Utopia, you are standing in it!

Yesterday Jeremy pointed out that while the 2021 economics Nobelists have reached various conclusions in their study of labor economics, the prize was really awarded to the methods they developed and used.

I find the best explanation of the value of these methods to be this 2010 article by Angrist and Pischke in the Journal of Economic Perspectives: The Credibility Revolution in Empirical Economics: How Better Research Design Is Taking the Con out of Econometrics

Like Jeremy, they think that empirical economic research (that is, research using econometrics) was most quite bad up to the 1980’s; as Ed Leamer put it in his paper “Let’s take the CON out of Econometrics”:

This is a sad and decidedly unscientific state of affairs we find ourselves in. Hardly anyone takes data analyses seriously. Or perhaps more accurately, hardly anyone takes anyone else’s data analyses seriously.

Angrist and Pischke argue that the field…

Last night the major party candidates for Senate in Pennsylvania had their first and only debate. I didn’t watch it, since I don’t live in Pennsylvania. But judging by my Twitter feed, a lot of people did watch it, including (bizarrely to me) lots of people who don’t live in Pennsylvania. And overnight, tons of articles were written analyzing the debate, saying who “won” the debate, and so on (“5 Things You Need to Know About the Pennsylvania Senate Debate” etc.).

But this blog post is the only thing you need to read about that debate. And these charts are really all you need to look at.

These two charts come from the prediction market website PredictIt. The charts show the “odds” (more on that below) that each candidate will win the Pennsylvania Senate race, over a 90-day time horizon (first chart) and the last 24 hours (second chart)…

Fracking: note the deep shaft
The people doing the banning conveniently forget they can’t enough gas at the moment, including from the US obtained by the method they profess not to like. But importing fracked gas is no problem, essential even.
– – –
The ban on fracking in England will be reinstated, new Prime Minister Rishi Sunak has said.

It reverses a decision by his predecessor Liz Truss, says BBC News.

Fracking was first halted in England in 2019, amid opposition from green groups and concerns about earth tremors.

What is fracking?

Hydraulic fracturing, or fracking, is a technique for recovering gas and oil from shale rock.

It involves drilling into the earth and directing a high-pressure mixture of water, sand and chemicals at a rock layer, to release the gas inside.

Wells can be drilled vertically or horizontally in order to release the gas.
. . .

The office of Prime Minister is a creature entirely of constitutional convention. While legislation references the office itself, setting out pay for example, this is only statutory recognition of the existence of an office which arises purely by virtue of convention. It is by convention that the Monarch appoints as Prime Minister someone who is capable of commanding the confidence of the House of Commons and it is by convention that he exercises certain prerogative powers only on the advice of the Prime Minister (or another minister in his government). The mechanism for choosing a Prime Minister is, however, not entirely covered by convention. While they must command the confidence of a majority of MPs in the Commons, it is not necessary that they be chosen directly by the Commons. This is because of the party system and the presumption that the leader of a given party has the confidence…

Mass civil unrest is odds-on in power starved Germany and Britain this winter, thanks to the so-called wind and solar ‘transition’.

With thousands likely to freeze to death, the collective sense of humour will soon evaporate, along with any remaining faith in the ability of wind and solar to deliver power, as and when it’s needed.

Everything about renewable energy policy is political; no one woke up 20 years ago thinking what a good idea would be to watch power prices triple and suffer power rationing every time the wind dropped and the sunset. Instead, it was a political ‘sell’ (aka lie) that the world would be an altogether happier place if only we were powered exclusively by sunshine and breezes.

Well, that didn’t pan out so well.

The political response to the disaster is all directed at preventing the proles from turning seething anger into outright revolt.

At the…

Retail electricity prices in Australia are expected to rise by 50%  over the next two years, with  Federal Treasurer Jim Chalmers said to be weighing up market intervention to stop those costs spiralling further.

The  Australian Treasury has assumed in the federal budget  presented  in Canberra  last  night that retail power prices will increase by an average of 20% nationally in late 2022 and a further 30% in 2023/24.

