I read a bunch of really cool stuff this weekend. The highlights:
This Salon interview is old, but the gist is that a professor realized that as young, innocent children most victims of sexual abuse don’t feel that traumatized while the abuse is happening. In contrast to an event like a rape, where the victim immediately feels terror, pain and shame, and does not consent to the event the feeling most often expressed by child sex abuse victims (at the time of the abuse) is confusion (the upset and anxiety comes when they grow older). So when sexual abuse is described by the media and popular culture as a traumatic event, sexual abuse victims believe that what happened to them doesn’t fit the bill, and don’t tell the relevant authorities. The author also believes that repressed memories are a myth; around the world, people remember traumatic events vividly. Because these events are not really traumatic, people forget about them and then recall them when asked later, which is natural, and has nothing to do with repression. Note that the author is not condoning or excusing sexual abuse; merely observing that for many children, the event is not traumatic or painful (at the time), merely confusing, and because their experience doesn’t match up with the description of sexual abuse in the media they don’t come forward, even though the crime is horrific.
Colin Marshall shares thoughts on interviewing after having done 100 of them. In essence, his advice is to go with the flow of the conversation, don’t prepare questions (but do your research) and ask questions about things about which you are genuinely interested in reading the answer. I keep meaning to start interviewing people; I should start right now but I doubt I will.
Here’s a good review of Center City, the new gigantic development in the center of the Strip in Vegas. I agree that it lacks personality, and two bits in particular reminded me of my own experience there (excepting the suicide bit):
“I start to feel claustrophobic and duck out of the event. For a certain type of person, Vegas is a non-stop party. For me, it induces a kind of persistent low-grade anxiety. There’s something dystopic about the place generally, and CityCenter is starting to feel like the world of Blade Runner come to life. I head back to my room, shut the black-out curtains and lie in bed. More people commit suicide in Las Vegas than in any other city in the United States.”
[…]
“Realistically, this place is as much an artifice as anything on the Strip, a re-imagining of a 19th-century saloon, complete with polished bar, antique typography, Edison bulbs. Why, then, does it feel so much more honest? Because its aesthetic is filtered through a contemporary sensibility? Because it seems a natural part of a vibrant neighborhood? Is this all bullshit I invent to make myself feel more comfortable? Could the real problem with Las Vegas — my real problem with Las Vegas — be that its commercial imperatives are simply too transparent?”
Here's an illustrated post describing 10 reasons to avoid talking on the phone. I don’t enjoy talking on the phone; on days like my birthday when lots of people call I get stressed out. It must show because people say I sound very funny when I talk on the phone.
Many Republican governors made a big show out of repealing the stimulus but as Jonathan Chait points out, Republican states generally get more federal money in than they give to the federal government in tax revenue than Democratic states. He also profiles Mitch Daniels, whose Indiana country bumpkin-ism is phony, as a former pharmaceutical company CEO, but who has generally governed Indiana from the middle, expanding health care and increasing taxes. My preferred Republican candidate is still Jon Huntsman, but he won’t be back on the national stage until around 2014, probably.
Daniela Papi has a great post on the many problems with “voluntourism,” or traveling to a foreign country to do volunteer work. She points out that most volunteers don’t know much about the local culture, you don’t speak the language and don’t have relevant skills, and this makes it very difficult to find work that’s useful. Given these constraints, it’s entirely possible that the work you’re doing overseas (for example, painting or building houses) is displacing local labor, and that the money you’re spending can be put to much better use.
“I really did travel with a tour company that decided to allow us to paint the school that was on their bike route. We painted it poorly, I must say, as we rushed to complete it in one day (and most of us felt too tired to put in a big effort). We probably spent $200 on paint (25% of which we dropped on the floor). The project was in rural Thailand, and $200 could have probably bought a lot of educational resources, hired a few teachers for a month, or done a list of other things which would have added more educational value than our patchy blue paint job. If they insisted on painting, if they had instead funded $3000 towards a locally identified educational need (for example, a weekly life-skills training course), plus bought $200 worth of paint, at least then our combined efforts would have been more than just the blue paint on the floor.”
Voluntourism creates an unhealthy culture:
“As Saundra has told us over and over again and as I have learned through seeing the negative effects of an unbridled tourism culture of giving things away “to the poor people”, giving things to people is never going to solve their problems. Instead, it can destroy local markets, create community jealousies, and create a culture of dependency.”
Tour companies don’t monitor projects effectively:
“A tour company in India allowed tourists to hand out goats to families on their tours. In the middle of the tour, a person from a nearby village came and told the director that the man who had been put in charge of choosing which poor families should get the goats had been charging the families for the goats for years. The tour company had been making their English speaking tour guide rich, were not helping “the poorest of the poor” that they claimed to be, and had furthered corruption and mistrust in the village.”
“There are many orphanages in Cambodia which take volunteers to teach English. Some come for a few weeks, others for a few days. When they leave, the classes have no teacher, there is no curriculum to ensure that the students aren’t learning “Head, Shoulders, Knees, and Toes” every day, and the school is not better able to solve its own problems in the future because of the volunteer’s visit. If skilled teachers had spent time teaching English teachers English, they would have improved the system at least slightly, but sadly, everyone just wants to pet the cute kids.”
