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17 ноября, 18:45

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**Comment of the Day**: I have evoked some rants from Robert Waldmann... **Robert Waldmann**: [Monday Smackdown: Oh Dear!](http://www.bradford-delong.com/2017/11/monday-smackdown-oh-dear.html?cid=6a00e551f08003883401b8d2bf205d970c#comment-6a00e551f08003883401b8d2bf205d970c): "It isn't exactly Robert Waldmann's critique... >...In 1982 someone told me that he thought macroeconomics had taken a wrong turn and commenced a sterile research program which would last decades and be fruitless. That's a lot more impressive than saying such a thing now. >Who was that guy? Oh yeah, his name was Brad DeLong. >He was explaining why he had chosen history and econometrics as fields. >Experiments? Bah, humbug! >I don't know where to put this, but I have a theory as to why people call simulations experiments: If you are dealing with something you don't understand, you attempt to learn how it works with experiments. The perception that theoretical work assisted by computers is experimental is due to the fact that no one understands what drives the behavior of modern DSGE models. >This is one of their defects. One use of a model is to clarify thought. A model which is mysterious like a cell (or an economy) can't clarify thought. If you need to do numerical experiments to understand the behavior of your model, it has failed one of...

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17 ноября, 17:17

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**Should-Read: Martin Wolf**: [A bruising Brexit could shipwreck the British economy](https://www.ft.com/content/e09d1f88-c9fe-11e7-ab18-7a9fb7d6163e): "The UK economy remains the most regionally divided in Europe... >...Inner London is the richest region in Europe. The other regions (apart from the rest of London and the southeast) are far poorer.... Gross domestic product per head has also only regained pre-crisis levels in London and the southeast.... Various categories of insecure work have greatly increased. In 2016, for example, 2.8 per cent of all people in employment were on zero-hours contracts.... It must be hard for people working under such contracts to have much control over their lives. >The UK’s level of inequality is among the highest in Europe.... People might wonder, given UK performance, what these business leaders have done to justify such huge increases. They might also point to the facts that the UK’s average productivity per hours worked is among the lowest among high-income countries and, still worse, productivity has flatlined since the crisis.... Last, but not least, on this list of failings, UK investment is exceptionally weak.... Spending on research and development is also relatively weak.... This is not a vigorous and healthy economy well able to take the shock of substantially worse...

17 ноября, 05:35

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**Should-Read: Matthew Yglesias**: [Watch CEOs admit they won’t actually invest more if tax reform passes](https://www.vox.com/policy-and-politics/2017/11/15/16653698/ceos-investment-tax-reform): "A telling and important moment... >...Awkward.... John Bussey... asks the CEOs in the room, “If the tax reform bill goes through, do you plan to increase investment—your companies’ investment—capital investment,” and requests a show of hands. Only a few hands go up, leaving Cohn to ask sheepishly, “Why aren’t the other hands up?” The reason few hands are raised is there’s little reason to believe that the kind of broad corporate income tax cut Republicans are pushing for will induce much new investment. A tax plan that was specifically designed to reduce taxation of new investments might do that. But most corporate profits are, of course, the result of activities undertaken in the past. So a broad cut in corporate tax rates is a windfall for what in tax policy jargon is called “old capital,” as well as for monopoly and quasi-monopoly rents and various other things that have nothing to do with incentivizing new investment. >The biggest immediate winners, in fact, would be big, established companies that are already highly profitable. Apple, for example, would get a huge tax cut even though the company’s...

17 ноября, 05:22

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**Comment of the Day**: [Six Faces of Right-Wing Chain-Forging Economist James Buchanan...](http://www.bradford-delong.com/2017/11/six-faces-of-right-wing-chain-forging-economist-james-buchanan.html): It's by, well, me: What seems to me a very strange comment on Twitter from Henry Farrell , who appears to deny that he (and Steve Teles) bend over backwards to be "fair" to Buchanan, while providing no such charity to McLean: >As I read our essay, our positive claims are (1) that public choice has some intellectual value and (2) that Buchanan saw himself as engaged in a project of counter-entrenchment. For the rest, we extend to Buchanan only that minimal form of intellectual generosity we'd all like-that when someone is accused of looking to protect the Southern way of life against the civil rights movement, masterminding Pinochet's constitution, & being the sinister intellectual Svengali behind the rise of the anti-democratic right, one would like to see supporting evidence. >As we explicitly note in the essays, we would not at all be discomfited if evidence emerged showing that either Buchanan or other public choicers had problematic views or pasts-on the basis of my run-ins with Charles Rowley, I know that there is a lot of nutty thinking there. But basic standards of intellectual argument demand that if...

