Valentine's Day Economics reading list

For those who only see women (men) as curves...

1. A Theory of Marriage: Part I by Gary Becker (an attempt to explain behavior in marriage using economic models)

2. A Theory of Marriage: Part II by Gary Becker

3. Career and Marriage in the Age of the Pill, Claudia Goldin and Lawrence Katz
(explores the effect of birth control pills on marriage and career choices)

4. For Love or Money--Or Both? by Nancy Folbre and Nancy Nelson
(tells us why market can't provide incentive to love, and therefore can't provide good quality elderly and child care)

5. Intergenerational Economic Mobility and Assortative Mating by John Ermisch et al (IZA)
(the main conclusion seems to be: how much you earn depends on how much your parents and your spouse's parents earn)

Another stimulus plan (the most economically sound proposal by far)

Let's blog our way out of recession!

At least it's much better than a tax credit for homebuyers...

Libertarian stimulus package

From Jeff Miron.

Abuse of the word "liberalism"

It is perplexing how the word "liberalism" evolved into its meaning of "active government intervention in the economy" in America. The Economist reviewed Alan Wolfe's book on liberalism.

Quote:
"Odder still, put this question to people who live, or would like to live, in a liberal democracy: “Which of the following values do you espouse—personal freedom, rule of law, active but accountable government, free but responsible markets, mutual toleration and equal concern for all?” It is a fair bet that people will tick most or all items on this list. Ask them if they are liberals, on the other hand, and many will turn contemptuously away."

Bookstores should expect a lot of customers returning this book a few days after purchase. American readers who buy it based on its name may be expecting a totally different topic than what the book really is about.

Attention Job Seekers! Lists of Companies That Are Still Hiring Aggressively

Survivors of the crisis so far are: audit, insurance, health care, and grocery retail.

CARPE DIEM: 13 Companies That Are Hiring in 2009

CARPE DIEM: They're Hiring!!

How market failure is causing traffic accidents in the US

This is not a conclusion of any serious research...yet. But if anyone wants to give me funding, I'll be more than happy to work on the empirical evidence and produce a rigorous research! :)

So, here's my theory:

Not everyone is good at driving or enjoy driving. In a Ricardian world where everyone specializes according to his/her comparative advantage, the bad drivers should not drive at all--but should spend his/her time on doing what he does better (e.g. fixing computers, teaching, farming, cooking, etc. you name it). The teacher or farmer or cook can then pay for transportation service from those who have comparative advantage in driving.

If you have lived your whole life in California, the abovementioned world may sound ridiculous to you. However, if you're from Hong Kong (Singapore, Taipei, or New York City), you know how natural and desirable that is. There people have access to reliable public transports within a few minutes from their doors, or they can flag a taxi right at the doors. Consequently, people who can't drive aren't forced to drive, leaving the road safer. Moreover, fewer cars are left idle. It does the environment a big favor. For those who still decide to drive, it's easier to find parking.

Now, look at what's happening in the US. The road is filled with bad drivers who would stop in the middle of the road suddenly, change lanes when there's another car 25cm away, take up 2 parking spaces when they parallel park...

Being a lousy driver myself, I sympathize with the drivers. I know clearly that driving requires talent. If you don't have the talent, you may still be a dangerous driver even though you try hard to drive safe. Moreover, if you know you're a bad driver, chances are that you won't like to drive either. However, if you can't go to work without a car, you are forced to drive even though you aren't good at it and don't like it.

Public transportation systems in the US are indeed so bad that people can't rely on them as the sole means of transportation. Taxicabs are inaccessible and/or prohibitively expensive.* To make the matter even worse, urbanization hasn't quite happened in the US. As many people live in suburbs, the population is too scattered to be served by public transport.

These form a vicious cycle: As people can't use public transport, they drive. Because they drive, they live in the suburbs where they can park for free. Since most people live in suburbs, demand for public transport is low. With the thin market, public transport remain scanty.

I think that is why so many people who are not supposed to drive are driving in America. Next time when you're pissed off by a bad driver, don't blame the driver--blame the market.

*: Here is an article about why taxis are so expensive (and services so poor) in Boston.

Christopher Hill on the Six-Party Talks on North Korea & Northeast Asia

I went to this talk yesterday:

SPEAKER: Christopher Hill
Assistant Secretary of State for East Asian and Pacific Affairs and Head of the U.S. Delegation to the Six-Party Talks on the North Korean Nuclear Issue

TITLE: "The North Korea Talks in the Context of Northeast Asia Security"

DATE: Monday, February 2nd, 6:30pm

LOCATION: Center for Government and International Studies (CGIS-South), Tsai Auditorium. 1730 Cambridge Street, Cambridge, MA.

MODERATED by Professor Alistair Iain Johnston, Department of Government, Harvard University


I had planned to write a full report on it last night, but I ended up sleeping right after the talk because I was exhausted from working on my thesis draft yesterday. Today I found a report about it on Daily NK, a website about North Korean news.

So I guess I can save the energy of writing a full report. Here are some random points that I remember from the talk:

1. When asked how South Korea should position itself in the region's international relations, Hill responded, "South Korea's role should solely depend on what South Korean people want. " But if someone really pushes him for his opinion, "I would say the best thing for South Korea to do is to preserve and strengthen her relationship with the US. Being a small country surrounded by strong neighbors, relationship with the US is the biggest leverage."

2. There are no substantial political alliance between Russia and China today.

3. North Korea may seem irrational and funny to the US media. However, if you walk in their shoes, considering their culture and other factors, their actions may have been totally logical.

4. Hill has one tip for "Western" politicians who want to deal with Asians. "Hardwork is admired and respected in Asia. Very often, Asians don't regard Americans as hardworking as we were born with many privileges. In working with Asians, I put extra hardwork to show that I have done my homework. When my Asian counterparts suggest meeting at 9am, for example, I would suggest 8am."

5. Hill is very glad that China is chairing the Northeast Asian security talks now because no other country has a bigger leverage on North Korea than China. However, the relationship between China and North Korea is complex. In China, different people have different voices on North Korean issues.

6. The North Korean nuclear proliferation is important for the Obama administration in the sense that it has a symbolic meaning. It is by far the only international security issue that has involved the three biggest economies of the world (US, Japan, China) and the biggest energy producer (Russia) in solving. "If we can't solve the North Korean problem, how are we gonna solve the Iran problem?"