Saturday, July 28, 2012

Capcha against massive registration spots

Central bank of a generic country had sent a letter (Dated 28 of June) to the banks, recommending to make use of "check yourself and the partner" system. Central bank's "recommendations" are generally acknowledged to be pretty obligatory among the banks and central bank's lower level employees.

One of the points of the letter is the idea of checking the address of the organization to avoid dealing with companies registered in massive registration spots. Those are buildings, where each square meter belongs to some organization, and a special person responds to tax inspection calls with a well-practiced "I am sorry, everyone in the management is out. Try some other day". Or sometimes the building just does not exist.

Problem is - these half-legal entities are not such an absolute evil. Yes, shadow economy in this country is huge. Yes, shadow economy does not pay taxes and operates by somewhat different, lower standards. But if fills in the void, where common organizations can't work. Shadow economy may just be a response to a demand for it, however Austrian it may sound.

What the letter would do for sure is discourage people from registering companies. The Federal Tax Service publishes disaggregated data on the enterprises registered. In separate excel files, so one has to write a parser for their website again, but you get used to it.

There are many things to plot, but what you get out of data is this:

(click to enlarge)

Seasonally adjusted with Tramo/Seats (February seems like a particularly unfortunate month). The data is for the 1st day of the corresponding month, so any changes should be reflected in the next month's value.

What we see is that the dynamics of newly registered companies is on a stable low level since last year. One can argue if the drop in December was the closing of phony companies, or not, but as for the idea of further discouraging entrepreneurship, it is, to say the least, not quite the perfect time.

It would be much more logical if we could just allow people to register companies in their apartments, the law is ambiguous on this matter anyway. For one thing, that would make tax inspectors job a lot easier.

Tuesday, July 24, 2012

Legislation DDoS

The end of the first session of the operation of the newly elected lower house of parliament of one generic country ended with adoption of a series of stupid, inherently contradictory to the current legislation and just plain funny laws. The law on non-commercial organizations makes this guy the foreign agent, slander law can be used against the official ideology, the law on political meetings questions the legality of parliament operation itself. (Paraphrased from here, read all about it from one of the few remaining actual political scientists)

State Duma just published its next report on its activity for the month. As usual, one has to actually go and click on every month to get monthly data.

So I wrote a tiny parser to gather all the data from the Duma website. The system administrator probably hated me during the debugging... If anyone wants me to elaborate on how to write a parser and batch-process data form web-sites that do not allow for that, I can write a post on that later, ask away - comments are open.

Now we calculate the ratio of passed laws to a total amount of proposed legislation.

(click to enlarge)

The series were slightly seasonally-adjusted, but that did not really matter. What is shown is a six-month moving average with zero months  (election periods, vacations or some other reasons for there being no acts to pass) removed.

After a stable 7-year period of rejecting four out of five, we are back to the nineties, passing every second law. Would be cool to compare to other countries, does someone have the data at hand?

Now what could that bring about? Tyler Cowen once suggested "a simple theory of regulations, new and old". The idea is that the ability to enforce regulation is depletable. When the state adopts new laws, the media attention is drawn to them, and the regulators use all their resources to enforce them, while the old laws are left forgotten.

The adoption of every second clearly obsolete or plain dumb law, whether it is the intention or not, is capable of distracting from other, more pressing issues. My guess - it is a DDoS attack on society, so that with all the legislative junk going on, everyone would stop caring whether you do the actual legislative reforms in the mean time.

Wednesday, July 18, 2012

Large open economy

For a lot of relatively obscure reasons I had chosen to withhold the name of the country I am blogging about and from. Let's say it's an ambigous generic country. Which happens to be number 120 in the World Bank's... Nah. That would be too easy now, wouldn't it?
I will go with this instead:

Of the top ten countries by nominal GDP in 2011 by WB estimate (Here. For your convenience)
it's the first one to appear in the decimal signs of the base of the natural logarithm (the e constant).

E constant

Appropriate music: Arcade Fire - Ready to Start