Most “economists” aren’t

John Quiggin39 Comments

I’ve always thought that an economist is someone who understands opportunity cost. If there is one thing a first-year undergraduate economics course should teach, it’s an understanding of this concept. So it’s alarming to discover that most members of a sample drawn from participants in the profession’s most important conference are not, at least by my definition, economists.

Via Harry Clarke, I found this paper by Ferraro and Taylor (guest registration or subscription required). Ferraro and Taylor presented their volunteer subjects with this question.

Please circle the best answer to the following question:

‘You won a free ticket to see an Eric Clapton concert (which has no resale value). Bob Dylan is performing on the same night and is your next-best alternative. Tickets to see Dylan cost $40. On any given day, you would be willing to pay up to $50 to see Dylan. Assume there are no other costs of seeing either performer. Based on this information, what is the opportunity cost of seeing Eric Clapton?

(a) $0
(b) $10
(c) $40
(d) $50.

Take some time to think before looking over the fold
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Mudslide in the Phillipines

John Quiggin3 Comments

The latest news from the mudslide in the Phillipines is grim. There have been no more people rescued from the village of Guinsaugon, even though students and teachers in the local school survived the intial slide and sent text messages calling for help. The Australian government is giving $1 million for relief and rescue.

In general, the world is pretty good about responding to disasters of this kind. But it’s worth remembering that the huge death toll associated with these disasters is often the result of the poverty of those affected, and that it is in our collective power to end extreme poverty once and for all. Simple improvements in health care and agrlculture would save millions of lives every year.

We should be pressing the government to maintain, every day of the year, the generosity it shows on occasions like this, and doing our individual best to help as well.

Theme competition

John Quiggin3 Comments

I finally got around to checking out the podcasting feature in iTunes today (I know I’m way behind the times, but I’m a texty kind of guy). It’s pretty kewl.

By coincidence, I also got an email today from Nicholas Gruen about a Theme Competition for The National Interest. The idea is to get an open-source theme that will allow podcasting of the show, by avoiding copyright problems with the existing theme.

Salvage?

John Quiggin4 Comments

My wife forwarded this sequence of photos that are doing the rounds, headed “Irish Salvage”.

No doubt eagle-eyed Irish readers will be able to point out that the truck is of a make used exclusively in the UK, or that the superscript on the manifest is of a type not found in the Irish localisation of MS Word.

Update: As expected, too good to be true. The second spill is faked. Still, it’s pretty funny.
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Weekend reflections

John Quiggin6 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.

The Washminster system

John Quiggin35 Comments

Peter Shergold, head of the Department of Prime Minister and Cabinet has stated what has long been apparent. The Westminster system, under which ministers are responsible for wrongdoing by their departments, is dead in Australia. Shergold says, in relation to incidents like the AWB scandal, that ministers should resign only if they ordered public servants to breach the law or “or if a minister had their attention drawn to matters and then took no action”.

Although Shergold apparently went on to deny this, it’s obvious that the current setup, in which ministers are screened by staff appointed on a basis of personal loyalty, ensures that ministers need never have their attention drawn to anything likely to compromise their position. Such information can always be communicated to a private secretary or similar staff member, who will judge what the minister needs to know and, more importantly, what the minister needs not to know.
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US vs EU, Round XXVIII

John Quiggin41 Comments

Fareed Zakaria has yet another piece on the inevitable decline of Europe. In it, he makes the claim

Talk to top-level scientists and educators about the future of scientific research and they will rarely even mention Europe. There are areas in which it is world class, but they are fewer than they once were. In the biomedical sciences, for example, Europe is not on the map.

High energy physics, anyone? Western European output of scientific papers surpassed that of the US about 10 years ago and the gap is still widening. The US is relatively stronger in biomedical research than in the physical sciences, but Europe has caught up there as well. The loss of the US lead in science is sufficiently widely-accepted that proposed responses made it into Bush’s State of the Union speech.
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Global warming and careerism

John Quiggin215 Comments

ABC Four Corners ran an interesting show last night on the anti-science interest groups who dominate the formulation and official discussion of policy on global warming in Australia. Transcript here, along with discussion from Tim Lambert and Larvatus Prodeo.

What particularly interested me was the number of scientists who had been pushed out of CSIRO, or had left of their own volition, after being tightly censored in what they could say about global warming, and the emissions reductions that would be needed to stabilise the climate (the latter point is particularly sensitive since any actual number implies a target and government policy is opposed to targets).

In particular, I was struck by the fact that global warming contrarians commonly explain the overwhelming support of climate scientists for the consensus view on anthropogenic global warming in terms of careerism. The contrarians say that if the scientists deviated from the dominant consensus, they would lose their jobs or their grant funding.

THe Four Corners report made it clear that, in Australia (as also in the US) the exact opposite is the truth. Speaking out in support of science on global warming is a very bad career move, at least for anyone employed by the government. In climate science, where the big organisations have been CSIRO and the Met Bureau, that constraint applies to most people working in the field.
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