Market Power

Cascade Pale Ale - All Grain Recipe

Phil Miller — 2009-07-18T10:48:00-05:00

Ingredients

10 pounds 2-row American malt
8 oz Carapils malt
8 oz Caramel 10L malt
1 oz Cascade hops (7.1% alpha acid) - bittering (60")
1oz Cascade hops (7.1% alpha acid) - flavor (15")
1oz Cascade hops (7.1% alpha acid) - aroma (2")
1t Irish moss
White Labs California ale yeast (WL001)

OG - 1.051

Notes: I mashed the grains at 152-151 F for 60 minutes. I used 1.25 quarts of water per pound of grain. My mash tun lost 1 degree of temperature during the mash. I started out at 152 and ended at 151.

This was my first all-grain batch. I heated the mash water to about 170 degrees, but adding the grains did not bring the temperature down to 152F. I added enough ice to bring the temperature down to 152F. I think heating the mash water to 165F will suffice.

At the end of the mash, I drew off 2 gallons of wort (a quart at a time) and poured back into the grains to rinse out grain specks. My goal was to get clear wort running out of the mash tun. I think drawing off 1.5 gallons would have sufficed.

I sparged the grains with 170 F sparge water using 0.5 gallons per pound of grain. I collected a total of 7 gallons of wort into my brew pot.

I brought the wort to a boil and boiled for a total of 60".

I cooled the wort to below 70 degrees, transferred to my plastic fermenter, pitched the yeast, and sealed with a lid and an airlock. I wrapped the fermenter with towels (swaddling clothes) and placed on my dining room table. The temperature in that room is kept at about 70-72 degrees in the summer.

I had vigorous fermentation within 24-36 hours.

I initially used a turkey fryer to try heating the wort to a boil, but the fryer was not powerful enough to do this. So I put the pot on my stove (covering two burners) and was able to heat my wort to a boil. I did not get the rolling boil I had grown accustomed to in my extract brews, but the resulting gravity measurements and fermentation activity seem just fine.

You Do Not Own a Copy of this Book, Dear Reader, Even Though You Bought It

Phil Miller — 2009-07-18T10:38:15-05:00

This morning, hundreds of Amazon Kindle owners awoke to discover that books by a certain famous author had mysteriously disappeared from their e-book readers. These were books that they had bought and paid for—thought they owned.

But no, apparently the publisher changed its mind about offering an electronic edition, and apparently Amazon, whose business lives and dies by publisher happiness, caved. It electronically deleted all books by this author from people’s Kindles and credited their accounts for the price.

Post here via via Kip. The following is so true:

As one of my readers noted, it’s like Barnes & Noble sneaking into our homes in the middle of the night, taking some books that we’ve been reading off our nightstands, and leaving us a check on the coffee table.

The Kindle seems kind of cool, but this will make me think twice should I ever think about buying one.

Unemployment Now Above 10% in 16 States - AP

Phil Miller — 2009-07-17T12:13:11-05:00

Story here:

The U.S. Labor Department says unemployment topped 10 percent in 16 states last month. The rate in Michigan surpassed 15 percent, the first time any state hit that mark since 1984.

Home to the nation's struggling auto makers, Michigan has been clobbered by lost factory jobs. Its jobless rate of 15.2 percent in June was the highest in the country, but the record-high for the state was 16.9 percent in November 1982.

Still, the government says it's the first time in 25 years that any state has suffered an unemployment rate of at least 15 percent. In 1984, it was West Virginia.

The national unemployment rate is 9.5 percent, a 26-year high, and is expected to hit 10 percent by year-end.

Here is the BLS news release.

The Cost of Organ Transplantation

Phil Miller — 2009-07-17T11:06:37-05:00

Despite the law in the US that states that humans cannot sell their organs to other humans (they can only be donated), organ transplantation is far from being free. This article has some interesting numbers on the cost of organ transplantation in the US.

Japanese who traveled to the United States to get new hearts were charged as much as about $1.63 million for the operation in 2008, or five times higher than in previous years, medical sources well-versed in organ transplants said Thursday.

