I love summer. It means barbecues and sunglasses; Summer League and Lonzo Ball throwing some absurd dimes; but most of all it means there’s Test cricket in England. Right now, Quinton de Kock is absolutely hammering the English bowling, someone’s just compared him to Lara on the Grauniad, and South Africa are 140-2. And we have four more days of ebbs, flows, cover drives and Jimmy Anderson being mouthy and annoying to look forward to. I love summer.
- With that uncharacteristically cheery start out of the way, shall we get our Grinch on? This tweet is extraordinary, and justifies the anger that the North of England feels about the way public decision making has left it behind. Spending per head on infrastructure, which reaches GBP2,600 per head in London, is just FIVE QUID A HEAD in the North East. It’s not just neglect at work here, but also the vagaries of economic decision making, as this excellent blog explains. If a region starts with higher income per head than others, then any growth-enhancing investments will maximise national returns (measured in average incomes) if it focuses on that region. This has implications for anyone who does CBAs. Income maximisation is not the same as utility maximisation, and the economists’ answer that people can and should move isn’t enough.
- While we’re being angry, though – has anyone seen Martin Wolf this angry before? He is not optimistic in the least.
- Not entirely unrelated: VoxDEV summarise research on the impact of greater openness to trade on domestic firms. What they find won’t surprise you: firms nearer the ‘best practice’ frontier for their industry thrive, while those further back tend to suffer. This is competition working, and it’s why producing tradables is such a good mechanism for increasing productivity – good firms expand and bad ones die. Two implications leap at me: first, that opening too much to trade when you have few firms producing tradables well is a problem; second, that closing off to trade increases the scope for bad firms with high costs and poor products to proliferate.
- This week in lacking self-awareness: In quick succession Vox ran an article on telling whether a chart was wilfully misleading you; and then ran a chart wilfully misleading readers about the size of a stock market dip by manipulating the time series shown.
- This one hurts. You know that famous study that Daniel Kahnemann cites about how parole judges get much meaner and deny parole to almost everyone right before lunch? I’ve used it to convince interview panel chairs to keep us well stocked with snacks during assessments. Well, it turns out it that the study has some pretty serious problems – not least the fact that the size of the effect is so enormous you’d expect that virtually all human activity basically ceases right before lunch and dinner. (Alright, it does for me, but that might be a local effect).
- Anyone ever tried to dismiss aid as ‘a transfer from poor people in rich countries to rich people in poor countries’ to you? Branko got annoyed at that one, so he demolished it. I imagine something like this happening while he was working on Stata for this.
- Okay, de Kock was just caught for 65, but to cheer us all up The Mighty Ducks are 25 today, and here’s a photo of Emilio Estevez being barely any taller than those kids.
Have a great weekend, everyone!