Sandbaging: Why We Still Use Sandbags

I've always had a fondness for North Dakota, my mom's home state. Right now Fargo, the capital, is experiencing major flooding. Like the floods for the last 100 years the tool of choice to prevent the river from rising are sandbags.

Recently Slate had a good article on why we still use sandbags. First, they are cheap. Second, they are easy to use. This a good combo for response to floods. Not surprisingly, Midwestern spirit had led to 100s or perhaps 1000s of volunteers to help fill sandbags. So there is usually is an abundance of cheap/free labor in response to the flood, but few volunteers have experience or expertise.

So a technology that is labor intensive is likely to be used, so that's why will likely see sandbags for years to come.

Fairtrade Coffee Not Just From Mexico, but In Mexico

One of the things that suprised me about my trip to Mexico, is that a coffee cooperative had opened a new cafe in Oaxaca City. It is a ways away from the tourist district, so I'm not sure the market they are targeting, but there seems to be a growing demand for organic fairtrade coffee (mercado justo) in Mexico.

Below are pictures of the new cafe and an advertisement for fairtrade coffee. Perhaps even in Mexico, they want to help rural farms and drink organic coffee?

From Mexico

From Mexico

Opportunitdades in Action and Underwear Sales

I’m back from a weeklong trip in Mexico, then a week getting settle. Lots of good stories to report, but I will start with this one. I visited a small village about 4 hours south of Oaxaca. It happened to be the day that the government was handing out cash as part of the Opportunidades program. This program pays households money if the children attend school and the family visits health clinics. The program has another twist in 99% of the household the payments are made to women, thus the picture on the side of the line shows a huge group of women lining of for their cash. The idea being that women are more likely to spend the cash payment on food for their children (this actually seems to work).

Of course some entrepreneurs set up a market just down the street from the school where payment were being handed out. Not surprisingly, the sellers wears included mainly household goods (plates, pans, ect.) and of some clothes.

Likely a result of the payment being made to women, the amount of women’s underwear for sale was probably triple the amount of men’s.

4 Traps of Develop and Paul Collier is Now Blogging

In my economic development class I have my students read Paul Collier's The Bottom Billion. In the book Collier outlines 4 traps to economic development (Civil War, Being Landlock, Overreliance on natural resources, and bad government). I like his straight forward approach, and he does a good job of emphasizing the macro trends in a country.

Collier has a new book (War, Guns, and Votes) out I haven't had a chance to read.

If you want to follow more of Collier's work he is now bloging occasionally (here), but this wesbite also seems to link to his other Op-Eds.

Tomorrow I'll talk about Bill Easterly who writes another book I have my students read.

The Economics of Day Light Savings

As a public service announcement, I’m going to remind you that daylight savings time is this Saturday night (Sunday morning), that means add an hour to your clock before you go to bed Saturday night.

I just think it’s a pain because its one more thing to remember so I'm anti-daylight savings. Plus one of the main reasons behind the change is that it is supposed to save energy. But a recent NBER paper by Kotchen and Grant, showed that DST actually increased electricity use.

Choosing a College Major

From a recent Chronicle of Higher Education article by Middlebury Economics Professor David Colander:

“We asked economics students to identify majors as hard, moderate, or easy, and we found that 33 percent viewed economics as hard, 3 percent said sociology was hard, 7 percent saw psychology as hard, and 13 percent thought political science was hard. Since other social sciences were the primary alternative majors that most of the economics students considered, that data is compelling evidence that the respondents perceived those other majors as too easy. Students likely reasoned that taking a "too easy" major would signal to potential employers that the student had chosen an easy path through college, thereby hurting their chances of being hired.”

“On the other end of the spectrum were math and science majors. In the survey, 81 percent saw chemistry as hard, 84 percent thought physics was hard, and 68 percent said math was hard.”

It’s surprising how much this sounded like my thoughts when I was an undergrad. Political Science and Sociology classes can be harder than economics classes, but for me science always seemed too hard. Maybe it was because of the 3 hour labs.

I think students choose their major based on the perceived difficulty and the job prospects they think they will get from it. Students will vary in their ability in certain subjects so difficulty will vary from person to person. At Towson there are about by my guess 10 times as many business majors as economics majors. I wonder if this is a result of a perception that the economics major is too hard or easy; or is that they perceive economics majors are less likely to get jobs.

If anyone would care to comment, did you choose your major based on ease or job prospects?

A 30 minute walk for $37: Beating the Ticketmaster Surcharge

So my wife and I along with a few of my professor buddies decided we want to see a concert Saturday night. OK GO is playing in downtown Towson. Tickets are listed at $16, but when I go to order them of course there is a $7.40 ticket master surcharge, or about 40% of the ticket price.

So instead of buying the tickets online, I walk down to the concert hall about 30minute roundtrip to save the $37. On the walk I had 3 thoughts about the ticketmaster charge.

1.)It is worrisome that ticketmaster has a monopoly on ticket distribution this could be in part to blame for the high surcharge prices.
2.)Maybe the surcharge is a way to separate the bargain hunters who will go to the box office, from the less bargain hunters.
3.)You also have to wonder about the endowment effect, you don’t get told about the surcharge until the last second. My guess is more people would buy $16 tickets with a $7.40 surcharge, then $23.40, even though it is isn’t rational.

But not to worry, I’ll be seeing OK GO on Saturday! If you need to get warmed up for the show here’s their most well known song with an awesome video.

Demand For Sports Tickets

On Friday I went to a Wizards (NBA) game with my old PhD advisor. The Wizards are terrible this year with their star player out with an injury. So I had heard tickets were easy to come by and could be purchased below face value from ticket resellers on the street.

When I got downtown though, the area around the arena was buzzing. It turns out I wasn't the only one in town who wanted to go a game, but our President also wanted to see his home team the Chicago Bulls.

I don't know what it says about the Wizards that I still paid less than 60% of face value for the ticket with Obama in the audience.

Besides Presidents, many things can impact the demand for tickets. Team quality, opponent quality, the economy, even fireworks and the weather can impact the demand for tickets.

Chronic Poverty; Thoughts from a recent conferences

On Friday I went to a conference on Chronic Poverty in developing countries. The conference was held by the Chronic Poverty Research Centre and a USAID research center that is run out of my old grad school department.

Papers were presented dealing with many different countries, but I think a take home message is that there are two different type of people who experience Chronic poverty. Those who with a little bit of help (safety nets, small asset transfers, microcredit, or agricultural assistance) can make it out of poverty. But there are still some people whose situation is so dire that these types of policies will not draw them out of the lowest poverty.

A summary report on chronic poverty can be found here. I particularly like the map on page 9, which gives a context for where the poor are.