Author: John Quiggin

Books and bombs, again

John Quiggin4 Comments

Reader Tom Stafford writes to publicise a protest against Elsevier:

Reed Elsevier is a publishing company with an arms trade problem. While the bulk of their business is in scientific, medical and educational publishing, they also organise arms fairs around the world. The aim of this website is to mobilise the academic community that writes and reads Reed Elsevier’s journals to persuade them to stop organising arms fairs. More details and petition here

I’ve been thinking about this on and off for a while, trying to work out what course of action is most effective in cases like this. Suggestions are welcome.

BrisScience and BrisReligion

John Quiggin14 Comments

The next in the BrisScience lecture series is on tomorrow (Monday) night, at City Hall, 6pm for 6:30. Continuing to diversify the range of topics, the speaker is Margaret Wertheim, on the topic ” Space and Spirit: Why Science and Religion Together are Driving us Crazy”. As the extract over the page suggests, Wertheim thinks that we have a fundamental pyschological need for a reconcilation of science and religion.

I’m not so sure about this. One of the most striking features of the late 20th century was the collapse of active religious belief in most of the developed world, with the glaring exception of the United States. This didn’t result in any direct sense from scientific discoveries about the universe. And, surprisingly, it didn’t seem to produce any big changes in behavior (there have been changes in sexual mores, but these have been just as noticeable in the US as elsewhere) or any obvious rise in cosmic angst. You can find some statistical differences between believers and non-believers, and between those who regularly attend religious services and those who don’t, but they are a lot smaller than much of the discussion of this topic would suggest.

Unfortunately, I won’t be able to make it, as I’ll be presenting at the IAAE Conference in the Gold Coast so maybe some Brisbane-based reader would like to put in a brief report on proceedings.
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Water and climate change

John Quiggin6 Comments

I spent yesterday at the Gold Coast, at a pre-conference Workshop on Water leading up to the International Association of Agricultural Economics Conference which starts today.

My presentation gave some simulation results on the impact of climate change. It’s still preliminary, but for those interested here is the presentation.

There’s a big area set aside for WiFi users at the Conference, including at least one possible liveblogger, who has already chided me for my failure to report promptly. The competition in econoblogging is definitely getting keener, in all senses of the term.

Cars

John Quiggin10 Comments

The fight over the economics of protection has been going on, with Harry Clarke at Kalimna saying

The argument that Nicholas Gruen has propounded, and which John Quiggin seems to have supported, that low levels of tariff protection are justified by the existence of market power in export markets, is just wrong.

I don’t think Harry’s argument actually proves his claims – he just shows that the simple version of this argument is too simple, which is true of all simple arguments, including simple arguments for free trade.

My view, for what it’s worth, is that any terms of trade benefit from protecting the industry is likely to be negligibly small and that the standard counterarguments about retaliation make it a bad idea to try to impose optimal tariffs to extract such benefits. But the allocative efficiency benefits of reducing small tariffs.

But if neither of these effects is significant what are we arguing about? A couple of things.
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Weekend reflections

John Quiggin14 Comments

Weekend Reflections is on again. Please comment on any topic of interest (civilised discussion and no coarse language, please). Feel free to put in contributions more lengthy than for the Monday Message Board or standard comments.

Two-point scales

John Quiggin16 Comments

I’ve been reading Steven Poole’s Unspeak and he observes that having introduced a five-level color coded terror alert, the government has never used the top level (red) or the bottom two levels (blue and green). The obvious reason is that a red alert would require some specific action, while a move to a blue or green level would imply that there was some prospect of the War on Terror actually ending.

I’ve noticed much the same phenomenon with 5-point grading scales for worker performance, such as those used in the Australian Public Service for a while. A top score suggests a requirement for some kind of substantial reward, so these are rare, while a score of 4 or 5 implies a need for counselling and a possibility of dismissal. So just about everyone gets a 2 or a 3, yielding, in effect, a two-point scale.

I imagine someone in psychometrics must have studied this kind of thing in general. Any pointers?

Update James Joyner at Outside the Beltway made the same point a couple of years ago.

Yet further update One day after I posted this, the Red Alert level has finally been used, but apparently only for commercial flights from Britain to the US, in response to the announcement by British authorities that they have detected a terrorist threat to blow up planes.

Groundhog Day

John Quiggin39 Comments

A decade and several communications Ministers ago, I was complaining about how telecommunications policy was killing the prospects for a fibre to the curb broadband network in Australia. And the sidebar quote from Richard Alston was in response to my observation that partial privatisation was the worst of all possible worlds. It looks very much as if I’ll be able to keep on recycling both complaints for another decade or so.

As some point, presumably, policymakers will realise that the only way we are going to get a modern telecommunications system is for the government to build it, or direct Telstra to do so. But there’s no sign of this at present.

What if they had a spill and nobody noticed

John Quiggin11 Comments

I was watching the TV news tonight and, about halfway down the bulletin, there were some stories about the new leader of the (Queensland State) Liberal Party, Bruce Flegg. Apparently he rolled Bob Quinn yesterday, but, even though I read the papers pretty carefully (OK, I read the websites of the national dailes pretty carefully and scan the Courier-Mail pretty fast) I hadn’t heard anything about this.Technorati suggests no-one else noticed either.* Somehow, I don’t think this is a good sign as regards the electability of the local Libs.

* I realise that my search omitted some blogs with few incoming links. A broader search picks up a couple of new bloggers more alert than me.

Heresy on Free Trade

John Quiggin32 Comments

While economists in general are trained to evaluate all arguments sceptically, there is one big exception – Free Trade. Most economists are wedded to the idea of free trade to the point that many will routinely reject the results of mainstream economic analysis in favour of logically incoherent claims about dynamic effects, ‘cold showers’ and so on.

For a variety of reasons, I apostasised from the free-trade religion early on and, for a while, became an outright protectionist in reaction. Now, I don’t have a preconceived position either way, and try to assess the issues on their merits.

One point that comes out of any neoclassical economic analysis is that, at tariff rates below around 10 per cent, the (traditional trade-theoretic) benefits associated with a reduction to zero are trivially small. This is because the welfare loss associated with a tax are proportional to the square of the tax rate, and the square of 0.1 is 0.01 (1 per cent).

Over at Club Troppo, Nick Gruen makes this point, among others, and sets off something of a firestorm. Read, enjoy and comment either there or here as you please.

Is Happiness Gross ?

John Quiggin21 Comments

There’s a lot of interesting stuff around just now on the question what we should and shouldn’t do with measures of aggregate economic performance and welfare. I talked about this in my BrisScience lecture. I make (again) the point the Gross Domestic Product is a bad measure of a nation’s economic welfare because it’s Gross (doesn’t net out depreciation of physical or natural capital), Domestic (doesn’t net out income paid overseas) and a Product (takes no account of labour input)).

But if GDP isn’t a good measure, what is? There are a bunch of alternatives in the air at present such as Gross National Happiness and the Genuine Progress Indicator (the latter has been advocated by Clive Hamilton and the Australia Insitute. These ideas have been getting a fair bit of criticism lately. Andrew Leigh has a go at Gross National Happiness while Nick Gruen writes on the Genuine Progress Indicator for New Matilda. This is subscription only, unfortunately, but when Nick completes his two-part paper, I’ll try to comment more. Andrew Norton at Catallaxy has also written a lot on this.

My general view is close to Nick Gruen’s. We should be trying to get at a Net measure of Full Income (including leisure and taking account of resource stocks) but none of the attempts so far have been really satisfactory. More on this when I get some leisure (As If!).