Marginal Revolution

Giovanni Peri's latest on immigration and productivity

Here is the abstract and it has to do with a Smithian theme, namely division of labor:

Using the large variation in the inflow of immigrants across US states we analyze the impact of immigration on state employment, average hours worked, physical capital accumulation and, most importantly, total factor productivity and its skill bias. We use the location of a state relative to the Mexican border and to the main ports of entry, as well as the existence of communities of immigrants before 1960, as instruments. We find no evidence that immigrants crowded-out employment and hours worked by natives. At the same time we find robust evidence that they increased total factor productivity, on the one hand, while they decreased capital intensity and the skill-bias of production technologies, on the other. These results are robust to controlling for several other determinants of productivity that may vary with geography such as R&D spending, computer adoption, international competition in the form of exports and sector composition. Our results suggest that immigrants promoted efficient task specialization, thus increasing TFP and, at the same time, promoted the adoption of unskilled-biased technology as the theory of directed technological change would predict. Combining these effects, an increase in employment in a US state of 1% due to immigrants produced an increase in income per worker of 0.5% in that state.

The paper is here.

Alberta fact of the day

Edmonton and Calgary are among the few metropolitan areas in the developed world that are not connected to comprehensive motorway systems.

Here is much more, on highways in Canada or rather the relative lack thereof.  I am not convinced by his argument that a "bigger and better" highway system is what Canada needs, but I found this interesting reading nonetheless, mostly because it shows how few highways Canada has.

NASA FAQ 2012

NASA scientists are frequently being asked questions concerning 2012 and for this reason they have created a web page to answer these questions and reassure the public. e.g.

Q: Is there a planet or brown dwarf called Nibiru or Planet X or Eris that is approaching the Earth and threatening our planet with widespread destruction?

A: Nibiru and other stories about wayward planets are an Internet hoax. There is no factual basis for these claims. If Nibiru or Planet X were real and headed for an encounter with the Earth in 2012, astronomers would have been tracking it for at least the past decade, and it would be visible by now to the naked eye. Obviously, it does not exist. Eris is real, but it is a dwarf planet similar to Pluto that will remain in the outer solar system; the closest it can come to Earth is about 4 billion miles.

Sigh.... I too fear for our planet.

Unemployment Breakdown

The NYTimes has a nice interactive graphic on unemployment rates and changes over time by demographic characteristic.  I am in the category--white men ages 25-44 with a college degree-- with almost the very lowest unemployment rate (3.9%).  Just to compare, as pointed out in the comments, black males 15-24 without a high school degree have an unemployment rate of 48.5%.  Check it out.

Hat tip to FlowingData.

Do cellphones outnumber light bulbs in Uganda?

Maybe so.

Hat tip goes to the always-impressive Rachel Strohm.

Fifty Years of Economic History in one Figure

David Beckworth sums up a lot of recent economic history in one figure.

A few thoughts:  I wish Arnold Kling were correct that inflation is around the corner.  We could use some inflation to get back on track.  Nominal wages are simply not flexible enough to get the job done in short order and there is much to fear from populist backlash.

See also the link above for a remarkably similar figure for the OECD which illustrates the US's role of monetary hegemon. 

"The GDP Mirage"

The story, by Michael Mandel, is here.  Excerpt:

While the statistics don't account for it, there's good reason to suspect intangible investments are falling. Companies are under pressure to cut costs by reducing R&D expenditures and deferring other crucial intangibles, notes Hulten. "Because these are expensed, it looks like a pure win," he says. "You are not seeing the benefits of the intangibles in the financial statements—only the costs."

There is much more of interest in this article.

Norway Tax Data Now!

It's the moment nosy Norwegian neighbors have been waiting for -- the release of official records showing the annual income and overall wealth of nearly every taxpayer in the Scandinavian country.

In a move that would be unthinkable elsewhere, tax authorities in Norway have issued the ''skatteliste,'' or ''tax list,'' for 2008 to the media under a law designed to uphold the country's tradition of transparency...

Many media outlets use the tax records to produce their own searchable online databases. In the database of national broadcaster NRK, you can type a subject's name, hit search and within moments get information on what that person made last year, what was paid in taxes and total wealth....

The information had been available to media until 2004, when a more conservative government banned the publication of tax records. Three years later, a new, more liberal government reversed the legislation and also made it possible for media to obtain tax information digitally and disseminate it online.

There has got to be more than one dissertation here.  Aside from the obvious issues of studying the distribution of wealth over time and cross-sectionally the three year break raises possibilities such as testing whether making salary and wealth information public encourages people to work more or less and  whether public information about income increases or decreases inequality.

Perhaps most interesting--does conspicuous consumption fall and efficiency increase in a society in which income is conspicuous?

Health Data Now!

It's well known that medical spending is highly variable but so are medical outcomes.  Here is Begley and Interlandi in Newsweek:

After we interviewed dozens of oncologists, pored over published papers, and obtained outcomes data that cancer centers have never before made public, it became clear that for these cancers there are indeed significant outcome differences depending where you are treated.

Five years after surgery for prostate cancer, for instance, 72 percent of men treated at leading hospitals are alive, compared with 62 percent of those treated elsewhere. Scrutinizing data from specific cancer centers reveals even greater gaps. Five-year survival for stage IV prostate cancer is 71 percent at Fox Chase, for instance, but 38 percent nationally. For stage IV breast cancer, the respective figures are 28 percent and 19 percent—an almost 50 percent edge. For stage IV cervical cancer, five-year survival is 33 percent at the Cleveland Clinic vs. 16 percent nationally.

Some of this is probably due to differences in patient characteristics but it could go either way - the better hospitals often get the hardest to treat cases.

Many hospitals hide this data (or "fail" to collect it which amounts to much the same thing) but there are some good rules of thumb such as looking for hospitals that specialize in certain procedures and thus perform many of them (there are large economies of scale in quality).  Patients can also find information about which hospitals closely follow best practices (kudos to Medicare for this data and see here for a mashup with Google maps) although the measures used are probably the ones that are easiest to collect and not the ones that correlate best with mortality.

Nevertheless, providing information does seem to drive change if only from the shame that a hospital receives when it is found not to be following best practices.  It's true that report cards can cause problems when the drive to get a better score causes hospitals to be more reluctant to treat sicker patients but better data on patient characteristics (stage of cancer etc.) and better process/treatment information can alleviate this problem. In fact, all hospitals should be required to provide standardized information for all patients on patient characteristics, treatments and outcomes.  Only by making outcome information public will hospitals have the incentive and researchers have the ability to develop more accurate report cards.  In short, I cannot think of a simpler change that would improve health care to as great an extent as freeing the data.

Argentina fact of the day

Argentina had 145 psychologists per 100,000 residents in a 2008 study by researchers Modesto Alonso and Paula Gago. That's far more than second-place Denmark, with 85, or ninth-place U.S. with 31, in a 2005 study by the World Health Organization.

The article is here and I thank Daniel Lippman for the pointer.