Assorted Links (9/17/2010)

Here’s a list of articles that I have been reading lately:

Shultz, Boskin, Cogan, Meltzer and Taylor: Principles for Economic Revival –

“In The Wall Street Journal, George P. Shultz, Michael J. Boskin, John F. Cogan, Allan Meltzer and John B. Taylor write that our prosperity has faded because policies have moved away from those that have proven to work. Here are the priorities that should guide policy makers as they seek to restore more rapid growth.”

The Prisoner’s Dilemma Makes a Reality TV Appearance –

“Once in a while, something happens in the real world that brings a flurry of e-mail to the Freakonomics office. If, for instance, the Prisoner’s Dilemma, or at least a version thereof, makes an appearance on a network TV show.”

Sizing Up Austan Goolsbee, Nominee to Head White House Council of Economic Advisers

“President Obama’s nominee as chairman of the Council of Economic Advisers combines sophisticated economics research with a keen appreciation of public policy, an economist writes.”

The game theory of ATM locations – Mind Your Decisions

“It’s interesting because the authors show how game theory principles can be used by banks to optimize ATM location. The key is that banks should not only consider a location’s demographics, but it should also consider how other banks are locating their ATM’s. This is particularly useful in a city where a bank will want to serve its customers but also reach other bank’s customers and get fees.”

Two Cheers for the Clean Air Act

“This week marked the 40th anniversary of its passage with scarcely any observance of the magnitude of progress under the legislation.”

A Poverty of Statistics

“Our official poverty measure is measuring the wrong thing.”

The Backlash Myth

Contrary to popular belief, this week’s Tea Party victories haven’t hurt the electoral prospects of Republicans in November.

Scientific Capitalism – Project Syndicate

“To understand how we got ourselves into our current economic mess, complicated explanations about derivatives, regulatory failure, and so on are beside the point. The best answer is both ancient and simple: hubris – in this case, that of modern mathematical economics, which claimed to have devised a set of scientific tools that could really predict human behavior.”

Economic Conditions Snapshot, September 2010

“Two years after the economic crisis, executives’ confidence has returned—albeit tenuously—suggesting a better ability to cope with and manage economic volatility. A Economic Studies article by McKinsey Quarterly.”

SSRN-Regulating the Shadow Banking System by Gary Gorton, Andrew Metrick

Here’s the abstract for this paper by Professors Gorton and Metrick: “The “shadow” banking system played a major role in the financial crisis, but was not a central focus of the recent Dodd-Frank Law and thus remains largely unregulated. This paper proposes principles for the regulation of shadow banking and describes a specific proposal to implement those principles. We first document the rise of shadow banking over the last three decades, helped by regulatory and legal changes that gave advantages to the main institutions of shadow banking: money-market mutual funds to capture retail deposits from traditional banks, securitization to move assets of traditional banks off their balance sheets, and repurchase agreements (“repo”) that facilitated the use of securitized bonds in financial transactions as a form of money. All of these features rely on an evolution of the bankruptcy code that allows securitized bonds to be used as a form of privately created money in large financial transactions, a usage that can have significant efficiency gains and would be costly to eliminate. History has demonstrated two successful methods for the regulation of privately created money: strict guidelines on collateral (used to stabilize national bank notes in the 19th century), and government-guaranteed insurance (used to stabilize demand deposits in the 20th century). We propose the use of strict rules on collateral for both securitization and repo as the best approach for shadow banking, with compliance required in order to enjoy the safe-harbor from bankruptcy.”

Why Does Government Grow and Grow and Grow?

“If Americans prefer smaller government, why does it continue to grow?”

The Myth of a Return to Clinton-era Taxes

“The claim that the president’s plan would only take the top tax rates back to Clinton levels isn’t quite right. Here’s why.”

The Day After Tomorrow

“Republicans are riding a wave of revulsion about what is happening in Washington. But once things settle down, what about the conservative future?”

Charles Krauthammer – The Buckley rule

“If DeMint and Palin care about the GOP keeping the Senate, they should stump for O’Donnell.”

Alberto Alesina: Tax Cuts vs. ‘Stimulus’: The Evidence Is In –

“In the Wall Street Journal, Harvard University economist Alberto Alesina writes that a review of 200 fiscal adjustments in 21 countries shows that spending discipline and tax cuts are the best ways to spur economic growth.”

The Sources of Liberal Intolerance

“American conservatives frequently complain that American liberals are intolerant—a striking paradox for a political movement whose very name suggests a respect for freedom. In their political rhetoric, liberals frequently resort to demonization, claiming, for example, that those who oppose same-sex marriage are animated by irrational hatreds.”

Obstacle to Deficit Cutting: A Nation on Entitlements

“Efforts to tame the U.S. deficit could soon confront a daunting reality: Nearly half of all Americans live in a household in which someone receives benefits, more than at any time in history.”

American Thinker: Retirement Fund Trillions Lure Government Grabbers

All I can say is, don’t cry for me Argentina…

America the Progressive

“The U.S. Social Security program is already among the most progressive in the world. Both liberal and conservative reformers would make it more so.”

Review & Outlook: Kathleen Sebelius Has a List –

“The Wall Street Journal on political thuggery from HHS.”

Arthur Brooks and Paul Ryan: The Size of Government and the Choice This Fall –

“In The Wall Street Journal, Arthur Brooks of the American Enterprise Institute and Paul Ryan, a Congressman from Wisconsin, say that Americans overwhelmingly prefer small government and low taxes to the alternative. Yet they’ve been given big government, one program at a time.”

Amar Bhidé: Don’t Expect Much From the R&D Tax Credit

“In the Wall Street Journal, Amar Bhidé of Tufts University writes that Apple does little of the kind of research that would be eligible. Nor do the thousands of companies that develop applications and accessories for iPhones and iPads.”

The Obama Administration and the Treatment of Human Embryos « Public Discourse

“Until every human being created in the image and likeness of God is protected in law and cared for in life, we shall not weary, we shall not rest. And, in this the great human rights struggle of our time and all times, we shall overcome.” With these words, the late Richard John Neuhaus concluded his last major pro-life address.”