Last but not least, the tours “foster moral imperialism” among volunteers:
This one is the biggest problem I think, but the least talked about. We assume, because we come from wealthier places with better education systems, that we can come into any new place without knowing much about the culture or the people, and we can fix things. We can’t! THEY, the people who live there and know the place well, can. Our job in the development world can and should be to support them in doing so. So, we can’t assume we can come do it for them and “save the babies” by visiting an orphanage for a few hours on our trip to India. And we sure shouldn’t think that our time is oh so valuable that we should fundraise money to pay for OUR flights to go paint a school poorly. My job, in running a tour operation, is to educate travelers on at least these two points: improvements take time, and the people we are visiting have just as much—if not more—to teach us as we have to teach them.
The bottom line is that “voluntourists” are more interested in showing that they care than in actually helping make a difference. This is one reason why I could never be a college admissions officer; I would reject outright any student that wrote about this sort of work in glowing terms (and I know many do).
I was pretty careful in vetting organizations at the beginning of the trip, and I know that the organization I’m working for does things the right way. I don’t have any illusions about the value of the work I’m doing. I tend to think of the main point of my trip as spending time traveling, learning about a different culture and trying to learn several specific skills.
It became clear very quickly that I don’t know much about the culture, and I definitely don’t know enough Hindi to get by. I do have some useful skills; I’ve been spending more than my fair share of time doing things for the NGO that I am good at, in particular redesigning their website to attract more money in donations (the revenue from which, when complete, will far exceed the cost of the plane flight), and writing grant proposals in English.
Traveling to a foreign country is an excellent experience and I recommend it, if you or your parents have the means. The longer you can stay the better, but even if you can only go for one week, don’t pay for one of these trips though. Aim for one of the smaller cities, then a month before you leave, buy a phrasebook and practice. Once you get there, rent a bike/car and get out into the countryside, eat the local food and try your best to make conversation.
Two articles today show how difficult it is to maintain good incentives in poor countries. The first was from Madagascar, one of a handful of countries in Africa which was exempt from U.S. tariffs under a special program, the AGOA program. The textile industry in Madagascar was thriving, employing over 100,000 workers and also employing hundreds of firms that supplied the raw inputs to the textile shops. The AGOA ran out at the end of 2009, forcing thousands in Madagascar and the surrounding countries to find other work. The results have not been pretty; there have been riots in the streets, and increased stress on profits in other professions, like street sales.
Ostensibly, Congress ended Madagascar's inclusion in the program because of a military coup in March. But there isn't really much evidence that imposing sanctions on the workers has had or will have any effect on the authoritarian leadership. Indeed these sanctions tend to hit the working classes much more than they hit the people in charge. Growth and good governance go hand in hand, but it doesn't make sense to kill a country's growth because the government changed.
Robert Strauss, head of the American Chamber of Commerce in Madagascar, told IRIN that a quarter of the jobs in the formal economy were dependent on AGOA, and the reintroduction of US import duties of up to 34 percent had made keeping factories open unprofitable.
The rapid decline of the textile industry was also having a knock-on effect in other countries in the region, including Mauritius, Swaziland, Lesotho and South Africa, where many of the materials used in Madagascar's textile factories, such as zips, were produced, Strauss said.
[...]
Fabien Rakotonirina, a textile factory machinist who lost his job in December 2010, told IRIN: "Here on the street there is not enough profit. In the factory I earned 10,000 ariary ($4.65) a day, now I earn 6,000 ($2.80)."
The second story is from India, whose farmers this year will produce less rice per hectare than Pakistan, Sri Lanka and Bangladesh. The Indian government has long subsidized the use of different types of fertilizer in agricultural production, which has by and large stimulated crop yields and reduced India's need to import food. As government revenues wax and wane, subsidies have gone up and down - but the urea (a type of fertilizer) manufacturers are politically powerful and have prevented the urea subsidy from being touched. Because urea is so much cheaper than other fertilizers and nutrients, farmers are spreading way more urea on their crops than is recommended (32-to-1 ratios of nitrogen to potassium, which should be about 4-to-1) and the soil quality is deteriorating. As a result India may soon have to increase its dependence on importing food.
India has been providing farmers with heavily subsidized fertilizer for more than three decades. The overuse of one type—urea—is so degrading the soil that yields on some crops are falling and import levels are rising. So are food prices, which jumped 19% last year...Farmers spread the rice-size urea granules by hand or from tractors. They pay so little for it that in some areas they use many times the amount recommended by scientists, throwing off the chemistry of the soil, according to multiple studies by Indian agricultural experts...The government has subsidized other fertilizers besides urea. In budget crunches, subsidies on those fertilizers have been reduced or cut, but urea's subsidy has survived. That's because urea manufacturers form a powerful lobby, and farmers are most heavily reliant on this fertilizer, making it a political hot potato to raise the price.
These are both examples that demonstrate the fragility of good incentives and growth, and the power of special interests and far away people to destroy it. Throwing money or sanctions at these problems is not very helpful, but encouraging trade and denying special interests are. Politics always has winners and losers; the winners here are textile manufacturers in America and other countries, and urea manufacturers, and the losers are producers in Madagascar, taxpayers in the US (who bear the cost of the subsidy as well as the market price of the food) and farmers in India.
I'm almost finished rereading The Count of Monte Cristo, one of my favorite books. It involves a prison escape, buried treasure, delicious revenge and a reversal of status. One thing I've noticed now is how egotistical the Count is: taking pleasure in others' misfortune, being convinced of his complete superiority over everyone else, believing that he is a messenger of God, sent to deliver justice for a crime committed twenty-five years hence. However the other characters are so evil that he's totally justified.
