Bridging the achievement gap

Los Angeles Times opinion editorial "Bridging the achievement gap" (September 22nd, 2010) discusses the achievement gap between black males and all other students (black females and white males being the primary groups of comparison). It speaks only of educational means to fix the graduation gap, while discussing crime. Corrections would like to entertain a different possibility that might help solve both. The Times also confuses correlation and causation.

These disparities aren't new — the Schott report could have been published a generation ago. What is new and noteworthy is solid evidence that this gap can be bridged, with well-tested approaches that don't require massive changes in public education and don't depend on superhero teachers and administrators.

An economic idea might be that individuals, both black and white, make decisions about education today based on what they believe their income differentials will be tomorrow. One way to encourage education is to ensure higher wages for the educated. Another is to ensure lower wages for the uneducated.

The Times suggests that some of these students might be on the "prison track." "All too often they're on what educators privately dub 'the prison track.'"

If the Times is concerned that black males (or, for that matter, individuals of any race or gender) are opting out of educations and into lives of crime, one way of reducing their involvement in crime and increasing their graduation rates might be to lower their future wages as criminals.

We do a quick back-of-the-envelope calculation to test this hypothesis. We should see a correlation between an increase in law enforcement officers tomorrow and an increase in graduation rates. For the 50 states from 1998-2003, we plot the two, and offer a fitted least squares line. This is displayed graphically below (click to enlarge).
The relationship is indeed positive, which is itself phenomenal. If high schoolers were myopic and unresponsive to future police presence, we would have expected a drop in graduation rates to result in an increase in police next period--an increase in bad high school students should make more police next period a necessity. The fact that we see this indicates that the difference between our two effects is rather large. At a first glance, while the relationship is only near significant, it would appear tantalizing. For those concerned about the outliers, the relationship remains positive dropping them from a fixed effects panel data regression.

The Times discusses young black males, their graduation rates, and crime. Following our above analysis, we might think that a way to increase the graduation rates of young black males (who head into crime at higher rates than young white men or young black women) might be to decrease their wage differential between crime and legitimate employment through the hiring of more law enforcement officials over the course of several years. This would have the added effect of decreasing crime. Indeed, if individuals are forward looking and we have a believable commitment mechanism, we needn't wait to see the effects.

Clearly the analysis Corrections provides is both preliminary and inconclusive--it is merely suggestive. Nevertheless, it offers an interesting avenue to improve education by rational forward-looking individuals of all races and genders.

Beyond this discussion of heterogeneous impacts by race of an increase in future police presence on future crime and graduation rates, we might also add a particularly offensive quote by the Times:

A large-scale study in Chicago found that 74% of the boys who attended preschool graduated from high school, compared with 57% of those who didn't.

This is a correlation. It is not clearly causal.

A Legislature of far too little impact

Los Angeles TImes editorial "A Legislature of far too little impact" (September 5th, 2010) neglects the economic idea that an inefficient government may be desirable.

Unfortunately, those successes must be regarded as exceptions. Smart and important legislation, much of it propelled by substantial public support, fell by the wayside in the final days. Indeed, what is most notable about the recently concluded session is not the little bit of good policy the Legislature made but the great deal that it did not. Not to mention the bad bills it passed.

At first glance, it would appear that an increase in efficiency of government would always be pareto improving. However, it may be that an inefficient government is desirable for some.

Specifically, one might see increased government activity as a long-term drain on growth. If, as Rothbard put it, "the State is nothing more nor less than a bandit gang writ large", then we might consider the societal implications for that band being more efficient (they are better able to steal). In this sense, it may be desirous for us to constrain government to only support inefficient programs.

The Law of Demand holds: if something is more expensive, people will buy less of it. In this case, increasing the price of government makes us demand less of it. This, in turn, helps to maximize freedom. This point would hold for consequentialist libertarians, for instance, who might view any government action as more likely to be from an interest group looking to transfer money from the general public using the government, than out of a real interest of a populace.

