que tu as trouvé un bon exemple où on partage les coûts – ou plutôt, où on partage pas les coûts – il paraît que chacun paye sa propre consommation dans ton exemple pour que la famille du décès n’a pas besoin de tout payer.
Le don peut être aussi de l’assurance, et pour moi, c’est ce qu’on fait ici au Lesotho. Chaque fois qu’on a des coûts importants à payer, le groupe en partage. (Ici, payer c’est pas lié au fait d’aller rendre visite à la famille.)
J’ai écrit quelques articles sur (i) pourquoi on donne de l’argent et (ii) le don comme assurance. Les résumés (en anglais) sont ci-dessous si ça t’intéresse :
What motivates gifts? Intra-family transfers in rural Malawi
This paper uses a simple econometric model to extend the analysis of remittance motivations in two ways. Firstly, motivations are tested not only for remittances from children to respondents, but also between siblings and respondents’ own parents. This allows for the fact that different individuals have different motivations for remitting. Secondly, the data allow for remittance flows in each direction to be analysed. Results are consistent with altruistic motivations for remittance flows between respondents and their parents and siblings, and with inheritance motivations for remittances from children to respondents. All groups use remittances as a form of co-insurance.
Remittances as Insurance for Household and Community Shocks in an Agricultural Economy: The Case of Rural
This paper uses Malawian household panel data to analyze the extent to which remittances insure households against idiosyncratic shocks such as sickness and community shocks such as drought. We extend the analysis of previous studies to find that the geographical source of remittances matters in agricultural economies when this flow is viewed as a risk pooling mechanism. In particular, we find that remittances from outside a household’s home district help to insulate a household against the effects of droughts but similar risk pooling within the local area is ineffective. Only around 10% of households received remittances from outside their home district, and these insured only food consumption. When remittances are viewed as an ex post coping strategy, there is some evidence that remittances from the local community insure household members against health shocks. In addition, we find that it matters which household member suffers from health shocks, with males tending to be better insured in male-headed households and females benefiting more in female headed households. Our results are robust to numerous model specifications including fixed effects, removing predictable shocks, and removing observations with potential simultaneity problems.
* Je suis contre le ‘s’ qu’on ajoute en anglais et français pour indiquer le pluriel. Le singulier *et* le pluriel devraient être « euro » pour que ça soit le même dans tous les pays. Sinon, on aura : euros ; euroen ; eri ; etc etc.
Sunday, August 16, 2009
See the whole blog here.
This is the second in what will be a regular series of comments which I have interpreted as being racist since I’ve been in South Africa/Lesotho.
1. I’m a victim too! I was queuing for a buffet lunch in
I had to recoil pretty quickly and in doing so hit slightly the black (definitely Mosotho) man behind me. I apologies but at the same time he made a comment to his friend/colleague. My Sesotho isn’t that great, but it is good enough to catch that the tone was aggressive and that the word‘Lehkooa’ (white person, Mzungu) was included and that the comment was directed towards me. If I am being generous towards him I would have to say he didn’t notice the person push in front of me and believed I randomly pushed backwards into him. Somehow I suspect that that wasn’t the case.
2. Another trip to Bloemfontein, another case of racism. So after a bit of a boogie in Bloem, myself and a friend decided to go and get a burger. There is a stand that does amazing burgers not too far from the lodge our group was staying at. Serving these excellent burgers was a young (white) Afrikaaner guy and a young black guy originally from Soweto.
We were chatting with them and at some point asked the black guy how he found it in Bloemfontein compared with Joburg. He replied that life is quieter in Bloem (very true) and that there is a lot less crime.
The white guy seemed to like the crime topic and informed us that black people commit all of the crime. He noted that there was a lot less crime in the UK compared to South Africa (true) and that there are fewer black people (also true). There is, according to him, a direct link between the two.
I was not surprised by what he said (I am getting used to that now), but I was surprised that he said it right in front of his back friend (or colleague), who kept schtum.
3. Not my story, but one I find interesting reported to me by a nameless, sexless, ageless Mosotho that, being rather unimaginative, I will call X (X, can I suggest you don’t make any comment in order to preserve your identity!)
X was at work up in the mountains and was staying overnight in a lodge. Also staying in the same lodge were several Basotho Government employees. They were complaining about the new Government financial system – it is very problematic for several reasons, but mostly for these people, apparently, because it makes corruption quite a bit more difficult.
Someone had to be to blame for this dire situation which prevented them (or made it more difficult, at least) from ‘skimming off the top’. Who could that be? It is, according to them, the fault of the Chinese.
This is absolutely not true. The new Government financial system is actually from Tanzania and is being implemented by a Tanzanian company by (partly) Tanzanian software engineers and other experts.
But, the Chinese are amongst the least popular people in Lesotho (and maybe in Africa in general, due to their increasing business presence, which I think is mostly good) and I have heard a number of racist comments about them during my nine months here. So if you want to blame someone, let’s just blame the Chinese.
