Tuesday, February 27, 2007

Plug for Bryan Caplan's Book

Even though Caplan’s book hasn’t been released yet, I was reminded of its impending release when one of Andrew Sullivan’s readers wrote this:

Someone like Kos or Josh Marshall will never, ever get this about us – we (Republicans) are an extremely pragmatic group of people who like to win and aren't willing to lose just because liberal bloggers and the Media say we should lose.

I’m not arguing with any points that Sullivan’s reader makes, but the tone of Sullivan’s reader reminded me about what Bryan Caplan wrote in an essay a few months back:

My view is that these are symptoms not of ignorance, but of irrationality. In politics as in religion, some beliefs are more emotionally appealing than others. For example, it feels a lot better to blame sneaky foreigners for our economic problems than it does to blame ourselves. This creates a temptation to relax normal intellectual standards and insulate cherished beliefs from criticism — in short, to be irrational.

A “pragmatic group of people who like to win…” It would be pretty hard to argue against that statement’s rationale.

Sunday, February 25, 2007

On Stephen Kirchner

For anyone who may not be aware, Stephen Kirchner has been a vocal critic of Nouriel Roubini for quite some time.

(As an aside, what has really made me a fan of reading Kirchner’s blog is the fact that I’ve never heard his foreign policy views; so I neither know if he’s pro-Iraq War or not. As much as I’ve agreed with Larry Kudlow and Hugh Hewitt on a few economic issues, I fear their other policy goals as I would the plague.)

But what I do know and love about Kirchner is his total lack of fear in confronting Roubini on what Larry Kudlow would call Roubini's “perma-bear” status. As Kirchner himself documents, Roubini wrongly predicts the demise of the U.S.’ markets on a surprisingly consistent basis.

If you want to see someone who is unabashed in commenting on financial economics, then look no further then Stephen Kirchner.

Monday, February 19, 2007


Sebastian Mallaby writes in the Washington Post today about how the Democrats current platform towards Globalization might create more economic woes than it would actually protect the U.S. economy.

Mallaby illustrates that globalization today is not the same as it was twenty years ago. Whereas, in the 80s, an entire industry might be at risk, in today’s age only specific tasks (or specific jobs) are at risk.

An excerpt:

But the new competition in tasks rather than industries renders the tragedy of the company town increasingly rare. If a data-entry clerk loses her job in Omaha, she can probably find other work without having to move.

Cheap labor means cheaper goods, and while we may fear the short term, in the long run, free trade will make everyone better off.

Friday, February 16, 2007

Stock Option Backdating

I had posted before on stock option backdating, and we have yet another executive who is being found guilty on backdating stock options.

As Pat Milton (AP) reports:

McKelvey became just another casualty in the widening scandal over the accounting of past options grants. At least 135 U.S. companies have disclosed internal inquiries or government investigations, and at least 39 executives and board directors at 19 companies have been fired or have resigned.

I remember in my previous post on the topic saying that Sarbanes-Oxley curtailed some of the practice. That is to say, I think it happens less frequently, as did the paper I mentioned surmise. I still have to gawk at the number though, and realize that the amount of money to be made by backdating has to be too good to pass up.

Thursday, February 15, 2007

Milli Vanilli

In case you didn’t know already, we may be seeing a movie sometime in the future about Milli Vanilli.

Sunday, February 11, 2007

Work and Leisure Time

In this latest paper from Valerie Ramey and Neville Francis, they provide a different paradigm in terms of how we think about work and leisure. It’s nothing mind blowing, but what it does say in the end is that when re-measured, the U.S. – since 1900 – hasn’t gained a substantial amount of leisure time compared to the amount of time that we work.

In defending the new conclusion they write,

Finally, while we think our series give good estimates of long-run trends in time use, we are much less confident about the cyclicality of time use.


The estimates we have produced are probably correct on the directions of movements over the business cycle, but are very imprecise estimates of the quantitative movements.

Something to think about, but I can’t think about it for too long because I have to get my work done.

Tuesday, February 06, 2007

More Dating Market Specialization

From Stephen Dubner at the Freakonomics blog; even farmers have their own dating market.

Sunday, February 04, 2007

More on China

Because I’m still thinking about China, here’s another link to a summation that the Nightly Business Report wrote on this formal complaint the U.S. is making to the World Trade Organization. From the USTR release:

“We recognize that China has taken significant steps to open its market and reform its trade practices since becoming a Member of the WTO, and both countries are benefiting from a deeper and stronger trade relationship,” Ambassador Schwab added. “However, where China has failed to meet its commitments, we will use the full array of tools available to secure compliance. Our decision to bring this case to the WTO comes after our efforts at dialogue failed.”

