Sunday, October 26, 2014

(Nominal) Income, Cost-of-Living, and Real Income (by Profession)

Rasmussen College has a great site that allows you to input professions, and then get a ranking of all 50 states by nominal and real income.

The Bill Arrives

With great fanfare last year the EU released updated GDP figures that includes information on prostitution, illegal drug use, and other underground aspects of an economy that were not counted before.

And this year, the EU wants the UK to cough up a bigger contribution because their economy has done better than the average European one … in part because of the bigger numbers from prostitution and drugs.

The payment, described by officials as a “surcharge” follows a change to the way the EU calculates gross national income to include previous hidden service industries, including such prostitution and illegal drugs.

Tim Worstall points out that just because you can count the GDP doesn’t mean you can raise the tax revenue from those sectors.

I’d add that since you probably can’t raise the money from those sectors, this amounts to a higher tax on legal sectors because the UK tried to count the illegal sectors.

This is analogous to taking a family containing a drug abuser, and telling the straight members of the family they have to work harder because one member of the family is having extra fun.

The bureaucrats at the EU have to be have a pretty screwed up worldview not to see that. Or … they just want the cash (and will use whatever excuse is handy).

Tuesday, October 21, 2014

Misinformation, and the Drive for Income Equality

There’s new and provocative research out of Sweden entitled “Richer (and Holier) Than Thou? The Effect of Relative Income Improvements on Demand for Redistribution”.

… A vast majority of Swedes believe that they are poorer, relative to others, than they actually are. This is true across groups, but younger, poorer, less cognitively able and less educated individuals have perceptions that are further from reality.

To put it more bluntly, people pushing an agenda for income redistribution will have better luck if their target market is young, dumb, and ignorant.

Then the authors try a little social engineering:

… We conduct an experiment by randomly informing a subsample about their true relative income position. Respondents who learn that they are richer than they thought demand less redistribution and increase their support for the Conservative party.

Their evidence of this is based on before and after responses to survey questions, not actual voting records.

Wanna’ Work at Google? (Not Required)

From the Business Insider piece entitled “The One App You Need On Your Résumé If You Want A Job At Google" (read more:

Google's former svp/product management Jonathan Rosenberg was in London with chairman Eric Schmidt …

… Schmidt had some more down-to-earth advice. Google really needs data analytics people and folks who have studied statistics in college, he said.

Big data — how to create it, manipulate it, and put it to good use — is one of those areas in which Google is really enthusiastic about.

And then Rosenberg said something really interesting. If you want to work at Google, make sure you can use MatLab, he said.

And, who’s the only SUU professor who has experience with Matlab? Yours truly. I gave up trying to get funding to buy Matlab for SUU about 10 years ago … no one had any vision about what it would be used for.

FWIW: I wouldn’t even worry about Matlab just yet. In order to use Matlab you really need to have taken linear algebra. I wouldn’t even worry about linear algebra yet though. In order to take linear algebra, you need two semesters of calculus. And that’s not business calculus, or ECON 2500. So, there’s a plan: Calculus I, Calculus II, Linear Algebra, talk to Tufte about learning Matlab.

Sunday, October 19, 2014

This Is What an Expansion Feels Like

Two graphs from the Pew Research Center:

Americans may not be raging optimists when it comes to finding work — perhaps “skeptical realists” is closer to the mark — but their self-assessment of the job market tracks pretty closely with official unemployment statistics.

It’s been a long time coming, because, really, that was a very nasty recession a few years back. But … people’s perception of the availability of jobs is back in line with what it was during the middle parts of the Bush expansion (say around 2004), and he unemployment rate is back where it was in the early middle of the Bush expansion (say around 2003).

Via I Love Charts.

Saturday, October 18, 2014

Why Is Macro So Hard? “This Is the Worst Thing Ever. And We’re All Going to Die”

David Harsanyi hits a homer with “This Is the Worst Thing Ever. And We’re All Going to Die.” from The Federalist.

Most of this piece isn’t explicitly about macroeconomics. But it gets at the point that one of the things that makes thinking about macroeconomics and policy so hard is the breathless negativity which politicians the legacy media condition us with.

Thursday, October 16, 2014

Some African Countries Bump Up Their GDP

I think you have to take this with a grain of salt, but some African countries are improving and revising their GDP numbers, and coming up with results that suggest their economies are a lot bigger than we thought.

Some of this is no doubt political.

But, do keep in mind that GDP is notoriously badly measured in poor countries. So there’s also a big “it’s about time” attitude that we should have towards better numbers.

And also, it’s a very good sign of improved economic activity that the governments of these countries can find the money to even consider doing this. Even if they’re fibbing about some of the numbers, it’s a costly undertaking that they wouldn’t do lightly.

Read the whole thing, entitled “Africa’s GDP Is Bigger Than You Think” in Bloomberg Businessweek.