...In the U.S., the only country that accepts Japanese for heart transplants, nationals are charged $300,000 on average in hospital and physician fees for the operation, they said, adding that the figure does not include pre- and posttreatment fees.

HT to Al Roth

In Defense of Dynamic Ticket Pricing

Phil Miller — 2009-07-17T08:47:00-05:00

You might recall that the San Francisco Giants have begun using a system that allows them to alter the prices of their tickets to help increase ticket sales (see here and here), much the way that airlines price their tickets. They use a system that allows them to alter the price of their tickets to account for changes in weather, etc.

Christian Hassold has a nice defense of such a system.

Dynamic ticket pricing is needed now and it could benefit the market in two ways. First, it would reduce the number of tickets resold on the secondary market because dynamic pricing would reduce profit potential at resale. Second, dynamic pricing could increase ticket sales volume for events where interest was low. It seems plausible that some concerts are under attended because lower quality ticket prices (with fee’s) are not enticing enough. This is probably why Live Nation is putting so much effort into selling lawn seats for $25 with no ticketing fees – that kind of price entices people to buy.

Belgian IPA

Phil Miller — 2009-07-17T03:14:00-05:00

This is another recipe devised by the good folks at Midwest Brewing Supplies in St. Louis Park, Mn.

Ingredients

6# pilsen LME
1# wheat DME
1# candi sugar
8 oz Carapils malt 20
8 oz Acidulated malt
1.5 oz Sterling bittering hops 6% alpha - 60"
0.5 oz Sterling flavor hops 6% alpha - 20"
1 oz Ahtanum flavor hops 4.5% alpha - 15"
1 oz Ahtanum flavor hops 4.5% alpha - 10"
1 oz Ahtanum aroma hops 4./5% alpha - 5"
1t Irish moss
Wyeast Belgian Saison yeast #3724 (White Labs Belgian Saison #WL565 can also be used)
5 oz corn sugar for priming

Notes: The LME and DME are added to the water and dissolved completely before putting the pot on the burner. The wort is then heated to a boil and the hops are added as listed above. The candi sugar is added to the wort with 15" left in the boil. I stirred the candi sugar to make sure it would get fully dissolved.

OG 1.074

The History of the American Football League

Phil Miller — 2009-07-16T09:17:53-05:00

Sports Illustrated has an interesting article in its current "Where Are They Now" issue on the American Football League. It's a great example of how entrepreneurs, seeing that an industry's customers are not being fully served by an incumbent monopolist, enter the market and change it for the best.

Of course, it would seem that sports leagues are something of a natural monopoly. The AFL proved to be a successful competitor to the NFL, but eventually merged with the NFL to make the league we know today. But that's a topic for another day.

Secondary Ticket Market Conference

Phil Miller — 2009-07-16T08:47:27-05:00

Al Roth tells of a conference for, well, scalpers.

He also points to a blog on the economics of ticket pricing by Christian Hassold.

The WSJ on Economics Blogs - *The Sports Economist Makes the List

Phil Miller — 2009-07-16T08:40:47-05:00

They note the biggies (Mankiw, MR, Thoma's). HT, MR.

*Update: If I had, you know, actually looked at the list when I saw the article, I'd have seen that they named The Sports Economist as an honorable mention (#30). Thanks to Ihsuan Li for mentioning this to me.

Life as a Minor Leaguer

Phil Miller — 2009-07-15T19:40:03-05:00

Garrett Broshius, a former Mizzou Tiger, chronicles his season in a blog for Baseball America. Here is his post about getting promoted and then demoted within a couple of days. An excerpt:

I felt like someone had tied me to a road, poured hot asphalt upon me, and taken a steam-roller to me—not once, but a dozen times as if all of the hope left in my seemingly meaningless baseball existence needed to be purged, made flatter than the pre-Columbus earth. I wished more than anything to be given another chance. I hadn't made a good first impression, but being the type of pitcher that can study hitters and adjust accordingly, I hoped to make a couple more starts. This foolish hope expunged, I again couldn't sleep.

Read the whole thing.

Flying Fish Brewery Annoys MADD

Phil Miller — 2009-07-15T15:49:42-05:00

by naming beers after highway exits.

