catallaxy files

catallaxy in technical exile

Archive for April 2005

Working hours and welfare

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An intriguing new paper from the US NBER by Alesina, Glaeser and Sacerdote tackles the question ‘Work and leisure in the US and Europe: Why so different? From the abstract:

Americans average 25.1 working hours per person in working age per week, but the Germans average 18.6 hours. The average American works 46.2 weeks per year, while the French average 40 weeks per year. Why do western Europeans work so much less than Americans? Recent work argues that these differences result from higher European tax rates, but the vast empirical labor supply literature suggests that tax rates can explain only a small amount of the differences in hours between the U.S. and Europe. Another popular view is that these differences are explained by long-standing European “culture,” but Europeans worked more than Americans as late as the 1960s. In this paper, we argue that European labor market regulations, advocated by unions in declining European industries who argued “work less, work all” explain the bulk of the difference between the U.S. and Europe. These policies do not seem to have increased employment, but they may have had a more society-wide influence on leisure patterns because of a social multiplier where the returns to leisure increase as more people are taking longer vacations.

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April 29, 2005 at 5:40 pm

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Are student union fees a 'tax'?

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For years supporters of compulsory student union fees have been saying that they are like council rates.

At yesterday’s rally the consensus seemed to be that these fees were a ‘tax’.

The University of Sydney’s Academic Board Chair John Carter told the students:

“I haven’t seen so many people on the front lawn since the Vietnam days and it says a great deal when there’s so many of you here protesting in favour of a tax.” [Note boomer nostalgia too]

Jenny Macklin agreed:

“Students could simply not afford to pay for services such as child care, health care, food, entertainment, sporting clubs, accommodation advice and counselling, which were subsidised from union fees,” she said. “Let’s face it, how many people would voluntarily pay their taxes if they didn’t have to?”

I am not sure that this helps their case. It makes it quite explicit that many students do not get value for money, but instead subsidise services used by other people. Over at her website, Macklin even unwittingly highlights the regressive nature of these subsidies, by calculating the large subsidies received by Establishment Liberals while they were at university.

This is a tax like no other. It’s not levied by government. It is not a flat sum for everyone, or a percentage of anything, the usual way of calculating taxes. You get something directly in return, from which people who do not pay the ‘tax’ are excluded.

In fact this ‘tax’ is exactly what it is called in practice, a fee. Like other bundled services, there is some redistribution going on, but it is nevertheless a fee. You pay less if you are a part-time student, on the assumption that you will make less use of the services. Try paying less tax, on the ground that you do not use the services government offers, or were out of the country for much of the year.

So why call it a tax? The answer can be found in the ideological hang-ups of the Macklin generation, kept alive in the student union movement. They remain ideologically opposed to fee charging at universities. Their logical difficulty now is that Labor’s position is that:

1) Universities should not be allowed to charge an extra 25% fee on HECS, which can be deferred and repaid via an income contingent loan.
2) Universities should be allowed to charge an unlimited fee on amenities and services, which must be paid up-front.

Working in higher education policy, you have to get used to a fair amount of absurdity. But this contradiction is too much even for Ms Macklin. The only way around it is to reclassify the fee they support as ‘rates’ or a ‘tax’. It’s bullshit, of course. But like yesterday’s rally, it will help the left feel better.

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April 29, 2005 at 8:02 am

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When should hypocrites be outed?

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Steve Sailer’s blog drew my attention to a minor development in the rough and tumble world of US politics, as reported here for instance:

Arthur Finkelstein, the ultra conservative Republican consultant, married his male partner in a civil ceremony at his Massachusetts home. Finkelstein, 59, who has made a practice of defeating Democrats by trying to demonize them as liberal and supporting politicians who routinely vote against gay rights, said in a brief interview that he had married his partner of 40 years to ensure that the couple had the same benefits available to married heterosexual couples. “I believe that visitation rights, health care benefits and other human relationship contracts that are taken for granted by all married people should be available to partners,” he said. An ally of Jesse Helms, Finkelstein’s associates said he didn’t tell them about the wedding..

I am as a rule against the invasion of privacy in political campaigns where private pecadilloes are irrelevant but relevance is of course the issue here. This Finklestein character has been associated with some of the most bigoted ultra- reactionaries in the Republican party. Would a political opponent have been justified ‘outing’ him where he employed his usual dirty tactics in a campaign? When is hypocrisy relevant?

One plausible claim is that in the absence of further evidence, all one can say is that in the past when working for the likes of Jesse Helms, he was merely acting in his professional capacity as a campaign manager and it is not necessarily true that campaign managers identify politically in every respect with their candidates. That is, his associations with the likes of Helms is possibly ‘just business’. To continue with my example, Helms is the candidate, not him. A campaign manager is like a criminal lawyer (actually, not a bad analogy, that).

