This is something I was thinking of doing for a while, but since Possum has started a “What if?” over at his joint, this is as good a time as any to launch Australian Alternate History Week and hope it is taken up across a few more blogs.

In short, I want participants to create a brief alternate history scenario in Australian history. There need not be a single hinge event that creates a point of divergence, it can be as many different changes you want to support an on going speculation. It’s an exercise to think about what dynamics have made Australia he way it is and how they could have been different – so the fun is in trying to extrapolate what would happen than merely asking the “what if?” by itself.

For example; Read more »

I have often worried about whether promoting ‘efficiency” – in the economic sense – ensures maximum well being where it makes some people better off but others worse off – even if the Kaldor-Hicks criterion is full met e.g. by ensuring those who gain from the policy could potentially bribe those who lose from it.

I discussed at length the issues involved in The Distribution Effects of Labour Deregulation” (see article in AGENDA, Volume 14, No 2, 2007). I reached an inconclusive answer: it depends on what mix of social values appeals most (distributive justice and equality of opportunity versus choice and self-reliance).

Now Uwe Reinhardt and Steven Landsburg debate this issue in a piece highlighted in Greg Mankiw’s blog, August 27, 2010. It is most interesting discussion which I strongly recommend.

It’s easier to declare a film a work of genius than to figure out its secret. But I think in the case of Boy, it’s balance. This film tempts you at the start to expect a feel-good movie, but ends up steering clear of sentimentality. There’s menace and heartbreak, but it doesn’t go over the top into numbing social realism. It’s about the clash between fantasy and reality that kids experience, some more brutally than others, but which most of us somehow survive. It highlights what is probably a near-universal experience — a boy’s disillusionment with his father and the process of re-establishing the relationship on a new footing. Boy has a comedic ride past that particularly milestone on the road to maturity, but there’s enough credibility to ensure that the journey is a jolting one all the same. Read more »

Here’s the breakdown of a Canb-Melb flight I just booked on the to be avoided at (almost) any cost Tiger Airlines. Read more »

Here are all the sponsors for the Australian Conference of Economists this year.  All public sector agencies. Now economics is a discipline fundamentally about policy – or I think it is – so it’s no scandal, but it’s still pretty striking that there’s not a private sector sponsor among them – or perhaps there are and they’ve fallen below the ‘bronze medal’ radar. Anyway, it’s a bit of a pity.

The Economic Society of Australia (NSW Branch) acknowledges the support of our ACE10 sponsors:

· The Treasury (Gold Sponsor)

· Australian Securities and Investments Commission (Silver Sponsor)

· Department of Families, Housing, Community Services and Indigenous Affairs (Silver Sponsor)

· NSW Treasury (Silver Sponsor)

· Productivity Commission (Silver Sponsor)

· Department of Education, Employment and Workplace Relations (Bronze Sponsor) Read more »

Unlike my AS peer Mr Trask, I'm unlikely to publish a book on my crippled escapades to make a living

Possum’s recent job plea has inspired me to do an experiment. Unlike him, I’m not explicitly seeking a job (although my ears and email are always open [FN1]). I’m merely looking for advice on what kind of job I should look for.

The short story is that I started studying economics because I liked the subject a great deal. I had no career ambitions in mind at all. This continued all the way to through honours year where I pursued a topic fascinating to me, but that was also very unlucractive. Read more »

. . .  quoting us

Kaggle has a couple of competitions running right now which are generating their usual stellar results. From Andrew Gelman quoting our blog:

The Elo rating system is now in 47th position (team Elo Benchmark on the leaderboard). Team Intuition submitted using Microsoft’s Trueskill rating system – Intuition is in 38th position. And for the tourism forecasting competition, the best submission is doing better than the threshold for publication in the International Journal of Forecasting.

Readers of this blog will know that I share Paul Krugman’s view that the US Republicans are a crazy, scary bunch. And during the Howard years there were lots of people who argued that Howard was the same.  Which is ridiculous.  He was sympathetic to the Crazy Party of the United States, and he did steal from their playbook, but mostly in the department of the culture wars – at which he was no slouch himself.

