The gender pay gap in New Zealand rounds down to zero for women in their mid-20s!
Gender pay gap at age 25-29, OECD countries @GreenCatherine
03 Dec 2015 Leave a comment
in discrimination, gender, human capital, labour economics, labour supply, politics - Australia, politics - New Zealand, politics - USA Tags: compensating differentials, gender wage gap, labour demographics
Australian and New Zealand detrended real GDP growth, PPP, 1956 – 2014
01 Dec 2015 Leave a comment
in economic growth, economic history, macroeconomics, politics - Australia, politics - New Zealand
I have updated my estimates of Australian and New Zealand detrended real GDP growth for the 2014 working age population statistics from the OECD. The charts show:
- the lost decades of New Zealand growth between 1974 and 1992;
- the return of trend growth between 1992 and 2007 but no rebounding to recover lost ground;
- the effects of the global financial crisis in Australia and New Zealand; and
- a return to trend growth in New Zealand since about 2010 but not in Australia.

Source: Computed from OECD Stat Extract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/
The real GDP data in the above chart is detrended by 1.9% per annum. 1.9% growth per year is the trend real GDP growth rate of the USA in the 20th century. The growth rate of the USA is taken as the growth rate of the global technological frontier. A flat line in the above chart is real GDP growth at 1.9% per year. A falling line is real GDP growth in that year of less than 1.9%; a rising line is growth that is greater than 1.9% in that year.

