Wednesday, March 31, 2010
1/ Geek Venn
2/ Why corrupt governments may receive more foreign aid. An academic paper.
3/ Do animals commit suicide: A scientific debate. And HERE is a nice video lecture on what makes human beings different from other animals. "You and me baby ain't nothing but mammals..."
4/ If the top is sclerotic maybe entrepreneurs are dynamic enough to lead development. (Here, here.)
5/ HIV prevalence in South African universities
6/ An excellent example of price discrimination
"At first glance this seems weird, they are charging different prices for the same thing!!! However, as anyone with experience of vending machines and universities knows, these puppies provide a lot of service to students late at night. In fact, it is typical for sections of the machine to sell out before nightfall.
As we know that the first people to the machine will pay the lower price, we can also say that once the cheap chips sell people will have to pay more.
Now, given that the local tuck shop will be closed by night time we know that the number of substitutes to the vending machine falls at night. As a result, this pricing system ensures that the owner of the vending machine can charge more for the same chips at night time (assuming of course that the cheaper chips will sell out during the day time when substitutes are available) – when people value them more highly and are willing to pay more.
Excellent stuff."7/ Optimal structures for ministries of finance.
8/ Is there a way to stop subway bombings?
9/ Someone's trying to stop Julius Malema acting like an unhelpful idiot... Good luck...
10/ Interesting and well-written essay on Delhi. (HT: AS)
Sunday, March 28, 2010
Friday, March 26, 2010
2/ Harnessing the power of business for development impact
3/ If economists ran the schools
4/ The economics of cheating
5/ Food in pictures of the last supper keeps on getting bigger.
The last thousand years have witnessed dramatic increases in the production, availability, safety, abundance and affordability of food. “We think that as art imitates life, these changes have been reflected in paintings of history’s most famous dinner.” The main meals grew 69% and plate size 66% between the oldest (carried out in 1000AD) and most recent (1700s) paintings. Bread size grew by about 23%. The sharpest increases were seen in paintings completed after 1500 and up to 1900AD.
6/ Where in America do bars outnumber grocery stores?
7/ Government spending and happiness. I really like this. There is an n-shaped relationship. It basically says that as Government (think of it as 'community') spending increases so does average happiness of a country. But after a certain point, happiness declines; people can better use their resources for themselves. I've not read the paper, and can think of a number of issues, but I like the idea.
8/ Are baseball umpires racist? (HT Neuroworld). Apparently, yes, a little bit. "[C]ontrolling for umpire, pitcher, batter and catcher fixed effects and many other factors, strikes are more likely to be called if the umpire and pitcher match race/ethnicity"
9/ Decline in life expectancy in Lesotho. I like and agree with this comment left when I posted this link on my Facebook wall:
Friday, March 19, 2010
2/ Dan Ariely on Placebos (I've reviewed Dan Ariely's book, Predictably Irrational: The Hidden Forces that Shape our Decision HERE).
3/ North Korean Finance Chief executed for botched currency reform. Don't worry - it's their culture!
4/ The Economics of Sainthood - Pope's seem to experience Saint-making fatigue!
5/ Two armies, one island; one fights, one retreats - or does it? Game theory and bridge burning.
6/ Randomness and God. O, how easy humans are to manipulate...
Friday, March 12, 2010
This week’s Lesotho Business reports that the Lesotho Water and Sewerage Authority (WASA) may soon change its parastatal status to become a company. It will be regulated by Government but the public will be able to buy shares “and thus fund the company”.
The Chair of the Natural Resources Committee is reported as saying that “water is a basic need and thus cannot be put into private hands that may increase prices if they want”.
I disagree on several counts.
1/ A “basic need” cannot be in private hands. This is entirely the wrong way to look at things. Food is a basic need but few people seem to feel that the public’s food needs would be better served if all production and manufacturing was placed in state hands. The correct question to ask is ‘what is the best way to provide the public with water?’ The answer is clearly subjective but there is no reason to rule out the private sector without any consideration.
The private sector may provide additional investment which would actually allow more people to access water. If it is motivated by profit rather than petty bureaucracy, it can have an incentive to prevent wastage of water through, for example, leaks. This might actually allow the price to decrease or, again, more water to be provided to more people.