I wanted to share some good quotes from the book. Abbe Faria, a priest locked up in prison for 15 years, is asked by Dantes, "What would you not have accomplished if you were free?" and replies,
"Possibly nothing at al; the overflow of my brain would probably, in a state of freedom, have evaporated into a thousand follies; misfortune is needed to bring to light the treasures of the human intellect. Compression is needed to explode gunpowder. Captivity has brought my mental faculties to a focus; and you are well aware that from the collision of clouds electricity is produced-from electricity, lightning, from lightning, illumination."
Here's another one, about the career-driven M. de Villefort and society:
Ordinarily M. de Villefort made and returned very few visits. His wife visited for him, and this was the received thing in the world, where the weighty and multifarious occupations of the magistrate were accepted as an excuse for what was really only calculated pride, a manifestation of professed superiority - in fact, the application of the axiom, "Pretend to think well of yourself, and the world will think well of you," an axiom a hundred times more useful in society nowadays than that of the Greeks, "Know thyself," a knowledge for which, in our days, we have substituted the less difficult and more advantageous science of knowing others
Kumbulgarh is a giant fort, in the middle of nowhere, on top of a plateau, with huge walls and a series of gates and walls leading up to a castle on a hill on the plateau. Given the fortifications and technology at the time I guessed it would have taken around twenty invaders for every defender to storm the thing. Which begs the question, why would any invading army bother capturing the fort? Just surround the whole plateau and steal all the food and messengers coming in, and you’ve effectively captured all of the land. For a fort to be effective, everyone must have had their huts/houses inside, but there wasn’t that much room on the top of the plateau, to support an army or otherwise. Sure, giant fortifications can keep people out but they can also make it really tough to maneuver.
There’s a passage in one of the Michael Crichton books that talks about the eerie silence in the Middle Ages, when there are no buzzing airplanes, cars or electronics emitting ambient noise. Crichton’s wrong on this point, because there are always animals around, and stuff like the wind that rustles trees, but it gets noticeably quiet when you are out in rural areas.
There were clearly different levels to the fort, with the palace at the top, so back in the day, you could tell someone’s status really easily by what level of the hill they lived on. People probably went their whole lives without getting to the top of the fort. Now you can get to the top of the fort for 5 rupees.
Tourist traps and historical sites can only make so much money charging admission, licensing guides and selling merchandise. I think tourist sites can go further nowadays in selling an experience to visitors, and especially selling exclusivity, to people that demand those sorts of things. Only a Westerner would say this, but I couldn’t help looking around and thinking about how cool it would be to have a giant paintball tournament or other battle-type event at the fort. Take the Tough Mudder competition for example – a 24 hour competition designed to test endurance and strength, and push people to their limits. Tough Mudder sells a story about toughness to people; complete this and you will have higher confidence and something to boast to your friends about. Why hasn’t someone thought to do the same at some of our coolest historic sites (at least the less reputable ones)? No question you could earn more revenue with a 1000-person, 5-day-and-night paintball tournament (biodegradable, washable paint, of course). All it would take is a blatant disregard for the reverence due to history. Historic sites only sell an experience so much; they could do a lot more if they were willing to be a little more entrepreneurial (and less respectful). Maybe I underestimate the tourism options available for the ultra-rich.
We hired a cab driver for the day (good decision) but he stopped at a restaurant that was, on reflection, a complete tourist trap. Not only was the food overpriced, but as a restaurant that caters to tourists, the food was geared to the lowest common denominator, e.g. a tourist who hates spicy food. Why people who can’t eat spicy food come to India is a mystery, but the lesson remains; any place that caters to (foreign) tourists is going to have bad food (and a big menu). While we ate the cab driver disappeared in the back, to eat lunch, no doubt. He probably ate way better than we did for about a twentieth of the price. Note to self: In the future, pack lunch.
Ranakpur
Ranakpur was a series of three awesome Jain temples, in the middle of the jungle. The temples were very beautiful, peaceful, and cool, decorated in marble on the inside and out. The temples were supported by many pillars (again, awesome for paintball); any one of the pillars by itself could have been an extremely valuable work of art, together they were overwhelming, and almost made you underestimate the amount of work that must have gone into any particular one.
It’s interesting to see how the ideal human form changes from religion to religion and culture to culture. In Buddhism the ideal is a smiling, fat Buddha; in Catholicism, a lean, suffering Jesus Christ; in Islam there are no pictures of faces. The Jain idols had very wide faces. Maybe this is just a relic of the sculpting style back in the day.
The temple is very much still active and there were many ascetics sitting crosslegged, praying and walking around the temple. There were many visitors just watching the Jains. I think it would be difficult to pray, or reach any sort of positive mental state, with so many people watching.
Every religion allows people to tell the difference between believers and non-believers. Believers seek out clothing, rituals, audible prayers and other visible actions that distinguish themselves from non-believers. In this case the Jains were wearing white almost-togas. It would be pretty awful to believe in something and not let others know that you believed it.
Photos when I get a more reliable internet connection...
From Poverty to Prosperity is full of excellent quotes. Here’s one from Robert Solow:
It is far from obvious to me that the way to foster competition is to leave the private sector alone. The private sector does not much like competition; it has its own ways of creating monopoly power, restricting access to wealth (and therefore to political rights), and preserving vested interests. It is no easy matter for a society to get the benefits of competition without the disadvantages of oligarchy, and there is no reason to believe that laissez-faire will do the trick.