Where else might this apply?  Deontological libertarians recognize that behind every state action is the barrel of a gun, to put it bluntly.  Take a parking ticket--it wouldn't seem that a firearm is behind one.  However, if one foregoes payment, either a violation warrant may be issued, at which point at any time a man with a firearm (police officer) may go to your home and arrest you by force.  Alternatively, you may simply run the risk of being arrested (through the use of force) the next time you are pulled over.  The only power The Law has is violence and the threat of violence.  

Deontological libertarians further believe that this initiation of the use of force is wrong.  Consequentialist libertarians have no such issue with the initiations of the use of force.  These libertarians support liberty because they see it as bringing about desirable conditions.  Therefore, a politically savvy Deontological libertarian might desire to make large government inefficient so Consequentialst libertarians essentially adopt all Deontological positions.

Corrections concludes that a government that efficiently takes and spends resources is not necessarily desirable due to these economic concerns.  Indeed, we have indicated that for reasons of political economy, some groups may even desire to make it less efficient to manipulate other groups to the adoption of similar positions.

Why California should just say no to Prop. 19

LA Times OpEd "Why California should just say no to Prop. 19" (August 25th, 2010) deceives readers.

A 2004 meta-analysis published in the journal Drug and Alcohol Review of studies conducted in several localities showed that between 4% and 14% of drivers who sustained injuries or died in traffic accidents tested positive for delta-9-tetrahydrocannabinol, or THC, the active ingredient in marijuana. Because marijuana negatively affects drivers' judgment, motor skills and reaction time, it stands to reason that legalizing marijuana would lead to more accidents and fatalities involving drivers under its influence.

The meta-analysis the article mentions is called "A review of drug use and driving: epidemiology, impairment, risk factors and risk perceptions" in the Drug and Alcohol Review Volume 23, Issue 3 by Erin Kelly, Shane Darke and Joanne Ross, and is available here (gated). The analysis notes explicitly that, "There is inconsistent evidence regarding the impairing effects of cannabis in field studies." It lists four field studies and notes that three of them indicate no significant impact of cannabis consumption on driving. The article concludes, "the relationship between between THC and street driving performance is equivocal." Any reader inclined towards believing what the data is telling them, rather than what they wish they could find, would conclude not that "legalizing marijuana would lead to more accidents and fatalities involving drivers under its influence", as the LA Times piece has, but rather that we shouldn't expect legalizing marijuana to change the number of accidents and fatalities. The OpEd's conclusion is ridiculous and unsupported by the evidence they themselves cite.

In addition the the egregious error discussed above, the article also provides readers with a foolish analysis of negative externalities.

The current healthcare and criminal justice costs associated with alcohol and tobacco far surpass the tax revenue they generate, and very little of the taxes collected on these substances is contributed to offsetting their substantial social and health costs. For every dollar society collects in taxes on alcohol, for example, we end up spending eight more in social costs. That is hardly a recipe for fiscal health.

This analysis implies that the pleasure people get from drinking is worthless. Drinkers and non-drinkers alike deserve to have their utility taken into account when analyzing the costs and benefits of a liquor tax. Basic economic theory would tell us that social surplus is maximized when the marginal social cost of drinking equals the marginal social benefit of drinking. If we are counting drinkers as members of society, then it follows that some level of drinking is optimal. The figure below demonstrates how a pigouvian tax allows us to arrive at the optimal social level of alcohol consumption (click here to enlarge).

In equilibrium, the level of the tax just measures the difference between marginal private cost (cost of drinking to drinkers) and marginal social cost (cost of drinking to society, including alcohol-related externalities). Taxes on goods with externalities are meant to regulate consumption to socially optimal levels. As in the figure above, it is possible to draw social and private cost curves that yield the result discussed in the article--tax revenue is one eighth the area between social cost and private cost curves. The red shaded area represents the tax revenue and the blue shaded area represents the difference between social and private cost. This is a socially optimal (but not necessarily revenue maximizing) tax.

Don't scorn Germany and Japan; learn from them

Los Angeles Times article "Don't scorn Germany and Japan; learn from them" (July 29th, 2010) offers a truly unbelievable statement.