A New Jersey brewery is using the state's congested and often-derided turnpike to promote its beer, an idea that concerns the New Jersey Turnpike Authority and a group that opposes drinking and driving.

Cherry Hill-based Flying Fish Brewing Co. (motto: "Proudly Brewed in New Jersey: You Got a Problem with That?") has undertaken an ambitious project of releasing a special beer in honor of turnpike exits, one at a time.

...Joe Orlando, a spokesman for the New Jersey Turnpike Authority, said it's a bad idea to associate a highway with alcohol. Flying Fish has answered the authority's concerns with disclaimers that the beer isn't endorsed by the authority.

"There's been a brokered peace here," Orlando said. "But don't expect to see it in any of our rest areas."

That doesn't satisfy Mindy Lazar, executive director of New Jersey's chapter of Mothers Against Drunk Driving. "The combination of a roadway and advertising for any kind of a beer doesn't make any kind of sense," she said. "This is almost a mockery."

The New Jersey Turnpike Authority has more of a beef than MADD does. Ms. Lazar is suggesting that more people would drink and drive because naming a beer after an exit. It's a stretch to argue that the marginal benefit obtained from the combined actions of drinking and driving will be increased merely by naming a beer after highway exits. Does she have any empirical evidence that this is the case?

Man, Those Are Some Pricey Cancer Sticks

Phil Miller — 2009-07-15T10:37:32-05:00

A New Hampshire man says he swiped his debit card at a gas station to buy a pack of cigarettes and was charged over 23 quadrillion dollars.

Josh Muszynski (Moo-SIN'-ski) checked his account online a few hours later and saw the 17-digit number — a stunning $23,148,855,308,184,500 (twenty-three quadrillion, one hundred forty-eight trillion, eight hundred fifty-five billion, three hundred eight million, one hundred eighty-four thousand, five hundred dollars).

Yes, that man also was charged an overdraft fee.

Spicer, Mn Tornado Video 7/14/2009

Phil Miller — 2009-07-14T22:50:14-05:00

Here is a video of the Spicer, Mn. tornado on Bastille Day, 2009 taken by Jacob Thumberger. You don't see the classic cone, but you can see the swirling condensation.

Happy Bastille Day

Phil Miller — 2009-07-14T12:47:26-05:00

Human vs. Animal Health Care

Phil Miller — 2009-07-14T10:05:00-05:00

Here's a very interesting chart showing health care expenditures on animals and humans.

This is from Andrew Briggs at the Enterprise blog (via Megan McArdle). He got the veterinary data from the consumer expenditure survey and the human health expenditures from the National Income and Product Accounts. McArdle argues:

Veterinary spending is rising just about in line with human medical spending. Kudoes to AEI for publishing a graph that seriously undercuts one of the major conservative arguments about health care: that the main problem is consumers who don't bear their own costs. Veterinary spending is subject to few of the perversities that either left or right suppose to be the main problems afflicting health care spending. Consumers pay full frieght most of the time. They are price sensitive, and will let the patient die if keeping him alive costs too much. There is no adverse selection. There is no free riding on mandatory care. Government regulation is minimal. Malpractice suits are minimal, and have low payouts. So why is vet spending rising along with human spending?

For those interested, here's a useful powerpoint presentation that describes what the NHE data show. Here's the (I think) data Mr. Briggs used for his chart (third link below "downloads).

Keep in mind that the scale on the vertical axes are very different here. The lefthand side increases by $2,000,000,000 increments, the righthand side increases by $500,000,000,000. Much more is spent on the care of humans than on animals. I would be interested to see how much is spent per pet for veterinary services and how much is spent per person for medical care.

Also, veterinary services don't include the cost of medicine for pets. Adding this in, I realize, would not change things very much, but it would make for a more apples-to-apples comparison.

Update: Greg Mankiw writes

These data are consistent with what I wrote a couple years ago: "The reason that we spend more [on healthcare] than our grandparents did is not waste, fraud and abuse, but advances in medical technology and growth in incomes. Science has consistently found new ways to extend and improve our lives. Wonderful as they are, they do not come cheap. Fortunately, our incomes are growing, and it makes sense to spend this growing prosperity on better health."