He never trashed the budget the way the Crazies can’t help doing. And this column by Paul Krugman reminds me that there’s something else they didn’t do for which I must say I’m very grateful.  They didn’t cut the top marginal rate of tax until right at the end of their term of office, when they were, in part responding (and responding in a fairly minimal fashion) to the urgings of ALP politicians. Read more »

The regulation requiring medicines to be sold with consumer product information guides is a good idea in principle.  But in the attempt to find out a little more about an over-the-counter pill I sometimes take to get to sleep – Restavit – I found myself reading one. It’s got some good information in it, but it’s still incredibly bogged down in form. Sad really. It really shouldn’t be hard to do a lot better than this. Here it is – with a few explanatory interpolations.

This leaflet answers some common questions about RESTAVIT. [Could be shorter and more succinct] Read more »

In politics you need a narrative about what you stand for, but you also need one – an ugly one – about the perfidy of your political opponents. As we can now see, the Coalition’s narrative of perfidy is in very good shape. In fact it’s over thirty years old. As it’s ad for the 2007 election “No offence Mr Howard” suggests, the Labor Party’s narrative is well the best that might be said is that it’s pining for the fiords.

Narratives of perfidy are usually entrenched by an incoming government. Read more »

Based on a good thread over at LP, I watched the Kerry O’Brien interview with Tony Windsor, Rob Oakeshott and Bob Katter.

Remarkable. I can’t remember the last time I so enjoyed watching politicians. Perhaps never. Intelligence, humour, apparent integrity and, more than anything, naturalness. It’s so refreshing as to be almost shocking.

The general buzz on the LP thread seems to be quietly optimistic, and very curious about what’s to come. Amen. If the independents keep it together, the high artifice that’s come to characterise party politics here might finally become the deadly handicap it always should have been.

Hard to see all this doing any harm, that’s for sure.

Extraordinary: just extraordinary. Courtesy of the AEC, these are the seats in Australia with the most informal votes.  I had no idea the informal vote could be so high. All from NSW. Read more »

The Australian fiscal stimulus package has been controversial, with some Australian economists and visiting UK historian Niall Ferguson arguing that it was unnecessarily large or wasteful, and other Australian economists and visiting US economist Joseph Stiglitz arguing that it was well designed and a model for other countries.  The Reserve Bank, however, seems to agree that the stimulus was important in sustaining economic activity. Read more »

Over a quarter of the debt from the fiscal stimulus will be repaid from the taxes of those who would otherwise have been unemployed.

As our economy turned down in late 2008, Australians’ spending kept other Australians in work. And those kept in work repaid the favour – by continuing to pay their taxes.

So for every dollar the government spent, tax revenue to Australia’s governments rose by around 22.5 cents, leaving just 77.5 cents to be repaid. The total windfall to the budget – and to the community – of the additional tax revenue from the cash transfers is around $6.7 billion. This money and the production of all those people and all that capital kept in employment are the riches of good economic management – the only kind of free lunch we know of. Read more »

Some great graphics from Tom Scott. I think the warning signs make most impact on their own, but Tom has annotated them on his site.  Below, your opportunity to win the coveted  Troppo Mercedes Sports and dinner with Nelson Mandela

Read more »

The delightfully named Ben Spies-Butcher of the CPD writes in support of the Henry Review’s proposals for the income tax system as opposed to a flat tax. In a nutshell, he feels that the Henry Review’s scheme offers great efficiency benefits by simplifying the tax system and reducing high and uneven effective marginal tax rates for low income earners without losing “the progressivity, or fairness, of the tax system by giving large tax cuts to those at the top.”.

It is a bit confusing to me that social democrats rely so heavily on the fairness argument for progressive income tax. Sure it is central to their own values, but I think it overlooks the good reasons to think that a properly designed progressive system can be quite efficient. Read more »

The floods in Pakistan have resulted in about 1,600 deaths, with many more expected (even disregarding the possibility of a cholera outbreak), and have stranded or displaced about 12 million people. The worst aspect seems to be that this is just a taste of what’s to come, if the disaster is essentially a consequence of global warming. Read more »

Hello all, your friendly Ozblogistan Overlord here.

Last week I wrote briefly about slowness being caused by attempts to debug a comments plugin used by several Ozblogistan blogs — Brian’s Latest Comments — in the context of Larvatus Prodeo. It transpires that LP’s database of comments was too large to process without causing errors and slowdowns. During the week I worked on various modifications; these ‘work’ in that they have the correct behaviour and don’t crash, but in actual use they have proved to be unacceptably slow.