Japan's economy has been and remains successful. So is Germany's. They have reached an economic steady state in which they don't need roaring growth rates to provide for their people.

This is, perhaps, the most dense quote that Corrections has yet reiterated. Not only is it not true, but it throws to the wind the most important idea that economics has to teach us in the macroeconomic realm: only growth matters. Indeed, as Robert Lucas put it well:

Is there some action a government of India could take that would lead the Indian economy to grow like Indonesia’s or Egypt’s? If so, what, exactly? If not, what is it about the “nature of India” that makes it so? The consequences for human welfare involved in questions like these are simply staggering: Once one starts to think about them, it is hard to think about anything else.

Why is economic growth so important? Yearly GDP growth rates seem to range, generally speaking, between 2% and 6%. Is there any real significance between one and the other? The answer is best introduced with a bar graph of compounded (not simple average, but compound-average) growth rates from a few selected countries from 1988-2008 (click to enlarge):



To understand why these differences are large, take Afghanistan in 1960. It had a GDP/capita that was 4.73% that of the United States's GDP/capita. How many years would it take Afghanistan then to catch up with the United States in 1960 using different growth rates? (To account for population growth, population growth would need to be subtracted from GDP growth, unnecessary to the point here). The number of years required using each country's growth rate is graphed below (click to enlarge).



Similarly, if we wanted to see how many years it would take for Afghanistan in 1960 to catch up to the United States GDP/capita in 2008, we can plot the same graph:



The difference between the author's lauded Japanese growth and a high-growth country like China, Ireland, or South Korea is the difference between Afghanisan transversing from what it was in 1960 to what the United States is today, in a generation, rather than as a long-term joke. The above figures make it obvious how important economic growth is, due to its exponential nature.

As an aside, the notion of Germany and Japan being at a "steady states" is simply first-tier ignorance, an article more worthy of Pravda in the 1960's than the Los Angeles Times today.

LeBron James: True to his generation

LA Times OpEd "LeBron James: True to his generation" (July 13th, 2010) suggests that young workers are more mobile than older workers. Apparently, this all has to do with generational-characteristics, not economics.

If younger workers have displayed anything as employees, it's that they prize mobility more than they do fidelity to their employers.

"Stability and company loyalty are high values for . . . those whose worldviews were shaped by experiencing the Great Depression in their formative years," Chip Espinoza, Mick Ukleja and Craig Rusch write in their new book, "Managing the Millennials." "But the work world has changed."

At all ages, workers seek to find a job at which they can earn the highest wage, and employers seek the best workers. Since it is not possible to know one's productivity perfectly before actually working at a particular job, workers will not necessarily find their best job immediately, and will continue to look for jobs until they find the one that they believe suits them best. Hopefully, by the time they are 50 all workers will have found their best job.

In addition, unlike their older counterparts, young workers sometimes are building their human capital while working. For example, they may be enrolled in a part time business school. When they are done, the will be able to find a better job. This move has nothing to do with "disloyalty," since firms rarely have higher-level positions ready and waiting for such workers.

The notion that young workers should stay put is completely out of equilibrium, and would likely only occur when productivity differences and wage differences between jobs were trivially small. In the current job market, this is not the case.

Farm Work should be an honored, palatable job for Americans

Los Angeles Times article "Farm Work should be an honored, palatable job for Americans" (July 10th, 2010) bemoans the decline in wages for farm workers but completely ignores the economics behind these fluctuations.

By 1981, the contract provided about double minimum wage, at which point we were probably the best-compensated grape pickers in the world. We had paid holidays, and for high-seniority workers, two weeks' paid vacation; disability and unemployment insurance; family medical insurance (with 60 hours of work or more in a month); even a modest pension plan. The Coachella Valley had a UFW medical clinic for the workers and their families, and a legal aid center to help with taxes, Social Security and other issues.

The legacy of David Freedman Co. under the UFW contract is one all Americans can be proud of. It is proof that American agriculture does not have to be based on the labor of an underclass denied the rights and benefits of other workers.

