Fri, 20 December 2019
Today's guest is Leah Boustan of Princeton University. Our discussion centers around her recent working paper, "The Effects of Immigration on the Economy: Lessons from the 1920s Border Closure." In the 1920s, the United States substantially reduced immigrant entry by imposing country-specific quotas. We compare local labor markets with more or less exposure to the national quotas due to differences in initial immigrant settlement. A puzzle emerges: the earnings of existing US-born workers declined after the border closure, despite the loss of immigrant labor supply. We find that more skilled US-born workers – along with unrestricted immigrants from Mexico and Canada – moved into affected urban areas, completely replacing European immigrants. By contrast, the loss of immigrant workers encouraged farmers to shift toward capital-intensive agriculture and discouraged entry from unrestricted workers. We also discuss her broader body of work on the age of mass migration. At the peak of this era, the United States had a foreign-born population of 15%. Today, after a century of restricted immigration, the United States foreign-born population has only just returned to 15%. It's a fascinating discussion with special relevance to today's debates about immigration. |
Tue, 26 November 2019
Today on Economics Detective Radio, I discuss health economics with Hannes Schwandt of Northwestern University. Hannes is the co-author, along with Diane Alexander, of "The Impact of Car Pollution on Infant and Child Health: Evidence from Emissions Cheating." Car exhaust is a major source of air pollution, but little is known about its impacts on population health. We exploit the dispersion of emissions-cheating diesel cars which secretly polluted up to 150 times as much as gasoline cars across the United States from 2008-2015 as a natural experiment to measure the health impact of car pollution. Using the universe of vehicle registrations, we demonstrate that a 10 percent cheating-induced increase in car exhaust increases rates of low birth weight and acute asthma attacks among children by 1.9 and 8.0 percent, respectively. These health impacts occur at all pollution levels and across the entire socioeconomic spectrum. We also discuss his work on the health impacts of the 9/11 dust cloud. |
Mon, 11 November 2019
Bryan Caplan and Zach Weinersmith both return to the podcast to discuss their new, non-fiction graphic novel, Open Borders: The Science and Ethics of Immigration.
Related episodes: Emerging technologies with Zach and Kelly Weinersmith The case against education with Bryan Caplan Refugee waves, mass immigration, and Jordan with Alex Nowrasteh and Andrew Forrester Social media, elections, and gender with Fabio Rojas Sociology and social science with Fabio Rojas
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Sun, 13 October 2019
Today's guest is Jeffrey Rogers Hummel of San Jose State University. He is the author of Emancipating Slaves, Enslaving Free Men: A History of the American Civil War. This book combines a sweeping narrative of the Civil War with a bold new look at the war’s significance for American society. Professor Hummel sees the Civil War as America’s turning point: simultaneously the culmination and repudiation of the American revolution. Links: The Curious Task from the Institute for Liberal Studies; mentioned in the outro. |
Fri, 20 September 2019
Today's guests are economic historians Alan Olmstead and Paul Rhode. Both of them have research related to the slave economy of the Antebellum South. Our main topic is a paper they co-authored, Cotton, slavery, and the new history of capitalism. The "New History of Capitalism" grounds the rise of industrial capitalism on the production of raw cotton by American slaves. Recent works include Sven Beckert's Empire of Cotton, Walter Johnson's River of Dark Dreams, and Edward Baptist's The Half Has Never Been Told. All three authors mishandle historical evidence and mis-characterize important events in ways that affect their major interpretations on the nature of slavery, the workings of plantations, the importance of cotton and slavery in the broader economy, and the sources of the Industrial Revolution and world development. We discuss the problems with the New History of Capitalism literature and some alternative hypotheses suggested by the economic history literature. In their previous work on the subject, Olmstead and Rhode show "that a succession of new cotton varieties helped propel the rise in labor productivity and southern growth" (p. 7). Ed Baptist dubiously attributes this rise in productivity to torture. |
Thu, 12 September 2019
Phil Magness returns to the show to discuss his work on slavery and capitalism, particularly as it relates to the New History of Capitalism (NHC) and the New York Times' 1619 project. Phil recently wrote an article entitled, "How the 1619 Project Rehabilitates the 'King Cotton' Thesis." In it, he argues that the NHC has unwittingly adopted the same untenable economic arguments made by slaveowners in the antebellum South: that slave-picked cotton was "king" in the sense of being absolutely indispensable for the global economy during the industrial revolution.