Before I go on, the wording and feel of Schwab’s statement is reminiscent of a collection agency sending a letter requesting for an account to be paid in full. However, while a funny observation, it’s irrelevant, so I’ll move on.

What this press release shows is that China really does have a problem, which is that they use subsidies that effectively lower what the price would otherwise be on the market. Something that I before said was “no-no.”

China’s usage of subsidies is the deal breaker in my opinion, but the problem is that the US also has subsidies of its own that many economists don’t approve of either. And if I were China, I would surely use that excuse when the World Trade Organization comes knocking on my door.

Response to eHarmony Comment

My last post left me with this comment from the eHarmony blog that linked me to this post on the eHarmony blog.

First, let me just address how the comment was written:

1 in 500? Check your figures again. :)

Firstly, it’s not my figure. In addition, the tone of that comment makes me believe that they’ve set up a Google search for anyone who links to the Scientific American article and then automatically post that comment. I’m simply speculating on how and why eHarmony would post a comment on my blog because my blog is simply not trafficked.

Fine, I’ll let the eHarmony blog take away the statistic, but before I do, let me just say a few more things. Another reason why I think they have a Google alert or a bot set up in searching for the comment is because it doesn’t even seem that they read my entire post because the statistic, while I thought important, was not really the point in my writing the post. My post was about how online dating is not the complete savior it’s cracked up to be. It still has its own drawbacks, which the eHarmony comment obviously did not address.

Also, while were on statistical analysis, don’t get me started on how different entities can use statistics differently to come up with findings for different points of view. Let us all just take a look at climate science. Robert Samuelsson touches on it here, Arnold Kling here, and Robert C. Balling Jr. here. So, let those links show that trying to argue on statistics won’t get us very far anyway in terms of climate, and I would venture the same goes for dating thanks to the Scientific American article.

Once again, it’s clear that the gist of my post was also simply inarguable because it was pretty much a wholly personal opinion on the Scientific American article, except for the statistic that eHarmony blog contests. They don’t contest any of the other research that I’ve posted on my blog here, here, and here.

Moreover, is there a retraction from Scientific American?

Why doesn’t the eHarmony blog address some of the drawbacks that Robert Epstein mentions? To generalize it: the lying, of which my favorite example that Epstein cites is where one woman uses pictures of women who are obviously not her.

You’ve got my attention eHarmony blog, and because you say the statistic is invalid, leave me another comment and show me the retraction from Scientific American.

Thursday, February 01, 2007

More on Online Dating

My good friend, Matt Huggins, emailed me this article by Robert Epstein from Scientific American.com that discusses online dating.

Epstein touches on some ideas that I’ve mentioned before. Once again proving that money matters in dating showing that income can make up for a lack of other attractive characteristics.

What Epstein writes really articulates though are the pros and cons of online dating, and while he tries to surmise that online dating could have a wonderful future ahead of it, I personally cannot get over the glaring drawbacks that are attached to the venture of online dating.

According to Epstein, the good news is that online dating is continuing to grow and in some ways getting better. Unfortunately, participants still have to deal with the lying of age, weight, and sometimes, flat-out lying about your own picture. Those are tough things to stomach for me, let alone the staggering odds that I might find a mate online.

In 2005, using eHarmony's own published statistics, a team of credible authorities--among them Philip Zimbardo, a former president of the American Psychological Association--concluded in an online white paper: "When eHarmony recommends someone as a compatible match, there is a 1 in 500 chance that you'll marry this person.... Given that eHarmony delivers about 1.5 matches a month, if you went on a date with all of them, it would take 346 dates and 19 years to reach [a] 50% chance of getting married." The team also made the sweeping observation that "there is no evidence that ... scientific psychology is able to pair individuals who will enjoy happy, lasting marriages."

Also, Epstein goes on to mention that we still face a “false negative problem” where the matching from a dating service takes away people you might never meet, but “who would adore each other.”

I think for myself to make a current judgment on the reading material for online dating, I would have to say that it’s simply just another market, a dating market. And just like the real life dating market, online dating deals with its own pitfalls. Deception, people (or computers) setting you up with whom they think is a good match, and the sheer effort and will it takes to put yourself out there and figure it out are all items that can make it difficult. In the end, the common sense logic is right, online dating is still dating; we’ve just changed the initial communication medium.

****Update: I respond to the comment left by the eHarmony blog.