Consequently I have asked our blogs to deactivate the offending plugin for a few weeks. Our busiest, Catallaxy Files and Larvatus Prodeo, have done so, which should for now improve performance for everyone.

Why have I asked them to deactivate it for a few weeks? Because yours truly is moving to Darwin to take up a new job. I won’t have my usual computer for 3 weeks, according to the removalists. Once I am settled in I have another plan of attack to try, but until then I will not be in a position to easily fix things. Until then, enjoy the blogging.

I’m in broad agreement with this piece by Chris Dillow. Read more »

Here I cite this article by Annabel Crabb [fn1]. Here she defends the fact that all questions asked at press conferences are race calling in nature on the fact that policy literature isonly given to journalists at the beginning of the conference, and that the harried journos just don’t have time to digest it. Then follows a lengthy piece of discussion about press conferences.

The response is obvious. Was there no time for the journos to digest enough to even describe the policies before the nightly news/the morning paper or the self appointed flexible deadlines of the online world?

Was there no time to write a story that included any policy detail, only time enough to write vacuous race calling in the hours before the deadline?

Was there no space the day after to describe policies that will affect the country for years because they’re in a pointless race to nowhere against competitors to be the first with nothing?

Or was it because the space was needed for stories about the absence of a story, such as speculation about Lindsay Tanner leaking things? Read more »

Well folks, that’s how your mad as hell correspondent feels.  I’m refining the #HeSaidSheSaid campaign. After posting it I realised that we really needed a more general term as the pathologies of modern media – what Tim Watts calls souffle journalism – comprehend quite a few moves, not all of which fit properly within the HSSS description, and, as my last post on the subject illustrates, sometimes bring on something resembling the opposite of HSSS which is comment dressed up as news. Thus a story tells us that Tony Abbott saying that Julia seems to be saying that “‘no’ doesn’t mean ‘no’” is a gaffe.  (I thought it was both funny and legitimate.)

So in the last post I mooted the idea of a new hashtag trying to encompass all that we hate about the kinds of stories I’m talking about. Read more »

A guest post by Conrad Perry:

It looks like the new Julia being the real Julia campaign has kicked off with a bit of good old fashioned teacher bashing. This reminds me of one of the things that seems really ingrained in many people’s minds, and an assumption which a lot of this teacher bashing is based on, which is that there is a horde of teachers out there who are bored, can’t teach well and are too lazy to get another job that they might actually enjoy. Read more »

Elo ratings involve a system whereby your ‘rating’ is a function of who you beat or lose to and their rating. The ‘future of the species’ business is a reference to the fact that this manoeuvre of bootstrapping meaning from the record has become more important to the world recently – because it’s the approach that Google showed us enables us to bootstrap a system of rating websites which provides pretty good proxies for their usefulness to users. Read more »

One reason that governments rush to the polls is because they have information about upcoming trouble that the opposition do not. This occurred in the Northern Territory, where in the wake of the 2008 election there was a spate of bad news that would have scuttled the Labor government only weeks earlier.

In February, the Australian Tax Office activated a completely new core system for collecting taxes and paying returns. This system proved to be inadequate to the task, causing enormous anger in the small business community due to delayed BAS refunds.

Now it seems that the same system has struck again for personal tax incomes. Yours truly feels sympathy for anyone having to hold onto great piles of cash, and thus, to relieve the government’s suffering I lodge my tax returns electronically on the 1st of July. Read more »

I’ve thought this for yonks:

Few mainstream therapists would contemplate trying to persuade a gay man or lesbian to “grow up, get real, and stop being gay.” But most insist that long-term sexual monogamy is “normal”.

This doesn’t mean I’m throwing the switch to polygamy or wife swapping any time soon, but it’s always struck me how inconsistently we throw round arguments in the area of sexuality. Anyway, the quote above comes from this article which is well worth a read. HT  Three quarks.

subito constitit ante eltum tegumentum ferreum corporis tam occupatus fuerat in effugiendo e biblioghecca ut non animadvertisset quo iret. fortisan quod tenedbrae erant, haudquaquam agnovit ubi esset sciebat tegumentum ferreum corporis esse prope culina, sed debebat eesse quinque tabulatis altior illis.