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Sat, 7 September 2019
Today's guest is Thomas Hazlett, former chief economist of the FCC and author of The Political Spectrum: The Tumultuous Liberation of Wireless Technology, from Herbert Hoover to the Smartphone. Perceptive listeners may recall that Ed Lopez mentioned Hazlett's work in our interview on political change. Hazlett's work concerns the legal institutions surrounding the radio spectrum. Popular legend has it that before the Federal Radio Commission was established in 1927, the radio spectrum was in chaos, with broadcasting stations blasting powerful signals to drown out rivals. In this fascinating and entertaining history, Thomas Winslow Hazlett, a distinguished scholar in law and economics, debunks the idea that the U.S. government stepped in to impose necessary order. Instead, regulators blocked competition at the behest of incumbent interests and, for nearly a century, have suppressed innovation while quashing out-of-the-mainstream viewpoints. Hazlett details how spectrum officials produced a “vast wasteland” that they publicly criticized but privately protected. The story twists and turns, as farsighted visionaries—and the march of science—rise to challenge the old regime. Over decades, reforms to liberate the radio spectrum have generated explosive progress, ushering in the “smartphone revolution,” ubiquitous social media, and the amazing wireless world now emerging. Still, the author argues, the battle is not even half won.
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Fri, 30 August 2019
Today's guest is Robert Wright, author of The Poverty of Slavery. The New York Times' 1619 Project has prompted renewed discussions on slavery and the New History of Capitalism literature. This episode is the first in a series addressing these topics. We discuss the prevalence of slavery in the developing world today, the arguments for and against reparations, and the rent-seeking behaviour of slaveowners in the Antebellum South.
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Thu, 22 August 2019
Today's guest is Alain Bertaud, author of Order Without Design: How Markets Shape Cities. Alain discusses his extensive experience in urban planning: When he was first trained as a planner, urban planning was thought of as an offshoot of architecture. In this conception, cities are just large buildings that need to be laid out and designed by a skilled architect. Through his experience, Alain came around to thinking of cities not as large buildings to be designed, but as markets. He argues that planners are too focused on what happens on private property and not focused enough on what happens on public streets and roadways. He argues that urban economics has many useful insights for urban planners and that economists should be integrated into urban planning teams. The publisher's description of the book follows: Urban planning is a craft learned through practice. Planners make rapid decisions that have an immediate impact on the ground—the width of streets, the minimum size of land parcels, the heights of buildings. The language they use to describe their objectives is qualitative—“sustainable,” “livable,” “resilient”—often with no link to measurable outcomes. Urban economics, on the other hand, is a quantitative science, based on theories, models, and empirical evidence largely developed in academic settings. In this book, the eminent urban planner Alain Bertaud argues that applying the theories of urban economics to the practice of urban planning would greatly improve both the productivity of cities and the welfare of urban citizens. |
Sat, 27 July 2019
Ben Powell joins the podcast today to discuss his new book, Socialism Sucks: Two Economists Drink Their Way Through the Unfree World, coauthored with Robert Lawson. The book is a combination of economic analysis and Anthony-Bourdain-style travel diary. Do We Have to Say It Again? Socialism Sucks! |
Thu, 18 July 2019
Today's guest is Edward J. Lopez of Western Carolina University. We discuss his book, Madmen, Intellectuals, and Academic Scribblers: The Economic Engine of Political Change, which was co-authored with Wayne Leighton. Does major political reform require a crisis? When do new ideas emerge in politics? How can one person make a difference? Links In the course of the conversation, Ed mentions Thomas Hazlett's work on the radio spectrum and Tina Rosenberg's discussion of Iranian kidney markets on Econtalk. |
Thu, 11 July 2019
Vincent Geloso returns to the podcast today to discuss his paper, "Markets for Rebellions? The Rebellions of 1837-38 in Lower Canada". The paper discusses the idea that political upheaval and even violent rebellion can be more likely in areas with a high degree of market access. In 1837-38, the British colonies of Upper and Lower Canada rebelled. The rebellion was most virulent in the latter of the two colonies. Historians have argued that economic consideration were marginal in explaining the causes of the rebellions. To make this claim, they argue that the areas that rebelled in Lower Canada were among the richest in the colony, and the least likely to be motivated by economic factors. In this paper, we use the census of 1831 and databases of rebellious events to question this claim. We argue that the rich areas were more prone to rebellion because they were where markets were most developed. These well-developed markets allowed for cheaper coordination of seditious elements while also increasing the wealth (i.e. the rent) over which to fight. |
