Tyler Cowen's Blog, page 385

Good sentences about inflation

As free goods become increasingly plentiful throughout the economy, and people learn to recycle, swap and exchange goods without monetary transaction, it becomes very difficult to engineer an inflation problem.

That is from Izabella Kaminska.  Most of the post is about the gold market.

Might this generation have less wealth?

A new study from the Urban Institute finds that Ms. Brady and her peers up to roughly age 40 have accrued less wealth than their parents did at the same age, even as the average wealth of Americans has doubled over the last quarter-century.

Because wealth compounds over long periods of time — a dollar saved 10 years ago is worth much more than a dollar saved today — young adults probably face less secure futures for decades down the road, and even shakier retirements.

“In this country, the expectation is that every generation does better than the previous generation,” said Signe-Mary McKernan, an author of the study. “This is no longer the case. This generation might have less.”

That is from Annie Lowrey.  I would note that some of these “future benefits” will be consumed in the form of health care, but still I think this is far from an efficient (or just) outcome.

China safety markets in everything

Chinese drivers hate to wear their safety belts. Instead, they wear specially designed clothing to pretend they are buckled up. But that won’t stop the seat-belt reminder lights and beeps, which are all extremely annoying.

It is possible to click the belt in the buckle behind your back but that is uncomfortable. It is also possible to fiddle with the electronics but that is difficult. Creative and innovative Chinese companies finally found an easy solution.

They are priced between fifty cents and $2.40.  Here is more, excellent photos too, and for the pointer I thank Michael Verdone.

Excellent new blog (if that is what it is)

theumlaut.com.

Note that the title, though not the site address, is THE ÜMLAUT.

Otherwise, they could have called it thenoumlaut.com, or a number of other things.

Fiscal policy correction

In my earlier post on fiscal policy, there is a mistake on point #1.  I failed to correctly distinguish between “total return” and “rate of return per annum.”  As the post read, it referred to the latter when it should have referred to the former.  Apologies!  Sometimes when I am traveling I don’t get to give posts enough rereads and am then more prone to errors; that is an explanation but not an excuse.

*With Charity for All*

I am a fan of this book.  The author is Ken Stern and the subtitle is Why Charities are Failing and a Better Way to Give, with emphasis on the former I would say.  Here is one excerpt:

The CBO study and other reporting on the practices of charitable hospitals did in fact spur reforms efforts, including a proposal in Congress to require a minimum uncompensated care rate of 5 percent in return for tax-exempt status.  All the major proposals, however, have been beaten back, with reform advocates having to settle for greater public reporting obligations for charitable hospitals on the theory that greater transparency would ratchet up pressure for change.  It hasn’t worked.  A 2012 nationwide study found continuing low levels of uncompensated care, only 1.51 percent on average, a number less than half the profit margins for the same group of hospitals.

Assorted links

1. For marketing purposes, I would not myself have called it “Soylent, and more here.

2. The (tank) culture that is Russia.

3. Facebook page on project evaluation.

4. Claims about Google glasses.

5. New FDA guidelines for Alzheimer’s drugs, and grocery gift cards for Medicare patients.

6. California makes a big move with on-line education.

J. Coetzee writes to Paul Auster

From a letter:

Finally, a remark by Christopher Tietjens in Ford Madox Ford’s Parade’s End: that one goes to bed with a woman in order to be able to talk to her.  Implication: that turning a woman into a mistress is only a first step; the second step, turning her into a friend, is the one that matters; but being friends with a woman you haven’t slept with is in practice impossible because there is too much unspoken in the air.

That is from Here and Now Letters 2008-2011, by Auster and Coetzee.  That excerpt is from the first letter, and I will keep reading.

How do cardinals divine the will of God?

Here is an older 2004 paper from J.T. Toman (pdf):

In modern times, the College of Cardinals have been locked in the Sistine Chapel with the purported aim to divine the Will of God in the election of the Pope. Between 20 and 60 percent of cardinals vote for the same candidate throughout the conclave, depending on the length of the conclave.  For those cardinals that change their voting behavior, they are influenced by both the vote counts and the nightly conversations. However, in unifying the cardinals to one winner the dominant force is the observed vote counts.

There is a good summary of the paper here, and another recommended paper here.

For the pointer I thank Adriano.

Markets in everything

For the past year and a half, he has been running a business, the Frivolous Engineering Co., that sells kits to build the gadgets—enough of them that he no longer repairs soft-drink machines.

And what is this fine gentleman from Saskatchewan marketing the instruction kits for?

Invented in the 1950s by an artificial-intelligence expert, the device is known as the “useless machine.” It is typically a small box with an on/off switch and a hinged lid. Turn on the switch and a lever pops out, turns off the switch, then retreats. That is the machine’s sole purpose: You turn it on, and it turns itself off.

There are many kinds of the machines:

There are useless machines made of wood, Plexiglas and Lego parts. There is a very tall useless machine. One uses a furry paw to pop out and switch itself off. Another does it with a toy duck’s bill. There is a useless machine battling another useless machine, turning each other on and off, over and over.

Note that while some call it the “useless” machine, a’ la Turing others call it the “ultimate” machine.  The full article is here.