2/ That may increase prices if they want. The private sector can raise prices. But so can the Government. Firstly, a private sector firm can be regulated by a Government authority. Price increases can therefore be approved by Government. Thus, a private utility firm can be limited in its price rises, as happens in much of the world. In a competitive environment, the private sector is limited in its price rises by demand from consumers and competition. Note that food prices are not unlimited despite this being a ‘basic need’.
Even acknowledging that the private sector might raise prices more than a state owned firm, higher prices can be desirable. For example, they might hurt in the short run, but allow more investment into the sector and actually allow more people to access clean drinking water in the longer run. Higher prices can actually therefore be seen as more humane.
Secondly, prices which are set too low can encourage wasted water. It hardly seems fair that poor tax payers money are subsidising the wastage of water by rich consumers (and firms). I, at least, have no problem in increasing water prices under the right circumstances.
Thursday, March 11, 2010
1/ Google have a new Public Data Explorer. Looks like it might be great for academics, students, NGOs or as an alternative to surfing Wikipedia at work. (HT: Social Science Statistics Blog)
2/ The US state department apologises because some crazy guy there criticised Gadaffi's call for jihad against Swizerland. WTF? The State Dept's response was more than merited and I would have gone even further - perhaps even sending a 'strongly worded letter' to the Libyan dictator. Unless, that is, I wanted to drill for oil there...
3/ Cheese from human breast milk. Um, no comment...
4/ Should Africa ban second-hand goods? Have your say.
5/ Religion in the brain. I am fascinated by religion - it is crazy and amazing. All of them. I love the incredible beliefs (yes, that's 'incredible beliefs' - think about it) and I find the social and political consequences amazing. I *love* research on religion from a scientific stand-point.
5/ They can't read, write, keep time, or be tidy. Tesco's verdict on school leavers in the UK.
6/ Argentina's claim to the Falkland Islands are neither logical nor valid. I agree. The Argentine Government is bullying the small Falkland Islands.
Tuesday, March 9, 2010
I am wondering if it wouldn't be a better idea to move production of the c-class here to serve better the demand from Governments...
Of course, like in the real world** scarcity isn't the only thing that determined value. Size did too - probably related to the cost of the marble in the shop, and how beautiful the marble was. (Just as in the real world some things have value because for whatever evolutionary reason, humans are attracted to spangly things.)
I realised one day I could take advantage of the scarcity influence on price and managed to procure from a friend at another school a certain number of a type of marble that had not yet made it to my school***.
I decided that one dark speckled little marble was worth as much as a cyclops (that is what we called the very large marbles, if my memory serves me correctly). From then it was a matter of getting the price socially accepted. It didn't go down very well, but I talked about how rare the marble was and deliberately rationed supply. Some people seemed to accept it and I made as much as I could (as it were) from those people.
I then slowly started to introduce more and more marbles into the 'market', and 'sold' these marbles for less and less. It was both (almost) perfect price discrimination (amongst those who had a different opinion of the 'value'****) and (almost) perfect control of supply which impacted on the price*****.
In the end, the marbles worked their way into the general mix of marbles and the market determined their long-run value. But for that short while I had a monopoly, I made a killing.
I was about 10 years old at the time. A natural economist :)
* This blog entry is inspired by a recent facebook comment by my sister which reminded me of this story.
** And who says my school days were not the real world?
*** I went to a village school as did my friend and with the distance of our schools at a full 4 miles and intra-village communication being discouraged, new technologies took time to travel :)
**** Limited by the non-divisibility of marbles.
*****I could control only the sales of new marbles and not the 'second-hand' market.
Friday, March 5, 2010
1/ Ten films about love from ten southern African countries. Love - Stories in a time of HIV & AIDS, will tug at your heart strings and stir up your emotions.
2/ Pizza, Guns or Strip Clubs?
3/ The Philosophical Cow Suppose that you are a cow philosopher contemplating the welfare of cows. In the world today there are about 1.3 billion of your compatriots. It would be a fine thing for cows if all cows were well treated and if none were slaughtered for food. Nevertheless, being a clever cow, you understand that it's the demand for beef that brings cows to life. How do you regard such a trade off?
4/Darkness encourages unethical behaviour even when it makes no difference to anonymity
5/ The FT takes a look at investment in South Africa
6/ Mugabe's 30 years: Have your say.
