Monday, November 30, 2009

The Effect of Newspaper Entry and Exit on Electoral Politics

That's the title of Jesse Shapiro and company's latest effort on media, available at NBER.

We use new data on entries and exits of US daily newspapers from 1869 to 2004 to estimate effects on political participation, party vote shares, and electoral competitiveness. Our identification strategy exploits the precise timing of these events and allows for the possibility of confounding trends. We find that newspapers have a robust positive effect on political participation, with one additional newspaper increasing both presidential and congressional turnout by approximately 0.3 percentage points. Newspaper competition is not a key driver of turnout: our effect is driven mainly by the first newspaper in a market, and the effect of a second or third paper is significantly smaller. The effect on presidential turnout diminishes after the introduction of radio and television, while the estimated effect on congressional turnout remains similar up to recent years. We find no evidence that partisan newspapers affect party vote shares, with confidence intervals that rule out even moderate-sized effects. We find no clear evidence that newspapers systematically help or hurt incumbents.

It seems that the existence of a news source is the primary factor; additional newspapers don't have a big impact, and the emergence of radio and television seem to mitigate the impact of newspapers on presidential races (though not Congressional races-- I wonder if there exists, or will exist, a good media substitute for local newspaper coverage). Perhaps most importantly, the partisanship of the newspapers don't have an end-of-the-day impact on the favored party's outcomes.

Interesting work from extremely capable folk.

Tuesday, November 24, 2009

2009 Gus Rankings: Week 12

Here are this week's Gus Rankings. Texas jumps to the top spot, followed by Alabama at #2 and Florida and TCU tied at #3. Some thoughts:

- It's fun to see who controls their own destiny for the top spot prior to bowl games. Of course, no one can directly control their own destiny-- your score will fluctuate based on whether teams you have already beaten continue to win (and if teams you have lost to continue to lose, though these top 4 haven't lost to anyone). To this end, within-league teams are unlikely to have a large impact; most of these teams play pretty balance schedules within the league, so if two teams play each other that say, Alabama, has defeated, Alabama will get a point since one of them has to win. What it comes down to is the teams outside of your conference performing well. Florida has Troy and Florida International, Alabama has Virginia Tech, Florida International and North Texas, Texas has Louisiana-Monroe, Wyoming, UTEP and Central Florida, and TCU has Virginia, Clemson, and Southern Methodist.

- However, even though you don't have direct control over your score, you do have control over beating the remaining teams on your schedule. Here's how many points the remaining teams stand to gain directly from beating their remaining opponents:

Texas - Texas A&M (6 points), Nebraska (8 or 9 points, depending on their performance vs. Colorado) for a best possible increase of 15 points.

Alabama - Auburn (6 points), Florida (10 or 11 points, depending on their performance vs. Florida State) for a best possible increase of 17 points.

Florida - Florida State (5 points), Alabama (10 or 11 points, depending on their performance vs. Auburn) for a best possible increase of 16 points.

TCU - They only play New Mexico and stand to gain 1 point for doing so.

Alabama looks to have the best direct shot at it, but Texas' opponents listed above have (in my opinion) a much better shot at winning their respective games, which would erode the direct advantage Alabama has. It's going to come right down to it, Art!

File this under: Assorted Links, Malaysian

I've happened across what I believe to be a Malaysian news site, The English may be spotty at times, but check out these (what appear to be reputable) news stories:

- The Cuban government is offering penile implants. TINSTAAFL has never been validated so strongly. Insert your own jokes here...equity/efficiency, from each according/to each according, incentives and information, etc.

- There's a market for personalized license plates in Malaysia.

“For example, the number 1 in Kuala Lumpur goes for between RM60,000 and RM80,000 while the same number in Malacca would go for RM35,000 to RM45,000.” The digit 1 is always the highest priced number in any state, followed by the digits 2, 3 and 8.

