A dollar is a dollar? What economists don’t get about indirect programs

[EDIT. I am no longer satisfied with my treatment of Ng's argument. It is perhaps not wrong as such, but it is like taking a 2 dimensional slice of a three dimensional object. I have ignored much of what is subtle and interesting in his take. I will leave this essay up though for two … Continue reading A dollar is a dollar? What economists don’t get about indirect programs

Against Kaldor-Hicks, or an ethical weight of zero on distributional concerns is still an ethical weight.

Definition of a Kaldor-Hicks improvement & efficiency  The notion of a Kaldor-Hicks improvement is a way of evaluating policies. As we shall see, it is a very bad one. A change is a Kaldor-Hicks improvement if and only if: A) It is a Pareto improvement (at least one party wins and no parties lose) OR … Continue reading Against Kaldor-Hicks, or an ethical weight of zero on distributional concerns is still an ethical weight.

GDP undervalues government services

I. Gross domestic product can be calculated in many ways, but one of the most common is: (Government expenditure)+(Consumption)+(Investment)+((Exports)-(Imports)) To see why government expenditure is under-counted consider two countries, one of which provides all of its health care through the public sector, the other through the private sector. In the latter case, health care is … Continue reading GDP undervalues government services

Jeff Beezos absolutely could afford to pay his employees much better

You occasionally see arguments that, while CEO's are spectacularly rich, those riches are drop in the ocean compared to the quantum that would be required to give a real pay rise to workers. Of course the main reply here is that CEO's are emblematic of a whole bunch of people who are overpaid relative to … Continue reading Jeff Beezos absolutely could afford to pay his employees much better

The Heritage Foundation Economic Freedom Index is bad

TLDR: The problem with freedom indexes is this. They are aggregates of separate variables, some of which indicate small government, others of which indicate what would uncontroversially be regarded as ‘good government’. It is the good government indicators, not the small government indicators, which actually correlate with GDP per capita- the measure that the Heritage … Continue reading The Heritage Foundation Economic Freedom Index is bad

Muh research budgets: Against a disingenuous defence of big pharma

Americans pay vastly more for many drugs than other countries. There are probably many causes of this, but one is the refusal of the federal government to collectively bargain about prices with pharmaceutical companies, unlike many other countries. The right wing defends this state of affairs with the following argument- these higher prices allow drug … Continue reading Muh research budgets: Against a disingenuous defence of big pharma

Delayed Impact of Fair Machine Learning: A response

Lydia T. Liu, Sarah Dean, Esther Rolf, Max Simchowitz and Moritz Hardt in “Delayed Impact of Fair Machine Learning” rightly make the point that in considering notions of fairness, it is critical that we consider them dynamically in terms of their long-term effects on a population, and not just statically. They argue that seemingly attractive and fair … Continue reading Delayed Impact of Fair Machine Learning: A response