The Ambrosini Critique

Faculty had a busy August:

• Knittel on gas prices: they rise fast but they fall slow. The reason may not be what you expect.
• Prof. Carrell shows having bad kids in the classroom creates quite large negative externalities. Here’s the newspaper’s account and here’s the NBER link.
• Rising incomes increases demand for trade which induces innovation that reduces the cost of trade and raises incomes. Wash, rinse, repeat. Governments screw with this process. Prof. Meissner’s evidence.

Does Palin seem less presidential than Howard Dean, for example, because:

• she’s eight years younger than Howard Dean when he ran for President?
• she’s only been the governor of a small State for little over two years whereas Dean was the governor of a small State for 12?
• she’s a she?

Does she seem less presidential than Barack Obama because:

• she has more experience as an elected official but of smaller districts?
• she didn’t give a speech at the 2004 Democratic Convention?
• she soundly defeated a party lion in her governors race, but Obama was able to beat The Hillary Clinton?
• she’s a she?

Does she seem less presidential than Joe Biden because:

• she hasn’t been representing a number of people about half the population of Alaska for 35 years in Washington?
• …¹
• she’s a she?

Look, I’m not the first person in a crowd to scream sexism. I’m usually the last. But the reaction to her selection as McCain’s VP smacks of it.

UPDATE: I should mention that with my winnings from the primaries last night I went all-in on Obama in the general election. The Palin selection didn’t change my opinion that Obama has a 70% to win the race.

1. I mean really, Joe Biden? Presidential? He’s Kerry with less hair and swift-boats or not, Kerry proved himself to be less than Presidential material. [↩]

I’m back and did you notice Tyler Cowen’s posts in August contained a number of links to blogs named in this thread?

Well, I’m off to an undisclosed location:

The roof has been finished since that picture was taken a couple summers ago. Two summers ago I put in a water system; fresh spring water right to the tap¹. Last year I added a sewage system. Yum.

I’m holing up to finish writing a paper and prepare for orals. There will be no internet. There’s a non-zero probability this will drive me crazy and I’ll occasionally make the 45 minutes drive to town to get a Google Reader fix.

Well intertubes, have a great August!

1. well, I haven’t installed the indoor plumbing yet. That’s this year’s project. [↩]

Prof. Delong links to Brad Setser who a couple months ago was lamenting over this chart:

Notice the negative growth numbers for the bottom 90th percentile.

The data are from Piketty and Saez. Curiously, these authors don’t analyze the income shares of the bottom 90th percentile. They say this is because before 1945 most people were exempt from filing tax returns except top earners. But I suspect they think these data are a bad measure of bottom 90th percentile even after that because in the working paper, the published paper, the comment and the “summary for the broader public” the shares of the bottom 90th percentile are never reported. In any case, this means whoever at the WSJ that created the chart extrapolated from Piketty and Saez’s data on top income shares and didn’t take the data directly from them.

Tax data have a number of problems, all addressed in their paper. There’s evasion, exemptions, and income shifting. Also, because most taxes are filed by family instead of by individual, tax data can only be used to look at family incomes. This means some of the trends will be the result of demographic changes (i.e. families differentially getting smaller in each income percentile).

But Piketty and Saez use tax data, instead of survey data (e.g. Census), to analyze top income shares because given there’s no random sample, the top of the top have a proper representation in the data set. In a random survey, its unlikely you’ll end up surveying one of the 14,836 families that make up the top 0.01% earners. They’re using the right data for the job, but the job isn’t to analyze shares of the bottom.

That’s why we have survey data. And I happen to have survey data, the 2000 Census and the 2006 CPS, sitting on my desktop. By my figuring, wages of the bottom 90th percentile went up by 5% between those years.

So, we should fight over what data is better, but its at least important to know that survey data gives a different answer than tax records. Its a bit premature to conclude, as Setser did, “Most Americans didn’t benefit from the expansion of the past few years.” That said, a 5% increase is meager over 6 years. I won’t be throwing any parties.

There’s a point in the first year of econ grad school where you switch from “yeah, I’m in grad school” to “OMG!!!11!! How am I going to live through all this formalization!”

For me that moment came about 10 minutes into Prof. Silvestre’s first lecture, in the first micro theory course on the first day of classes. If I had opened up the required text for that class, MWG, before lecture, I may have had that sinking feeling even before I started grad school; this is assuming I would have started grad school school if I’d known what I was getting in to. In any case, these notes on the MWG text may help.

PS – Fellow UC Davis grad Matthew Pearson wrote these notes on surviving the first year.