One Malaysian ringgit is about 0.3 US$, so these are sizable prices. The piece mentions one particular plate that went for over $60k; the per capita income of Malaysia is about $3300, so the plate went for 18 times average annual income. Scaled to America, that would put the most lucrative license plate at nearly $600,000. Were there to be a market or license plates in this country-- and the associated status that comes with such a market-- I could imagine highly public high income earners shelling out that much money for said plate.

The article mentions that the numbers are sold through "public tender"; I'm guessing that's some form of auction, though the bit also mentions about numbers with the highest price which could either confirm or refute the auction guess depending on how you want to read it.

- Three to four percent of Malaysian children of school-going age don't attend school. This seemed remarkably low to me; this data about Grade 1 intake rate, if accurate, would confirm that.

Monday, November 23, 2009

Bias in College Basketball Referees

Here's a bit talking about a new paper talking about bias in college basketball referees. In particular:

- The probability of a foul being called on the visiting team was 7 percent higher than on the home team.

- When the home team is leading, the probability of the next foul being called on them was about 6.3 percentage points higher than when the home team was trailing. The professors also cited an earlier study that concluded there were more calls against teams ahead in games on national TV versus those ahead in locally televised games. Calling fouls against the leading team tends to keep games closer, the studies said.

- The bigger the difference in fouls between the two teams playing, the more likely it was that the next call would come against the team with fewer fouls. When the home team had five or more fouls than the visiting team, there was a 69 percent chance the visiting team would be whistled for the next foul.

I haven't seen a copy of the article itself, and while bottom two statements take some effort to be put forth accurately, the top one speaks plainly to an issue worth looking at. 365 games is admittedly small but it's a great start for a wide-scale investigation. I'd be curious to see at what point that home advantage dissipated-- smaller D-I basketball? D-II or D-III? High school? Middle school?

The Mystery of Yawning

I knew earlier in my life, either through someone telling me the fact of it or just passing along an old wives' tale, that we didn't know why we yawned. Well, we still don't know. It seems to serve a behavioral purpose more than physical one; the information on those with autism or schizophrenia was interesting. I also wasn't aware that you don't yawn while lying-- that in itself opens up a pandora's box of possibilities.

An interesting read.

Thursday, November 19, 2009

The Right to Hang (Your Laundry)?

Story here:

PERKASIE, Pennsylvania (Reuters) – Carin Froehlich pegs her laundry to three clotheslines strung between trees outside her 18th-century farmhouse, knowing that her actions annoy local officials who have asked her to stop.

Froehlich is among the growing number of people across America fighting for the right to dry their laundry outside against a rising tide of housing associations who oppose the practice despite its energy-saving green appeal.

Although there are no formal laws in this southeast Pennsylvania town against drying laundry outside, a town official called Froehlich to ask her to stop drying clothes in the sun. And she received two anonymous notes from neighbors saying they did not want to see her underwear flapping about.

"They said it made the place look like trailer trash," she said, in her yard across the street from a row of neat, suburban houses. "They said they didn't want to look at my 'unmentionables.'"

Froehlich says she hangs her underwear inside. The effervescent 54-year-old is one of a growing number of Americans demanding the right to dry laundry on clotheslines despite local rules and a culture that frowns on it.


Florida, Utah, Maine, Vermont, Colorado, and Hawaii have passed laws restricting the rights of local authorities to stop residents using clotheslines. Another five states are considering similar measures, said Lee, 35, a former lawyer who quit to run the non-profit group.

Do the 6 states that have already passed laws against clotheslines have anything in common? That is a very diverse group.

While states are getting in on the action, it seems primarily that private homeowners associations are the primary conduit here. It brings up the hairy issue of distinguishing between clubs and government. It is hard for me to see it as coercion since that meant there was a contract you had to agree to ex-ante in order to buy the house, but the same can be said of any local government rule (or pirate ships for that matter).

I take very seriously the externality concerns in this story. While I can not find it in me to object to someone hanging their laundry, others might feel it equivalent to someone standing nude on their front lawn. The Coasian/Bloomington school in me thinks that this should be resolved over a pie among neighbors rather than in the courts.