7/ Do blogs affect African opinion? Have your say.
Tuesday, March 2, 2010
See all Friday links.
1/ Zero currency. 5th Pillar, an Indian anti-corruption organisation makes notes worth zero, say, rupees. The idea is that you give them to people who request bribes to indicate that you refuse to participate in corruption. Seems like a nice idea, but I wonder if it is sustainable. (HT: MM)
2/ Why not ban pornography instead (of the burka)? I can see where the viewpoint is coming from and have some sympathy for it. The proposal to ban the burka in France (or, hoodies in UK shopping centres) comes from the fact that some people's clothing can make other people feel uncomfortable for whatever reason. In this case, society feels that it can impose the will of the majority on the minority. It is always a difficult one to call and my opinions lead me both ways on this one. One could argue for a ban on pornography for the same reasons. However, I can't help feeling that this might be the case of each individual society making its own choices...
3/ The economics of placebos for self-remitting diseases.
4/ Agricultural subsidies and food aid can harm at times.
5/ I agree with the Roving Bandit. I am also an advocate of cash transfers and migration.
6/ Crime and mangos in South Africa. Takes a genius to put these two together!
7/ Scholarships for African students.
8/ Economist videographics.
9/ Islamic radicals infiltrate the Labour Party.
The impact of AIDS on intergenerational support in South Africa: Evidence from the Cape Area Panel Study
Who Should be Interviewed in Surveys of Household Income?
This study tests the null hypothesis that it is sufficient to interview only the household head to obtain accurate information on household income. The results show that using a husband’s estimate of his wife’s income does not produce statistically reliable results for poverty analysis. Estimates of the wife’s income separately provided by the husband and wife agree in only 6 percent of the studied households. This indicates that although limiting interviews to one person can reduce the time and expense of household surveys, this appears to be detrimental to accuracy, and may lead to incorrect conclusions on the determinants of poverty.
A new paper talks about the positive side of natural resources. The summary of The Blessing of Natural Resources: A Summary from a Peruvian Goldmine is below:
This paper studies the impact of Yanacocha, a large gold mine in Peru, on the local population. Using annual household data from 1997 to 2006, we nd robust evidence of a positive effect of the mine's demand of local inputs on real income. The effect, an average income increase of 1.7% per 10% additional mine's purchases, is only present in the mine's supply market and surrounding areas. We also nd evidence of improvements on measures of welfare and reduction of poverty. We examine and rule out that our results are driven by increased public expenditure associated to the mining revenue windfall. Using a spatial general equilibrium model, we interpret these results as evidence of net welfare gains generated by the mine's backward linkages and its multiplier effect.
Monday, March 1, 2010
HERE is a wonderful little insight into prostitution in Sierra Leone.
If you want to consume these nice things, you have two choices: you can either make them for yourself, or you can make something else and swap.
Either way, to consume, you must produce. Countries that are rich are rich because they produce a lot. That means they are able to consume more.
Mugabe has found another great way to keep his people poor. First, he did his best to take farms away from people who know how to produce food for everybody, and gave them to his friends and family who (shock horror) didn't seem to be able to produce as much food as, say, actual farmers. There was less food for everyone (and obviously, the poor suffer most).
Now, after ensuring that food production lies with people who are not very good at producing food, he wants to ensure that Zim produces even fewer things that they could swap with food. How will he do that? By making sure that every large firm is out of those evil foreign hands. You know, those evil foreign hands that ensure your country produces things - things you can consume or swap with other countries for (say) food (since you can no longer produce enough to feed your people).
I'm sure this time it will be a great success.
"Dan McDougall spent four months delving into Cape Town's violent gang culture. He witnessed young men - gangsters and drug addicts - turn to football to try to keep their heads above water. But ultimately, he explains, his journey left him despairing of a broken society, a place where those growing up in the streets and townships of the rainbow nation are prisoners not of apartheid's legacy and race, but of the true blights of modern South Africa - gangs, murder and drugs."
2/Julius Malema: Genius, clown or fat cat?
"He is 28, a little overweight, impeccably dressed, and rather fond of referring to himself with the royal "we". He is also, without doubt, the most divisive, the most ridiculed, and for some, the most alarming public figure in South Africa today."