Tyler Cowen's Blog, page 112

China blood for grades markets in everything

It’s one thing for parents to shell out for cram schools or private tutors for their children, but parents in China’s Zhejiang province are taking it a step further. There, parents can give their own blood to earn some extra points on their child’s zhongkao, or high school entrance exam.

Four liters of donated blood will get your child one extra point; 6 liters adds two points; and 8 liters, three. One 28-year-old man on Weibo, China’s version of Twitter, posted that he had surpassed the 4-liter mark, a gift to his unborn child: “[I] want to tell my future son: No worries with the high school entrance exams, Dad has already got you bonus marks!” the man said, quoted in the South China Morning Post. The policy began this July, but parents are able to take into account the blood they donated in the past. The 28-year-old had started donating when he was 18.

That is from Jeanne Kim, there is more here.

Assorted links

1. Things that cost more than space exploration.

2. Tim Harford on why Parisian food is getting worse.

3. The Mercedes-Benz driverless truck.

4. Steven Pinker on why academic writing stinks.

5. Bill Gross’s Straussian take on his deceased pet cat, CAPM, the disrepair of economic models, his personal pet history, and the future of asset returns.  It is strange how they concluded from this letter that he was erratic: “I often asked her about her recommendations for pet food stocks, and she frequently responded – one meow for “no,” two meows for a “you bet.” She was less certain about interest rates, but then it never hurt to ask.”  I say he was spot on, and knew no other way of communicating the bad news.  I suppose he needed to be Straussian about his Straussianism.

Hong Kong bleg

You know the drill, I have been there before but not in a long time.  Your assistance is much appreciated and I thank you all in advance…

How to make beer a natural monopoly?

Bruges is trying something different:

The Belgian city of Bruges has approved plans to build a pipeline which will funnel beer underneath its famous cobbled streets.

Locals and politicians were fed up with huge lorries clattering through the cobbled streets and tiny canal paths of the picturesque city and decided to connect the De Halve Maan brewery to a bottling factory 3.2km (two miles) away.

It is estimated that some 500 trucks currently motor through Bruges each year on their way to the brewery, which is a famous tourist attraction.

Now they will be kept out of the city limits, as the pipe pumps 1,500 gallons of beer per hour. Construction is set to begin next year.

“The beer will take 10 to 15 minutes to reach the bottling plant,” said brewery CEO Xavier Vanneste. “By using the pipeline we will keep hundreds of lorries out of the city centre. This is unique in the brewing industry with exception of one German brewery that has installed a similar system.”

There is more here, and for the pointer I thank Samir Varma.

On-line classes really do work, at least sometimes

There is a new report of interest, admittedly MIT physics-specific only:

…for the first time, researchers have carried out a detailed study that shows that these classes really can teach at least as effectively as traditional classroom courses—and they found that this is true regardless of how much preparation and knowledge students start out with.

The findings have just been published in the International Review of Research in Open and Distance Learning, in a paper by David Pritchard, MIT’s Cecil and Ida Green Professor of Physics, along with three other researchers at MIT and one each from Harvard University and China’s Tsinghua University.

“It’s an issue that has been very controversial,” Pritchard says. “A number of well-known educators have said there isn’t going to be much learning in MOOCs, or if there is, it will be for people who are already well-educated.”

But after thorough before-and-after testing of students taking the MITx physics class 8.MReVx (Mechanics Review) online, and similar testing of those taking the same class in its traditional form, Pritchard and his team found quite the contrary: The study showed that in the MITx course, “the amount learned is somewhat greater than in the traditional lecture-based course,” Pritchard says.

A second, more surprising finding, he says, is that those who were least prepared, as shown by their scores on pretests, “learn as well as everybody else.” That is, the amount of improvement seen “is no different for skillful people in the class”—including experienced physics teachers—”or students who were badly prepared. They all showed the same level of increase,” the study found.