Sun, 7 July 2019
Tooday's guest is Jennifer Murtazashvili of the University of Pittsburgh. We discuss her book, Informal Order and the State in Afghanistan. Despite vast efforts to build the state, profound political order in rural Afghanistan is maintained by self-governing, customary organizations. Informal Order and the State in Afghanistan explores the rules governing these organizations to explain why they can provide public goods. Instead of withering during decades of conflict, customary authority adapted to become more responsive and deliberative. Drawing on hundreds of interviews and observations from dozens of villages across Afghanistan, and statistical analysis of nationally representative surveys, Jennifer Brick Murtazashvili demonstrates that such authority enhances citizen support for democracy, enabling the rule of law by providing citizens with a bulwark of defence against predatory state officials. Contrary to conventional wisdom, it shows that 'traditional' order does not impede the development of the state because even the most independent-minded communities see a need for a central government - but question its effectiveness when it attempts to rule them directly and without substantive consultation. Our conversation dives deep into the modern history of Afghanistan, including its 1978 communist revolution and subsequent Soviet invasion. |
Fri, 28 June 2019
Today's guest is Randall Holcombe of Florida State University. Our discussion today focuses on his book, Political Capitalism: How Economic and Political Power Is Made and Maintained. Problems associated with cronyism, corporatism, and policies that favor the elite over the masses have received increasing attention in recent years. Political Capitalism explains that what people often view as the result of corruption and unethical behavior are symptoms of a distinct system of political economy. The symptoms of political capitalism are often viewed as the result of government intervention in a market economy, or as attributes of a capitalist economy itself. Randall G. Holcombe combines well-established theories in economics and the social sciences to show that political capitalism is not a mixed economy, or government intervention in a market economy, or some intermediate step between capitalism and socialism. After developing the economic theory of political capitalism, Holcombe goes on to explain how changes in political ideology have facilitated the growth of political capitalism, and what can be done to redirect public policy back toward the public interest. |
Fri, 21 June 2019
Today's guest is Arvind Panagariya of Columbia University. We discuss his book, Free Trade and Prosperity: How Openness Helps Developing Countries Grow Richer and Combat Poverty. Free Trade and Prosperity offers the first full-scale defense of pro-free-trade policies with developing countries at its center. Arvind Panagariya, a professor at Columbia University and former top economic advisor to the government of India, supplies a historically informed analysis of many longstanding but flawed arguments for protection. He starts with an insightful overview of the positive case for free trade, and then closely examines the various contentions of protectionists. One protectionist argument is that "infant" industries need time to grow and become competitive, and thus should be sheltered. Other arguments are that emerging markets are especially prone to coordination failures, they are in need of diversification of their production structures, and they suffer from market imperfections. The panoply of protectionist arguments, including those for import substitution industrialization, fails when subject to close logical and empirical scrutiny.
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Sun, 9 June 2019
Today's guest is Robert Krol of California State University. Our topic is a recent policy paper he wrote for The Center for Growth and Opportunity at Utah State University entitled Can we Build our way out of Urban Traffic Congestion? This paper examines the impact of highway expansion on congestion. Because highway expansion lowers travel times, expanded highways attract additional vehicle traffic—so-called induced travel. The empirical evidence indicates that the magnitude of induced travel is economically significant. Some researchers find cases where, despite highway expansion, congestion changes very little owing to high levels of induced travel. These results suggest that costly highway expansion will increase access, which is beneficial to a community, but highway expansion is generally an inefficient solution to the high time costs of urban congestion. Instead, variable tolling of some or all lanes could manage traffic flows efficiently and reduce congestion.