If so, then medical costs are not spiraling out of control relative to what we get in return for our expenditures.

Someone Needs a Lesson on What it Means to be Overpaid

Phil Miller — 2009-07-14T08:30:00-05:00

Just because a baseball player is paid waaaay above average with stats that don't seem to match the pay does not mean that the player is overpaid. What matters is a comparison of his pay to what he produces in terms of revenue for his teams. In other words, the benchmark is how much the hometown fans value the player's productivity. But that's lost on this writer.

To measure this year’s most overpaid players at the All-Star break, we compared the major offensive stats – batting average, home runs, runs batted in and OPS (on-base percentage plus slugging percentage, now a major metric of production) of each player to the league average for starters at his position. Then we did the same with salaries. Hunter’s number at the break (17 HR, 63 RBI, .304 batting average and .946 OPS) certainly outpace the American League’s other 13 starting center fielders, who average eight homers, 31 RBI, .265 batting average and .754 OPS. But Hunter’s $18 million salary this year is almost six times what the league’s other center fielders make, on average.

But I do agree with this assessment:

When it comes to fighting a salary cap, the union is all for free markets. But constraints that benefit players – such as minimum salaries and limited free agency that controls the supply of players each year – are just fine. The owners pretty much have to live with what they created. And Jeter, Hunter and Beltran can laugh all the way to the bank.

This is what unions are supposed to do: they are supposed to raise the pay of the people they represent. But keep in mind the labor market in MLB is defined by the collective bargaining agreement between the union and the league. These agreements come about through collective bargaining - a series of gives and takes arrived at through negotiation. In other words, there are trade-offs built into the agreement - some benefit the league, others benefit the union.

HT to JC Bradbury

Everything You Wanted to Know About...

Phil Miller — 2009-07-13T21:13:15-05:00

Switchblades.

Fly in a Real B-17

Phil Miller — 2009-07-13T20:49:05-05:00

You can fly in the Aluminum Overcast, a fully restored and functional B-17. It's in Mankato tonight and tomorrow. I got an up-close-and-personal look at it tonight at the airport and the kids and I are taking a tour tomorrow. No flight though. Those are spendy.

The Economic Impact of 9-11

Phil Miller — 2009-07-13T20:46:49-05:00

This volume contains eight studies that provide a definitive range of estimates of the economic impacts of 9/11. The collection of papers represent the outcome of a collaborative and iterative research process known as the CREATE Economic Impact Modeling Forum (EIMF).

Here is the link. Via King.

Jeff Jacoby on the Minimum Wage

Phil Miller — 2009-07-13T08:45:00-05:00

Column here. HT Mark Perry via Kip. Excerpt:

AS IF the recession hasn’t been rough enough on those near the bottom of the economic food chain, fresh bad news is on the way. Beginning July 24, the federal government will be making it more difficult for employers to hire low-skilled and unskilled American workers. Thanks to an ill-advised law enacted with bipartisan support in 2007, the cost of providing an entry-level job to individuals with few skills or minimal experience will be going up by more than 10 percent. Those who cannot find a job paying at least $7.25 an hour will not be permitted to work.

People who would be willing and able to work for less than the minimum wage cannot find jobs because employers are prohibited from hiring people at less than the minimum wage. In other words, it creates ceteris paribus unemployment, especially of teenagers, the lowest skilled of the lowest skilled.

In addition, many teenagers who can't find work because of the minimum wage will be hamstrung over time because they won't get the valuable experience that comes from holding a job. This experience is an investment that pays a return over a lifetime.

"A Good Paper Topic for an Ambitious Grad Student"

Phil Miller — 2009-07-13T07:52:34-05:00

Here.

When You Take the Profits out of Healthcare,

Phil Miller — 2009-07-13T07:50:00-05:00

you take the innovation out of health care. Glenn Reynolds:

The normal critique of socialized medicine is to point out that people have to wait a long time for these kinds of treatments in places like Britain. And that's certainly a valid critique. I'm sure my mom and daughter would still be waiting for their treatments, while my father and wife would probably be dead.

