.@MaxRashbrooke wants to close Jetstar and give Telecom its monopoly back! Seriously; that is the test of whether he believes what he is saying

From https://www.newshub.co.nz/home/shows/2018/09/opinion-the-surprising-evidence-about-how-well-government-works.html

Does this mean Max always flys Air New Zealand and has his mobile phone contract with Telecom?

Everyone’s household income has gone up according to these impeccable left-wing sources despite the dead hand of neoliberalism; there was the return of real wages growth after 20 years stagnation after the passage of the Employments Contracts Act. After staying at $24 per hour for 20 years from 1975 in the good old days of union power and collective bargaining, average wages increased from $24 an hour to about $28 per hour by 2014 in one of the most deregulated labour markets in the world.

The increase in percentage terms of Maori and Pasifika real household income is much larger than for Pakeha since the economic reforms of the 1980s and 1990s. As Bryan Perry (2015, p. 67) explains when commenting on table D6 sourced by Closer Together Whakatata Mai:

From a longer-term perspective, all groups showed a strong rise from the low point in the mid 1990s through to 2010. In real terms, overall median household income rose 47% from 1994 to 2010: for Maori, the rise was even stronger at 68%, and for Pacific, 77%. These findings for longer- term trends are robust, even though some year on year changes may be less certain. For 2004 to 2010, the respective growth figures were 21%, 31% and 14%.

The classic in Australia is Kim Beazley in the 1998 federal election:

  • He was asked by a journalist that if the GST is a mistake, as he claimed, would he repeal the GST if he won office at some later time.
  • Beazley waffled about you can’t unscramble an egg and so on. He could not admit the truth.

If deregulation was a mistake, campaign for a reintroducing of the two-airline policy, the bank regulation that suppressed competition, high tariffs on cars, electrical goods and clothes, and media regulation that outlawed cable TV. Campaign for a repeal of the GST and for 66% tax rates again on the middle class! The Left must campaign for a buy back of the Commonwealth Bank, Qantas and Telecom. They will be a good buy. Public ownership is said by them to be as least as efficient as private ownership, and the cost of capital cost for state owned enterprises is allegedly less.

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Veteran lefties (disappointed?) to discover NZ Rich listers are working rich

At https://www.tandfonline.com/doi/full/10.1080/00779954.2017.1354907?scroll=top&needAccess=true

The rapid adaptation of women to changing prospects

Utopia, you are standing in it!

On the upside, Goldin (2006) showed that women adapted rapidly over the 20th century to changing returns to working and education as compared to options outside the market. Their labour force participation and occupational choices changed rapidly into long duration professional educations and more specialised training in the 1960s and 1970s as many more women worked and pursued careers. The large increase in tertiary education by New Zealand after 1990 and their move into many traditionally male occupations is another example.

The key is what drives the rapid changes in the labour force participation and occupational choices of women. Some of the factors are global technology trends such rising wages and the emergence of household technologies and safe contraception and antidiscrimination laws. All of these increased the returns to working and investing in specialised education and training.

Up until the mid-20th century, women invested in becoming a teacher…

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Colour blindness and other sensory drivers of occupational segregation @women_nz

Price gouging-moral insights from economics

Knowledge Problem

Dwight Lee in the current issue of Regulation magazine offers “The Two Moralities of Outlawing Price Gouging.” In the article Lee endorsed economists’ traditional arguments against laws prohibiting price gouging, but argued efficiency claims aren’t persuasive to most people as they fail to address the moral issues raised surrounding treatment of victims of disasters.

Lee wrote, “Economists’ best hope for making an effective case against anti-price-gouging laws requires considering two moralities—one intention-based, the other outcome-based—that work together to improve human behavior when each is applied within its proper sphere of human activity.”

Intention-based morality, that realm of neighbors-helping-neighbors and the outpouring of charitable donations from near and far, is good and useful and honorable, said Lee, who term this as “magnanimous morality.” Such morality works great in helping family and friends and, because of the close relationship, naturally has a good idea of just what help may be needed and when and where.

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Alchian and Allen, opportunity cost, and the kid in the candy store

Knowledge Problem

The new Alchian and Allen book Universal Economics is out. The publisher reports the authors have collaborated to produce a ”fresh, final presentation of the analytical tools” contained in their famous (among a certain kind of economics nerd) textbooks University Economics and Exchange and Production.

In introducing the idea of opportunity cost in the new book, Alchian and Allen give us a “kid in the candy store example.” Alchian and Allen get their explanation wrong.

From the new Alchian and Allen:

A candy-store owner told Annie: “I want to give you some candy for free. Select whichever one you want.” She responded, “Thank you. But it’s not free!” Annie’s smart! She recognized that choosing her favorite, Snickers, is costly. She would have to give up here next best-liked candy, a bag of M&Ms—her alternate personal highest-worth good. Costs can occur in several forms, and some things that are not…

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Towards the Flame: Empire, War and the End of Tsarist Russia by Dominic Lieven (2015)

Books & Boots

Towards the Flame is a diplomatic history of imperial Russia in the years 1905 to 1920. By diplomatic history, I mean a detailed, a really detailed, account of the men who ran Russia’s Foreign Ministry and its embassies (with sometimes a nod to the heads of the army, navy or other government ministers), their policies, debates and disagreements. We are given pen portraits of Russia’s premiers, foreign and finance ministers, and key ambassadors to London, Paris, Berlin, Vienna and beyond.

And the guts of the book is a history of their diplomacy – the papers and memos they wrote laying out Russia’s strategies – the information they gathered about rival nations’ aims and goals – the assessments each nations’ military attaches made about their rivals’ readiness for war. (Position papers like the brilliantly prescient memorandum former head of secret police Petr Durnovo gave Tsar Nicholas in February 1914 which said…

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