(Hat Tip: Jason Oberle for the story.)

Wednesday, November 18, 2009

Back to the Future II

False alarm....the hover-board has not yet made it to the shelves. However, this week saw the release of Tony Hawk's Ride for the Wii and Xbox360. The board comes equipped with motion sensors that allow you to control the game by pushing off for speed, tilting the board and shifting your weight to steer and do tricks.

According to Michael Mandel, the current outlook of economic growth does not reflect cutbacks in R&D spending. "That's because the official statistics are not designed to pick up cutbacks in "intangible investments" such as business spending on research and development, product design, and worker training. There's ample evidence to suggest that companies, to reduce costs and boost short-term profits, are slashing this kind of spending, which is essential for innovation."

In Peter Boettke's analogy, the success of capitalism (whereby the ultimate goal of business is to meet consumer demands) is an ongoing race. If the innovation of Schumpeter and the free-trade of Adam Smith can outpace government policies that stifle innovation, economic growth will occur.

If one believes the predictions of Back to the Future 2 (1989), Americans could possibly be enjoying the fruits of capitalist innovation of hover-board technology by 2015. Innovative consumer successes such as the Tony Hawk Ride, while amazing accomplishments, are suggestive of the illusive counter-factual -- what level of wealth and prosperity could people enjoy if the government were not allowed to participate in the race? What types of technologies are resources being diverted away from with government bailouts, stimulus, and inflation?

If the hover-board example seems trivial, consider the new Cato policy analysis by Glen Whitman and Raymond Raad. They note that
"health care issues commonly considered most important today — controlling costs and covering the uninsured — arguably should be regarded as secondary to innovation, inasmuch as a medical treatment must first be invented before its costs can be reduced and its use extended to everyone."
As Kenneth Rogoff has stated,
"[I]f all countries squeezed profits in the health sector the way Europe and Canada do, there would be much less global innovation in medical technology. Today, the whole world benefits freely from advances in health technology that are driven largely by the allure of the profitable U.S. market. If the United States joins other nations in having more socialized medicine, the current pace of technology improvements might well grind to a halt."
The hover-board example works to illustrate how policy today can prevent product development tomorrow because people can envision that which may be forgone by stifling innovation. In health and medicine, innovations and developments are less visible to the public and hence possibly more susceptible to the whims of democratic interest group politics. By 2015, there may be many more significant invisible losses than the lack of a hover-board technology.

2009 Gus Rankings: Week 11

Here are this week's Gus Rankings. A few comments:

- Art's team, Alabama, continues to impress. It's at this point that I wish I had previous years of Gus Rankings to fall back upon. Is a 4 point lead large at this point in the season? If things shake out a certain way, could that be overcome by Texas or TCU in a week's time? (It's probably harder for Florida due to the common opponents.) I get the sense that it's probably not likely but I'd like some historical precedent.

- Congrats to Marshall and his Rice Owls-- winners over Tulane and likely removing themselves from the bottom spot at the end of the season. As Marshall mentioned last week, the Owls had the inside track for the bottom rung of the Gus ladder but righted the ship just in time.

The larger question: Can the Gus Rankings grow in popularity beyond Rhodes College?

- I did some quick calculations to get a sense for conference strength-- here's the average number of points:

SEC: 12.25 (West: 18.33, East: 6.16)
Big East: 10.00
Pac-10: 7.30
Big 10: 7.09
Big 12: 6.17 (South: 12.83, North: -0.50)
ACC: 5.25 (Coastal: 14.33, Atlantic: -3.83)

Mountain West: -1.78
WAC: -7.89

The top 6 are the BCS conferences, and the bottom two have teams in the running for an at-large BCS spot.

Surprising is the dichotomy between divisions in the three BCS conferences that have such a split. Again, it would be nice to have some sort of historical precedent. Is this usually the case, or are both sides of the conference pretty balanced? Before looking at this, I would have guessed that you might have a split in the Big 12's divisions but not in the SEC and the ACC. It's an interesting result. You could certainly slice the remaining conferences to have differences like this if you so desired, but what's par for the course? I'm intrigued.