The key point, though, is that these treatments didn't just come out out of the blue. They were developed by drug companies and device makers who thought they had a good market for things that would make people feel better.

But under a national healthcare plan, the "market" will consist of whatever the bureaucrats are willing to buy. That means treatment for politically stylish diseases will get some money, but otherwise the main concern will be cost-control. More treatments, to bureaucrats, mean more costs.

One only need to look at the market for flu vaccines as a case in point. There were only two companies that serviced the entire US market back in 2004. Moreover, the way the vaccines are produced, a rather labor-intensive production process using eggs, has largely been unchanged since the 1960's. A big reason is because government is the biggest buyer of flu vaccines in the US, and public servants use their monopsony power to lower the costs to the government and, thus, the profits of pharmaceutical industries (one person's expenditure is another's income).

Sometimes we need to reminded of this: people respond to incentives. When government takes the profit out of a venture, people are going to be less willing and able to invest in that venture. Is this really what we as a society want for ourselves and our children (and their children) in the market for health care?

Happy Anniversary, Disco Demolition Night

Phil Miller — 2009-07-12T22:12:51-05:00

An Argument Against a College Football National Championship

Phil Miller — 2009-07-12T19:08:57-05:00

From the WSJ:

Well, here's one. As defenders of the BCS rightly point out, a bowl system helps make college football the most compelling regular season in sports. When Ohio State meets USC this coming September in a nonconference game, each needs to take that game seriously if it wants the national title. It's the exact opposite in college basketball.

So the BCS was right to keep the bowls. Where it went wrong was in instituting what its advocates still believe is its main fix: establishing a single championship bowl. That "reform" eliminated what had been a key advantage of the old system: the enticing possibility that a number of different teams might emerge as national champion, depending on who lost to whom in the various bowls.

There's something to this. I started grad school at Mizzou in 1993 and it wasn't until 4 years later that Mizzou finally made a splash on the national map when they made it to their first bowl game since 1983. We knew there was no way in hell that the Tigers were going to compete for the national championship, although they played in the best game I have ever seen in person when they lost to Nebraska on flea kicker play. But a bowl game was a real possibility, and I remember how happy I was listening to the radio when they beat Colorado in Boulder to become bowl eligible.

But when Mizzou's basketball team makes the NIT, you might as well tell me that the Mary Jane Girls are reuniting and adding Nancy Pelosi to their lineup. It's quite possible that the bowl system would become football's equivalent of the NIT if a playoff system is devised. That would be a shame.

Famous Homes of a Bygone Area

Phil Miller — 2009-07-12T17:58:00-05:00

Link here. Via Ironman.

Restaurants Per-Capita in the US

Phil Miller — 2009-07-12T11:27:34-05:00

Minnesota ranks 42nd out of 51 states + Wash DC in restaurants per capita (HT to Craig Newmark), It seems they are all Famous Daves!. But we are number 1 in boats per-capita. So I guess Minnesotans would rather take part in the lake culture in Minnesota on weekends than go out to a restaurant.

I grew up in Iowa in the 1970's and early 1980's and the joke was that anything that happened elsewhere in the US would take 20 years to get to Iowa. I suppose with the internet that lag time has shrunk. But Iowa ranks 2nd in wooden roller coasters per capita. I knew Iowa was behind the times, but c'mon! Get some steel thrill rides! ;-)

Knee High by the 4th of July

Phil Miller — 2009-07-12T10:34:54-05:00

Doc writes:

Over the past decade or so, Ms. Eclectic and I have been keeping tabs on the corn crop in our area, and pretty much every year, the corn has been noticeably taller than knee-high by the Fourth of July.

This year has been different though. There were a few fields where the corn might have been that tall, but for the most part the corn in this area was not knee-high by the Fourth of July. We have had a colder-than-usual spring and summer so far. The strawberry crop in our area is smaller than usual, and Ms. Eclectic's tomato plants have been very slow to flower. This is in sharp contrast to my dad's telling us that on hot summer nights in Missouri, he could hear the corn growing --- we haven't had any hot summer nights in our area yet (nightly lows in the range of 10 to 15C, where C stands for Canadian and F stands for Foreign).