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17 ноября, 04:50

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**Must-Read**: @dashching seems like an unhappy camper today—unhappy with the Tax Foundation setting forth a model that (a) they know is inaccurate even on their own methodologies, and (b) based on a methodology—that the medium-run drag on growth from a larger deficit does not exist—that I do not believe can be defended in a professional manner: **Chye-Ching Huang**: [@dashching on Twitter](https://twitter.com/dashching/status/931207023596900352): "A Tax Foundation dynamic score that no-one should pay any attention to an indication of what this bill would do for growth... >...Two major problems: >1. Unlike mainstream models, the Tax Foundation's ignores deficits. Would be very strange for lawmakers concerned about deficits to rely on a model that ignores them . >2. Further, @gregleiserson has identified two major *additional* conceptual errors with the model , that don't seem fully resolved. These are not errors modeling specific proposals, but affect the model's results, *every time* it runs...

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17 ноября, 04:26

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**Should-Read: Douglas L. Campbell**: [Ancestry and Development: the Power Pose of Economics?](http://douglaslcampbell.blogspot.ru/2017/11/ancestry-and-development-power-pose-of.html): "George Mason... asked me to present my work joint with Ju Hyun Pyun, taking down the "genetic distance to the US predicts development"... >...This has evolved into an Amy Cuddy "Power Pose" situation, in which Spolaore and Wacziarg refuse to admit that there is any problem with their research, and continue to run income-level regressions and write papers using genetic distance which do not include a dummy for sub-Saharan Africa, but exclude that region instead.... The remaining question is how robust the genetic distance-development relationship is in Europe. In fact, there is already a paper, by Giuliano, Spilimbergo, and Tonon, saying that the impact of genetic distance on both trade and GDP in Europe is not robust.... The early drafts of that paper also said something about GDP in Europe, while the published version stripped out GDP precisely because the referees—likely Spolaore or Wacziarg—wouldn't allow it.... >Wacziarg has now posted regressions on his website used by this referee, so I gather that he must be the author... had some very choice words for this paper... "Giuliano, Spilimbergo and Tonon, the authors of this paper are clearly referring to...

17 ноября, 04:22

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**Should-Read**: The point, though, of being a party of cultural grievance-mongers catering to symbolic and social recognition ethno-sectarian demands is that one can also, on the side as it were, enrich plutocrats. As Lyndon Johnson said in Bill Moyers's hearing: "If you can convince the lowest white man he's better than the best colored man, he won't notice you're picking his pocket. Hell, give him somebody to look down on, and he'll empty his pockets for you..." This has been going on since the 1890s... hell, the 1870s... hell, the 1810s. It used to be the business model of the Royalist wing of the Southern Democratic Party. Now it is the business model of the Republican Party. The interesting thing is that they do not seem able to execute it very well: **Matthew Yglesias**: [Republicans should admit to themselves they mostly don’t want big change](https://www.vox.com/policy-and-politics/2017/11/3/16596440/republicans-change): "It’s a cranky old person party, not a policy visionary party... >...Republicans are mostly a party of cultural grievance-mongers, not ambitious legislators. That’s why Donald Trump is their president. That’s why they don’t seem to notice or care that Paul Ryan is a total fraud. They’d be a lot happier if they just owned it....

17 ноября, 04:21

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**Comment of the Day: Erik Lund**: [The Robert Heinlein Wars, Part MDCCLXIV: Hoisted from 2006](http://www.bradford-delong.com/2017/10/the-robert-heinlein-wars-part-mdcclxiv-hoisted-from-2006.html?cid=6a00e551f08003883401b8d2b4cc69970c#comment-6a00e551f08003883401b8d2b4cc69970c): "It's pointless to read Heinlein through a political lens. He was a narcissist; it's all about him... >...Starship Troopers was written for Heinlein's Scribner's contract. He was supposed to produce an annual juvenile novel for the Christmas season. The novel was written in a hurry, submitted too late for editorial revision, and rejected by his long-time editor, Alice Dalgleish, sometimes mischaracterised as a blue-stocking prude. (Well, I suppose she could have been; LGBTQs can be prudes, after all.) >With the rejection, Heinlein was free to shop Starship Troopers around. Later, he characterised this as his plan, all along. He was tired of juveniles. (Except that he returned to the well with Putnam in Podkayne in 1963.) >So what else might have been going on in Heinlein's mind? Many of Heinlein's early books were dedicated to family members; but ST is dedicated to a a crazy guy who was lobbying to get the United States to redeclare war on North Korea and save his son from the sekrit Commie prison camp he was sure the boy was in. (You may recall this as a background point...