Where does this paragraph come from? (And warning, I may have mistranscribed something above. I’m not being paid to work here so you’ll have to cope.)

As usual the prize is a Mercedes Sports of the Troppo editorial board’s choosing (I’ll be proposing to the board that you can have the one Ken’s driving). In addition, the winner will be flown first class to London to receive his Mercedes sports in an awards ceremony from the UK’s latest  Tony Blair clone, smooth new PM David Cameron.

Well I can complain about the media till I’m blue in the face, they’re after ratings, entertainment and so on.  Anyway, I said to one journalist that it was ‘crazy’ that public servants who I knew read Troppo didn’t comment, not because I don’t understand that they don’t want to get embroiled in controversy – that is generally speaking fair enough, but because they can stop way short of any of that and still participate.  Anyway, my guess is that the journo in question led with the word ‘crazy’ because it was a good word to lead with, and the subbie did the rest with this headline. ” Read more »

One of the big mistakes responsible for the outbreak of WWI was that existing Western powers actively tried to contain the influence of emerging powers. England and France tried to hold on to all their colonies and keep Germany out of the colonial game. Conversely, Austria and Germany were wary about Russia’s growth and housed opinions that advocated war as a means of halting the growing threat. The notion of aggressively holding on to the current division of the spoils was a large factor in the outbreak of WWI. It seems a valid question to ask whether we are making the same mistake with China and India now, or whether ‘we’ have apparently learned our lesson. Read more »

It’s pretty obvious that if science involves standing on the shoulders of giants (and the odd pygmy) then exclusive rights to ideas can slow down innovation. Still it’s quite hard to demonstrate this. Some econometric studies are persuasive that it does. But there are presumably cases where patents do at least generate incentives which are instrumental in getting innovation funded. Pharmaceuticals is probably the best example, though patents may be far from the optimal arrangement even there. But the burgeoning of new areas like software and the extension of patents in other areas – the extension of patents to 20 years under TRIPs and patent extensions in pharmaceuticals – has been thoroughly craven and stupid public policy. Sad, but true.

And here’s some hard evidence of the damage gene patenting does.

Intellectual Property Rights and Innovation: Evidence from the Human Genome by Heidi L. Williams – #16213 (AG HC PR)

Abstract: Read more »

Iris Murdoch and her very literary husband John Bayley had a term for going to literary festivals and talking on panels with names like “whither the novel”. They called it ‘whithering’. The Sydney Morning Herald asked for 1,500 words of withering on the tax system, which I structured around what I liked and  didn’t about the Henry Review. Unfortunately, it turns out, they didn’t, in the end, want 1,500 words.  Of  the 1,000 odd words on Fairfax websites, even fewer made it into the paper and, as is the way with such things some things got garbled.

But that’s the game with papers, so there you go.  At least I get to post it up here.  So here it is below the fold in its full 1,500 word glory. Read more »

I have it under control.

I flatter myself I can judge a film from the trailer, but I got it wrong in this case. It looked like a bunch of fancy special effects strung together with some half-baked premise about hacking people’s dreams. I expected tedious chase scenes, endless explosions, and a general spectacle of death and destruction. Read more »

Dear editor

I wonder how many of the 84% of NT News respondents who think NT courts are too soft on criminals are aware of any of the following indisputable facts: Read more »

Evidence-based policy is a buzzword that conjures up images of responsible government: difficult decisions taken after a careful examination of the evidence, tailored local experiments, and then implemented using the best advice available. Sounds good, no? As a buzzword, it is a clear winner and something we all want more of.

But how much can we really expect of this buzzword and what will it actually lead to? Let’s have a look at the dangers and benefits.

The dangers and limitations

The first thing to note about the buzzword is that its main association is with rational control. In order to have evidence based policy, you must gather evidence and have a policy process. That means hiring more bureaucrats to do the gathering and the processing. Hence the buzzword is first and foremost a means for a bureaucracy to get their hands on more resources. Read more »

I got this email from someone with whom I’ve been having an enjoyable correspondence for the last few months (though I’ve never physically met him). He’s an Australian, living overseas, in his twenties or perhaps early thirties (I’m guessing) and is ideologically predisposed right of centre parties. (I continue to imagine that I’m not really left leaning, but that my preferences towards the ALP over the Coalition are because the Coalition are so uninterested in policy and therefore just bad at it. But I know lots of readers won’t believe me, and they may be right.)