Sadly, only one UFW contract remains in the Coachella Valley, and wages and benefits are not as generous as they were 25 years ago.

In fact, wages in these competitive markets are not set by the sentiments of Americans, but rather by market forces. For example, if demand for produce increased, then firms would want to increase their production. However, most farmers were likely constrained in their ability to purchase more capital (farm equipment) and so were only able to increase their demand for farm labor. This caused an increase in farm worker wages.

Again, the reason that wages increased by as much as they did may simply have been that in the short run, capital is inelastic. In the long run, it is perfectly elastic. Thus, the long-run rise in wages would be heavily mediated by substitution into high capital-share production.

Financial reform: Who's happy, who isn't and why

Los Angeles Times article "Financial reform: Who's happy, who isn't and why" (June 26th, 2010) writes an article on one of the two major parties who will be hurt by financial reform, if it passes. The article speaks at length of how banks will be harmed. It does not, however, note that the individuals who lose the most due to financial regulation are likely to be low-income borrowers.

'This is a landmark, a true inflection point,' said Calhoun, president of the Center for Responsible Lending in North Carolina.

Since the mid-1970s, Calhoun has been pushing to get an agency that would look out for consumers' interests.

If one takes the typical narrative, shark-like banks waited in the wings for naïve, impoverished individuals, in order to get them to take out a loan they could not possibly repay to the bank. The bank would then work through months or years of foreclosure hearings to get a house worth less than the value of the loan, while individuals are living in a house they could not have otherwise afforded, and often never having to repay their loans, having declared bankruptcy.

This, of course, is a political narrative rather than a sensible one. It remains that some of the individuals who have benefitted the most from poor bank lending practices are the very people banks are accused of acting in a predatory manner towards (by giving them free housing for a period).

Financial reform seeks to end this relationship between the poor and banks that would lend them money for "unaffordable mortgages." Because Corrections does not see a paternalistic master-slave relationship between government and the poor as beneficial to the poor, we see this sort of legislation as hurting the people it claims to help, a party that shouldn't be happy, though the Los Angeles Times does not take note of these poor.

A smart bill to fight smoking

Los Angeles Times editorial "A smart bill to fight smoking" (June 22nd, 2010) offers another endorsement of another paternalistic bill that would increase deadweight loss in society. Specifically, it advocates the coverage of anti-smoking programs. It offers two ludicrous claims.

Some people might object that smokers choose their unhealthful habit. But since insurance covers the cancer and emphysema that result from cigarette use, it makes sense to help smokers when they decide to quit.

We should note that the above statement, while sounding innocuous, has an unintended consequence: it makes becoming addicted less costly. Corrections conjectures some subset of people who do not smoke, or try drugs such as heroin, because they fear the consequences of becoming addicted. If cigarettes were no longer addictive, then the cost of becoming addicted would be lifted, and we would observe more smoking from this crowd. Whether or not it is larger than the number of people who would stop smoking is an empirical question. Obviously, an insurance program serves the same purpose.

We can discuss whether or not more people being able to smoke would be a good thing--Corrections posits that if it were, then competitive insurance companies or cigarette companies would be willing to set such a thing up, and therefore our system is clearly less efficient, but the point is tangential.

We should further add another point the Times offers that is empirically contentious.

Less smoking means less chance of catastrophic illnesses that are much more expensive to cover; lower rates of disabilities that taxpayers end up footing the bill for; less secondhand smoke; and even less litter.

The first claim, that less smoking means lower insurance is unclear. Indeed, for the people who would quit because of the lower premiums, we should have seen them already quit, if insurance companies can discriminate on smoking behavior--this would therefore make the statement of the Times patently untrue. People who smoke also die younger and more quickly, and the costs/benefits to society appear to be a wash (for example, they pay to social security but do not collect as much as were they a nonsmoker).