17 ноября, 04:16

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**Should-Read: Nick Bunker**: [The forces behind the highly unequal U.S. wealth distribution](http://equitablegrowth.org/equitablog/value-added/the-forces-behind-highly-unequal-u-s-wealth-distribution/): "Two papers... give us some guidance on the forces that have led to such an unequal wealth distribution in the United States... >...Jess Benhabib and Alberto Bisin... an overview of previous research... three broad mechanisms or explanations that have been the focus of previous research and consider how much they could help explain this “fat tail” of wealth.... The first mechanism deals with income inequality and how that arises from shocks to individuals’ earnings. The second is related to capital income risk, or differences in the rate of return on investments at different levels of wealth. The third factor is “explosive” wealth accumulation.... >Benhabib, Bisin, and Mi Luo (also of NYU), is an attempt to parse out the influences of these three factors on U.S. wealth distribution.... Differences in the rate of return on capital and in savings rates are the main factors explaining the distribution of wealth in the United States. As suggested by the first paper, the differences in income caused by shocks don’t explain much—though shocks do contribute significantly to mobility up and down the rungs of the wealth ladder. The differences in savings rates—documented...

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17 ноября, 03:57

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**Comment of the Day**: "Praise then darkness and creation unfinished"; "praise the fire and the impulse of making"; isn't there another large, very densely-written book by now? **Graydon**: [](http://www.bradford-delong.com/2017/11/a-very-nice-essay-on-sexual-morality-from-elizabeth-bruenig-but-it-could-have-been-shorter.html?cid=6a00e551f08003883401bb09d68667970d#comment-6a00e551f08003883401bb09d68667970d): ""Good" is a value judgement, subject to context and hindsight, and it's subject to hindsight forever... >...There are a whole bunch of things even in Christianity about this -- "we do not presume to come to this thy table, O merciful Lord, trusting in our own righteousness" -- that a whole lot of people clinging to morals over material consequences could do with considering. (Similarly the really very trivial observation that morals do not and cannot scale to large groups; this is why prophets have railed against cities for such a very long time. A working city is not run on the basis of morals. If there are no working cities, there is no economy.) >"Praise ice when it is crossed, ale when it is drunk, a ship returned to harbour, a friend on the pyre..." Moral judgements happen, when it is possible for them to happen, afterwards, in difficulty, in complexity, and -- none of us being divine beings -- in doubt. >Everyone is always responsible for everything they do....

16 ноября, 21:54

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**Must-Read**: Noah Smith gets this 100% right, IMHO **Noah Smith**: [On Twitter @noahpinion](https://twitter.com/Noahpinion/status/931200696900128768): "Nasty tweets are like nasty blog comments... >...My feed is like a blog. And because Twitter has no way to delete or moderate individual tweets, blocking is the only option for curation.... >Blocking isn't for my own benefit. It's to protect my timeline and my followers from people who just come to disrupt conversation and create unnecessary bad feelings!... [People muted] still respond to my tweets and engage with my followers, this disrupting the friendly, positive community I want to create in my timeline... Now it is time for 560 to make it even more like a weblog!

16 ноября, 20:33

Six Faces of Right-Wing Chain-Forging Economist James Buchanan...

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Six Faces of Right-Wing Chain-Forging Economist James Buchanan... Steven Teles inquired why I liked Will Wilkinson's essay [How Libertarian Democracy Skepticism Infected the American Right](https://niskanencenter.org/blog/libertarian-democracy-skepticism-infected-american-right/) much more than I liked **Henry Farrell** and **Steven Teles's** essays [When Politics Drives Scholarship](http://bostonreview.net/class-inequality/henry-farrell-steven-m-teles-when-politics-drives-scholarship) and [Even the intellectual left is drawn to conspiracy theories about the right. Resist them](https://www.vox.com/the-big-idea/2017/7/14/15967788/democracy-shackles-james-buchanan-intellectual-history-maclean) as takes on **Nancy McLean's** Democracy in Chains ... I must confess that I **was** struck by the contrast between the, on the one hand, enormously generous hermeneutic through which [Steve Teles and Henry Farrell] read James Buchanan and the, on the other hand, ungenerous hermeneutic through which [they] read Nancy McLean.... I see at least six James Buchanans: 1. The brilliant academic thinker behind the genius insights of Calculus of Consent . It is worth noting that the framework underlying _CoC_ with its emphasis on unanimity at the constitutional stage for _any_ regime that can be just or justified, has a profoundly egalitarian and even Rawlsian bent—a bent that becomes stronger the thinner you make the veil of ignorance and the more averse to risk you make the people behind it. Thus the fact that Buchanan deduces a profoundly anti-egalitarian politics and built from...