TPS at the 2009 SEA's

Here is where TPSers can be found in San Antonio this weekend for the Southern Economic Conference:

Sunday, 8AM - 9:45AM, Session 03F "Applied Political Economy"
Claudia Williamson will present Culture and Economic Freedom

Sunday, 10AM - 11:45AM, Session 08G "Economic Behavior"
David Skarbek will present Why The Inside Rules the Outside: The Economics of Criminal Gang Control

Sunday, 4:15PM - 5:45PM, Session 02I "Cities and Disasters"
Emily Schaeffer will present Searching for Sympathy in All the Wrong Places: Adam Smith and Social Distance Determined Charitable Giving

Monday, 8AM-9:45AM, Session 08J "Decisions and Social Outcomes"
Justin Ross will present Is There Crowd Wisdom in the Judgment of Experts? Evidence from College Football Rankings

Tuesday, November 17, 2009

Calculating the Silverdome as an Investment

My former professor Bob Lawson posted some silly calculations up at DOL.
PV(1975) = $55.7million. FV(2009) = $583k. Yield = -12.55%
If anyone is actually interested in calculating the return on investment, be sure to include the annual revenue stream from the project.

As a comparison, imagine if I were trying to convince an old fashioned monk who spends his day transcribing texts by hand to invest in a copier. "It only costs $100 up front," I point out, "and you can resell it for parts in twenty years for $10." With a few scribbles in the margin of some sacred text, he turns to me and says "Do I look like an idiot? That investment has a negative return!"

Note: I am not claiming the stadium was a good investment. Rather, I merely suggest that we consider the benefits before we say it is too costly.

The Costs and Benefits of Married Life

Paul Fritjer's work is summarized in this article (Hat Tip: Pavel Yakovlev):

WHAT'S a marriage worth? To an Aussie male, about $32,000. That's the lump sum Professor Paul Frijters says the man would need to receive out of the blue to make him as happy as his marriage will over his lifetime. An Aussie woman would need much less, about $16,000.

But when it comes to divorce, the Aussie male will be so devastated it would be as if he had lost $110,000. An Aussie woman would be less traumatised, feeling as if she had lost only $9000.

For fun, take the points at face value:

So, a man who marries and divorces would be worse off on net by an estimated $78,000 than if he never married at all, whereas a woman would remain better off still from having been married by a $7,000 margin. In a utilitarian sense, this is a $71,000 loss to social welfare arising from marriages occurring that result in divorce.

There should be a bargaining opportunity to arbitrage away this difference, where a man should be able to bribe his would be ex-wife into remaining. This willingness to bargain though might be individually rational but collectively problematic for men in a rent-seeking sense.

Friday, November 13, 2009

The Research Productivity of Robert Tollison

Forthcoming in Public Choice, and the authors are Nicole and Mark Crain. I admit that I think this is one of the strangest paper ideas I've ever seen, which of course predisposing me to liking it. Abstract:
Academic performance is typically measured as some combination of teaching, publishing, and professional service. This paper focuses on the publication aspect of academic output, estimating the determinants of publication productivity using data for Robert D. Tollison (RDT). Robert Tollison published 433 articles and books, and collaborated with 524 coauthors while at a dozen institutions over thirty-eight years. Our findings indicate that RDT’s output is significantly correlated with several factors, including co-authorship, the diversification of his research portfolio, business cycles, and academic pay. To a lesser extent, his production pattern is influenced by non-work interests and specific institutional affiliations.

Thursday, November 12, 2009

Auctioning off a Stadium

New stadiums are great, but what happens to the old ones? Usually the edifices are torn down to make way for parking, but sometimes they remain. Joel Osteen bought the Houston Rockets' old stadium. TPS Clevelander Rob Holub sends along this link concerning the Pontiac Silverdome, home of the Detroit Lions until 2001.