A coworker, upset at some of the arguments I was making, told me I should watch a video called "The Story of Stuff" to see the world from her point of view. These sorts of exercises are useful, because they force you to go through and think about why you believe the things you believe. I don’t have Jonathan Chait's grace, but I can hopefully discuss some of the arguments made during the video, and along the way give you a better idea of how I see the world.
A note about the format of the video:
I distrust arguments that are made using video, where the arguer attempts to tell a story, introducing facts with no citation, making a short argument and then making a new argument before fully developing the previous one. I don’t like it when Michael Moore does it, or Glenn Beck, or any other demagogue. A story requires unambiguously good characters and unambiguously bad characters. The truth is often more messy.
A note on imposing personal beliefs on others:
In the past three years, I think I’ve purchased two shirts and two dress shirts. I spent about a week over winter break systematically throwing out and giving away stuff in my room, and vowing to try harder to avoid introducing clutter in the future. I plan on giving away most of the clothes I brought with me to India, and on choosing a job after school that I enjoy doing, rather than one which maximizes my income. I am aware of things like ‘the hedonic treadmill.' These personal beliefs are not inconsistent with the following points:
Most of the arguments in this video are misleading.
Just because I believe that a worker is being exploited does not give me the right to pass a law prohibiting the employer from offering that type of work, especially when I do not know anything about the worker’s circumstances, and the worker has entered into a voluntary contract with the employer.
Just because I believe that some consumption is wasteful and causes clutter doesn’t give me the right to legislate against someone else’s style of living, even if I believe it’s wasteful.
Capitalism, in particular, an economy which promotes the purchasing of items which make people's lives easier, spurs innovation and raises productivity, both of which are responsible for allowing people around the world to earn higher wages and enjoy better standards of living.
A note about the growth of countries: Every nation around the world once had an agrarian economy, including the United States. On the way to becoming modern, service-based economies, nearly every developed country went through a phase where the primary industries were sweatshops and dirty manufacturing jobs. The conditions in these types of jobs in the United States in the 1800's are awful, and well documented. People who have spent their entire lives working on the land do not have the skills, or the institutional capital, to perform jobs which demand more skill than sweatshop work, which pays marginally higher wages than ordinary farm labor. The key point is that as workers wages rise, they begin to demand more services and better rights, and at some point when workers could make enough money doing other jobs, the sweatshops close their doors.
Countries like South Korea, Taiwan, and Singapore, which are generally well developed today, had agrarian economies as recently as the 1950’s, and had sweatshops as recently as the 1970’s. As workers wages rose, they demanded better jobs and better working conditions and the sweatshops moved elsewhere. The sweatshops though were a key step in the transition from an agrarian economy to a modern economy.
Here’s a chart showing the first and most recent countries to reach $2000 in average income, and subsequently how long it takes them to reach $4000. Source: Arnold Kling and Nick Schulz, “From Poverty to Prosperity,” New York: Encounter Books, 2009.
Country Year reached $2000 Years to reach $4000
New Zealand 1821 65
Australia 1831 42
United Kingdom 1835 54
Netherlands 1855 64
Belgium 1856 55
United States 1856 44
Syria 1961 12
Jordan 1964 15
Taiwan 1965 10
Turkey 1965 23
South Korea 1969 8
Thailand 1977 13
The process of transitioning from a subsistence economy to a modern economy is speeding up, which is indisputably a Good Thing. Countries are reaching higher wages fairly quickly and thus, in my loose economic shorthand, spending less time in the sweatshop/dirty factory phase of growth.
Using GDP and average income as barometers:
GDP and average income are not perfect measures of how countries are doing. If Bill Gates lived in Uganda, the GDP and average income figures for Uganda would look very different. While qualities like Amartya Sen’s notion of capabilities may be important factors in growth, capabilities would be extremely difficult to measure.
I believe, and I think the statistics will back me up, that the majority of people in Third World countries (and I will use the word “Third World” because the narrator of the movie does as well) desire higher income, which allows them to purchase things like better health (nutrition as well as medicine), convenience (a car, computer, washing machine, or access to the Internet), better living standards (a home), or better living standards for their children (saving up enough to provide a large dowry or a private education for their child, in the hopes of sending him/her to a better college). Anecdotally, I see this at my school, where the majority of foreign students are interested in the field (finance) that allows them to earn the highest income out of college.
Again anecdotally, the people saying things like “It doesn’t matter what job I have after graduation, as long as I am happy” are the students who come from relatively wealthy backgrounds. I am reminded of a scene in the movie Platoon, when the other (black) soldiers ask Charlie Sheen what he’s doing in Vietnam, and he responds using an ideological argument about fighting communism and doing the right thing. “Man,” one soldier says, “you gotta be rich to think like that.” Furthermore, contrary to popular belief, higher income is correlated with higher levels of happiness everywhere around the world. These data points suggest that a development or political effort designed primarily to increase the income of Third World country inhabitants is not misguided.
To conclude, GDP and average income may not capture every important variable about a country, or people's livelihoods, but they are fairly easy to measure, and give a rough idea of how the inhabitants of that country live.
Sweatshops:
The narrator points out that pregnant women in Third World countries sometimes work in dangerous conditions. “What sort of woman would work in a factory like this except one with no other option?” she says. How, then, is the solution to remove the option? Poverty is the main cause of being option-less, not sweatshops. Increasing average income is the way to give pregnant women more options, like the ability to afford maternity leave, and the way to increase average income is, generally, to participate in the global economy, not shun it.