Source: Computed from OECD Stat Extract and The Conference Board. 2015. The Conference Board Total Economy Database™, May 2015, http://www.conference-board.org/data/economydatabase/
How Scandinavian Countries Pay for Their Government Spending
20 Nov 2015 1 Comment
in politics - Australia, politics - New Zealand, politics - USA, Public Choice, public economics Tags: Denmark, Finland, growth of government, Norway, Scandinavia, size of government, Sweden, taxation and entrepreneurship, taxation and investment, taxation and labour supply, welfare state
@amyadamsMP Bias in the battered women’s syndrome as a defence for murder
18 Nov 2015 Leave a comment
in economics of crime, law and economics, politics - Australia, politics - New Zealand Tags: battered woman's defence, crime and punishment, criminal deterrence, criminal procedure, Justice Michael Kirby, law and order
Jihadists and the Nisei soldiers
16 Nov 2015 1 Comment
in economic history, economics of religion, occupational choice, politics - Australia, politics - New Zealand, politics - USA, war and peace Tags: British politics, counter-signalling, economics of oppositional identities, game theory, ISIS, New Zealand Greens, war against terror, World War II
Japanese Americans interned during World War II jumped at the chance to volunteer to fight. They saw it as their last chance to prove their undivided loyalty to their country.
One Japanese father, when saying goodbye to his son, stressed that showing his loyalty to his country, if necessary through the last full measure of devotion was far more important that his returning safely to his family.
The 442nd Combat Regiment Team was the most decorated unit in World War II. Its motto was “Go for Broke”. The 4,000 Nisei soldiers in April 1943 had to be replaced nearly 2.5 times. In total, about 14,000 men served, earning 9,486 Purple Hearts.
Migrants are a cut above regarding initiative and judgement. They pass many of these traits on to their children. These Japanese Americans, both migrants and native born knew that counter-signalling was required. They had to go out of their way to show their loyalty no matter how unfair any suspicions of disloyalty among Japanese Americans might have been at the time.
I am reminded of that counter-signalling by Japanese Americans during the darkest days of World War II when I read the remarks of Julie Anne Genter and Jeremy Corbyn. Both focused their pleas on the need to be inclusive and understanding why people join violent, radical groups. They and the rest of the Twitter Left had nothing to contribute regarding strategies to deter the next attack and disrupt those that are in the planning stage, but that is not new.
The notion that bad behaviour towards minority communities leads to more recruitment to the terrorists is overrated. There will be a few wind-bags who say harsh things after each terrorist attack, but if they cross the line, they will be dealt with by the police and courts in a democracy governed by the rule of law.
Acrimony towards your community following the latest terrorist attacks has little to do with the level of recruitment to these terrorist groups either now or in the past. As Alan Krueger explains:
One of the conclusions from the work of Laurence Iannaccone—whose paper, “The Market for Martyrs,” is supported by my own research—is that it is very difficult to effect change on the supply side. People who are willing to sacrifice themselves for a cause have diverse motivations. Some are motivated by nationalism, some by religious fanaticism, some by historical grievances, and so on. If we address one motivation and thus reduce one source on the supply side, there remain other motivations that will incite other people to terror.
Malcontents join the jihadists today for the same reasons they joined the Red Brigade, the Japanese Red Army Faction and Baader-Meinhof gang in the 1970s and 1980s.
Plenty of young people were attracted to communism in previous generations as a way of sticking it to the man. Now as then economic conditions were good as were political freedoms. Italy, Japan and Germany were all at the peak of recoveries from war. Japanese incomes are doubled in the previous decade. Germany and Italy were rich countries. As Alan Krueger explains:
Despite these pronouncements, however, the available evidence is nearly unanimous in rejecting either material deprivation or inadequate education as important causes of support for terrorism or participation in terrorist activities. Such explanations have been embraced almost entirely on faith, not scientific evidence.
Each generation has its defining oppositional identity. Radical Islam is the oppositional identity of choice for today’s angry young men and women. Mind you, they have to buy Islam for dummies to understand what they’re signing up for.
In previous generations, it was communism, weird Christian sects, eco-terrorism, animal liberationist terrorism and a variety of domestic terrorists of the left and right with conspiratorial motivations. Look at the level of diversity of the angry young men and women on the domestic terrorists list of the FBI. One jihadists when interviewed said that 30 years ago he would probably have become a Communist as his vehicle for venting his frustrations.
There is always an ample supply of troubled and angry people so trying to redress their grievances is overrated as Alan Krueger explains:
…it makes sense to focus on the demand side, such as by degrading terrorist organizations’ financial and technical capabilities, and by vigorously protecting and promoting peaceful means of protest, so there is less demand for pursuing grievances through violent means. Policies intended to dampen the flow of people willing to join terrorist organizations, by contrast, strike me as less likely to succeed.
The current appeal of radical Islam rests on what psychologists call personal significance. The quest for personal significance by these angry young men and women is the desire to matter, to be respected, to be somebody in one’s own eyes and in the eyes of others.
A person’s sense of significance may be lost for many reasons, including economic conditions. The anger can grow out of a sense of disparagement and discrimination; it can come from a sense that one’s brethren in faith are being humiliated and disgraced around the world.
Extremist ideologies, be they communism, fascism or extreme religions are effective in such circumstances because it offers a quick-fix to a perceived loss of significance and an assured way to regain it. It accomplishes this by exploiting primordial instincts for aggression, sex and revenge. MI5’s behavioural science unit found that
“far from being religious zealots, a large number of those involved in terrorism do not practise their faith regularly. Many lack religious literacy and could… be regarded as religious novices.” The analysts concluded that “a well-established religious identity actually protects against violent radicalisation”
Most evidence point to moral outrage, disaffection, peer pressure, the search for a new identity, for a sense of belonging and purpose as drivers of radicalisation. Anthropologist Scott Atran pointed out in testimony to the US Senate in March 2010:
“. . . what inspires the most lethal terrorists in the world today is not so much the Quran or religious teachings as a thrilling cause and call to action that promises glory and esteem in the eyes of friends, and through friends, eternal respect and remembrance in the wider world”. He described wannabe jihadists as “bored, underemployed, overqualified and underwhelmed” young men for whom “jihad is an egalitarian, equal-opportunity employer . . . thrilling, glorious and cool”.
Chris Morris, the writer and director of the 2010 black comedy Four Lions – which satirised the ignorance, incompetence and sheer banality of British Muslim jihadists – said “Terrorism is about ideology, but it’s also about berks”.
#GeorgeOrwell on @jeremycorbyn #pacifism and #Paris
14 Nov 2015 Leave a comment
in defence economics, politics - Australia, politics - New Zealand, politics - USA, war and peace Tags: British politics, France, game theory, George Orwell, pacifism, Paris, war on terror
Employment status of sole parents in UK, USA, France, Italy, Australia, Ireland and New Zealand
13 Nov 2015 Leave a comment
in economics of love and marriage, labour supply, politics - Australia, politics - New Zealand, politics - USA Tags: Australia, British economy, France, Ireland, Italy, maternal labour supply, single parents, sole parents, welfare state
Despite supposedly having stingy welfare states, both New Zealand and Australia have a lot of sole parents who do not work at all. There is no separate breakdown of full-time and part-time work status in the USA. About 72% of sole parents in the USA either work full-time or part-time.