It's been cool here in Minnesota as well the past couple of years, but the corn crop really looks good around here. It was definitely higher than knee high on the 4th. There has been just enough moisture for the corn to be tall, green, and happy, but not so much to leave desolate spots in the fields. Yesterday my family took a drive around the Mankato area and we saw that many fields were already tassling.

A Quick Note on Tournaments

Phil Miller — 2009-07-11T08:09:00-05:00

The Williams sisters, Venus and Serena, competed in the Wimbledon championship match again and Serena came out victorious. You already knew that. It was the third Wimbledon championship match between the two sisters Combined, they have appeared in the Wimbledon finals 11 times since the 2000. This year, going into the final, they were a combined 100-13 career at Wimbledon. Together they have appeared in 7 grand-slam title matches (all data gleaned here). Like Tiger Woods has been in golf, the Williams Sisters have been a dominant duo in tennis over the years.

In a winner-takes-all tournament, there is less overall effort put forth by all entrants when there is one dominant entrant in the tournament, ceteris paribus. To get more overall effort, a simple solution is to add a second prize. If there are two dominant entrants, then to get more overall effort, a third prize is needed. The bigger the second and third-place prizes, the more effort that gets put forth overall.

Virginia Postrel on Kidney Donations

Phil Miller — 2009-07-10T16:28:15-05:00

Her excellent column is here. HT Glenn Reynolds.

I've written before on how a legal market for human organs, and not just kidneys, would save lives. But ethicists insist that having people pay for organs is unethical (yet they don't seem to mind paying transplant doctors). So we have laws that make it illegal to trade organs for money. Only donation is allowed. The result includes excruciating waits for patients and, oftentimes, deaths. How is that morally superior to a functioning market?

Update: Greg Mankiw writes "What market has 80,000 potential consumers each demanding one unit, 300,000,000 potential producers each capable of supplying one unit, and a shortage nonetheless?"

A New Way to Measure Defensive Ability in Baseball

Phil Miller — 2009-07-10T10:46:48-05:00

A new camera and software system in its final testing phases will record the exact speed and location of the ball and every player on the field, allowing the most digitized of sports to be overrun anew by hundreds of innovative statistics that will rate players more accurately, almost certainly affect their compensation and perhaps alter how the game itself is played.

Story here. HT JC Bradbury.

I think that defensive ability matters at the margin for players when it comes to valuing them. But when I used to analyze MLB player salaries, it was common for researchers to find that defensive statistics did not explain variation in player salaries. Of course back then (10+ years ago) the statistics we had to work with were things like fielding percentage and errors, variables that don't vary much from player to player at given positions.

The NOAA Announces the Birth of a New El Nino

Phil Miller — 2009-07-09T15:33:17-05:00

Story here.

WSJ Poll of Economists on the Need for Another Stimulus

Phil Miller — 2009-07-09T15:17:31-05:00

Most surveyed said "no."

Edward Lazear on Whether We Need Another Stimulus

Phil Miller — 2009-07-09T15:15:06-05:00

Prof. Lazear says "no," and argues that the stimulus really wasn't much about stimulating the economy anyways. If it were, he argues, then the spending should have been made up front, not written into future budgets.

It seems to me that the stimuli being pushed right now and those recently passed are using the recession as an excuse to grow government As they say, never let a crisis go to waste.

Lucian Bebchuk on the Fall of the Toxic Assets Plan

Phil Miller — 2009-07-09T14:58:04-05:00

Harvard professor Lucian Bebchuk in the WSJ today: The Fall of the Toxic Assets Plan. Money quote: "In the meantime, it must be recognized that the curtailing of the PIPP program doesn’t imply that the toxic assets problem has largely gone away; it has been merely swept under the carpet."

Why the Big Ten is So Lame in Football

Phil Miller — 2009-07-09T13:43:07-05:00

Dave Matter quantifies the talent shortage at Big 10 schools by using recruiting rankings.