Assume we know nothing about the life of an average citizen in a Third World country. The worker has employment options A, B, C, or unemployment. The worker chooses option A, which is working in a sweatshop. While sweatshop work may be horrible and the hours long, clearly the worker prefers it to options B, C, and being unemployed. To say that we should take the worker out of the sweatshop implies that we know better for the citizen than the citizen knows for himself, which violates the assumption.
The fact that workers choose to work in sweatshops, which have generally poor conditions, should indicate to most people that the alternatives to sweatshops are even more horrific. Nicholas Kristof and Paul Krugman point out that alternatives for many people might be scavenging in a garbage dump, or going hungry. With few exceptions, which are rightfully being rooted out and banned, sweatshop workers enter into voluntary paid contracts with sweatshop owners, which they can quit at any time.
People may feel bad that the sweatshop workers are being employed making products for our use. Even assuming that most sweatshops in Third World countries produce products which are directly sold to customers in the West, raising the wages/improving conditions in those sweatshops would not allow Third World countries to compete for business; if my wage costs are the same, would I rather place my factory in India or in the USA? Moving the factory to America takes jobs away from the poor; industrial growth is generally good for the workers in a third world country.
Some people argue that sweatshop workers aren’t learning useful skills. On the contrary, they are learning how to produce goods at a level of productivity per worker that approaches Western standards. In the excellent book The Elusive Quest for Growth, Bill Easterly gives the example of the Bangladeshi garment industry, which started from practically nothing. Noorul Quader partnered with a Korean garment firm, Daewoo, and sent some of his workers to learn from Daewoo. Using the new techniques, and with the benefit of high productivity and technology levels, Quader’s firm, Desh Ltd., grew rapidly. Soon after, workers in Desh Ltd. quit and started their own garment companies, using the lessons they learned from working at Desh. Now the Bangladeshi garment industry is a largely homegrown $2 billion industry.
The use of misleading statistics throughout the video: In a world where incomes are not evenly distributed, it’s natural that the people on the high end of the income distribution consume more goods than the people on the low end of the income distribution. The USA has an extremely high concentration of people on the high end of the income distribution. Thus I do not feel guilty when the narrator says that the USA has a small share of the world’s population, but consumes such a large proportion of its resources. People may feel guilty because they believe it is not fair or just that the people on the high end consume more than the people on the low end. Most systems aimed at reducing this inequality have failed miserably, and even in communist countries, the leaders ate and owned dachas on the lakes while the people starved. I would be more moved by a study showing that people in the United States consume more stuff than other similarly rich people, and this is because of consumerism, government regulation, etc.
The narrator wants to scare the viewer by mentioning the horrible chemicals that go into everyday products. Specifically, she mentions brominated fire retardants, which are used in pillows. Pillow manufacturers have reputations; if their pillows were killing people, or if a study came out linking the materials in their pillows with a higher risk of cancer, they would remove the chemical from the product, because otherwise, people wouldn’t buy it.
Reputation effects are a key component of capitalism; we do business and we buy products from companies that have earned our trust, especially because we don’t have the time to inspect the materials and safety of each and every product that we purchase. If an airline skimped on maintenance and one of its planes crashed, or if Toyota didn’t fix its gas pedals and a driver died, the PR effects would far outweigh the tiny savings from skimping on maintenance or environmental standards. And if reputation systems aren’t strong enough, we have things like consumer advocacy groups that do the research, educate consumers about the problems and demand better products from businesses.
It would be a horrible abuse of correlation/causation, but I could produce a chart demonstrating a positive correlation between average length of life around the world, which has steadily increased over time, and the number of chemicals being used in commercial products, which have steadily increased over time.
The narrator also wants us to feel guilty about the statistic that after six months, only one percent of consumer products are still being used. Rent, food, gasoline, utilities, and entertainment (vacations, movies, CD’s – and note that music is becoming a digital product, in response to consumer demand) are all large categories of consumption that are exhausted soon after they are purchased. Thus I don’t feel very guilty about the fact that a small percentage of consumer goods are still being used six months after use, because many products are not designed to be used continually. I would be more moved by a study examining how the average life of a TV, couch, or shirt has changed over time (and whether those products are being recycled more or less).
When workers move out of rural communities and into cities, their communities are destroyed:
Assuming that this actually is a problem, how would you solve it without restricting the mobility of the working class? I don’t think we should be able to restrict someone else’s freedom to move.
Two hundred years ago, 90% of people in the United States used to be employed in rural agriculture, and in farming communities. Now, less than two percent of the United States workforce is involved in farm labor, and a larger, yet still small percentage of the US is in rural areas, yet I don’t know anyone that would argue that the US lacks vibrant communities. People generally appreciate conveniences like toilets, laundry machines, cars and cheap food. Yet how did we move from 90% farms to less than 1%? At some point, people had to move off of the farms, away from their communities, and pursue other work.
Throughout history, most of the available jobs are in towns and cities. In fact, one clear sign that an economy is in dysfunction is when people in urban areas move back to the rural areas. At the peak of Roman civilization, the city of Rome had over 1 million inhabitants. When Rome collapsed, and Europe sank into the doldrums of the Middle Ages, the population of Rome fell. We didn’t see another city with 1 million inhabitants until the 18th century. Workers move to cities because that’s where they can find jobs.