Friday, August 14, 2009
My ODI colleague in
Neuroworld. The Hot Waitress Indicator. A new economic indicator.
Dear Economist… . An economist as agony uncle. Here is an example:
I believe that there is an inexplicable shortage of sex. Given that studies show that women and men enjoy it more than most other activities, and given its intrinsically low cost, it appears that even a crude approximation of a utility-maximising person would probably spend much more time having sex than most. Do you know of any economic discussion of this?
See the economic agony uncle’s reply here.
Brit. Psychological Society. Your facial expressions influence speakers’ language.
and There is a surprising link between anger and perception of time.
Personally, I have no idea how a meeting moved forwards two days from Wednesday can possibly be on Monday and not Friday. I am surprised anyone might think that, and I don't consider myself at all an 'angry person'. Still, live and learn!
Only I think there is a flaw in the study. I am wondering whether it was actually the lecture on homophobia that made things worse. There should have been a third control group which did nothing to avoid this issue.
BBC article on the fear of a ‘land grab’ in
Zoulous blancs. Pour les francophones. Thomas, mon collègue ODI fellow au Burundi a écrit un blog intéressant sur la culture de don dans ce pays et ses expériences là-dessus ainsi que les difficultés que doivent faire face les étrangers qui n’ont pas l’habitude d’en participer. Voir De chacun selon ses moyens.
Monday, August 10, 2009
Thanks to a
It seems that one habit the border officials have is to deliberately mis-stamp your passport. For example, they might deliberately give you an exit stamp when you are entering the country, or an entry stamp on leaving. Alternatively, they might stamp your passport twice either on exit or on entry.
In all of these cases, it makes it appear as though you have come into or left the country without stamping at some point, and are therefore liable for a fine. The border officials will try to catch you out on “your” fault at some point in the future, and you will be asked with a shake of the head what can be done to help “correct the problem”.
Of course, you will have no idea that there was anything wrong because you assumed that they correctly stamped your passport each time, and will try to rack your brains to figure out what happened.
It took me a while to understand what was happening but actually witnessed my passport being stamped twice on one occasion, and on another occasion - just after my arrival in
When I noticed my passport being stamped twice, I got really angry and asked for their names and told them to correct it. The officials looked pretty worried, but officially, my passport is still wrong. I am wondering what the legal position is – presumably it is against some international law to stamp passports deliberately incorrectly. I have also seen a law in
Why did my visit to
Saturday, August 8, 2009
This is a photo of a machine in Lehakoe, a gym in Maseru. It is an immense machine. And you will never guess what it does.
It does exactly the same as these:
Only it’s not as good. You can only hold the handles on the machine with the palm facing upwards, not to the side, as you can with dumbbells. Also, you can only move the arms together (at the same time), not one after the other.
Why does this machine exist? Answers on a postcard. Or in comments below.
Friday, August 7, 2009
Some interesting recent blogs and research available on the internet.
Marginal Revolution. Measuring Economic Growth from Outer Space. Using light visible from outer space can give a good idea about growth. Even more interestingly, you can see, for example, where the places are that grow following discovery of natural resources.
British Psychological Society. Gentlemen take Caution Interacting with a Lady. It seems that cognitive functions are lower following interaction with a female than with a male.
Neuroworld. Giving Burglars their Due. I love this. Here is the first paragraph
“So, you’re on vacation. A burglar has staked out your home. He’s figured out a way in. He’s taken the trouble to climb up the fire escape, to get your window open, and to sneak inside. He’s risked a lot to be here today — the least you can do is make sure he (or she, don’t want to be sexist!) doesn’t go away empty handed.”
Stumbling and Mumbling. Gender and Decision-Making. A discussion of the evidence that men and women make decisions differently. Some examples: i. Majority female groups are more generous to outsiders but all-female groups are less generous; ii. Men are better at negotiating; iii. Men perform better under pressure iv. Men are more over-confident; v. Women are more risk-averse. But what does it all mean?
And some academic research:
Religion and Health Behaviour amongst Teenagers. More religious teenagers engage in less risky health behaviour than less religious ones. I always find it very interesting when (any) religion is shown to have useful survival benefits. As a non-religious person, I have to acknowledge nonetheless that religion serves some very interesting social, psychological and survival needs. Not all religions can be true by definition, but they could be useful – that leaves heathens like myself in a difficult position. An atheist, Voltaire also had this problem but said that despite his own beliefs he wanted “my lawyer, my tailor, my servants, even my wife to believe in God, because it means that I shall be cheated and robbed and cuckolded less often. … If God did not exist, it would be necessary to invent him”.
Speaking about the
Should non-believers nonetheless be happy to encourage religiosity amongst other people on the basis that it encourages good behaviour? That can no doubt be the subject of a future (and no doubt ranting) blog entry, but for the moment, it seems like any cost-benefit analysis should weigh up the positive impact of religion, however untrue those beliefs might be*.