Dave also makes a good point that recruiting rankings mostly show who is being recruited the most heavily, not who the best players are going to be. But it's important to remember that during the recruitment process, a player's ability to play is a random variable with a mean and a variance. Recruiting interest is going to correlate positively with the player's ability to play, even if it doesn't explain all deviations from the mean fully.

Feature on SCSU's Banaian and MacDonald

Phil Miller — 2009-07-09T08:35:00-05:00

Fellow economist and MnSCU economists King Banaian (every other letter's an A) and Rich MacDonald's work on the St. Cloud Area Quarterly Business Report is detailed here.

Prices and Waiting Times - Alternative Rationing Systems

Phil Miller — 2009-07-08T08:09:00-05:00

Prices are one way to ration scarce goods. If the price system is not allowed to ration goods, some substitute system will take its place. One of those substitutes is waiting times.

A couple of interesting facts:

Average US emergency room wait time: 4.05 hours

Average Canada emergency room wait time: 8.9 to 23 hours

I confess the numbers are not apples-apples, but they are certainly in the ballpark and highly illustrative. Have any commenters seen a direct comparison?

Update: OK, the numbers are more apples-apples than I thought. The US 4 hour number is total time from coming in the door to leaving or getting a bed, the same as the Canadian numbers. The CNN report linked above got their data from here.

Under the waiting time rationing system, those who get the goods are those most willing and able to wait. Under the price system, those most willing and able to pay the price get the good. It is not at all clear to me that the waiting time system is ethically superior to the price system.

Eldest Turns 9 Today

Phil Miller — 2009-07-07T08:48:26-05:00

Happy Birthday, Eldest!

No, he's not driving anywhere.

Iowa Chops Cease Operations for the Short Term, At Least

Phil Miller — 2009-07-07T07:41:00-05:00

Here is a Des Moines Register article on the Iowa Chops, an American Hockey League team that, despite the construction of a publicly-supported arena, are ceasing operations (at least temporarily) because of mounting losses.

Dude, Where's My Job? A Quarter of the Teenage Labor Force is Unemployed

Phil Miller — 2009-07-06T10:36:11-05:00

From the NY Times.

Numbers provide the backdrop to the story — not just the grimly familiar national unemployment rate, 9.5 percent in June, but the even scarier, less publicized unemployment figure for 16- to 19-year-olds, which has hit 24 percent, up from 16.1 percent two years ago. Internships available to college students have fallen 21 percent since last year, according to the National Association of Colleges and Employers. Across the country, there are countless tales like that of Morgan Henderson, a student at the University of San Francisco, who, along with friends, planned a big road trip to Las Vegas this summer. With so few of the friends finding jobs, they downgraded plans to a road trip to Reno, then to no road trip at all. They’re spending time watching DVDs at one another’s houses.

HT Instapundit. Yes, the business cycle matters. But don't forget that the national minimum wage, the price floor set on the wages of the lowest skilled of the low-skilled labor force, has increased in July the last two years and is set to increase again this month.

"I Got You Under My Skin" Air New Zealand Videos

Phil Miller — 2009-07-06T10:01:40-05:00

A video from Air New Zealand featuring employees body painted to look like pilots, stewardesses, and stewards. You tell me if it's NSFW :-) HT to Ming Lo.

Update: Here's an even better one (also from Ming). The link now goes to video with audio.

Black Markets in Everything - Currency Edition

Phil Miller — 2009-07-06T08:14:00-05:00

From Yahoo!

Facing real world debts, a trusted figure in a popular online game stole money from the virtual bank he ran and exchanged it for cash through the black market.

It happened in EVE Online, where more than 300,000 subscribers pay $15 a month to play. They gain wealth through hard work, manipulating the market, or killing rivals in a distant future where humans have colonized the stars in an online game similar to World of Warcraft and Second Life.

EBank, EVE's largest player-run financial institution which has thousands of depositors, is at the center of the scandal.

"Basically this character was one of the people that been running EBank for a while. He took a bunch of (virtual) money out of the bank, and traded it away for real money," said Ned Coker, of the Icelandic company CCP, which developed the game.