We should finally add that such coverage is not free. Individuals will have to pay for it. The Times appears to pretend that by requiring insurance companies to pay for these new treatments, they are somehow "free" to consumers. Prices will rise, and there is no such thing as a free lunch.

Corrections recognizes that the set of benevolent or honest paternalists is zero--if Rothbard noted that government was "a band of thieves writ large," we would be benefitted by noting that paternalists are, to coin a phrase, "slavemasters with a smile." In articles such as this, the Times earns its paternalist credentials.

The gulf tragedy doesn't negate the fact that oil is a green fuel

Los Angeles Times editorial "The gulf tragedy doesn't negate the fact that oil is a green fuel" (June 15th, 2010) suggests that ethanol production causes more expensive food. Whether or not this is true isn't immediately clear to Corrections.

Ethanol production steals precious land to produce inefficient fuel inefficiently (making food more scarce and expensive for the poor).

An increase in the demand for ethanol likely an increase in the demand for, example, corn. Normally, one might associate an increase in demand for corn with an increase in the price for corn. However, if the supply of corn is perfectly elastic, we should expect that price will not rise. This situation is depicted graphically below (click to enlarge).



The idea of the above diagram is as follows: corn is supplied and sold to the highest bidder. If we are to have corn going to both corn feed and to ethanol production, then the prices must be the same--otherwise a corn producer would sell it to the higher bidder--law of one price holds. Therefore, price is set by combined demands and corn supply--price is projected back to individual demands and determines quantity.

This assumption as a long-term assumption is not necessarily absurd. We might add that productivity growth is endogenous and inputs into agricultural production have not risen over the last 60 years, while output has risen 150% (it is 250% of what it was in 1948, for the same inputs). We imagine that not only might land use be easy to scale, so might productivity. Data from the USDA on output, productivity, and inputs are displayed in the figure below (click to enlarge).

Men should exercise to improve sex life

LA Times article "Men should exercise to improve sex life" (May 31st, 2010) notes a study that finds

Men who exercised had significantly higher scores on a sexual-function questionnaire compared with men who were sedentary, according to a study released Monday at the annual meeting of the American Urological Assn.

The article then makes the causal claim implied in its title. Of course, the relationship (that more exercise implies better sex life) may be inverted. Perhaps it is true that men who have greater utility from their sex life are willing to pay more to maintain that sex life. This will, among other things, cause these men to exercise more, improving their appearance to the opposite sex (and so increasing the amount of sex they have). In addition, it may be that more virile men have both better sex and are pre-disposed to exercise more. Fundamentally, the article gives us no reason to exclude either reverse-causality or a correlation caused by an unobserved third factor as responsible for the relationship reported between sex and exercise. Nonetheless, the article suggests in its title that people change their lives in way fundamentally rooted in a rejection of these possibilities.

America's 'casualty gap'

Los Angeles Times opinion editorial "America's 'casualty gap'" (May 28th, 2010) reports the difference between the percentage of total wartime casualties suffered by members of poor communities relative to members of rich communities.

Nationally, in the Korean, Vietnam and Iraq wars, communities in the lowest three income deciles suffered 35%, 36% and 38% of the casualties, respectively. Yet communities in the top three income deciles sustained significantly fewer casualties — 25%, 26% and 23% of the casualties, respectively.

The United States has a volunteer army. Soldiers are compensated by regular pay, hazard pay, enlistment bonuses, government benefits, and well-earned gratitude from present and future generations. When the United States has a volunteer army, which it has since December 1972, the last month in which an individual was conscripted into the U.S. Armed Forces, it is an exercise in futility to argue any sort of discrimination. Individuals freely choose the Armed Services over their other options. They further choose their branch of service, as well as their military occupational specialty, generally speaking. If poorer people choose the military, it would appear, in a rough analysis, that they are benefitting more from its presence.