Secondly, the hypocrisy has to be directly related to the policies being proposed. Thus, there may be plausible, non-hypocritical reasons why a ‘closet’ gay candidate might be opposed to gay marriage but if that same candidate is opposed to, say, legalisation of consensual gay relations, then his sexuality is fair game.
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April 28, 2005 at 7:01 pm

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Einstein's Big Year

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This is a contribution to Einstein Year, the centenary of the publication of Albert Einstein’s equation E = mc2. Actually he made two other major advances in the same year, so it was a kind of trifecta. [warning, the link is slow to open]
The three papers that he published that year were (1) the founding paper of special relativity, (2) the first paper ever on photons which won him the Nobel Prize 16 years later, and (3) a paper on Brownian movement that established the reality of atoms.
The folk at Spiked have compiled a list of statements about the importance of science and the scientific approach from the following: Colin Berry, Paul Davies, Richard Dawkins, K Eric Drexler, Susan Haack, Matt Ridley, Simon Singh, John Stachel, John Sulston, Raymond Tallis. Not exciting but interesting.
My favorite is from Raymond Tallis (any relation to Gordon Tallis I wonder?)

I would emphasise that the robustness and practical usefulness of scientific knowledge is based upon an unrelentingly critical attitude to its own intuitions, theories and beliefs, so that what survives its scepticism towards itself is of a very high quality indeed.

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April 28, 2005 at 3:39 pm

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Catallaxy mention on Radio National

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Thanks to Teresa Fels for drawing my attention to a mention of Catallaxy on Radio National this morning in a program on blogging. Here is the link. Thanks too to blogger Trevor Cook for the mention though he does get something slightly wrong:

Trevor Cook: Tim Blair is a must-see if you’re a John Howard supporter and you want to read about why John Howard’s right every morning, that’s ideal, and why George Bush is right every morning. John Quigan, an academic from the University of Queensland, his site’s called John Quigan, and of course he’s an economist, and he writes from a social democratic perspective.

Jason di Rosso: He’s a journalist also for The Financial Review?

Trevor Cook: Yes, he writes Op. Eds for them. Catallaxy is another one, which is associated with the Centre for Independent Studies, which is a sort of pro-market, pro-free market think-tank.

Jason di Rosso: That’s a group log isn’t it, that one?

Trevor Cook: Yes, it’s got a couple of people, which I think works really well, having a couple of people, with a broad range of similar views I guess.

Confusing Catallaxy for a CIS group blog is understandable given that Andrew, myself and Rafe are or have been employed by the CIS but it really isn’t – this was more a case of my roping in people I know, though perhaps Don Arthur would appreciate the honorary membership! And poor ‘John Quigan’ gets his name misspelled by the transcriptionists every time!

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April 28, 2005 at 12:30 pm

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Islam and economic development

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I haven’t had a chance to read this paper yet but I thought it might be worth drawing attention to. It’s by Timur Kuran, a noted scholar on the links between economic development and religion who is ‘Professor of Economics and Law and King Faisal Professor of Islamic Thought and Culture’ at the University of Southern California. The paper is entitled ‘Why the Middle East is Economically Underdeveloped: Historical Mechanisms of Institutional Stagnation ‘. Here is the abstract:

Although a millennium ago the Middle East was not an economic laggard, by the 18th century it exhibited clear signs of economic backwardness. The reason for this transformation is that certain components of the region’s legal infrastructure stagnated as their Western counterparts gave way to the modern economy. Among the institutions that generated evolutionary bottlenecks are the Islamic law of inheritance, which inhibited capital accumulation; the absence in Islamic law of the concept of a corporation and the consequent weaknesses of civil society; and the waqf, which locked vast resources into unproductive organizations for the delivery of social services. All of these obstacles to economic development were largely overcome through radical reforms initiated in the nineteenth century. Nevertheless, traditional Islamic law remains a factor in the Middle East’s ongoing economic disappointments. The weakness of the region’s private economic sectors and its human capital deficiency stand among the lasting consequences of traditional Islamic law.

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April 28, 2005 at 10:06 am

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Why Mark Latham should publish his memoirs on CD-ROM

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Fallen Labor Leader Mark Latham is, according to press reports, trying to flog his memoirs to publishers. One of them declined ‘because it was “a book of insults”.’

Poltical autobiographies, or for that matter biographies, don’t have a great record in Australia. Don Watson’s Recollections of a Bleeding Heart about Keating is the only one that I can recall being both widely bought and read, though I didn’t mind Hayden’s autobiography or Peter Walsh’s Confessions of a Failed Finance Minister.

But as someone who has quite a large library of books relating to Australian politics there is one rule I have with these life story volumes: don’t pay full price. After some initial hype, they are almost always remaindered, and even if they are not copies will quickly appear in second-hand stores, as people whose aunts and grannies think they are interested in politics convert unwanted birthday and Xmas presents to cash.

Since self-reflection is not a quality often found in Australian political figures, most of these volumes are long exercises in self-justification and belittling of rivals and colleagues. It’s all so tedious. Mark Latham has already effectively written one of these, The Whitlam Government, penned when he was a research assistant to the other spectacularly fallen Labor leader featured in the book’s title.

And now it seems he is writing another, though I imagine his insults will be cruder and less witty than Gough’s. But since few will actually be able to keep going through several hundred pages of tiresome score-settling, but many will want the juicier items of gossip, I suggest Latham’s memoirs be published on CD-ROM. This will aid with rapid searching for whatever piece of gossip the purchaser wants, and minimise the amount of reading required.

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April 28, 2005 at 8:02 am

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