From the article:

"Williams & Williams, a Tulsa, Okla.-based auction firm, is accepting sealed bids until the deadline. Under the terms of the auction, city officials can accept the highest bid or invite as many as five of the bidders to a live auction on Monday. If the live auction happens, the bidding will begin at the highest offer from the sealed bids"

Rob offers the following:

"Does it not benefit each bidder to bid lower than they would if the live auction result was not a possibility? Why bid what you feel is your best offer, if the next "best offer" is 30% less than yours? I'd think each bidder would lowball so that they either a) get a bargain in their eyes, or b) engage in the live auction so they can make a more educated bid in the presence of their competitors."

The structure of the auction is interesting; it's like a action with a reserve price, only the failure to reach this price kicks the deal over to a new, live auction.

My thoughts:

- Has the city ever revealed what that reserve price is? If they never have, they're strictly better off by automatically defaulting to a live auction since the bids start at the highest sealed entry.

- Insofar that the participants can learn from the bidding process, Rob is right-- everyone is better off in the live auction. Independent of the incentive for the city to take this to a live auction, imagine the situation of everyone desiring a live auction and restraining their bids accordingly. One shirker takes the auction, but if everyone shirks then everyone is worse off. A situation where you acting in a certain manner makes you better off but if everyone acted as you did then you all would be worse off? That's a prisoner's dilemma.

- Given the above two points, I believe that the final result is no different whether the participants know the reserve price or not.

- Auction theory has always been of interest to me; I very nearly wrote my undergraduate thesis on the topic. It cuts at the larger (public finance) question of how to get people to honestly reveal their preferences. There's plenty of alternatives; my favorite is to deliver sealed bids and the winner pays the second place bid. Incentives are weak to misrepresent your true value. What are some others?

Wednesday, November 11, 2009

How is that Pfizer Deal Working out, New London?

The City of New London (CT) and the U.S. Supreme Court stole Susan Kelo's home, and the Tax Foundation blog has a great post providing us with an update:
The Court accepted the argument of the City of New London, Connecticut, that transferring the property from the current homeowners to private developers would increase the number of jobs in New London and increase the tax revenues available to the city. This, in the Court's mind, was enough to satisfy the "Public Use" requirement of the Takings Clause.


Well, how much tax revenue is it generating now? Zero. The developers have changed their minds and have no plan to develop the land, as Business Insider explains, alongside a picture of the vacant lot where only feral cats now live.
I recommend the whole post, which also mentions that Justice Souter, who cast the decisive vote for the majority, became the target of a Kelo-style eminent domain attempted seizure for something called the "Lost Liberty Hotel."

Facts of the day

Except for Oregon, John McCain carried every one of the 17 states with the lowest tax levels in the 2008 presidential election, while Barack Obama won every one of the 17 at the top of the list except for Wyoming and Alaska.


Besides Mississippi, every one of the 17 states with the lowest state and local tax levels had positive net internal migration from 2000 to 2007. Except for Wyoming, Maine, and Delaware, every one of the 17 highest-tax states had negative net internal migration over the same period.

That's from this bit on Tiebout, California and Texas.

Tuesday, November 10, 2009

2009 Gus Rankings: Week 10

Here are the Gus Rankings for the week. Alabama claims the top spot this week, and by a healthy margin. There are six non-BCS teams in the Top 25. As the Top 10 goes, 2 from the SEC, Big 10 and ACC, and one each from the Big 12, Mountain West, Pac-10 and Big East.

I'm also curious to see who, in absolute terms, can post the highest number. It's neck and neck right now with Alabama (39) and New Mexico (-39). Basically, can New Mexico's opponents be worse to a greater degree than Alabama's opponents be good? I'm intrigued.

Congrats to Janey Wang!

For successfully defending her dissertation, titled "Redistributive Budget, Intergovernmental Transfers, and Fiscal Institutions."

Congrats, Dr. Wang!