This may be especially true during wartime. Corrections cobbled together military pay for E-2 (an enlisted pay-grade corresponding to a Private in the Army, PFC in the Marine Corps, Airman in the Air Force, and Seaman Apprentice in the Navy and Coast Guard. It is a pay grade relatively rapidly achieved for enlisted men. Military pay sheets for every year were not easily available. Corrections imputed pay for those years in which it is not, denoted by a circle. Years featuring a war in which more than one-hundred Americans died (as well as the first three years of Operation Enduring Freedom, in which fewer than 100 Americans died) are denoted in red, while years without such a conflict are denoted in blue. It appears to Corrections, generally speaking, that post-draft wartime has caused more rapid increases in inflation-adjusted military pay. Therefore, it is difficult to discern without more careful calculus whether or not individuals are being compensated for the risks they are taking--with heterogeneous valuations, we might expect wartime military service to be better for poorer Americans who choose to serve, rather than worse. Our data is displayed graphically below (click to enlarge).

We note the sharp spike in pay occurred when Richard Nixon was engaged with the idea of an all-volunteer army.

Corrections should further add that including Operation Enduring Freedom, Operation Iraqi Freedom and Operation New Dawn in their analysis, without including the enrollment, average length of service, and rate of ascent figures for each income decile is egregiously misleading. In fact, both the lower class and the upper class are underrepresented in enrollment--this article's analysis would suggest that the middle class suffers disproportionately the costs of war.

In addition, a low-income recruit may not be identical to a high-income recruit, making it difficult to compare their wartime outcomes directly. For example, it is well known that income is correlated with education. If the army recruits more "high-quality" soldiers from higher income brackets, then we would expect these "high-quality" recruits to more quickly achieve higher and higher military rank, making them potentially less likely to be in the line of fire than their low quality counterparts. In this sense the article may be taking issue with the fact that more intelligent soldiers are less likely to die in battle. Similarly, if the poor serve longer than the rich, these statistics could be driven by the relative density of poor servicemen. Ultimately, the number of confounds in this analysis make it completely incredible.

Child mortality rates dropping, study finds, but U.S. lags

LA Times article "Child mortality rates dropping, study finds, but U.S. lags" (May 24th, 2010) argues that

The U.S., which is projected to have 6.7 deaths per 1,000 children this year, saw a 42% decline in child mortality, a pace that is on par with Kazakhstan, Sierra Leone and Angola.

"There are an awful lot of people who think we have the best medical system in the world," said Dr. Christopher Murray, who directs the institute and is an author of the study. "The data is so contrary to that."

The statistic the article uses, however, does not speak to the quality of the medical system. The mortality rate equals the number of children who die divided by the number of children who are born. The number of children born very prematurely in the US has increased dramatically in the past twenty years, as we show in the graph below (click to enlarge).

In fact, the great improvements in delivering children who have a low survival rate may fight any improvements in lowering the mortality rate among more healthy children. The greater number of at-risk children delivered, the greater the mortality rate will be. Such success should not suggest a "lag" on the part of the US, and it may simply indicate that few at-risk children are born alive in other nations.

The propaganda campaign against Obama's tougher fuel economy rules

Los Angeles Times editorial "The propaganda campaign against Obama's tougher fuel economy rules" (May 26th, 2010) offers a diatribe in favor of higher fuel economy for cars. Within its arguments, it offers a pecuniary externality:

To recap the benefits of fuel economy: Consumers win by saving money on gas; public health improves because cars emit fewer toxic pollutants; the nation becomes less reliant on foreign oil; and greenhouse gas emissions drop.

The first is false. If the government imposes higher fuel economy, Corrections suggests that it is a fact of competition that they will lose more money/utility on their more expensive cars than they will on fuel economy. If a car company could produce cars that has savings that consumers want, then they could make money off it. The fact that car companies are not making it now indicates that the "saving money" argument is fallacious--were it worth it for consumers, the profit motive is there, and it would already be being done.

The starving can't wait

LA Times article "The starving can't wait" (May 19th, 2010) claims that

Although development experts need to address the global shortfalls in production, distribution problems and other underlying causes of famine, the immediate challenge always is to feed the hungry.