The CEO of EBank, a 27-year-old Australian tech worker who identified himself only as Richard and used the online name Ricdic, embezzled about 200 billion interstellar kredits, the game's virtual currency.

He broke the rules of the game by exchanging the stolen virtual funds for $6,300 Australian ($5,100) with players who preferred to buy virtual money rather than earn it playing the game.

HT to Ming Lo. That is absolutely fascinating. Had the guy not thrown the game out of equilibrium, no-one would have been the wiser. But he played an out-of-equilibrium strategy that per-se proved to be his undoing.

What Will Obama Do? Impose Restrictions on Chinese Tires or Favor Tire Consumers?

Phil Miller — 2009-07-05T22:16:31-05:00

From the WaPo:

A majority of the U.S. International Trade Commission recommended on Monday that President Barack Obama impose additional duties for three years on imports of low-cost Chinese tires the panel says are harming U.S. industry.

In a case seen as a test of how the Obama administration will cope with Chinese trade issues, four members of the six-member commission recommended that Obama impose additional duties of 55 percent in the first year, 45 percent in the second year, and 35 percent in the third year on imports of passenger vehicle and light truck tires from China.

"In our opinion, these tariff levels would remedy the market disruption that we have found to exist," the four said in a statement. The complaint was brought by the United Steelworkers union, which said a surge of Chinese tire imports have cost thousands of U.S. jobs.

Two other members of the commission disagreed, saying Obama should take no "trade-restricting" action because this would do more harm than good.

"This is an industry in which the trend toward gradual downsizing appears likely to continue regardless of the commission's action today," the two dissenters said in a statement. But they joined the majority in urging that the Obama administration provide aid to displaced tire workers under the U.S. Trade Adjustment Assistance program.

Greg Mankiw notes:

Larry Summers once said of Barack Obama, "When I’ve heard him talk about economic issues—with the exception of NAFTA, where I just hope he doesn’t believe what he says—he seems intelligent and serious. I wouldn’t say I’m bowled over by the brilliance of anything I’ve heard, but everything has a kind of thoughtfulness to it that’s sort of impressive." That is, even the president's chief economic adviser was discomfited by his campaign rhetoric concerning international trade.

This Chinese tire case may be one indication of the president's true feelings about trade. So let's wait and see what happens.

I have nothing to add to this at this time, but I'm not holding my breath.

Are Porn and Rape Substitutes or Complements?

Phil Miller — 2009-07-05T09:46:19-05:00

Tim Worstall has an interesting look at the question. Here is the abstract of the paper he cites in the article as evidence of the substitute theory.

The incidence of rape in the United States has declined 85% in the past 25 years while access to pornography has become freely available to teenagers and adults. The Nixon and Reagan Commissions tried to show that exposure to pornographic materials produced social violence. The reverse may be true: that pornography has reduced social violence.

According to the substitute theory as laid out by Worstall, men have a finite bound to the number of times they can get sexually excited. If they release that excitement with porn, they are less likely to seek out other ways of releasing that excitement, of which porn is one way. And remember this... they are get tired after sex and need to rest.

HT to Glenn Reynolds

A Clear Example of a Shortage - Tickets to Michael Jackson's Service

Phil Miller — 2009-07-05T08:21:00-05:00

When the price of a good is below its equilibrium price, a shortage ensues. You think that's the case with tickets to Michael Jackson's memorial service? Ya, you betcha!

More than half a million fans from around the world applied for 17,500 free tickets to Michael Jackson's public memorial service next week, organizers said on Friday as a massive security operation got underway.

The life and music of the self-proclaimed "king of pop," who died of sudden cardiac arrest last Thursday, will be celebrated on Tuesday at the Staples Center, a basketball arena in downtown Los Angeles.

Officials on Friday unveiled an ambitious online lottery that will allow fans to attend either the televised service at the arena or watch the proceedings on a big screen at the nearby Nokia Theater.

Why not charge for these tickets and give the money to some charity or help settle Mr. Jackson's debts? It should have been a-priori clear that $0 was too low of a price to charge for tickets to this service. Somebody is going to profit off of this service and it might as well have been someone closer to Mr. Jackson's camp.