The Economics of Prejudice

October 19, 2014 in Daily Bulletin

The Economist wrote:

  • Anti-Semites have often claimed, for a large part of history, that Jewish people control the world of finance.
  • So much so that it seems that areas with a legacy of anti-Semitism avoid using finance.
  • According to a study, even today, areas in Germany where Jews were most likely to be sent to concentration camps are 7.5% less likely to invest in stocks, when compared to other Germans.
  • This is to their disadvantage – such individuals get lower returns on their savings, imposing a direct financial cost on them.
  • The authors conclude that “persecution of minorities reduces not only the long-term wealth of the persecuted, but of the persecutors as well”

It is perhaps important to note that this is “a cultural norm of distrust in finance that has transmitted across generations independently from anti-Semitism”. Read more details here.

Source: The Economist

What Is The Optimal Time To Show Up At A Party

October 17, 2014 in Daily Bulletin

An equation that tells you exactly when to arrive at a party to not be weird. What a ridiculous idea! Why, the only people who would use that are those who break out in a cold sweat wondering if they’ll be socially ostracized for being late, or awkwardly gawked at for being the first ones there. People who’ll map the location in advance to find the closest Starbucks so that they have a place to retreat too if no one else is there. People who will write a bulletin about it for an “economics” website so that they can easily find it in the unlikely scenario that someone invites them to a Halloween event.

*Ahem*. Walt Hickey wrote:

  • The chaps at FiveThirtyEight organized a crowd sourced experiment to figure out when people show up to parties.
  • They found that the median individual shows up to a party 58 minutes after it was meant to begin.
  • But it depends on the size of the party. In those that have fewer than 23 attendees, the median guest is only 29 minutes late.
  • Those with more than 25, the median person comes 70 minutes into the event.
  • As a general rule of thumb, if you want to be the median guest to arrive, show up 42 minutes late, allowing for an additional 4 minutes for every ten members attending.

Read the caveats about the data, the 9% of people who arrive before a party begins, and see some excellent graphs and visualizations, as well as additional trends here.

Source: FiveThirtyEight

The French Need The Chinese To Drink More Wine

October 16, 2014 in Daily Bulletin

More bad news about France’s economy from Kabir Chibber: sales of Bordeaux are cratering:

  • Wine from Bordeaux, a region in France, is responsible for half the value of French wine exports.
    • Sales have fallen 18% to $2.3 billion this year.
  • The fall is in part due to the Chinese government’s recent anti-corruption measures which discourage officials from giving or receiving expensive gifts.
  • French people as a whole are also drinking less wine – -consumption fell 7% in 2013 and has steeply declined since the 1980s.
  • This leaves the US as the biggest market for wine in the world.

Read more about France’s economic woes here.

Source: Quartz

Air Umbrella

October 15, 2014 in Daily Bulletin

We’re inventing force fields! What are we using it to protect, you ask? Tactical nuclear warheads? Strategic bits of infrastructure? George R.R. Martin?

No, as a society we’ve decided that the best use of this technology is to avoid a touch of rain. Michael Franco wrote:

  • An Air Umbrella on Kickstarter has raised $22,000 of its original $10,000 goal with 9 days to go.
  • It will use pressurized air to protect users from the rain.
  • It comes in three different versions and is expected to cost up to about $150.
  • The battery is nothing to write home about – it’ll last between 15 and 30 minutes.
  • Expected delivery is December, 2015.

Read about the project, how it works, and more over here.

Source: CNet

Bose Gets Beat By Dr. Dre

October 14, 2014 in Daily Bulletin

Barry Petchesky wrote a piece that will make you feel for the poor souls at Bose:

  • As the NFL is being sponsored by Bose, the famous maker of noise cancelling headphones, players aren’t allowed to wear any other brand.
  • A player who wore a pair of Beats headphones was fined $10,000.
  • However there is reason to believe that Beats just paid the fine for him.
  • And anyway $10,000 is a drop in the bucket compared to what the players get for wearing the brand.
  • This is probably why other players have since been seen prominently wearing Beats headphones even after the fine was announced.

Read more here.