Saturday, November 07, 2009

Blogging is NOT a Crime

Kareem Amer is the Egyptian blogger arrested in 2006 for posting his thoughts online. He received a three year prison sentence for insulting Islam and inciting sedition and another year for insulting the Egyptian President. Kareem has not yet been released.

For more information on Kareem Amer, including English translations of his writings, visit the FreeKareem website.

Friday, November 06, 2009

Illegal Substance Taxes

I did not realize that several states have an illegal substance tax. Check out the following rates in North Carolina:
Marijuana stems & stalks that have been separated from the plant $0.40 for each gram or fraction thereof More than 42.5 grams

Marijuana other than separated stems and stalks $3.50 for each gram or fraction thereof More than 42.5 grams

Cocaine $50.00 for each gram or fraction thereof 7 or more grams

Any other controlled substance that is sold by weight $200.00 for each gram or fraction thereof 7 or more grams

Any other controlled substance that is not sold by weight $200.00 for each 10 dosage units or fraction thereof 10 dosage units

Any low-street-value drug that is not sold by weight $50.00 for each 10 dosage units or fraction thereof 10 dosage units

Illicit spirituous liquor sold by the drink $31.70 for each gallon or fraction thereof No minimum

Illicit spirituous liquor not sold by the drink $12.80 for each gallon or fraction thereof No minimum

Mash $1.28 per gallon or fraction thereof No minimum

Illicit mixed beverages $20.00 on each 4 liters and a proportional sum on lesser quantities No minimum
There is a lot of great stuff in the above hyperlink, so do check it out. Now, to calculate the deadweight loss of these taxes, we would need to discount for the probability of being caught on each unit. It would be further interesting to calculate if these rates are revenue maximizing, that is, holding constant the probability of being caught, do the tax too much illegal activity to be revenue maximizing? How have the tax structures influenced the way the products have been produced? There is probably a dissertation here.

Here is a Table from Tennessee that shows that tax revenue on illegal substances swelled 80% from the previous fiscal year.

Hat Tip: Sarah Larson for both the link and the Table.

H1N1 calculation

I can't say I'm surprised about the hubbub over certain Wall Street firm receiving H1N1 vaccines. But it seems that the justification of how to distribute H1N1 vaccines is only half the story. The "highest risk" individuals are to first get the scarce vaccine-- that means those that are most likely to contract (and suffer most) from H1N1. That's only the direct cost. If we're economists, we also want to look at the indirect cost-- the lost productivity from contracting the flu. To that end, one could make the argument that maybe it was those on Wall Street that should be vaccinated first. It also could be the case that it's not those on Wall Street but another group entirely-- it doesn't matter either way. The point is that there's more to consider that just probability of catching H1N1. As it turns out, the market would cover this aspect quite nicely; willingness to pay considers foregone productivity. What we do know is that the government can't aggregate this information and create a top-down distribution strategy that replicates the market outcome. (Nor, for that matter, are they likely to be able to effectively distribute along the simpler lines of "highest risk" either.)

Congrats Will!

TPS bloggers are rolling in the awards lately, now with Will taking home some hardware for his work on money supply in the Great Depression.

Congrats, Will!

Blockquoting X

X = Phillip Swagel, former Assistant Secretary for Economic Policy at the Treasury.
This became a familiar story: nearly every Treasury action had some side effect or consequence that we had not expected or had foreseen only imperfectly (p. 43).

Thursday, November 05, 2009

2009 Gus Rankings: Week 9

Here are this week's Gus Rankings. Iowa maintains the top spot. Of the seven remaining undefeated teams, they occupy the top 11 spots. The lowest one-loss team is Utah at 22.

Simplicity works!

File this under: Lobbying, BCS-style

We all know lobbying in the Capitol Hill sense, but concept need not stop there. Anytime someone is in a decision-making position that has monetary consequences we can expect some political efforts.

Today's example? The Western Athletic Conference on behalf of one of its members, Boise State University.

The Western Athletic Conference is using Boise-based PR firm Scott Peyron & Associates to help Boise State's football team in its push for a BCS bowl.