The short-term challenge of feeding the hungry may undermine long-term efforts to lead developing countries out of poverty. Foreign aid combined with corruption keeps poor systems of governance in place. It appears a significant portion of foreign aid ends up being subsidies for corruption and oppression. For example, Jakob Svensson and Ritva Reinikka's 2004 Quarterly Journal of Economics paper "Local Capture: Evidence From a Central Government Transfer Program in Uganda" finds that only 13 percent of grants for schools were actually spent on schools--most schools received no grant money. Foreign aid easily can hurt populations as often as help them.

Warm, and getting warmer

LA Times editorial "Warm, and getting warmer" April 22nd, 2010 argues that the governments of India and China need to set up regulation against carbon emissions in order to protect their peasant populations who would not be able to migrate if the world temperature significantly increased. However, it is unclear whether regulation against global warming would help or hurt these peasants. The article states:

The peasant farming populations are not rich enough to simply adapt. So the first thing we need to do is to beg the rulers of China and India to understand their nations' long-term interest.

Suppose however that any environmental regulation decreased the value of the peasant's labor. Perhaps even the growth rate of the peasants' wealth would slow, and these citizens would find themselves far poorer in 30, 40, or 50 years (whenever global warming would have caught up to them--if ever) than they would have been had the government allowed them to freely invest in their future, even if that meant taking jobs at carbon emitting plants. The time-invariant image of peasantry that the article conjures belies a fundamental misconception: people, even peasants, tend to invest in their own future. Generally, they can do so better than the government.

A death penalty record

Los Angeles Times article "A death penalty record" (April 8th, 2010) appears to be in error. It claims that Los Angeles County is a "killer county." While Los Angeles has sentenced individuals to death, none of those individuals have actually been killed.

Los Angeles isn't the only killer county in California; death sentences were also up sharply in Orange and Riverside counties last year.

This is hyperbolic at best. Since 1976, California has executed 13 individuals. One of these individuals, executed in 1996, George Bonin, was given two death sentences (for different sets of victims) for ten separate murders by Orange County independently of his death sentence from Los Angeles County for four other murders. The other execution, taking place in 2005, was of Stanley Williams, convicted of murdering a store clerk laying prone, and separately murdering a family of three.

It does not appear that calling Los Angeles County a "killer county" for executing two men, over the course of the last 31 years that individuals have been executed in Post-Gregg, Post-Proposition 8 California, is appropriate. Given that the two men were responsible for eighteen murders between them, the attack by the Times on Los Angeles County's death penalty cases does not seem to warrant the comment, that in the context of an absence of complete certainty about murderer culpability, Los Angeles County is "inhumane."

Life span may be as wide as your smile

LA Times article "Life span may be as wide as your smile" (March 29th, 2010) makes the causal connection between smiling and longevity, among other things. Unfortunately the article doesn't note the fact that causality can run both ways, and giving people encouragement that smiling more will improve their lives may be quite misleading.

People who smile a lot are usually happier, have more stable personalities, more stable marriages, better cognitive skills and better interpersonal skills, according to research. Science has just uncovered another benefit of a happy face. People who have big smiles live longer.

Maybe being happy, having a more stable personality, having a more stable marriage, and better cognitive and interpersonal skills causes one to smile more. When we see a positive correlation between smiling and other measures of happiness, we should be careful not to infer that smiling more will cause improvements in other areas of our lives without evidence that this is the case. Science has not necessarily uncovered the benefit of having a happy face--people are likely happy for a reason.

California's quality-blind layoffs law harms teachers and students

Los Angeles Times article "California's quality-blind layoffs law harms teachers and students" (March 24th, 2010) while making a valid point, misunderstands optimal hiring practices. It suggests schools, rather than retaining teachers who have been employed the longest, should only keep the best teachers.

After all, if layoffs are unavoidable, you would think that it would be in the interest of everyone to keep the best teachers and cut those who are least effective.

Corrections agrees that length of tenure is suboptimal. However, only hiring the best is similarly suboptimal. While the problem of optimal hiring given a fixed budget and discretely heterogeneous population can take on the dimensions of a Knapsack Problem requiring a dynamic programming solution, Corrections suggests that the essence of the problem is quite simple: hire the best teachers per dollar, which may or may not be the best teachers.