There’s a missing variable, and that’s what economists call productivity. Let’s say that a village has two farmers. Farmer A – maybe his child is sick and he can’t afford treatment, or farming only generates enough income to feed the family for 5 nights a week, or farming is a profession with a highly variable income based on weather - decides that he is going to sell his land to Farmer B and move into the city in pursuit of a higher-paying job. Farmer B now needs to cultivate twice as much land, but he also has the potential to earn twice as much at harvest time. Because of the additional expected income, Farmer B invests in technology that makes him more productive – a tractor that lets him till the land more quickly, a dal mill, seeds that produce better yield, or additional farmhands. At harvest time, Farmer B cultivates twice as much land – in other words, he’s become twice as productive. Furthermore, former-Farmer A is earning a higher wage in another job, so he’s more productive as well. Both Farmer A and Farmer B are earning higher incomes than they were before. This is the story that has played out in the USA, where today's farmers can cultivate much more land than they could in the 1800’s. Futhermore, thanks to technological progress, each piece of land can support much more food than it could in the 1800’s. This makes food cheaper and means that we can use less land to support everyone, leaving more for forest conservation or other uses.
As workers become more productive, wages rise and prices decline. Everyone around the world today can purchase far more for an hour’s worth of labor than they could two hundred years ago. Here’s a chart detailing the number of hours necessary to purchase various household goods in 1895 and the time necessary to purchase them today. Source: Arnold Kling and Nick Schulz, “From Poverty to Prosperity,” New York: Encounter Books, 2009.
Commodity Time (hours) to Time (hours) to
earn in 1895 earn in 1997
Horatio Alger books 21 0.6
One-speed bicycle 260 7.2
Office chair 24 2
100-piece dinner set 44 3.6
Hairbrush 16 2
Gold Locket 28 6
Oranges (dozen) 2 0.1
Ground beef (pound) 0.8 0.2
Milk (gallon) 2 0.25
These drops in price (and increases in wages) have allowed people to live easier lives, and at the margin where Seva Mandir works, made basic goods, especially food, cheaper. Do ever-lower prices mean that producers like farmers are always going to be screwed over? No, because increasing productivity and better technology mean that most people are able to produce more goods in the same amount of time; this is the factor that drives prices lower in the first place.
Because prices of basic goods get lower, some people with lots of money may purchase goods like clothes and then dispose of them shortly thereafter. This is probably bad, but on the other hand, the cheapness of basic goods might allow a rural child to own a pair of shoes or a few shirts.
Pollution:
The narrator isn’t the first person to point out that pollution is warming the world, and that we are generating lots of trash. I agree that these are problems; maybe not the world’s most pressing issues, but issues nonetheless. What should and shouldn’t we do about pollution?
Solutions that harm rather than help:
Engage in costly signaling that is not going to do much about the problem. Because global warming is such a large problem, one state or town’s reducing their pollution is not going to make a meaningful difference. Thus, rather than do anything about the actual problem, governments have an enormous incentive to “show that they care” by commissioning new public works projects or demanding/subsidizing expensive clean sources of energy, and little incentive to actually reduce the amount of pollution. Most evidence is that adding things like solar panels or wind turbines increase the amount of energy consumed; there isn’t much of a substitution effect away from polluting sources of energy.
Shut down factories in Third World countries. At low levels of average income, there’s a tradeoff between clean air and economic productivity, and the way to settle the debate in favor of clean air is to raise everyone’s income enough that they start to demand the shutdown of the factories. China is just starting to lift millions of its citizens out of poverty and give them a chance at leading a life away from a rural village; draconian legislation would send those millions back to lives barely above the subsistence level. Yes, these pollutants are causing respiratory problems on a wide scale, but they are also engines for economic growth, so there’s a tradeoff there.
Raise the price of polluting. There is a flipside to pollution, which is that pollution is a byproduct of producing things that we really value. For example, flying halfway around the world generates a significant amount of pollution. But we also value the freedom to travel and live in India. So if we want to reduce pollution, we should also be careful not to reduce people’s freedoms to do things that they enjoy. What we can do is raise the price of doing things that happen to generate lots of pollution, like driving cars or using electricity. The easiest way to do this without creating lots of skewed incentives in an economy is to use a carbon tax, or to cap emission levels and allow firms to trade permits. Heavy-polluting firms would then have an incentive that would allow them to save money and help the planet at the same time.
Educate consumers about pollution and waste and encourage them to recycle. Which this video does, although the reasoning behind it is mostly flawed.
Non-intrusive measures that help cut down on smog. For example, some cities in Thailand offered free tune-ups to especially smoggy vehicles, which helped lower the overall pollution level in those cities. A study from McKinsey suggests that most companies could save money and help the planet at the same time; the net effects from switching to cleaner technology are positive. Specific subsidies for replacements of especially bad pollutants wouldn’t hurt either.
The average company takes in about six percent more in revenue than it spends in expenses. That’s not an obscene amount of profit. Furthermore, for most companies, pollution isn’t profitable; most pollution is directly tied to energy use, so companies have an incentive to cut down on energy use, which cuts down indirectly on the amount of pollution.
Fashion: The narrator blames fashion, and consumers always needing to buy new products, on firms. If firms were responsible, then we would expect fashion anywhere and everywhere to be a monetary phenomenon. This is not the case. For example, children wearing school uniforms have fashionable and unfashionable ways of wearing them; styles like sagging become trendy and then become un-trendy. Companies were smart to notice this, and marketed their products accordingly. Should we pass a law so that Apple can only come out with one new product every two years, or that you can only buy new clothes once a year? No.
