Easy Useless Economics - Krugman

Mark Thoma provides a Krugman commentary in the NY Times.  Basically, how some economists explain away economic phenomena as "just because".  That sounds bad.  I should sum up a bit better.  Economists calling the current drag in unemployment a structural problem.  Krugman says this is the easy way out and leads to laziness - if it's structural, you're rather limited in what you can do to bring employment back up.  He points to pre-WWII as evidence, as there's an article in the AER, a top economics journal, calling the pre-WWII high unemployment structural.  Krugman says that WWII provided fiscal stimulus, and the US bumped down that high unemployment.  While I (seem to) agree with Krugman that this current bout of high unemployment is unlikely to be (mostly) structural, as I can't imagine something that happened so quickly and drastically changing employment decisions, I'm curious if Krugman is insinuating that NOTHING is particularly structural.  I feel it's appropriate to criticize the somewhat lazy thinking, but I think Krugman is thinking first best (when there's nothing to distinguish between ideal and real life), whereas we live in a world where we need to think about third best (transaction costs and political friction).  There are folks out there who don't want to see fiscal stimulus, so even if you want to see it happen, it ain't happenin'.

Job Creation by Party

From Bloomberg.com, via Mark Thoma.  Private jobs increase more during a Democratic presidency while public sector jobs see more of a boost during Republican presidencies.  A little ironic, but it's definitely more of a correlation than a causation.  Roaring debate in the comments section about which presidents did what with regards to taxes to boost growth.  Some violently defensive comments, somewhat amusing...

IGM Forum Poll

Another two-fer.  My excuse is studying for finals and working on some final papers...

French labor policies.  I lied, this is sort of a three-fer, as this is a two part poll.

Question A: Reducing the minimum retirement age in France from 62 back to age 60, permanently, would reduce long-term French economic growth and substantially raise French debt relative to GDP over time.

Question B: France’s overall employment is higher today because of the 35 hour work week than it would be without a limit on weekly hours.
General agreement for A, I think it's hard to argue against it, and the one disagree vote didn't have a comment.  Encouraging people to not work (retirement) surely can't help growth.  Question B, I think that the general equilibrium effect is difficult to assess; a few economists think this, quite a few uncertain votes.  If (big if) workers are homogeneous and each hour they work is homogeneous, then the work hour limit would boost employment - you want to hire a certain number of total hours, but it's split between more people.  Research project, maybe?

Price gouging.
Connecticut should pass its Senate Bill 60, which states that during a “severe weather event emergency, no person within the chain of distribution of consumer goods and services shall sell or offer to sell consumer goods or services for a price that is unconscionably excessive.”
Lots of beef with "unconscionably".  For the most part, people like pricing mechanisms in the free market setting, which I'm a fan of, but a few economists are wise enough to point out unfortunate monopoly effects.  If a rich-ish person (not so rich that they wouldn't mind arbitraging a little) sucked up quite a bit of the supply, this would lead to some serious inefficiencies.  Two agree, and Angus Deaton steps in and strongly agrees: "Efficiency is less important than distribution under such transitory conditions."  I'm torn; if people aren't jerks about it, this law isn't necessary, but I'm rather skeptical about people not being jerks...  Professor Deaton is right, though, efficiency needs to take a back seat if the welfare of a good amount of citizens is suffering.

Age Limit in the NBA

Steve Kerr on age limit for NBA, via Grantland.  He thinks it's good business to have a 20 year old age limit.  On the one hand, I would argue that it's up to the clubs to make that cost/benefit analysis to themselves; if clubs don't think Anthony Davis isn't ready, they can just pass on him.  There are arguably externalities, though.  It hurts the whole league a little bit if top pick bomb, not just the club itself.  And, if there was anything that really stood out during the lock out, it was that owners and general managers needed rules in place to save themselves.

From a "right to work" legal stand point, I'm curious as to how age limits work.  There's an age limit for the US President and other political offices, but no one cries foul about discrimination or anything like that.  Kerr points out that this isn't ruining their opportunity to earn income - just look at Brandon Jennings playing abroad.  I definitely think the one year rule is a pretty big farce; as has been pointed out, you don't really need to attend your classes to play your freshman year.  You'll be put on probation in your second semester, and failing those classes, you'll be suspended, but you're going pro anyways, so it's all moot.

I definitely think there needs to be more information given to these athletes, trying to get them on the right path in the long run, and in life in general, not just the quick money grab.  With that being said, the NCAA definitely needs to fix up the image of the "student athlete" it's trying to portray.  I don't know about paying student athletes, but I do know that the NCAA needs to make sure athletic departments get their priorities right: the students should come first.

Youth Football and Concussions

Youth Football and concussions, article by Ashley Fox on ESPN.  The article has a video with Merril Hoge discussing youth football risks.  Fox would want her kid to play any other sport than football.  She doesn't name hockey, to be fair, but lists lacrosse as a possible alternative, but from what I know of lacrosse, it's not extraordinarily better than hockey or football.  I agree with Hoge in that people seem to be ignoring improving the situation.  Risks are higher in football, but good training of the coaches and parents can do a lot for those risks.  I also agree with TMQ's suggestion to let kids play flag football until their brains have developed more.  Even more so, with the game becoming a pass heavy league.  You learn plenty of good techniques and skills, playing flag football - how to run routes, remembering plays, and all that.  Maybe even argue for better tackling, since you can't recklessly go after someone and hope to grab a flag.

The Culture of Music Snobs and Music Mobs

"High brow" elites moving towards "low brow" culture in the Understanding Society blog. (Via Mark Thoma)  I put in quotations because I question the definition, but we'll get to that.  The article covers a few articles researching the music-listening habits of people divided into high status and low status categories.  The theory is that high status people would flock to "high brow" elite culture whereas low status people flock to "low brow" mass culture.

(much longer post, so click below to read more!)

Paul on Paul vs. Paul

Krugman (not Ron) thinks face-to-face debates are kind of pointless.  At least, in the setting which the video presented.  Need some fact checkers, says he.

I think it was TMQ or Bill Simmons who said that all these televised debates should have people checking facts, so one wouldn't be able to (inaccurately) hype themselves up/blast others.  I think the reference was to "Around the Horn" or "Pardon the Interruption", where arguments are revisited and mistakes are pointed out.  Blowing things out of proportion, stretching the truth, I get how that's part of politics.  Telling (blatant) lies to generate votes in your favor, however, is disgusting.  If I ever run for a political position, I will hire plenty of fact checkers to correct other people and myself mid-debate.  Anybody who doesn't want a fact checker during these sorts of things is a phony.