For the pointer I thank Samir Varma

Friday assorted links

1. Is software outpacing hardware?  A chess experiment pitting a smart phone against a desktop.

2. Guide to Aphex Twin (the new release is quite good).

3. Wimps.

4. “In Average Is Over, George Mason University economist Tyler Cowen delivers good news and bad news with nearly equal enthusiasm.” Joseph Stromberg has a good review.

5. Knausgaard bingo.

6. Two big mysteries.

China fact of the day

…the size of the Chinese government and party bureaucracy is surprisingly modest…In this respect, the Chinese communist Party is similar to previous Chinese dynasties as far back as the Han, which ruled the vast Chinese empire with a modestly sized civil service.

…China has only 31 government and party employees per thousand residents.  The number of civil servants per thousand residents in France is 95, in the United States, 75, and in Germany 53.

You will note that these numbers exclude state-owned enterprises, which in China are extensive although shrinking in relative terms.

That is from the new and excellent Nicholas Lardy book Markets Over Mao: The Rise of Private Business in China.  In my view the truth lies somewhere between the arguments of Lardy and the thesis of Joe Zhang, see the first Amazon review for Zhang’s critique of Lardy, plus Zhang’s comments here.  Here is Scott Sumner criticizing Zhang.

Food is cheaper in large cities

Eliminating heterogeneity bias causes 97 percent of the variance in the price level of food products across cities to disappear relative to a conventional index. Eliminating both biases reverses the common finding that prices tend to be higher in larger cities. Instead, we find that price level for food products falls with city size.

That is part of an abstract and new paper from Jessie Handbury and David E. Weinstein, via Kevin Lewis.  They have two additional interesting papers on the cost of living here.

Is stopping climate change a free lunch?

We’re again seeing the return of magical thinking in the economics profession and elsewhere.  Limiting climate change is indeed worth doing, but it is not close to a free lunch.  Eduardo Porter makes the relevant point quite nicely:

“If the Chinese and the Indians found it much more economically efficient to build out solar, nuclear and wind, why are they still building all these coal plants?” asked Ted Nordhaus, chairman of the Breakthrough Institute, a think tank focused on development and the environment.

China’s CO2 emissions increased 4.2 percent last year, according to the Global Carbon Project, helping drive a global increase of 2.3 percent. China now accounts for 28 percent of the world’s total emissions, more than the United States and the European Union combined.

“I don’t think the Chinese and the Indians are stupid,” Mr. Nordhaus told me. “They are looking at their indigenous energy resources and energy demand and making fairly reasonable decisions.”

For them, combating climate change does not look at all like a free lunch.

Note that doing something about air pollution and doing something about carbon emissions are two distinct issues.  America did a great deal to clean up its air, for instance when it comes to the dangerous Total Particulate Matter, but has done much less to lower its carbon emissions.  It is no accident that the former is a national public good, the latter is mainly a global public good.  China, India, and other developing nations may well go a similar route and simply keep emitting carbon at high and perhaps even growing rates.   If you lump everything together into a general “the benefits of getting rid of air pollution,” you will be missing that nations can and probably will make targeted clean-up attempts that leave carbon emissions largely intact.

By the way, here is yesterday’s report from India:

“India’s first task is eradication of poverty,” Mr. Javadekar said, speaking in a New York hotel suite a day after a United Nations climate summit. “Twenty percent of our population doesn’t have access to electricity, and that’s our top priority. We will grow faster, and our emissions will rise.”

India is the world’s third-largest carbon polluter, behind China and the United States, and Mr. Javadekar’s comments are a first indication of the direction of the environmental policies of the new prime minister, Narendra Modi…

In coming decades, as India works to provide access to electricity to more than 300 million people, its emissions are projected to double, surpassing those of the United States and China.

If you haven’t tried crossing the street in India, you don’t know much about how hard it is to fix the problem of carbon emissions.

The Thomson Reuters Nobel picks

This source mentions Mark Granovetter, Aghion and Howitt, and Baumol and Kirzner.  I don’t know if those are their “top picks,” or simply some of their picks.  (Addendum: This further link suggests it is their only picks.)

For the pointer I thank Peter Boettke.