Fashion also serves a valuable social purpose, by letting us know who’s desirable and who isn't. Fashion trend-setters of all socioeconomic classes are generally high status people. Trend followers are medium status and people who don’t follow trends at all are generally low status. If you can follow fashion well, then you’re probably well in tune with the needs of others and a desirable person to be around. Copying others, or getting others to follow our trend, thus has a valuable sorting purpose, leading to better matching, lower divorce costs, etc. We shouldn’t shame or judge people for following fashion, or hate companies for helping us sort people in this way. If I had to pick one argument out of the bunch that readers of this post are likely to hate, it’s this one.
Note that in some circles it’s become fashionable to reject corporate fashion and instead shop at goodwill or wear old clothes, and that’s cool too.
Conclusion
For the relatively well off in the West, purchasing fewer goods and finding a social group where members judge other members for things unrelated to the purchases they make may make a person better off. Educating consumers about the aims of marketing, and publicizing the problem of pollution, cannot hurt either. But companies are not evil, and we should not impose our belief systems upon others, especially people in the Third World, who grow up in cultures and socioeconomic situations radically different from our own.
The holy grail of development is a resource that explains why the West has grown so far ahead of the rest of the world in terms of income per worker and productivity. Hernando De Soto makes a good case in The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else that property rights are one of the main reasons why the West has gone so far ahead of other countries. Every neighborhood in the world has property rights, in the sense that if I build a shack or house, the neighbors agree that it’s mine and that the space is mine. But only in the West are the property rights likely to be registered with the government, and the owner of the property able to use his land or house as collateral to secure credit from banks or strangers (people who are not family or friends, in other words).
To start a legal business, or establish a formal claim to property, is an onerous process in most Third World economies. For example, in India, “about 90 percent of land titles are unclear as to who actually owns the land…[this] causes competition among real estate developers to be over finding and acquiring land with clear titles rather than over construction productivity,” according to William Lewis. Apart from explaining, for example, the number of megastores and car dealerships I’ve seen in low-traffic locales, this can explain why it’s so hard to get growth; there are a number of problems that arise when your property is on land that you don’t own. You can’t get credit, because it’s hard to use land as collateral when you don’t own it (and the bank probably can’t sell it either). When you might not be able to sell your property for very much, and the government could kick you out at any point, then you don’t have a huge incentive to make lasting improvements, either.
The poor around the world own a surprising amount of capital; according to one estimate, the world’s poor collectively own $9 trillion in assets, between the land they own, the improvements they’ve made on the land and their savings. The problem is that in the absence of a formal system of property rights that’s consistent across the country, they’re unable to leverage that capital in a meaningful way.
Most attempts to establish systems of property rights have failed, because of fears from entrenched parties (lawyers, the rich, special interests) about change. In Peru, De Soto’s country of specialty, the government’s tried to provide property rights to the poor on multiple occasions, and failed to help the poor in any meaningful way; sometimes the problem was in implementation and sometimes the rich hired lawyers to subvert the system and claim land that wasn’t theirs. Governments have spent billions on GPS and mapping technology, without making it any easier for the poor to own the land on which they sit; America managed to integrate property by 1900 without any of that technology.
Businesses and squatters face tradeoffs; De Soto argues that many of them would like to become legal, but the costs of doing so in some countries are so high (sometimes requiring 200 steps and as many as 15 years) that most small businesses have no choice but to operate outside the law. In Peru De Soto set up a simple alternate registration system for businesses, and generated $1.2 billion in revenue for the government, by making it easier to become legal (and enjoy all of the protections of a working legal system).
Capitalism, to many of the entrepreneurial poor around the world, is a series of stupefying laws, and necessary innovations to create agreements in the absence of any recognition or protection from the government. In the absence of a functional legal system, the poor in every part of the world have their own arrangements for assigning property. De Soto gives the example of walking through a field in Indonesia, where he could tell who owned the land because a different dog would bark at him when he crossed an invisible property line. The key for governments is to transform those extralegal agreements into formal agreements that foster trust and capital generation among the poor.
This is one of a few projects I am working on at the moment.
Connecting Rural Teenagers with High-Paying JobsKevin Burke, Seva MandirThe problem
The first step on the economic ladder for most citizens is a job requiring skills slightly more advanced than day labor. For rural villagers, the economic and personal returns on these jobs are quite high; workers may be able to get a high-paying job without having to migrate to Gujarat, for example. Seva Mandir, in partnership with Ajeevika Bureau, offers trainings in areas like plumbing, electrician, auto repair, stitching etc. but take-up for these courses is low.
The goal
The goal is to investigate the reasons why take-up is low, and after a field survey has been completed, to propose solutions or possible training modules to increase take-up among rural teenagers.
Implementation
A) Get information from Abhay (Seva Mandir employee), members of Ajeevika Bureau (training organization) to estimate the education level, amount of training, job opportunities and pay schedule for various possible jobs like plumbing, auto repair, etc. Research Government of India statistics on the average salary for a worker with no primary education, a worker with primary, secondary, and a high school degree.
B) Conduct field surveys in 8 villages. The goal is to conduct 15 surveys per day, and 30 surveys per town. Visiting two towns per week will allow us to complete the survey portion of the study in 4 weeks.