Entrepreneurship in Developing Countries. I am a firm believer that business is key to development. After all, development largely means producing more things so you can consume more things, be it a corrugated iron roof, or a road, or a medication, or food, or transport, or education, or whatever. To consume it, it has to be produced.
I found two interesting papers on Entrepreneurship and Reforms in Developing Countries and Measuring Entrepreneurship in Developing Countries.
* I say “untrue” because it is my belief that they are, but also, whatever one’s own beliefs are, by definition, most of the rest of the world must hold untrue beliefs.
Thursday, August 6, 2009
A few weeks ago, I went to a recently established secondary school near Teyateyaneng (TY) in
I have a rather tenuous connection to the school; it was set up by a friend’s cousin’s husband, who is a teacher in the
Each year he brings out a small group of his sixth form students (usually 16 to 18 years of age) to
Things I was impressed with:
· The motivation of both the Basotho and British people who helped to set up the school and who have given up time and effort to run the school.
· The enthusiasm of all of the teachers (as far as I could tell, 1 Mosotho, 1 Cameroonian, 1 Ghanaian, 1 Brit*), most of whom had given up other safe posts to be part of what they felt was a well-run school with a drive to improve.
· The turn-out of the local village population to support their school (although I admit, the economist in me asked why they weren’t busy being productive).
· The Basotho pupils, who seemed to have a real drive to improve themselves and to work with the school.
· The British students, most of whom had not been in a developing country before. I was interested to know what their first impressions were of
o One regular response was that they thought that they thought that they would see more poverty by which they seemed to mean starving children (or food poverty).
o Another regular reply was how happy and friendly people are “despite the fact that they have nothing”.
· The Basotho and British pupils/students** for making an effort to talk to each other and mix.
· The effort put in by the pupils/students to put on dances/singing and the effort by the organisers to put on such a wonderful afternoon.
Something I was less impressed with:
· The length of the speeches. In fact, some people went on for so much longer than they should have that some of the dances that the pupils had been practicing for weeks had to be cut from the schedule to make up the time. The audience was visibly bored, but people just carried on and on and on. Why do people feel that they can dominate an occasion like that? It was a real shame as the same things were repeated over and over and over, and the speakers just didn’t seem to care about the consequences of their behaviour – just as long they get to speak to an audience, all is fine. Yes, I was quite disappointed by that behaviour...
To end on a positive note though, everyone was very friendly and very accommodating and the afternoon, overall, went wonderfully well.
To end on a positive note though, everyone was very friendly and very accommodating and the afternoon, overall, went wonderfully well.
* There are some concerns that now the school falls under the Government umbrella, the non-Basotho teachers will no longer get paid. Despite this risk to their jobs, they were all genuinely pleased that the school had achieved this recognition.
** I am using ‘pupils’ for those before sixth form and ‘student’ for those in sixth form.
Tuesday, August 4, 2009
So when I visit my local friendly supermarket of choice, I have to queue at the counter. At some point there is only one person ahead of me. This usually seems like a good time to start unpacking my trolley or basket. In fact, it is probably the most efficient time (and economists love efficiencyJ) in terms of getting out of the shop as quickly as possible.
Here, I have some problems though. I find that the space to place goods on the check-out before reaching the till is rather small, so people have to move properly on before I can start to unpack. But people don’t move to the other side of the till until they have completely finished; they stay exactly where they are until they have paid. What is more, people don’t seem to pack their bags until everything has been paid for. I find this very strange.
Most people stand and watch over the check-out person until all products have been scanned and placed on the other side of the till. Then they remain in a position which prevents me from unpacking while they pay. Only then do they begin to pack, and am I able to unpack.
As in other cases it seems that time is a lot less important (see Oh! You Mean I Have to Open the Door Myself?!). There is little rush to get out of the supermarket, and the assumption is presumably that everyone else is happy to spend longer queuing than they would otherwise have to.
I have been trying to think of alternative explanation – like it is a ‘safer’ place to pay in terms of other customers watching how much you pay, or seeing a credit card code, but that does not really seem to be the case. If anything, the fact that you are preventing the next customer from unpacking means their attention is more focused on you than it would be otherwise.
Alternatively, maybe having waited a long time, a customer feels that they deserve to monopolise as much time of the cashier as possible – even at the expense of someone else’s time and convenience. This would suggest that this happens more the longer the queue is – something that I have not noticed occurring.
So I am now confused. Why is the habit to waste one’s own time, and that of other people? I do not really fully understand the time preferences, and the general meaning of time in Africa. Not worrying about wasting time is one thing – actually having social customs whose aims seem to be to deliberately waste time seems somewhat strange to my mind. And another great reason for research psychologists to branch out to Africa in their research – why should experiments to understand social perception of time be limited to Western countries, and might it not be interesting to make some comparisons?