Tyler Cowen's Blog, page 408

The impact of biofuel policy on Guatemala

It is bad:

In the tiny tortillerias of this city, people complain ceaselessly about the high price of corn. Just three years ago, one quetzal — about 15 cents — bought eight tortillas; today it buys only four. And eggs have tripled in price because chickens eat corn feed.

…In a country where most families must spend about two thirds of their income on food, “the average Guatemalan is now hungrier because of biofuel development,” said Katja Winkler, a researcher at Idear, a Guatemalan nonprofit organization that studies rural issues. Roughly 50 percent of the nation’s children are chronically malnourished, the fourth-highest rate in the world, according to the United Nations.

Assorted links

1. Charles C. Mann reviews Bernard Bailyn.

2. Becker and Murphy on whether we have lost the war on drugs.

3. How loud should religious announcements be?

4. A paper on lead exposure and crime, internationally (pdf), and some predictions here, including that Latin American crime will fall sharply.

5. Is it too easy to meet someone new?

6. What will induce nostalgia in 2033?

7. Is Social Security in worse shape than we think?

There is no great stagnation

A US patent application has been made for an unlikely weight loss tool: a tube installed from inside the stomach, out the abdominal wall, that allows patients to manually pump their meal straight out.

Here is more, via @RobespierreVTec.

The culture that is New Zealand auction markets in everything

A spurned New Zealand woman sold the secret locations to her ex-boyfriend’s favorite fishing spots, netting $3,000, which she then spent on herself.

Here is more, and for the pointer I thank Daniel Lippman.

*The Bankers’ New Clothes*

That is the new book by Anat Admati and Martin Hellwig and the subtitle is What’s Wrong with Banking and What to Do about it.  Here is their bottom line:

We have argued that if banks have much more equity, the financial system will be safer, healthier, and less distorted.  From society’s perspective, the benefits are large and the costs are hard to find; there are virtually no trade-offs.

I agree with the proposal, though not with the claim that this is virtually costless, as is laid out in their chapter seven (oddly they focus on the question of whether debt and equity “require” comparable rates of return, rather than the general notion of opportunity cost).  In any case this is a major net work on banking and its regulation.  Here is the book’s home page.  Here is Admati on YouTube.

Signaling markets in everything: fashion braces

Many teens in Southeast Asia have been shelling out more than $100 for so-called black market braces, mouth gear that doesn’t serve any function other than fashion — and status. While being a brace-face stateside might be a drag, real braces cost close to $1,200 in places like Bangkok, putting dental care far out of reach for the average family. As a result, braces have become a surprising status symbol.

Here is more, via Daniel Lippman.  From Daniel, here are expensive parking spaces in Hong Kong.

The culture that is Republican

House Republicans signaled Thursday they will not follow rules in President Obama’s healthcare law that were designed to speed Medicare cuts through Congress.

The House is set to vote Thursday afternoon on rules for the 113th Congress. The rules package says the House won’t comply with fast-track procedures for the Independent Payment Advisory Board (IPAB) — a controversial cost-cutting board Republicans have long resisted.

Here is more, via Brad DeLong.

Assorted links

1. The statistics software signal.

2. The culture that is Iceland (book flood).

3. Not-new books of the year.

4. Isaac Asimov 1988 video on on-line education (very good).

5. Is education becoming more or less segregated?

6. A negative review of Les Mis.

How brutal is vegetarianism to animals?

Here is one take on the matter, from Mike Archer, controversial to be sure, and in some ways under-argued, but offering some points to ponder:

… the largest and best-researched loss of sentient life is the poisoning of mice during plagues.

Each area of grain production in Australia has a mouse plague on average every four years, with 500-1000 mice per hectare. Poisoning kills at least 80% of the mice.

At least 100 mice are killed per hectare per year (500/4 × 0.8) to grow grain. Average yields are about 1.4 tonnes of wheat/hectare; 13% of the wheat is useable protein. Therefore, at least 55 sentient animals die to produce 100kg of useable plant protein: 25 times more than for the same amount of rangelands beef.

You will note that this comparison works for grass-fed beef only.

Hat tip goes to Dalibor Rohac.

A skeptical perspective on African development

Rick Rowden thinks manufacturing is a key:

We can look at whether manufacturing has been increasing as a percentage of GDP, or whether the manufacturing value added (MVA) of exports has been rising. In these cases the comparison between Africa and East Asia is actually quite revealing — as demonstrated by a recent U.N. report that paints a far less flattering picture of Africa’s development prospects.

It finds that, despite some improvements in a few countries, the bulk of African countries are either stagnating or moving backwards when it comes to industrialization. The share of MVA in Africa’s GDP fell from 12.8 percent in 2000 to 10.5 percent in 2008, while in developing Asia it rose from 22 percent to 35 percent over the same period. There has also been a decline in the importance of manufacturing in Africa’s exports, with the share of manufactures in Africa’s total exports having fallen from 43 percent in 2000 to 39 percent in 2008. In terms of manufacturing growth, while most have stagnated, 23 African countries had negative MVA per capita growth during the period 1990 – 2010, and only five countries achieved an MVA per capita growth above 4 percent.

The report also finds that Africa remains marginal in global manufacturing trade. Its share of global MVA has actually fallen from an already paltry 1.2 percent in 2000 to 1.1 percent in 2008, while developing Asia’s share rose from 13 percent to 25 percent over the same period. In terms of exports, Africa’s share of global manufacturing exports rose from 1 percent in 2000 to only 1.3 percent in 2008.

The pointer is from the excellent @FGoria.