C) Analyze data
D) Propose solutions/possible randomized experiment
Tentative Hypotheses
1) Some workers do not sign up because have the required skills to even sign up for a 2 month training course. There is no quick fix for this problem.
2) Workers are credit constrained; to sign up for trainings they would have to forgo two months worth of wages and possibly pay part of the cost of the training. Loans are one possible solution, although collecting the loans has been tough; there’s no easy source of collateral to secure the loan.
3) Workers do not properly estimate the returns to education, or the possible salary in a city job. If their internal estimates of future pay are too low, then they would not sign up for training or education that has a high present cost. Fortunately, Trang Nguyen (2008) found a quick solution to this problem; hold a meeting and display the statistics about how much a 25-year old can make in various professions and with various education levels. She used a graphic with bags of rice; no primary education means avg. pay is 3 bags of rice, a primary education means 6, etc. After the intervention the local people estimated the return to education correctly and their test scores improved.
4) The teenagers possess the skills but have difficulty applying for available jobs, or there are not jobs available.
5) Workers are not aware of the Seva Mandir training programs.
We will test these hypotheses in the survey, and propose an appropriate course of action.
Today I popped all of the keys off of my laptop keyboard and rearranged them in the QWERTY format. In the name of efficiency, I switched my keyboard to the Dvorak system during my sophomore year of high school. It only took about a week and a half to learn how to use it at full speed, and I’ve been using it ever since.
I haven’t measured whether I type faster using QWERTY or Dvorak, and from what I’ve heard, studies don’t really show any improvement in typing speed. I would guess that I type faster in Dvorak, although it’s been several years since I’ve typed any long document in QWERTY still use Dvorak. The keyboard shortcuts with Dvorak are also in generally better positions, especially the close window and quit application commands (Apple-W and Apple-Q, respectively).
The small gain from typing with Dvorak, though, is outweighed by the tedium of explaining to everyone who peeks over my shoulder why my keyboard is funky. Telling people that my laptop was assembled at a facility that provides jobs to the mentally retarded got old quickly. It’s also frustrating for people who want to borrow my laptop and are not used to looking away from the keys.
If everyone used a Dvorak keyboard, we all would be slightly better off, but the cost of switching (alternate keyboard layouts, retraining, reprogramming old machines, etc) probably outweighs the productivity gain.
I’m able to type without looking at the keys in both Dvorak and QWERTY layouts. The feeling of switching between the two layouts is very interesting, and I’m not sure how to describe it. It’s unlike language, where you would never make the mistake of responding to a Frenchman in English on purpose; many times on public keyboards I start typing in Dvorak, then erase the keys and flip a switch in my head so the words show up correctly.
that property rights are one of the main reasons why the West has gone so far ahead of other countries. Every neighborhood in the world has property rights, in the sense that if I build a shack or house, the neighbors agree that it’s mine and that the space is mine. But only in the West are the property rights likely to be registered with the government, and the owner of the property able to use his land or house as collateral to secure credit from banks or strangers (people who are not family or friends, in other words).
To start a legal business, or establish a formal claim to property, is an onerous process in most Third World economies. For example, in India, “about 90 percent of land titles are unclear as to who actually owns the land…[this] causes competition among real estate developers to be over finding and acquiring land with clear titles rather than over construction productivity,” according to William Lewis. Apart from explaining, for example, the number of megastores and car dealerships I’ve seen in low-traffic locales, this can explain why it’s so hard to get growth; there are a number of problems that arise when your property is on land that you don’t own. You can’t get credit, because it’s hard to use land as collateral when you don’t own it (and the bank probably can’t sell it either). When you might not be able to sell your property for very much, and the government could kick you out at any point, then you don’t have a huge incentive to make lasting improvements, either.
The poor around the world own a surprising amount of capital; according to one estimate, the world’s poor collectively own $9 trillion in assets, between the land they own, the improvements they’ve made on the land and their savings. The problem is that in the absence of a formal system of property rights that’s consistent across the country, they’re unable to leverage that capital in a meaningful way.
Most attempts to establish systems of property rights have failed, because of fears from entrenched parties (lawyers, the rich, special interests) about change. In Peru, De Soto’s country of specialty, the government’s tried to provide property rights to the poor on multiple occasions, and failed to help the poor in any meaningful way; sometimes the problem was in implementation and sometimes the rich hired lawyers to subvert the system and claim land that wasn’t theirs. Governments have spent billions on GPS and mapping technology, without making it any easier for the poor to own the land on which they sit; America managed to integrate property by 1900 without any of that technology.
Businesses and squatters face tradeoffs; De Soto argues that many of them would like to become legal, but the costs of doing so in some countries are so high (sometimes requiring 200 steps and as many as 15 years) that most small businesses have no choice but to operate outside the law. In Peru De Soto set up a simple alternate registration system for businesses, and generated $1.2 billion in revenue for the government, by making it easier to become legal (and enjoy all of the protections of a working legal system).
Capitalism, to many of the entrepreneurial poor around the world, is a series of stupefying laws, and necessary innovations to create agreements in the absence of any recognition or protection from the government. In the absence of a functional legal system, the poor in every part of the world have their own arrangements for assigning property. De Soto gives the example of walking through a field in Indonesia, where he could tell who owned the land because a different dog would bark at him when he crossed an invisible property line. The key for governments is to transform those extralegal agreements into formal agreements that foster trust and capital generation among the poor. 