Go back to InTrade and check on some probabilities

Here.

The latest on the trade front with China

Not great news.

Waxman-Markey

Pro and con.

Me on the carbon tax

Here and here and here, among others.

If you want to read a skeptic, try this.

Carbon tax vs. cap and trade

Here is one short piece.

The Bush analysis of cap-and-trade

You'll find it here. This is no longer the position of the Republican Party, of course.

Uncertainty and climate change

There are some interesting points here.

The cupcake bubble

It is spreading worldwide.

A contrarian defense of current malpractice law

By David Leonhardt.

This morning's WTO news

China, the U.S., and media products.

The deadweight loss of tariffs

Read more here.

Here is another piece on the tire dispute

From The Financial Times, a great newspaper.

The Airbus summary

Here is a brief summary, this is the biggest trade case of late.

Short bit on China tire dispute

Read it here.

Debate on outsourcing

Tyler Cowen vs. John Irons.

The Candlemaker's Petition

By Fredric Bastiat, from the 19th century. This is one of the classic writings on international trade.

Eliot Spitzer (of all people) on financial regulation

It's short but one of the better pieces. Last week I debated him on the radio and I can vouch that he does genuinely understand economic concepts.

What's the incidence of this tax?

Read about it here.

Drugs in Singapore

Here is follow-up:

Singapore's drug laws are among the world's harshest. Anyone aged 18 or over convicted of carrying more than 15 grams of heroin faces mandatory execution by hanging.

But drug addiction was still a problem, Amnesty said, adding that there was "no convincing evidence" high execution rates had curbed drug use in Singapore.

It cited Singapore Central Narcotics Bureau statistics showing 3,393 people arrested for drug offences in 2002 and the number of new drug abusers up 16 percent from 2001. Use of methamphetamines, or "ice," also showed a significant increase.

Dynamic pricing for hockey games

Why doesn't everyone do this?

What's a day in jail worth?

This is more from the Kleiman book:

In 1974 the average burglary resulted in about four days behind bars (that's the average sentence adjusted by the chance of getting caught). The average 1974 burglary yielded about $320 (in today's dollars), which amounts to about $80 a day payment for time behind bars. Even forgetting about the fixed costs of getting a criminal record, or a longer criminal record, that screams out to me: "It isn't worth it!"

Today, for burglary, the average return per day in jail is $22. That is one reason why crime has gone down but the real question is why crime has not fallen even more.

How much would you have to be paid to spend a day in jail? I know, it depends on which jail. The median jail.

I believe that many burglars, especially repeat burglars, are deluded about their chances of eventually getting caught.

The elasticity of crime with respect to incarceration

It is estimated at about -0.2, which means that a ten percent increase in incarceration results in about a two percent reduction in crime.

That is from p.113 of the new (and excellent) Mark Kleiman book When Brute Force Fails: How to Have Less Crime and Less Punishment.

On p.114 we learn that the elasticity of crime with respect to policing is somewhere between -0.3 and -1.0, depending on the estimate you favor.

Does this have policy implications?

Are malpractice suits responsible for high health care costs?

Probably not so much:

But are “frivolous lawsuits” the real cause of high health care costs? The short answer is no. Malpractice costs represent less than half of 1% (0.46 percent of total health care expenditures) and malpractice settlements have grown modestly with inflation. In fact, in states that have adopted caps on jury awards, doctors are prescribing too many aggressive and intensive treatments that increase costs, but don’t improve outcomes.

When Texas capped non economic medical malpractice damages to $250,000 in 2003, most conservatives argued that the reform would free doctors from having to prescribe unnecessary treatment. It didn’t happen. According to the Dartmouth research on disparities in health care spending, many Texan doctors are still prescribing aggressive treatments that don’t improve outcomes. In fact, as of 2006, Texas was still at the top of the list of high-spending states.

Here is the article, note that I don't agree with everything in there. That all said, most health care economists do agree that malpractice reform is probably a good idea, even if it is an overrated idea.

Another good piece on health care economics

It's a somewhat different perspective than offered in class but to be taken seriously. Read it here.

This is an article to read

Yikes!

Obama partially endorses soda tax

Read about it here. You can find here the Jonathan Klick paper on obesity; there is no need to read it but the abstract notes:

Americans have been getting fatter since at least the mid 1980s. To better understand this public health problem, much attention has been devoted to determining the underlying cause of increasing body weights in the U.S. We examine the role of relative food prices in determining an individual's body mass index, arguing that as healthful foods become more expensive relative to unhealthful foods, individuals substitute to a less healthful diet. Using data from the National Health Interview Survey (NHIS) for the period 1982-1996, we find that individual BMI measures, as well as the likelihood of being overweight or obese, exhibit a statistically significant positive correlation with the prices of healthful relative to unhealthful foods. These results are robust to endogenizing the relative price measure. While the magnitudes of our estimates suggest that relative price changes can only explain about 1 percent of the growth in BMI and the incidence of being overweight or obese over this period, they do provide some measure of how effective fat taxes would be in controlling the obesity epidemic. Our estimates imply, for example, that a 100 percent tax on unhealthful foods could reduce average BMI by about 1 percent, and the same tax could reduce the incidence of being overweight and the incidence of obesity by 2 percent and 1 percent respectively.

The number of foreign-born among the uninsured

You'll find the exact numbers here.

Tax incidence and health care benefits

Read more here.

My favorite article on the economics of American health care

You'll find it here.

The Rand health care study and other bits on health and health care

Here is a link from Wikipedia.

Here is the Atul Gawande piece on different levels of Medicare expenditures but similar health outcomes. Someone mentioned this piece in class. Obama has indicated he is very influenced by it and he passed it around the White House for others to read.

Here is a good graph on higher U.S. health care expenditures.

Current health care proposals

Here is some basic information.

Exploding offers for clerkships

Here is a short blog post on how judges make "exploding offers." How should we think about this practice in economic terms? Is it a good or bad idea for a) the potential clerks, b) the judges, and c) society overall? Can you conceptualize these answers in terms of supply and demand and other basic economic concepts?

The supply curve shifts out

Redbox. Do any of you use it?

Is there a cupcake bubble?

David sends me this article to read, it is interesting.

One more query about prices (but not the last)

In the old days (it still may be true), the fancy restaurant Inn at Little Washington *did* charge a higher price for Saturday nights. Why would they do this?

Are there reasons why an especially fancy restaurant would be more likely to do this?

What other predictions can you come up with?

In general these are not always easy problems.

When prices don't clear the market

Let's consider a few cases:

1. People wait in line 24 hours for concert tickets.

2. People wait in line 24 hours for the new iPhone on its first day.

3. Movie theaters are more crowded on Saturday night than Monday night, yet the price is the same each evening.

4. Movie theaters do lower the price for early shows.

5. Restaurants have waiting times for Saturday night but not always Monday night.

6. Super Bowl tickets are allocated by lottery rather than by raising the price.

7. When there is a storm, 7-11 doesn't simply raise the price of shovels and that is true even in states with no anti-gouging laws.

How many of these phenomena can you explain?

Price controls on Iraqi brides

Analyze the economics of this price control.

Another blog on our textbook

Someone else is teaching a similar class, with the same book, his blog will be here. This is strictly optional and I have no idea what he will do with the blog.

Supply and Demand

Here is a short post on common confusions about supply and demand. It requires careful reading and I would say it is likely to confuse you a bit as well. It's a kind of test to see if you have a final, 100 pct. understanding of the difference between shifts in a curve and movements along that same curve.

Remember, under our procedures, you're not responsible for reading this for class tonight, it's for next week.