These  startling  rises  stem  from  Australia’s  drive  to  decarbonise  its  electricity  supplies. After  enjoying  a long  run of  cheap  electricity, Australian consumers  are  now  facing  what  will be  a  severe attack  on  household  budgets.

By  comparison,  with  80%  of our  electricity  already  coming  from  renewable  sources, New Zealand may escape  such  rises.

I’m in Europe to give a couple of speeches about fiscal policy, so I’m going to spend all week commenting on the continent’s (mostly miserable) fiscal policy.

Let’s start with comments about Italy, the nation most likely to suffer a crisis.

Normally, I tell people to focus on government spendingrather than red ink. After all, the economy is hurt whether spending is financed by taxes or borrowing (or printing money).

But I’ve also noted that governments sometimes spend so much money and incur so much debt that investors decide it is very risky to buy or hold debt from those governments. In other words, they begin to fear default.

When investors (sometimes known as “bond vigilantes”) reach that stage, they probably try to get rid of their holdings and definitely refuse to buy more debt. The net result is that profligate governments have to offer…

Blogging is not easy on time, which for all of us is fixed. Nobody can make any more of it. Time is the enemy for a lot of people. I have a busy work life, and a couple of other interests keep me occupied, hence the time I can dedicate to this blog is regretfully limited. I would rather spend the reasonably limited amount of time I have for writing here dedicated to things that are useful and informative, rather than comment on the day-to-day socialism and slow degradation of this once great country through either the Labour or National governments.

The Supreme Court decision in the Peter Ellis appeal is one such useful and informative matter that I feel the general populace of this once great Westminster, parliamentary democracy needs to understand. So I thought it would be helpful for the generally small number of readers here for me…

As I sit and watch the turmoil at Westminster on the morning (afternoon in London) that Liz Truss announced her resignation; the morning that the 1922 Committee of Conservative backbenchers scramble to find a leader in a week’s time; a seemingly firm date of October 31 for a budget statement from a recently appointed Chancellor of the Exchequer; and cries for an election, there seems to be no way forward that does not continue the chaos.  But there just may be a way to calm the waters somewhat.  A proper and timely use of prorogation.

Prorogation, where one session of Parliament ends and a new session is prepared for, has received much negative press and commentary in the last few years, in the UK and in Canada.It has been seen as a way for a Prime Minister and a government to avoid facing Parliament when there was an imminent need for a…

Here it is. This is the result of many months and years of work, and a lot of editing, and it should not be viewed as my work but rather as joint work of mine with Eric Goldwyn, Elif Ensari, and Marco Chitti. People should read the report, which talks about how to build in-house capacity and institutional support that does not involve American-style micromanagement and politiciziation.

We’re going to present on this in person at NYU in a day and a half, on Wednesday 10/26, at 11 am (moderated by Aaron Gordon) and again at 8 pm for people who can’t make it during work hours; this is at Marron’s office at 370 Jay Street on the 12th floor, room 1201. (I’m also separately on this panel about through-running, online, 10/25 at 6 pm New York time.)

We’ve managed to decompose much of the cost premium of…

Earlier this week, I explained the formalities that a person must undergo before they can become Prime Minister. Today, I will do the same thing for the other members of Her Majesty’s Government. This is a surprisingly complex subject since ministers take office in many different ways.

The Cabinet

Most Cabinet ministers formally take office at a meeting of the Privy Council. There are three oaths/affirmations involved: the Privy Counsellor’s Oath, the Oath of Allegiance, and the Oath of Office (however, if someone has already taken the Privy Council Oath and the Oath of Allegiance, they will not need to take them again). The oaths are taken while kneeling on little footstools, and afterward ministers kiss Her Majesty’s hand. Sometimes the gymnastics involved have proven too much for ministers. Richard Crossman records an incident where four Privy Counsellors found themselves on the wrong side of the room and ended up crawling toward the Queen on…