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Sun, 12 May 2019
Today's guest is Vlad Tarko of Dickinson College. We discuss the life and work of Elinor Ostrom, the 2009 winner of the Nobel Prize in economics. Vlad is the author of Elinor Ostrom: An intellectual biography. We discuss Elinor Ostrom's work on polycentric governance, the management of common-pool resources, and policing. We also discuss the continuing work scholars are doing in this research area, including Vlad's new book Public Governance and the Classical-Liberal Perspective: Political Economy Foundations co-authored with Paul Dragos Aligica and Pete Boettke.
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Sun, 14 April 2019
My guest today is Matthew Curtis, founder of the startup Vice Lotteries. Vice Lotteries is a new startup that aims to challenge state governments' legal monopolies over lotteries. State lotteries are amazingly and bizarrely unethical. They drain billions of dollars out of communities, primarily poor ones. Lottery spending has increased substantially over the past decades, with the average lotto player spending $600 per year, and many spending significantly more than that. Vice Lotteries aims to create a more ethical alternative to state lotteries, allowing people to have the fun of gambling without losing significant amounts of money. From the Vice Lotteries website: Vice Lotteries was founded with one purpose: Allow our customers to enjoy gambling while saving money. With Vice Lotteries, you can enjoy the tremendous pleasure of tossing the dice without losing your ability to afford all the other things in life that you love. However, it is currently illegal to run a private lottery. Before Vice Lotteries can start operating, they need to win one of the multiple lawsuits they are filing in state courts to challenge state lotteries.
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Thu, 4 April 2019
Today's guest is Jamin Speer of the University of Memphis. We discuss his paper, "Are Changes of Major Major Changes? The Roles of Grades, Gender, and Preferences in College Major Switching" co-authored with Carmen Astorne-Figari. The choice of college major is a key stage in the career search, and over a third of college students switch majors at least once. We provide the first comprehensive analysis of major switching, looking at the patterns of switching in both academic and non-academic dimensions. Low grades signal academic mismatch and predict switching majors - and the lower the grades, the larger the switch in terms of course content. Surprisingly, these switches do not improve students’ grades. When students switch majors, they switch to majors that "look like them": females to female-heavy majors, and so on. Lower-ability women flee competitive majors at high rates, while men and higher-ability women are undeterred. Women are far more likely to leave STEM fields for majors that are less competitive – but still somewhat science-intensive – suggesting that leaving STEM may be more about fleeing the "culture" of STEM majors than fleeing science and math. Links Jamin's Twitter thread about the paper Niederle and Vesterlund's paper on gender differences in competitiveness Neal's paper on job mobility featuring the following quote mentioned in the episode: "To the extent that college provides an opportunity for premarket search over potential careers, this result [of fewer career changes among college graduates] is to be expected." (p. 250) |
Sun, 17 March 2019
Kevin Erdmann of the Mercatus Center returns to the podcast to discuss his new book, Shut Out: How a Housing Shortage Caused the Great Recession and Crippled Our Economy. From the publisher's website: The United States suffers from a shortage of well-placed homes. This was true even at the peak of the housing boom in 2005. Using a broad array of evidence on housing inflation, income, migration, homeownership trends, and international comparisons, Shut Out demonstrates that high home prices have been largely caused by the constrained housing supply in a handful of magnet cities leading the new economy. Links: My previous interview with Kevin, from 2017 Kevin's policy brief for Mercatus, arguing that housing was undersupplied during the so-called "housing bubble" Kevin's blog, Idiosyncratic Whisk
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Sun, 17 February 2019
Today's guest on Economics Detective Radio is Anja Shortland of King's College London, discussing her new book Kidnap: Inside the Ransom Business, where she brings an economist's perspective to the shady world of the kidnapping for ransom business and to the professionals who specialize in getting hostages home safely. The book's description reads as follows: Kidnap for ransom is a lucrative but tricky business. Millions of people live, travel, and work in areas with significant kidnap risks, yet kidnaps of foreign workers, local VIPs, and tourists are surprisingly rare and the vast majority of abductions are peacefully resolved - often for remarkably low ransoms. In fact, the market for hostages is so well ordered that the crime is insurable. This is a puzzle: ransoming a hostage is the world's most precarious trade. What would be the "right" price for your loved one - and can you avoid putting others at risk by paying it? What prevents criminals from maltreating hostages? How do you (safely) pay a ransom? And why would kidnappers release a potential future witness after receiving their money?
