Book Report: The Undercover Economist

The 8th book I've read this year was The Undercover Economist by Tim Harford. I initially read Tim somewhere on the internet and liked his writing style enough to buy his book.

The Undercover Economist was thoroughly enjoyable although I wanted to understand it so I took my time reading it. In addition, some of it I had to take with a grain of salt. I don't know that any book will convince me that markets are inherently free and that taxes are simply inefficiencies in markets. Experience would dictate that markets are under constant flux because of both government and market participants and taxes can be ways of either correcting for inefficiencies of market structure, forcing participants to address externalities, and (yes) inefficient in and of themselves. He glosses over the example of how Singapore provides health care to its citizens but that seems to me the crux of the type of question his book can help to answer: requirements by governments that in effect create a market. How can this market be created so that consumers win and no monopoly rents can be generated?

That being said, this book was excellent at pointing out ways in which economics can be useful in explaining why prices are what they are (scarcity power driving up rents, barriers to entry, extracting information, and even auctions to name a few) and other such interesting economic phenomena (like congestion pricing - which is good!). It really gave me a lot to think about in how to think about a lot if that makes sense.

Book Report: The Return of Depression Economics

I'm testing a new feature here at Nacho Lovers Anonymous, cataloging the books I read throughout 2010. A friend of mine made a resolution to read 25 books in 2010. I thought that was a good number. I actually like 26 better (a book every 2 weeks) but let's not quibble over details. So in addition to my previous resolutions (which, as it turns out, isn't such a great idea) let's add "read 26 books".

My first book of 2010 was The Return of Depression Economics and the Crisis of 2008 by Nobel Prize winning economist Paul Krugman. For those who have never heard of him, I apologize. For those who dislike him, I'm not sure I like you. And for those who know and like him this post will be relatively meaningless since I don't have anything of substance to add to any of his topics.

In addition to his work as an economist Paul is a columnist and blogger for the New York Times, with an article entitled Conscience of a Liberal (an interesting sidenote is that while his is very liberal and progressive, Times' policy does not allow him to endorse political candidates). I read the blog regularly and have read a couple of his other books. His writing is clear, concise, and persuasive. He makes the subject of economics extremely interesting (at least for this humble blogger), in addition to offering keen insights to other parts of the political spectrum (especially health care).

Here's a quick book review, another from the UK, and an interesting video of a talk he did recently about the book.

Maybe You Should Move to El Paso

My sister, bless her little heart, knows that I really like maps. Especially Google Maps. So when she sent me a link today about an interesting Google Map mashup I was understandably excited. The link she sent, from a company named PSFK who's about section says this:

PSFK is a trends and innovation company that publishes a daily news site, provides trends research and innovation consultancy and hosts idea-generating events. We aim to inspire our readers, our clients and our guests to make things better - whether that’s better marketing, better lives or a better world.

This mission statement nonsense aside, what I thought was interesting was that PSFK titled the page "Google Map: When Will Recession End Locally?" The reason I find this interesting is that when you look at the map on it's original site from the Sacramento Bee, it's not really about when the recession will end per se, rather it is a visual representation of when a certain organization (IHS Global Insight, a "leading economic forecaster") thinks that different areas will return to pre-recession employment levels. Whew.




All this got me thinking about how different people have different ways of measuring what exactly constitutes a recession (or a depression for that matter), how to determine when a recession starts or ends, and how exactly does it affect day to day lives of people. I think we can all agree that employment is a part but is it the only part? I would say no. Then again, I'm 100% unqualified to make any kind of economic arguments. For a good place to read about the economy and finance I would definitely point you to the blog Calculated Risk. They even have a recent post detailing which states are currently in a recession. The answer? Basically everywhere except North Dakota. Maybe we should all move to Fargo instead of El Paso? I doubt we should move to Youngstown, OH or Elkhart, IN though.

Google Earth pollution maps

(Image from LA Times)

Has it really been two weeks since my latest post? Fortunately a couple of interesting tidbits today caught my eye. First, I subscribe to the Google Lat Long blog, and it had a post today about a new layer in Google Earth. The new map layer shows pollution levels courtesy of The Vulcan Project at Purdue University. The LA Times also had a tidbit about it. The data isn't super duper recent (circa 2002), and from my quick perusal it seems to be only carbon dioxide (with a super sarcastic emphasis on the word 'only' - I applaud them for having so much nationwide data available in the first place).

What I found especially interesting about this article, however, was another article I read today that Obama says he will NOT tax vehicle miles traveled, instead saying that he intends to keep taxing gasoline consumption. This is a quandry: VMT more accurately tracks individual riders, which is a good for incentivizing things like paying for roads and bridges, but not necessarily good for incentivizing paying for cleaning up the environment. Essentially, auto efficiency (i.e. miles per gallon) is ignored. Taxing gasoline consumption is almost the opposite effect: it does a good job of incentivizing payment for lowering air pollution, but a poor job of incentivizing paying for projects based on mileage. I think the ultimate solution is a combination of both, but that's probably a topic for the guys over at the Freakonomics Blog at the NY Times.

(Which, by the way, is totally effing sweet).

Trickle Down Economics?