Source: OECD Family Database.
Escaping from Australian immigration detention facilities – what’s the point?
12 Nov 2015 Leave a comment
in applied price theory, economics of crime, politics - Australia
Some poor bugger died shortly after escaping from the Australian immigration detention facility on Christmas Island a few days ago. I wonder where he was intending to escape?
Christmas Island is in the middle of the Indian Ocean and the only way off is by the airport. He had nowhere to run. There would be lucky to be 2000 people living on the small island of Christmas Island so he would stand out very quickly.
Many years ago, a fight broke out one breakfast time between the different nationalities regarding the management of the canteen at the Port Hedland immigration detention facility. They resolved the differences about this largely self-managed canteen where each cooked their own foods by deciding to stage a spontaneous escape.
As they marched down the road, free at last, the manager of the facility caught up with them. He asked them where were they going? He said it already telephoned Greyhound buses and told them not to sell them bus tickets. Perth is 1300 km away from Port Hedland. The manager of the facility suggested they all come back to settle things over a cuppa as it was warming up as noon was approaching.
Unions – not the cause of our 40 hour workweek
10 Nov 2015 Leave a comment
in applied price theory, applied welfare economics, economic history, entrepreneurship, health and safety, human capital, industrial organisation, labour economics, labour supply, Marxist economics, minimum wage, politics - Australia, politics - New Zealand, politics - USA, poverty and inequality, unions Tags: The Great Enrichment, union power, union wage premium
When did buying your own home become a good investment in Australia?
09 Nov 2015 Leave a comment
in economic history, politics - Australia, urban economics
When I left university, all my mates were in a fever pitch about buying a house because it was such a good investment. They didn’t mention that housing had been a dog of investment for the previous 10 years. Housing was a good investment for a couple years around the time of this feverish home buying by my friends as the chart below shows. I didn’t buy a house because I could rent houses that were far nicer and more convenient to work and that any I could buy in Canberra. That pretty much applies to today.

Source and notes: Dallas Fed International Housing Database July 2015 – The author acknowledge use of the dataset described in Mack and Martínez-García (2011); real housing prices are nominal housing prices deflated by a personal consumption deflator.
Through all the 1990s as the chart above shows in retrospect, I was too polite to inquire of friends about their house prices in case they had no equity in their own house after the bank took its slice. For all of the 1990s, investing in a house was a dog of an investment in Australia if the above chart is a reasonable national summary of what is a medium-sized country. Things then hit a fever pitch at the end of the 1990s with house prices doubling and then some across Australia.
There is a God! @AlboMP and @tanya_plibersek could lose their seats to Greens at the next election
06 Nov 2015 Leave a comment
in election campaigns, politics - Australia, politics - New Zealand

Source: Do it | Catallaxy Files.
Similar karma here. The deputy leader of the New Zealand Labour Party wins his seat because the Greens do not fight for it. The co-leader of the Greens happens to contest that seat. The Greens win or almost win the party vote in that electorate for several elections now.
How the first world war changed the world
04 Nov 2015 Leave a comment
in politics - Australia, politics - New Zealand, politics - USA, war and peace Tags: Armistice Day, World War I
#Dailychart: How the first world war changed the world econ.st/1rvj6tW http://t.co/OldeGaiJEe—
The Economist (@ECONdailycharts) July 28, 2014


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