New editor at Reason

Here is the announcement from reason and here is an interview. My favorite bit of the interview:

One of the great pleasures of Reason — as an editor and (I hope) as a reader — is listening in on five decades of freewheeling conversation about how to make the world more free, more fair and more fun," says Mangu-Ward, a self-described "Beltway baby" and "D.C. lifer" who's an Alexandria, Virginia native and lives in the capital.

Who would argue that there is not far too little emphasis on fun in American political discourse more generally? It is all grim conservatives going on about the end of civilization and endless war and grim progressives going on about their endless moral purification campaigns.

Having been reading reason since my college days, I can say from my own experience that every editor brings a different flavor to the magazine. My favorite to date was probably Nick Gillespie who gave it a more cultural spin - not surprising given he has a doctorate in English - with lots of talk about gatekeepers and such.

Movie: Indignation

Philip Roth sends his main character, a working class Jewish boy seeking to avoid the Korean War to a liberal arts college in Ohio in this movie based on his book of the same name.

The movie is really well done. I found the depiction of the day-to-day workings of "in loco parentis", the now largely obsolete but once very serious doctrine that colleges should monitor and guide their students in the absence of the parents, quite fascinating. The one flaw with the movie is that it does not make it clear enough that this was standard fare at the time at most residential colleges, not something unusually horrific about the college represented in the movie.

I also like the overall theme, which concerns the unintended consequences of sequences of seemingly minor choices.

Positive NYT review here.

Recommended.

First seven jobs

I had missed it until now, but apparently there is a meme about listing one's first seven jobs.

To wit:

1. Cashier in a hobby shop (at which I was a regular customer) over the holiday season (minimum wage plus cookies)

2. Dish washer / short-order cook / ice cream scooper at Farrell's Ice Cream Parlour Restaurant Southcenter, the first Farrell's to ever top $1 million in sales in a year. I started at $2.98 when the minimum wage was $2.90. I later advanced to $3.25 per hour plus free meals.

3. Consultant / operator at the Health Sciences remote site of the Academic Computing Center at the University of Washington. My remote site (a grand name for a small windowless room in a very large building) featured one of the last (punched) card readers on campus. This job resulted from my dad meeting someone from the ACC at some work function.

4. Summer intern (twice) at the Reason Foundation, which publishes reason magazine. This was in Santa Barbara, which is a very nice place to spend a summer indeed.

5. Research assistant to Joe Hotz at the University of Chicago

6. Research assistant to Jim Heckman at the University of Chicago

7. Assistant professor of economics at the University of Western Ontario

I have omitted a few more minor things like small amounts of paid tutoring in both my undergraduate and graduate school days.

Lena und Lisa

The new enthusiasm among the younger set at my household is called musical.ly, an app that allows the user to record themselves lip-synching bits of songs, movies and television shows. These bits can then be shared among one's friends.

The stars of muiscal.ly are two young Germans called Lena and Lisa. You can watch their greatest hits in the video above, and you can hear their real voices here. One infers that Lena und Lisa have very indulgent (and well funded given the large number of different outfits and props) parents as well as lots of spare time (and the grit and determination for quite a lot of practice).

Hat tip: Lizzie Smith

Statistical treatment rules and racial bias in the criminal justice system

Jennifer Doleac, who is on leave this year at Brookings from Virginia's policy school, provides a very fine summary of the issues.

Jen's post includes a shout-out to my one economics of crime paper (which is co-authored with my former Maryland criminology colleague Shawn Bushway). In that paper we raise some issues that have been discussed a bit in the labor economics literature in the context of the criminology literature where they had not really been addressed. Labor economics and criminology (and medicine) each have their own statistical treatment rule literatures that mostly do not talk to one another, which opens up space for intellectual arbitrage.

This quite nice AEJ paper by Devin Pope and Justin Sydnor considers related issues in the context of the Worker Profiling and Reemployment Services (WPRS) system.

Assorted links

1. State-level freedom ratings from CATO

2. On economics seminars.

3. Advice on the publishing of academic books.

4. Frontiers of academic administration (or "it could be worse"). Apparently the chancellor has recently resigned. Hard to imagine why.

Book: Blood and Daring

Boyko, John. 2013. Blood and Daring: How Canada Fought the American Civil War and Forged a Nation. Knopf Canada.

I got this book from my (Canadian) father-in-law as a gift, and quite enjoyed it. Though it is less academic in style than I usually prefer, and perhaps a bit too fawning on some of the Canadian founders (something that never, ever happens in books about the US founders), I quite liked it, mostly because it is full of things I had not read about before. The American Civil War was actually pivotal in uniting what was at the time a collection of multiple Canadian colonies into a single (almost) political entity, driven by fear that the Union army would finish the job left unfinished by the War of 1812 as soon it finished finishing off the confederates. The amateur cloak and dagger antics of the confederate agents in Toronto and Montreal provide comic relief.

Recommended if you are interested in our neighbor (or even neighbour) to the north.