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Fri, 8 February 2019
Mark Thornton returns to the podcast to discuss his new book The Skyscraper Curse (available digitally for free). The book discusses the connection between record-setting skyscrapers and economic recessions. Here's an excerpt from the book's introduction: The Skyscraper Index expresses the strange relationship between the building of the world’s tallest skyscraper and the onset of a major economic crisis. This relationship only came to light in 1999 when research analyst Andrew Lawrence published a report noting the odd connection between record-height buildings and noteworthy economic crises — that is, the skyscraper curse, a relationship that dated back nearly a century. Without a theory to support it, journalists largely dismissed Lawrence’s report as the fun story of the day. Mark relates these skyscrapers to the Austrian Business Cycle Theory (ABCT). He shows how record-setting skyscrapers and recessions can be caused by a common factor: excessively cheap credit. We discuss this theory in the interview.
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Sun, 27 January 2019
Today's guest is Louis Rouanet from George Mason University. Our discussion focuses on an economic history paper he co-authored with Ennio Piano (a previous guest of the show), "Filling the Ranks: The Remplacement Militaire in Post-Revolutionary France." Many economists have analyzed the efficiency of a volunteered army relative to a conscripted army. However, they have rarely studied the working of real-world alternative, market-based, military institutions where military obligations are traded among the citizens. This paper fills this gap by studying the rise and fall of the Remplacement Militaire in 18th and 19th century France. This system endured for more than three-quarters of a century until the French government progressively moved toward universal conscription after 1872. We explain why, as the proportion of men drafted increased, the State systematically restricted the trade of military obligations.
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Fri, 18 January 2019
Today's guest is economic historian Gregory Clark, and our topic is England's New Poor Law of 1834. Gregory and his co-author, Marianne E. Page, wrote a paper on the topic entitled "Welfare reform, 1834: Did the New Poor Law in England produce significant economic gains?" Spoiler alert: It didn't. The English Old Poor Law, which before 1834 provided welfare to the elderly, children, the improvident, and the unfortunate, was a bête noire of the new discipline of Political Economy. Smith, Bentham, Malthus, and Ricardo all claimed it created significant social costs and increased rather than reduced poverty. The Poor Law Amendment Act of 1834, drafted by Political Economists, cuts payments sharply. Because local rules on eligibility and provision varied greatly before the 1834 reform, we can estimate the social costs of the extensive welfare provision of the Old Poor Law. Surprisingly there is no evidence of any of the alleged social costs that prompted the harsh treatment of the poor after 1834. Political economy, it seems, was born in sin.
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Sat, 12 January 2019
Today's guest is Mikayla Novak (Twitter, SSRN) of the RMIT Blockchain Innovation Hub at RMIT University. Her work focuses on some innovative new and potential uses for blockchain technology. As we all know at this point, the first use of blockchain technology was to create decentralized digital currencies like Bitcoin and Ethereum. But a blockchain is a much more general technology than this: it is a decentralized ledger that is resistant to tampering by any one individual. As such, it is a technical innovation that can allow us to coordinate activities that a lack of trust may have prevented otherwise. Mikayla discusses institutional cryptoeconomics, an emerging field of research centered on the ways blockchain technology can improve both private and public institutions. Links Mikayla's Medium article on Crypto Fiscal Federalism discusses how blockchain could make the system of making government grants more transparent and efficient. This article by Mikayla's colleagues at RMIT gives a detailed and accessible introduction to institutional cryptoeconomics. |
Sat, 5 January 2019
Today's guest is Martin Gurri (Twitter, blog), author of The Revolt of the Public. We discuss his book, which deals with the impact of information technology on political trends and populism. In the words of economist and scholar Arnold Kling, “Martin Gurri saw it coming.” Technology has categorically reversed the information balance of power between the public and the elites who manage the great hierarchical institutions of the industrial age—government, political parties, the media. The Revolt of the Public tells the story of how insurgencies, enabled by digital devices and a vast information sphere, have mobilized millions of ordinary people around the world. Originally published in 2014, this updated edition of The Revolt of the Public includes an extensive analysis of Donald Trump’s improbable rise to the presidency and the electoral triumphs of “Brexit” and concludes with a speculative look forward, pondering whether the current elite class can bring about a reformation of the democratic process, and whether new organizing principles, adapted to a digital world, can arise out of the present political turbulence.
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