Imagine there are six types of teachers, as displayed graphically below (click to enlarge). Teachers quality is denoted by number of boxes--teacher price and quality units per dollar are also displayed numerically. Then, let us say that we have $1260 dollars. We could hire 105 Type I Teachers, 140 Type II, 180 Type III, 252 Type IV, 420 Type V, or 1260 Type VI (we could also hire a combination of the teachers--our point is robust to allowing this). We would then get 630, 700, 728, 756, 840, or 1260 units of quality by hiring each type. We can see that we are best hiring the worst teachers, because they are the cheapest teachers per unit of quality. While the Times is correct that firing based on tenure is poor decision making, it is not correct that schools should hire the best teachers if they want the highest quality education possible.

Backing down on climate change

The LA Times recently ran an editorial called "Backing down on climate change" (February 5th, 2010) that claimed

No one really knows what would happen if average temperatures hit 5 C higher than 1850 -- a level we could easily reach within a century under a business-as-usual scenario -- but changes to the physical geography of the planet become probable: land masses would vanish; ecosystems would collapse. Human civilization would change, and not for the better.

Corrections would urge the author to credit the human race with some modicum of intelligence. It is unclear that a global climate change would harm civilization, as a whole. Afterall, the flood urged Noah to build the world's largest boat. Rational human beings will begin to invest increasingly in technology that will prevent serious climate change as soon a such change becomes worrisome. In fact, many have done so already. Assuming people discount the future, they may be willing, for some time, to put off trying to solve the global warming problem in favor of leisure activities or other types of invention. When demand for a solution becomes large enough, individuals will certainly shift their production toward climate innovation. Just because we currently see no social investment in the problem of global warming (beyond shopping in a special "organic" aisle at the grocery store), does not imply that such investment will not take place. Warning readers that "human civilization will change, and not for the better" is contingent on the same, ageless refrain "if current trends continue..."

Don't legalize marijuana

LA Times Opinion article entitled "Don't legalize marijuana" (January 28, 2010) misses one fundamental lesson on the subject of drug legalization: enough taxation can reduce marijuana consumption to current regulation levels.

Legalization almost certainly would bring with it additional substance abuse in the state, and the long-term public costs associated with that would vastly exceed the relatively modest amount of new revenue legal weed might bring in.

The economics of illegal goods weighs extremely heavily in favor of legalization and taxation rather than banning and enforcing, as Gary Becker, Kevin Murphy, and Michael Grossman outline in The Economic Theory of Illegal Goods: The Case of Drugs (NBER Working Paper, 1994).

Corrections would suggest that when marijuana is illegal, the government raises the cost of selling marijuana until production falls to the socially optimal quantity. This is a costly activity. Police must be hired, lawyers must be provided, and offenders must be jailed. The end result of all the government's expenditure is to raise price and reduce quantity consumed by the law of demand. However, legalizing marijuana and taxing its sale until the quantity demanded was reduced to the same socially optimal level as regulation would result in no change in marijuana consumption, by construction.

The graph below (click to enlarge) demonstrates the possible ways in which government can reduce marijuana consumption to its preferred point. Raising the cost of production and shifting the supply curve back is costly and loses consumer surplus. On the other hand, taxing marijuana use until consumption falls to Q_regulation results in government revenue that simply does not exist when marijuana is illegal. It is the difference between paying to destroy money and being paid to destroy it.

If the government seeks to regulate the quantity of marijuana consumed, it should choose to do so with a pricing mechanism such as taxation (from which it can earn revenue) rather than a ban (which is costly to enforce). The result is otherwise the same.

Corrections does note our a priori belief that demand will not shift out, or not shift out much, if drugs are legalized. We do not see the "stigma" of marijuana use as a major factor in utility inputs of extra-marginal users. We might further note that we see addiction arguments as lacking firm foundation in human behavior, as discussed in a previous post.