Christmas economics

Way back in 1993 Joel Waldfogel argued that from a tenth to a third of annual christmas presents is nothing much, but a deadweight loss. We usually regard Christmas to be a good thing, economically - stimulated consumption, stimulated economic growth. Yet some people are just bad at picking the right gift. Hence the deadweight loss (Christmas mathematics and the rest of the paper here - http://graphics8.nytimes.com/images/blogs/freakonomics/pdf/WaldfogelDeadweightLossXmas.pdf). Waldfogel likes curious topics. This is him on RePEc - http://ideas.repec.org/e/pwa46.html

Railway utilization

How do you measure railway companies effectiveness?
Through track and rolling stock utilization (following ITF/OECD research - http://www.internationaltransportforum.org/jtrc/DiscussionPapers/DP201312.pdf)

Data is available from my drive
https://drive.google.com/file/d/0B1DiSgE7Yta4amhJdFlMWnBORFE/edit?usp=sharing

Or from manyeyes (IBM online experiment that collects open datasets and lets everyone visualize it, it provides nice chart tools too)
http://www-958.ibm.com/software/analytics/manyeyes/datasets/europe-rail-performance-utilizatio

Also - to make labels like that in Excel , you would need an add-in like this - 
http://www.appspro.com/Utilities/ChartLabeler.htm

The countries that are to the right and top are generally roughly speaking performing better.

Painting by Ronald Coase

I was wondering about the hobbies of famous economists and look what i found -

A painting by Ronald Coase himself. This is a portrait of Duncan Black, a scottish economist in public choice. There is a signature and certified authenticity and everything if you follow the link below.

Check it out here - http://dev.arch.hku.hk/creue/achieves/duncan-black-by-ronald-h-coase-no-flash/

Do you know any other paintings by economists? I don't think I know any other. I know Haavelmo loved motorbikes though, but don't know other cases with paintings or anything like that.

And, just to be sure - i claim no rights or anything. It's Ronald Coase after all - would be ironic for me to get into property rights trouble here, and i bet Coase would win on his field.

xkcd and numbers

As economists, our profession is numbers, no less than for mathematicians. But we often forget to put numbers into context. Say, cost of the financial crisis, 6 billion dollars (or 14, or whatever figure you personally prefer). How much is that in terms of lost value? Do you know the world's GDP by heart (you should though). A tiny add-on to your browser can solve that, by adding automatic "contextual statements". It will tell you for example 6 billion dollars presumably lost in the crisis is the whole China GDP of 2011.

Or it could tell you that your credit card balance is roughly average CEO's hourly pay, or a per capita income of Brazil a few years ago.

And it does all that on the spot, making inline adjustments to webpage code, without any additional input from you.

I should not have to tell you that if you are not reading xkcd, you are missing out. Go read it, as in - right now.
But apart from an amazing comic and a 'what if' series, Randall Munroe also made this amazing chrome extension, which is free for downloading (and yes, i, as well, want it for opera. Proper opera, not that chromium thing).

Get it here. http://www.dictionaryofnumbers.com/

And, yes, xkcd's hat guy will have access to all your data on all your websites. I am not sure whether that's scary or awesome.

For those of you, who are more interested in xkcd than in economics - there is a leopard<->keyboard extension too over here. Browse the internet with word keyboard being replaced by leopard on every webpage. :)

Maybe someone can make a mandatory extension to replace the "devaluation" with "depreciation" in all those texts online, written by those poor stupid bastards, who confuse fixed and floating exchange rate systems. But i am afraid the hope is lost in that department.

Firefly is economics

There is an old blog, arranging music lyrics by appropriate JEL codes.
http://divisionoflabour.com/music/2009/03/girl_your_marginal_benefits.php

No reason. It is just that I am rewatching Firefly, and thinking -
I suspect there was a decent economists in there in the film crew. The economics side of the story is spotless. The explanantion of how robbing a hospital works out for everyone holds an implication of how Firefly crew and other borderlining criminals are shifting the dirigisme economy of Alliance towards more market-oriented equilibrium.

Add someone Douglas to Jayne Cobb, and i can recommend the whole series for undergraduates to study.

Final fantasy

Do you know about fantasy-leagues?
Do you know about Repec and Ideas? (Sure, you do)
Well, there is a mix of the two - a fantasy-league of economic departments.
http://blog.repec.org/2013/04/01/introducing-the-repec-fantasy-league/

Am I the only one who missed that? :) It sounds kind of cool. Apparently, the "super"-department has to  be realistic, so you can't just put Krugman and, say, Stiglitz together and watch them fight.
If someone is registered and is into that, i would love a full story from inside.

How to: write a bilingual blog

This blog has posts in two languages: Russian and English. Some are duplicates, having a translated copy; some are present in only one language.

Setting up a bilingual blog requires some calibrating.

The primary question is how to divide two sections of the blog.

This blog has control links (the ones up there) that allow you to view only Russian, only English and all Russian posts without English duplicates + unique English posts (ideal for an English-speaking Russian reader).

In order to do that here, on blogger, you need to:
1. Set up a label system for which posts goes to which section of the site. This blog has "Russian" "English" and "bilingual post" labels.
2. Create links (on a new HTML-gadget for example). Blogger has a search php script with q parameter that looks like this:
http://cafedomancie.blogspot.ru/search?q=label:somelabel
The first two links are straightforward:
 http://cafedomancie.blogspot.ru/search?q=label:English
 http://cafedomancie.blogspot.ru/search?q=label:Russian (# Note that I was not able to write it in Russian language, there seem to be charset problems in the script. You will need English labels)

Third one requires conditional operators and, yay!, blogger search does a good job at hiding them, but has them.
logical AND is "+"
logical OR is "|"
logical NOT is "-"
You can use as much parentheses as you like as well.

These are enough to build the third link:

http://cafedomancie.blogspot.ru/search?q=(-label:"bilingual post"+label:English)|label:Russian

# Note the quotes around label "bilingual post", because it has a space in it.

That's it. There are other options, like crossposting to another website, but this one is less messy and gives more control.

The Others

Since this is an economic blog, that you are reading, it is only logical to bring in the conversation about those, since you are so obviously interested in them.
What other economics and close enough blogs are there to read?

1. Well, the obvious. And no it does not link to Paul Krugman.
2. On signalling, there is nothing better than - Overcoming Bias
3. Less wrong, the community on rationality comes very close to discussing some microeconomics topics.
4. afinetheorem. Astonishingly good.
5. Ksonin. Yes, in the language of generic country. 
6. Ruconomics used to have some nice articles in the language of this particular country. Pity it had grown to a halt.
7. Mankiw, for this pic mostly.
8. Ecocomics. Comics and economics. Used to be nice.
9. NBER digest of working papers every week.

There. Subscribe to these and you are more or less up to date on what is hot.

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.

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.

The data is here: http://www.duma.gov.ru/legislative/statistics/

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).

Appropriate music: Arcade Fire - Ready to Start