Friday, September 29, 2006

What's missing from this story?

Nigeria and Venezuela to Cut Oil Production

Two of the OPEC oil cartel’s 11 members, Nigeria and Venezuela, said today that they would voluntarily cut production in response to declining crude oil prices, which have fallen 20 percent from their peak two months ago.

The two most dysfunctional states in OPEC decide to "voluntarily" cut production and the reporter doesn’t even consider the possibility that they can’t meet their production quotas?

Saturday, September 23, 2006


Just bought my first "mango verde con sal". Apparently this is a regional thing for Ica as my Arequipeña enamorada said she'd never eaten unripe mango.

The fruit itself is very user friendly to eat. The vendor peals all the skin, slices the mango into three wedges and gives you a tiny bag with too much salt. The texture was super crisp and the flavor was sour, without any bitterness. Great snack food, but a bit messy if you don't carry wet-naps!

Friday, September 15, 2006

The spaghetti bowl problem

A few months ago Greg Mankiw worried about Democrat Ned Lamont's views on trade.

I responded by arguing that in int'l trade it was the big fish (WTO negotiations) that needed frying and to ignore distractions on the periphery:

I see that this is one of those issues that could make you (or any reasonable economist) lean towards the Republican position. But, I would take a careful look at the actual trade deals that have been passed since TPA was granted to GWB. They have opened up far fewer (and smaller) markets than the ones led by Clinton and the administration has put very little effort into promoting broader-based (WTO) trade agreements.

As someone concerned with international development, it is actually easy to see that the recent bilateral agreements (specifically US-Chile and US-Jordan which I am most familiar with) are far more lopsided in the number of remaining tariff restrictions than a multilateral agreement would be. Each country ends up negotiating to appease their own special interest groups and you end up with ~100 goods that are exempted from tariff reductions coming into the U.S. from a (very) small country like Chile.

So while the average Republican may be better than the average Democrat on trade, it looks like Clinton was far better than Bush on trade (and very possible that Gore could have been as well).

Well, today the International Herald Tribune Globalization Blog brings in heavy hitter Jagdish Bhagwati to back me up.

The money quote:
The architects of GATT, looking at the degeneration of the world trading system in the 1930’s into protectionism and discriminatory trade in the form of bilateral preferences, had vowed: Never again. They had made non-discrimination, and its embodiment in the Most Favored Nation clause (which guarantees to every member the lowest tariff by any member), the central principle of GATT. But they had allowed for an exception in the case of free trade areas (FTAs) and customs unions in Article 24. I am sure they thought this Article would be used rarely. But today, there are over 300 such FTAs formed or announced, and they are multiplying by the week! The culprits in this game were the Europeans. But the Americans, led by former United States Trade Representative Robert Zoellick, joined in actively. And now the Asians are busy doing their own bilaterals as well; there are elements of both “monkey see, monkey do” and tit-for-tat in what they are doing. But the whole world has practically collapsed into bilateralism which is driven by sloppy arguments and failure of leadership by the major powers such as the United States.

These Preferential Trade Agreements (PTAs), among other problems, have created a chaotic system of preferences. I have called it the “spaghetti bowl” problem since eating spaghetti makes a mess for my tie and shirt!

Thanks to the PSD Blog for the link.

Thursday, September 14, 2006

Define irony (or strategy)

¡Mira! Our president can't pronounce the word strategy and David Brooks does not understand the meaning of the word!
And the sad truth is, there has been a gap between Bush’s visions and the means his administration has devoted to realize them. And when tactics do not adjust to fit the strategy, then the strategy eventually gets diminished to fit the tactics.

Merriam-Webster's entry on Strategy:
1 a (1) : the science and art of employing the political, economic, psychological, and military forces of a nation or group of nations to afford the maximum support to adopted policies in peace or war (2) : the science and art of military command exercised to meet the enemy in combat under advantageous conditions b : a variety of or instance of the use of strategy
2 a : a careful plan or method : a clever stratagem b : the art of devising or employing plans or stratagems toward a goal

The strategy doesn't get diminished to fit the tactics; the strategy gets replaced because it was craptastic in the first place! Brooks is basically using strategy as a synonym for vision.

"I don't think that word means what you think it means."

HT to Lance

Does politics matter for health outcomes?

Earlier today Matt Kahn, an environmental economist at the Fletcher School posted Life Expectancy by State: Selection or Treatment?

In his post, Matt wonders whether "living in the District of Columbia really that bad for one's longevity (treatment)? Or do people with less health capital move to D.C (selection)?"

I can't answer that question, but the state level data for health outcomes immediately brought to mind a different question. How do political outcomes affect life expectancy?

After quickly downloading Matt's data and matching it up with the results of the 2004 presidential election ( I was able to create a STATA spreadsheet with two variables: additional years of life expectancy* and percentage vote for George W. Bush.

Using the basic regression function (add_years = percent_bush + constant), there was not a strong correlation between politics and health: .0022969 and not statistically significant.

Taking a closer look, it seemed that a few outliers might really skew results. When I looked only at states in the 10-90% distribution of health outcomes (dropping Hawaii, Minnesota, Utah, Connecticut, Massachusetts on the high end and South Carolina, Alabama, Louisiana, Mississippi, and the District of Columbia on the low end), suddenly my hypothesis seemed a little more reasonable: -.0378876 correlation coefficient and significant at the 10% level.

Obviously I'm not the first person to point out that red states do worse than blue states on general health outcomes, but I am surprised how small the relation actually is when looking at life expectancies. And what about the tails of the distribution? HI, MN, CT, and MA are all strong blue states, but UT is the most pro-Bush state in the country. SC, AL, LA, and MI are all strong red states, but DC is the most anti-Bush voting unit in the country.

Obviously Washington DC is not at all like the other states, but Utah does seem to fit into a distinct trend. Great Plains and Western states that are strongly pro-Bush (Utah, Wyoming, Idaho, the Dakotas, Kansas) have reasonably good health outcomes, while the former Confederate states have uniformly horrible comparative health outcomes. Maybe we should call this the Jefferson Davis Health Corollary?

*Additional years of life expectancy ranged from 0 in the District of Columbia to 8 in Hawaii.

Sunday, September 10, 2006

How good are Peruvian surgeons?

Hmmmm. Flu-like symptoms, loss of appetite, occasional nausea, severe pain in my right abdomen. This does not look good.

Situation: developing

Friday, September 08, 2006

Who turned the lights off?

From the new Pienso Blog:

Pretty crazy to think that all the traffic and nighttime activity in Lima (population 8+ million), don't add up to a brighter light than frigid Edmonton and Calgary (population ~1 million apiece).