Weekend Music & Links
Lots of items to share this week, but first:
It's a long way away from being commercially ready, from being the sort of disruption the educational materials market is waiting for, but a UC Berkeley senior has designed an interesting history-visualization tool, according to The Atlantic. (HT: Tyler Cowen)
Tyler Cowen raises very challenging questions about shadow bank runs and how our regulatory institutions should change in response to changes in financial market organization in The New York Times.
Extreme labor-saving technology comes into force in Amazon.com warehouses. (HT: Karl Smith)
Menzie Chinn of Econbrowser lays out a cogent case based in trade theory for why the completion of the Keystone oil pipeline, which runs from Canada to the Gulf coast, may very well result in higher fuel prices in the United States.
A. Sahin and C. Patterson have a neat model of the unemployment rate using flow dynamics on the New York Fed's "Liberty Street" blog. (HT: The Economist)
"Less Wrong" is an amazing website Tyler Cowen linked to the other day which talks about cognitive biases -- here's an eye-opening post on selection bias, and how the British Royal Air Force used careful but counterintuitive thinking to redesign efficient airplane armor.
Central banks are better when independent -- or are they, always? What about during liquidity traps? Paul McCulley says collaboration between fiscal and monetary policy is exactly what is needed. (HT: Paul Krugman)
A really great pedagogical example of Bertrand competition -- firms compete based on setting a price for a homogenous product -- in local low-cost pizza joints in downtown New York City. The model's predictions are borne out in that there should a "price war" until prices fall to marginal cost, and if marginal costs aren't the same, then the high-marginal cost producers are going to fail, and eventually the price of a slice of pizza will stabilize at the limit price. It's a great day to be a pizza eater in NYC, obviously, given the consumer surplus. (HT: Mark Perry)
An old but interesting study by P. Moser I found about how patent law affects innovation by influencing the direction of technological change. At some point I'm going to write a blog post about optimal patent law, because I'm finding "law and economics" interesting.
Conservatives, especially in light of the Supreme Court oral arguments, are waving around the slogan "repeal and replace ObamaCare." But what should it be replaced with? J. Capretta and R. Moffit tell us in National Affairs, which is an absolutely wonderful but not-as-popular-as-it-should-be publication.
Isabella Kaminska of the Financial Times reveals that India's current-account deficit is swelling due to a sudden slowdown in exports and industrial production, rising government borrowing, slowing corporate investment, and shrinking foreign exchange reserves. All the warning signs of a 1997-style financial crisis are now present in India; now we should just keep our eyes on the value of the rupee, which has lost 13 percent of its value since August. (HT: Tyler Cowen)
Jon Stewart had Rachel Maddow on Thursday night to talk about her new book, Drift, and what bothered me about Maddow's comments is the way she talked about the end of the draft as this enabler of warmongering, because it eliminated the need for mass civilian participation. I found myself going back to Milton Friedman's classic, anti-collectivist "Why Not a Volunteer Army?" which helped end the draft after Vietnam.