The firm was put on a monthly retainer this summer to help promote Boise State as a legitimate participant in a BCS bowl should it go undefeated regardless of whether another nonautomatic qualifying school is ranked ahead of it.

But you'd think that the WAC would want the most favorable treatment possible for Boise State, right? This year, as opposed to previous seasons, Boise State can claim a large-scale marquee victory (over the University of Oregon). They deserve a spot as much as any other undefeated team, right?

The WAC doesn't care where Boise State gets into the BCS, just that it gets a spot.

Alas, the payment for a spot in the BCS is the same whether you play in the title game or one of the four supporting bowls.

Wednesday, November 04, 2009

Praise for Bauer

I just wanted to draw your attention to my post and the discussion over at AidWatch on the importance of Bauer in development economics, especially on the role of foreign aid.


Presidential Proclamation Database

Database here.

According to the website, a presidential proclamation is
...“an instrument that states a condition, declares a law and requires obedience, recognizes an event or triggers the implementation of a law (by recognizing that the circumstances in law have been realized)” (Cooper 2002, 116). In short, presidents “define” situations or conditions on situations that become legal or economic truth. These orders carry the same force of law as executive orders – the difference between the two is that executive orders are aimed at those inside government while proclamations are aimed at those outside government. The administrative weight of these proclamations is upheld because they are often specifically authorized by congressional statute, making them “delegated unilateral powers.” Presidential proclamations are often dismissed as a practical presidential tool for policy making because of the perception of proclamations as largely ceremonial or symbolic in nature. However, the legal weight of presidential proclamations suggests their importance to presidential governance.

Now, the database goes back to 1789 with G.W., who issued one proclomation that seems to be a formal recognition of Thanksgiving as being November 26th. In 1790 he makes two proclomations pertaining to treaties reached with Indian tribes. In 2009, there are several proclamations per month, most of which seem to be raising awareness of something. Just skipping around, it seems this behavior started with Ford in 1974-1975. Prior to Ford, nobody seems to issue a proclamation on even a monthly basis.

It would be interesting to try an correlate number of proclamations with employment or other business cycle variables.

DMV Day: Pennsylvania Edition

We here at TPS seem to provide anecdotes in all their DMV glory. Claudia talked about a visit here, I provided one here, and Justin seems destined for a life of frustration.

Nothing too outlandish this time around, though I did enjoy the back-of-the-envelope calculation that can come from it. The entire experience took about 75 minutes, as my name had a typo (understandable, since my name is particularly difficult to spell) and I had to do the whole process over again, but it took 45 minutes to be called to the front in the first place. When I got my automated ticket, it mentioned that my estimated wait time was 11 minutes. They were free to estimate any time they wanted, take into consideration any factors they felt important, and even bias it to make themselves look better. But they were still off by a considerable margin!

Government production: 4 to 5 times more inefficient than even their own estimates.

Monday, November 02, 2009

Terrorism and Labor Market Effects

Exactly what's the impact of a terrorist attack on labor market outcomes? It's an interesting question, here's an attempt to get after the answer. Note that they look at suicide attacks by Palestinians in Israel, then compare the Israel effects with the Palestinian effects. They admit the problems in disentangling cause; nonetheless, it's a place to start. The abstract is below.

The literature on conflict and terrorism has paid little attention to the economic costs of terrorism for the perpetrators. This paper aims to fill that gap by examining the economic costs of committing suicide terror attacks. Using data covering the universe of Palestinian suicide terrorists during the second Palestinian uprising, combined with data from the Palestinian Labor Force Survey, we identify and quantify the impact of a successful attack on unemployment and wages. We find robust evidence that terror attacks have important economic costs. The results suggest that a successful attack causes an increase of 5.3 percent in unemployment, increases the likelihood that the district’s average wages fall in the quarter following an attack by more than 20 percent, and reduces the number of Palestinians working in Israel by 6.7 percent relative to its mean. Importantly, these effects are persistent and last for at least six months after the attack.