Barnes and Noble page.
Amazon page.

More on Farrell's

There are a couple of errors in the backstory at the beginning. Bob Farrell was having trouble and sold out to Marriott (!) at some point not long before I started working at Farrell's in the spring of 1979- my paychecks were Marriott paychecks. It was Marriott who sold out to the investor group shortly after I stopped working there in 1982. Also, it is just wrong that there were ever zero Farrell's. One of the original franchisees kept running stores in San Diego long enough to overlap the stores operated by the new group featured in the show.

Lots more history at this website maintained by a former Farrell's manager.

Vegetable video

Thankfully, only a subset of my vegetabletarian friends are like this.

Assorted links

1. On the Icelandic national soccer team, that defeated England. A couple of months old but still very funny if you follow such things.

2. On the history of airport mobile lounges.

3. Mao and the cultural revolution. We should make much more of this than we do.

4. New research on the causes of divorce.

Hat tip on #1 to Peter Dolton.

Farrell's closes three locations

The Sacramento store, the Mission Viejo store, and the Rancho Cucamonga store all closed. I hope it is indeed just property issues as suggested in the news stories and not signs of a broader decline, though the fact that they also removed all the franchising information from the website suggests that more is going on.

I had lunch at the Sacramento store when I was in the area to give a seminar at UC-Davis. I had a great time but it did not seem like the most auspicious location. I had also been to the Rancho Cucamonga store.

Hat tip on the first two closures: Chuck MacDonald (who was an assistant manager at Farrell's Southcenter in Seattle when I was working there)

Movie: Suicide Squad

So I thought this was the worst movie I have seen in a couple of years, but not one of the worst of all time. My young companion, however, enjoyed it very much indeed.

A.O. Scott takes a (more positive than I expected) middle road, in another very snarky review. He is certainly correct that the best bits are Harley Quinn and the Will Smith character but, really, Will Smith should fire his agent over this.

Recommended only if the nine-year-old is making the decision about which movie to see.

New working paper on teacher unions

The Long-run Effects of Teacher Collective Bargaining
Michael Lovenheim (Website), Alexander Willén

CESifo Working Paper No. 5977 (July 2016)

Abstract:

This paper presents the first analysis of the effect of teacher collective bargaining on long-run labor market and educational attainment outcomes. Our analysis exploits the different timing across states in the passage of duty-to-bargain laws in a difference-in-difference framework to identify how exposure to teacher collective bargaining affects the long-run outcomes of students. Using American Community Survey (ACS) data linked to each respondent’s state of birth, we examine labor market outcomes and educational attainment for 35-49 year olds. Our estimates suggest that teacher collective bargaining worsens the future labor market outcomes of students: living in a state that has a duty-to-bargain law for all 12 grade-school years reduces earnings by $800 (or 2%) per year and decreases hours worked by 0.50 hours per week. The earnings estimate indicates that teacher collective bargaining reduces earnings by $199.6 billion in the US annually. We also find evidence of lower employment rates, which is driven by lower labor force participation, as well as reductions in the skill levels of the occupations into which workers sort. The effects are driven by men and nonwhites, who experience larger relative declines in long-run outcomes. Using data from the 1979 National Longitudinal Survey of Youth, we demonstrate that collective bargaining leads to sizable reductions in measured cognitive and non-cognitive skills among young adults. Taken together, our results suggest laws that support collective bargaining for teachers have adverse long-term labor market consequences for students.

You can find the paper here.

Assorted links

1. The map of (heavy) metal

2. A wise piece from Thomas Friedman on Hillary Clinton

3. Deeply horrifying video of the 1996 democrat convention, featuring Hillary as a Stepford wife.

4. I agree with John Cochrane (and by extension the marginal revolutionaries) on NSF. Data is a public good, summer ninths are not. NSF should just be funding data, and maybe grad students.

Hat tip on #1 to Stephane Mahuteau and on #2 to the deputy dean, who denies being the unnamed colleague responsible for #3.

Book: Japan 1941

Hotta, Eri. 2013. Japan 1941: Countdown to Infamy. New York: Knopf.

This book presents a political history from a skeptical Japanese perspective of the period leading up to the Pearl Harbor attack. The history gets denser as the day of infamy gets closer in time. I found the book fascinating as I knew essentially nothing about the internal politics of Japan in the interwar period. The book makes the case that a combination of cultural (saving face, etc.) and institutional (too much shared responsibility) factors led to a war that, had you somehow collected the honest opinions of the major players, most of the Japanese leadership did not want.

Recommended if the subject is of interest.

Amazon page
Barnes and Noble page

Movie: Cafe Society

It is a Woody Allen movie, so you know what you are getting. I liked it better than A.O. Scott but he does a fine job of laying out the strengths and weaknesses.

He does not mention my favorite line, which is "Socrates says that the unexamined life is not worth living; the examined life is no bargain either."

Recommended if you like Woody Allen movies.