Anyway, I have his permission to reproduce his email to me.

Nicholas,

I don’t believe I have ever witnessed such a backward and chaotic start to an election campaign as has come from the Liberal Party. How can the party of business with people who have “real world” experience lack basic organisational leadership? In a party populated with lawyers and wannabe MBAs they are looking more like the keystone cops than professionals. Read more »

In May of this year, the Australian government announced a tax increase on the mining company whereby all profits over the long-run bond rate would be taxed at 40%, with off-sets for losses. This tax on the rent created by the boom in mineral prices was spent on reductions in the company tax rate and on various overall subsidies. Following a fairly extensive campaign by the big mining companies and their representatives such as the Minerals Council Australia, the government in July negotiated directly with the three major mining companies and reduced the planned tax increases in return for the explicit promise to stop campaigning. If we compare the revenues the tax would have gotten (under the revised price estimates) with the current expected revenue, it seems radio silence has come at a cost close to 5 billion dollars per year. In terms of discounted values, every dollar spent on campaigning by the mining industry seems to have paid off (ball park figure) something like a thousand dollars in less tax. Read more »

An honours student approached me to interview me on an interesting thesis she is writing currently entitled “The conceptualization of political participation by advocates of Government 2.0″.  Naturally enough I agreed to what turned out to be an excellent interview (I do like it when people actually ‘get’ what I’m saying even if it’s a bit subtle, a bit conceptual). The distinction between government and politics is a difficult one and something that I’ve given quite a bit of thought to, even though it only appears implicitly, and even then very sotto voce in the Taskforce report.

Anyway, before the interview could take place I was asked to fill out this form (pdf). Read more »

The publication of Peter Coleman’s collection of essays with some memories and reflections is a reminder of his remarkably productive career as a public intellectual. Those who do not share his politics should note that his first book in 1974 was a scathing critique of Australian censorship.   Obscenity, blasphemy, sedition: censorship in Australia.   

This demonstrates that he  is not a conservative of the kind piloried by Hayek, but a true classical liberal. Duffy and Snelgrove reprinted the book “because of its entertainment value (due to Coleman’s wonderfully light but effective style, and the intrinsic interest of its subject matter), its importance as a work of popular history, and its new relevance at a time when there are increasing attempts to censor the Internet.” Read more »

Having visited the OECD and observed the strange way in which views are arrived at and prosecuted, I read all OECD commentary with a grain of salt. The OECD staff spotted my stuff for the BCA on independent fiscal policy in 1999 and flew me to Paris to present to a Senior Finance Officials meeting. I presented away and made my points. No-one seemed to really disagree with them, but it was clear that I’d been invited as a kind of variety act, someone to spice things up with a new idea which could then be chatted about but not taken seriously. No Senior Finance Officials thought the idea would play all that well back home.  So it never really got considered. Read more »

Jorg Guido Hulsmann, professor of economics at the University of Angiers in France has written a magesterial biography of Ludwig von Mises, running over 1100 pages. This allows sufficient space to permit generous coverage of  the historical and intellectual background with close attention to his major works and the salient features of his life and social relations.

Mises (1881-1973) is one of the sleeping giants of the 20th century. For many decades he was the leader of the “Austrian school” of economics and social thought but he is scarcely a household name, even among economists and classical liberals where he should be well known and appreciated.

It is appropriate that he lived almost from the time that Carl Menger published the book that launched the Austrian school  to the year before the conference at Royalton in the US that signaled the revival of the tradition.  Read more »

Yes folks, it’s on again!  Well it’s probably not on, but someone wants me to pontificate on tax reform as one of a range of issues in some ‘vision’ pieces. I get to paint my own picture.  But I wanted to throw things out to the crowd.  What things did Henry get right, what wrong?

Just rereading the executive summary, I think it’s a very impressive document and it will be a useful blueprint for the future. (As an aside, the whole cockamamie idea of an 18 month review to be served up six months before an election beggars belief for political ineptitude. The motivating idea of some comprehensive (root and branch – yada yada) review is not much closer to reality either. Read more »