Saturday, July 28, 2007

If Jackson Pollock were an economist

He would create figures like that: "The Product Space Conditions the Development of Nations". (I still do not get what they mean, but they are quite beautiful.)

Via Dani Rodrik.

Wednesday, July 25, 2007

Monday, July 23, 2007

The Ten Commandments of Applied Econometrics

This week I have been running regressions on the determinants of industrial location in 1920 Brazil. The first results are quite promising.
Before starting any an applied paper, however, I think it is healthy to read Peter Kennedy's "Oh no! I got the wrong sign! What should I do? and The Ten Commandments of Applied Econometrics. If I had learned his lessons when I was younger, maybe I wouldn't have sinned as much as I did. I strongly recommend grad students to read the paper before applying the last rocket-science technique as well.

Andrew Gelman provides further comments on Kennedy's papers.

Friday, July 20, 2007

My brothers were right!

When we were kids, my brothers used to call me "stupid". It turns out that they were right! A new study shows that:
"differences between first-borns and second-borns of about one fifth of a standard deviation or approximately 3 IQ points."

Ok, it is not a huge difference, but they had (have?) a point anyway.

Wednesday, July 18, 2007

Why R?

I am afraid that analysing the data from the Lancet study on Iraqui mortality is not an appealing reason for changing to R. But how about presenting a cool graph instead of a boring table of regression results?

Thanks to Andrew Gelman (the brilliant statistician, blogger and passionate R user).

My presentation at the Spatial Econometrics Conference 2007

The powerpoint presentation of the paper "SPATIAL DYNAMICS OF ECONOMIC
GROWTH IN BRAZIL (1970-2000):AN EMPIRICAL APPROACH" (with Martin Brauch) is available here. (Just drop me an e-mail if you want the full version of the paper).

Tuesday, July 17, 2007

P. J. O'Rourke on Adam Smith

I haven't bought it yet because it is only available in hardcover and it is quite expensive. But I can assure you that it is excellent.
The satirist P. J. O'Rourke authored a brilliant and hilarious book on economic development.

Monday, July 16, 2007

Honey, I misinterpreted the coefficients

Last Saturday, at the Spatial Econometrics Conference 2007, James Lesage presented a paper showing that everybody misunderstood the meaning of coefficients in spatial regressions. And sometimes the difference is huge. It was an excellent presentation and you could almost hear the audience thinking: "Ay caramba, I have to rewrite everything...".
Only the abstract of the paper is available on-line. Stay tuned.
(Luckily, there were no spatial regressions in the paper (co-authored with Martin Brauch) that I presented there.)

Zimbabwe is collapsing

Mr. Mugabe has created a Bizarro World of sane economic policies. Sure Zimbabwe was not a perfect place before Mr.Mugabe, but it is almost unbelievable what he has done to the country:
Eight in ten people have no formal jobs; inflation, officially estimated at more than 3,700%, may actually be twice as high.
So President Robert Mugabe has decided to try to do something about the galloping prices of basic goods. Ignoring protests from Gideon Gono, the governor of the central bank, Mr Mugabe, who famously despises “bookish economics”, has sent the police in to order shopkeepers to slash their prices, forcing them to sell at a loss. The predictable result is huge crowds waiting outside shops to rush in and grab whatever they can while the going is good. Factories are threatened with being taken over if they stop production. Hundreds of shopkeepers have been arrested, accused of not lowering their prices enough.

By the way, before trying to help Africa, you should read this or this.

Wednesday, July 11, 2007

Poverty and Development - Hans Rosling

He is the crazy genius behind Gapminder. His new TED talk is amazing. 19 minutes that will make you fell more optimistic. Do not loose the last minute!
Best sentence:

"My neighbor knows 200 types of wine, I know just 2. But I know 200 types of countries, while he knows just "Developed" and "Underdeveloped"."

BTW, if the subject is Gapminder you should take a look at the Dollar Street.

More underwear, more literacy

The story goes like this: Marco Mostert says that the increase in the use of underwear in medieval Europe led to a growth in the supply of rags, a fall in the price of paper and eventually the increase in literacy.
That's unintended consequences!

Via boingboing.

Balassa Samuelson and Le Big Mac

The Economist has published a new Big Mac index. It is the best way to teach Power Purchasing Parity to undergrads. Furthermore the index is useful to explain the Balassa Samuelson effect, one of the most interesting and comprehensive theories/effects of economics. It explains long term trends in exchange rates, as well as why tourists from developed countries travel abroad in search of sex e medical treatment.
By the way, there is a Big Mac boom going on in Paris.

Monday, July 9, 2007

The Dangerous Book for Boys

It is the best book ever written if you are 13. Nevertheless, I have just bought a copy of it. Know what? It is still amazing. Read an enthusiastic review here.

Saturday, July 7, 2007

in the most recent issue of European Economic Review:

Income inequality and colonialism

Luis Angeles

This paper proposes that colonialism is a major explanation behind today's differences in income inequality across countries. We argue that income inequality has been higher in the colonies where the percentage of European settlers to total population was higher, as long as Europeans remained a minority. The countries where Europeans became the majority of the population did not suffer from high inequality. These initial differences continue to hold today. The empirical evidence we provide strongly supports our thesis.

An older non-gated version of the paper is available here.

Tuesday, July 3, 2007