Comments on economics, mystery fiction, drama, and art.

Wednesday, November 30, 2005

And, While I'm At It...

There's been a lot of chatter on tch-econ, a listserv devoted primarily to the teaching of economics, about "tax emancipation day"--the average date at which we become free of the "burden" of taxation.

What I learned from that chatter is how many of the people on that listserv apparently think government is inherently bad or, for that matter, evil. I learned nothing about the value of aclculating a "tax emancipation day."

And, Now, Pension Funds Are Diving Into the Hedge Fund Swamp

I expressed some concern awhile back about the university from which I graduated having put 15% or so of its endowment into hedge funds, seeking higher returns at a higher risk. Now, from Andrew Samwick, comes news that coporate defined-benefit pension funds are doing the same. Weyerhouser apparently has 39% of its pension funds in hedge funds. That's insane.

Why would any rational pension fund manager do this? Because these funds are no longer--if they ever were--being managed with the interests of the workers in mind. Throwing money into hedge funds allows the fund manager to claim a higher expected return on those investments. And the higher return allows the company to--surprise, surprise--reduce its annual contribution. So who bears this additional risk? NOT the corporation. The corporation's retirees, and its current workers.

Ain't that sweet?

Friday, November 11, 2005

The Strength of the Canadian Acorn

The Onion reports on the decline in the value of the dollar relative to the Canadian acorn.

Tuesday, November 08, 2005

Great Headlines of the Western World

From the Federal Reserve Bank of Dallas:

Mexican GDP Falls but No One Notices

Monday, November 07, 2005

Price Elasticity of Supply and the Web

One of the most difficult things about teaching microeconomics has been, for me, the difficulty in finding actual empirical estimates of price elasticity of supply. There are literally hundreds of estimates of price elasticity of demand, quite a few estimates of income elasticity of demand, and even a fairly large number (courtesy of the USDA) of estimates of cross-price elasticities of demand. But price elasticity of supply estimates have remained difficule to find.

But now there's the web. This morning, I needed to find some estimates, and in about 10 mminutes on the web, and thanks to Google, I found the following:

Transit in Sweden: 0.44 to 0.64.
Labor in South Africa: 0.35 to 1.75.
Beef in
.....Zimbabwe: ≈ 2.0
.....Brazil: 0.11 to 0.56.
.....Argentina: 0.67 to 0.96
.....Colombia: 0.56 to 1.20
Corn, short-run, US: 0.96.
Crude petroleum, long-run: 2.5.
Housing, long-run:
.....Dallas: 38.6
.....Atlanta: 28.8
.....Indianapolis: 14.6
..... St. Louis: 8.1
.....Akron: 4.4
.....San Francisco: 2.4
.....New Orleans: 0.9
.....Toledo: -0.3
.....Orlando: -6.3
Uranium: 2.3 to 3.3.
Recycled aluminum: ≈ 0.5.
Oysters: 1.64 to 2.00.
Retail store space: ≈ 3.2
Natural gas (short-run): ≈ 0.5.

There's even interesting stuff to talk about--like the price elasticities of supply for housing in Toledo and in Orlando

The web is wonderful.