Source: Deadspin

The Economics Of Gangs

October 13, 2014 in Daily Bulletin

The Economist reviewed “The Social Order of the Underworld: How Prison Gangs Govern the American Penal System” and outlined parts of the argument for why prison gangs are rational:

  • Up until the 1950s prison gangs did not exist. Instead prisoners lived according tp a “convict code” that included guidelines such as not snitching.
  • It worked because in a small prison community fears of social ostracism was enough to keep everyone in line.
  • Then the prison population exploded and as s result of larger prison populations as well as a lot of first time offenders who did not know the code, the arrangement began to break down.
  • In this breach emerged the prison gang. Not only did they provide protection, their size meant that they were better able to bargain collectively and smuggle goods in such as drugs.
  • Gangs are also long term sellers which mean that their reputations are a guarantee of the quality of the products they offer.
  • Gangs are often centered around race because to avoid damage to the gang’s reputation it is important that others be able to clearly distinguish who is and isn’t a member of the gang.

Read about what this means in terms of policy prescriptions and more details about the book here.

Source: The Economist

Why Comic Book Cartoons Target Boys

October 12, 2014 in Daily Bulletin

Kevin Smith and Paul Dini, two giants in the comic book cartoon industry, pointed out a disturbing preference that executives have:

  • Television shows that appeal to girls are pressured to expand their young male audience because boys are more likely to spend money on merchandise.
  • This creates a tendency towards goofy and random humour.
  • It also creates a self-fulfilling prophecy where girls don’t watch comic book cartoons on TV because they’re not geared towards them, further causing such shows to focus on boys.
  • Smith, for his part, feels that girls may not buy action figures but they may buy other accessories such as character clothing. Executives are merely failing to do their jobs in identifying markets.

Read more about the phenomenon here.

Source: io9

The Economics Of The Umbrella Revolution

October 8, 2014 in Daily Bulletin

The umbrella revolution – so named because of the umbrellas that protesters are using to protect against tear gas and the weather – has been going on for over a week now. Heather Timmons looked at what this meant for Hong Kong’s economy:

  • China’s ban on tour groups visiting Hong Kong was expected to hurt the service sector as two thirds of visitors to Hong Kong are from the mainland. However tourism has actually increased as visitors arrive to shop and view the protests.
  • Retailers may have lost $284 million in sales according to one group, although the reality is murky. Others are reporting that the protests are actually boosting sales.
  • While the stock market has taken a hit, traders have generated more in fees due to higher trading volumes as skittish investors reevaluate their portfolios.
  • All in all, the Chinese government’s assertion that the protests could cost Hong Kong $5.2 billion seem unfounded.

Read more about the economic impact of the protests over here.

Source: Quartz

The Oddest Cases Of Comparative Advantage

October 7, 2014 in Daily Bulletin

C. Coville wrote about strange cases of one country building market dominance in weird things:

  • Sweden is responsible for a lot of our pop music. Producers and musicians increasingly come from the country, in part because the government launched several music schools, and now one in three Swedish children attend after-school music programs.
  • We can thank India for the best hair extensions. Since many Indian women don’t treat or blow dry their hair, they make for the best tresses. Some then cut their hair at a temple as an offering, and the clippings are auctioned off for community funds.
  • A good number of the Avengers – and movie stars in general – are Australian. Reasons for this include that they’re cheaper than American actors, and project a more chiseled action hero image, than American ones who tend to be more boyish.

Check out the rest of the article which includes musings on the spread of Wahhabism, why producers have to coerce Chris Evans to become Captain America, and more over here.

Source: Cracked

The Economics Of Hazelnuts

October 6, 2014 in Daily Bulletin

The world’s demand for Nutella is causing a shortage of hazelnuts writes Dan Charles:

  • Most hazelnuts come from a narrow strip of land around the black sea in Turkey.
  • Ferrero, the maker of Nutella, is responsible for the consumption of about 25% of the world’s hazelnuts.
  • This year there was a frost in Turkey that cut production in half, causing prices to rise by 60%.
  • The world’s demand for the nut is encouraging other countries to start production. Chile, Australia, and America are all starting or expanding hazelnut growing operations.
  • Humans aren’t the only creatures that love the nut; one of the biggest challenges of growing them is keeping the squirrels away.

Read about the hazelnut market, find out why it’s so difficult to grow them in America, and find out about one scientist that might have figured out a way to do so anyway over here.

Source: NPR