Something to listen to next time you get a jerky referee report

Some clever person should do a version of this using the vast supply of intellectually narrow and misogynist comments from "econjobrumors".

Hat tip: Lizzie

Assorted links

1. JJH on the NFL draft - yes, a couple of months late, but still worth reading on several levels.

2. I wonder if a study of resumes on on-line job sites would yield the same findings.

3. The economist on Donald supporters on the Donald.

4. Nick Gillespie on the (yawn) Olympics. I always say that I will start watching again when they no longer identify the country associated with each athlete and instead have them compete as individuals. Probably that's not true - I never liked them that much anyway - but I doubt that my claim will ever be tested empirically.

Ann Arbor up in smoke

My first reaction to this headline about the Ann Arbor city council banning the sale of cigarettes to individuals ages 18 to 21 is that it is odd that they would have the power to do this. Reading the article, it seems likely that they do not actually have the power to do it, though in a narrower sense than my initial reaction had in mind.

This looks to me like a bunch of pointless moral posing by local pols at public expense, and thus yet another lesson in the difficulties of solving principal-agent problems. If the city council really does not have anything better to do, they should come over to my neighborhood and fix the appalling potholes.

More substantively, it seems to me to that if you are old enough to vote you ought to be old enough to buy cigarettes and alcohol. Politicians are a lot more dangerous than a few puffs of tobacco smoke or a beer. Indeed, that point is made by this very episode.

Movie: Jason Bourne

Bourne, again?

I liked it more than A.O. Scott, who I think feels a bit guilty about liking it as much as he did. The review is Scott at his snarky and insightful best. An example:

This is perhaps the most striking feature of “Jason Bourne”: Virtually all the major characters — good, bad and in-between — work for the same organization, at least on a consulting basis. There are dark whispers about external threats, and invocations of the tension between security and privacy in the digital age, but geopolitics and technology are scaffolding for what is essentially a movie about human resources challenges in a large bureaucracy.

Maybe it was this labor economics angle that drew me in?

New IZA Working Paper

IZA Discussion Paper No. 10108
July 2016

ABSTRACT

Viewpoint: Estimating the Causal Effects of Policies and Programs

Estimation, inference and interpretation of the causal effects of programs and policies have all advanced dramatically over the past 25 years. We highlight three particularly important intellectual trends: an improved appreciation of the substantive importance of heterogeneous responses and of their methodological implications, a stronger focus on internal validity brought about by the “credibility revolution,” and the scientific value that follows from grounding estimation and interpretation in economic theory. We discuss a menu of commonly employed partial equilibrium approaches to the identification of causal effects, emphasizing that the researcher’s central intellectual contribution always consists of making an explicit case for a specific causal interpretation given the relevant economic theory, the data, the institutional context and the economic question of interest. We also touch on the importance of general equilibrium effects and full cost-benefit analyses.

JEL Classification: C18, C21, C26, C50, C90

Keywords: causal effects, heterogeneous treatment effects, partial equilibrium identification

The paper is forthcoming (after a while) in the Canadian Journal of Economics.

You can find the working paper here.

ASAK

I like it when my students win awards. Even more marvelous, Sasha is now a tenured full professor at Harvard just five short years after earning her doctorate.

Assorted links

1. Applied monetary policy at the Houston public schools.

2. On neckties. In my view, they can't disappear fast enough.

3. Maybe you don't have the right to remain silent.

4. Demetra Nightengale on evidence-based policy at DOL. They have made some real improvements. It will not come as a surprise, of course that I think there is room for a lot more.

New NBER Working Paper

Tobacco Regulation and Cost-Benefit Analysis: How Should We Value Foregone Consumer Surplus?
Helen Levy, Edward C. Norton, Jeffrey A. Smith

NBER Working Paper No. 22471
Issued in July 2016
NBER Program(s):   HC   HE

Recent tobacco regulations proposed by the Food and Drug Administration have raised a thorny question: how should the cost-benefit analysis accompanying such policies value foregone consumer surplus associated with regulation-induced reductions in smoking? In a model with rational and fully informed consumers, this question is straightforward. There is disagreement, however, about whether consumers are rational and fully informed, and the literature offers little practical guidance about what approach the FDA should use if they are not. In this paper, we outline the history of the FDA’s recent attempts to regulate cigarettes and other tobacco products and how they have valued foregone consumer surplus in cost-benefit analyses. We discuss the evidence on whether consumers are fully informed about the risks of smoking and whether their choices are rational, reviewing the competing arguments made by different authors about these questions. We describe the appropriate approach to welfare analysis under different assumptions about consumer information and rationality. Based on our reading of the theoretical and empirical literatures, we advocate using a behavioral public finance framework borrowed from the literature on environmental regulation. This approach applies standard tools of welfare analysis while allowing consumer behavior to deviate from rationality and full information without requiring specific assumptions about the reason for the deviation. The use of this approach would substantially reduce the confusion currently surrounding welfare analysis of tobacco regulation.

The paper (gated) is here.