A Nation of “Adultescents”?

I just came across this great article in the New Yorker by Elizabeth Kolbert, “Spoiled Rotten: Why Do Kids Rule the Roost?”  Read it all, but here’s a blurb:

Today’s parents are not just “helicopter parents,” a former school principal complains to Marano. “They are a jet-powered turbo attack model.” Other educators gripe about “snowplow parents,” who try to clear every obstacle from their children’s paths. The products of all this hovering, meanwhile, worry that they may not be able to manage college in the absence of household help. According to research conducted by sociologists at Boston College, today’s incoming freshmen are less likely to be concerned about the rigors of higher education than “about how they will handle the logistics of everyday life.

 

Letting things slide is always the easiest thing to do, in parenting no less than in banking, public education, and environmental protection. A lack of discipline is apparent these days in just about every aspect of American society. Why this should be is a much larger question, one to ponder as we take out the garbage and tie our kids’ shoes.

Some Economics of the Apple Store

Via Marginal Revolution, here’s an interesting story by Horace Dediu on the growth in Apple stores and some explanations.

 The total store count went from 172 to 361, more than doubling. But the growth in employment was faster: from about 6400 to 42,200, more than quintupling. This is reflected in the total number of employees per store which increased from 37 in Q1 2007 to 117 in Q1 2012.

Dediu argues this is driven primarily by increased customer traffic:

The visitors per store per quarter increased from 125k in Q1 2007 to 235.5k last quarter. Nearly double the number of visitors in five years. It’s this increased traffic that is closest tied to the increase in employment.

Part of this seems to be marketing (putting a “human face” on the products) but the stores are also very profitable:

New Evidence on Comparative Advantage

That old Englishman David Ricardo may have been on to something after all!  MIT economists Arnaud Costinot and Dave Donaldson find that his insights hold up pretty well even in today’s complex global economy (via Mark Thoma):

Costinot and Donaldson looked at the numbers from an FAO model of yields of 17 crops on 1.6 million plots of land in 55 countries to examine whether countries specialize in the way Ricardo believed. That is, if a country’s terrain allows it to grow wheat more productively than grapes, comparative advantage suggests that specialization will occur. So Costinot and Donaldson compared the predicted output of crops in each of the 55 countries (based on the FAO data and on prevailing prices) with the actual output of those crops.

 
The numbers show that Ricardo was right — to an extent, anyway. Costinot and Donaldson analyzed the results so that if the real world worked just as Ricardo supposed, the correlation between productivity and output would be 1.000. Instead, the logarithmic correlation they found was 0.212, with a margin for error of 0.057.

 

“We found a positive and statistically significant correlation,” Costinot says.

Quote of the Day

“The same persons who cry down logic will generally warn you against  Political Economy.  It is unfeeling, they will tell you.  It recognises unpleasant facts.  For my part, the most unfeeling thing I know of is the law of gravitation: it breaks the neck of the best and the most amiable person without scruple, if he forgets for a moment to give heed to it.  The wind and waves too are very unfeeling.

Would you advise those who go to sea to deny the wind and the waves – or to make use of them and to find the means of guarding against their dangers?  My advice to you is to study the great writers on Political Economy, and hold firmly by whatever in them you find true; and depend upon it that if you are not selfish or hard-hearted already, Political Economy will not make you so.”

- John Stuart Mill, 1867

Hamilton on “Europe in 1931″

James Hamilton has an interesting new post (along with slides and video from a recent conference dealing with these issues) on the gold standard and the Great Depression, and connections to today’s Euro crisis.

In part, he writes:

In 1931, countries faced doubts about whether they would stay on the gold standard, and had a choice of either to abandon gold or else to inflict further domestic economic damage in the form of monetary contraction and price deflation. Those doubts and their damage ended up bouncing across countries like a ping pong ball. In 2012, countries face doubts about whether they will remain in the European monetary union, and have a choice of either to abandon (or be forced out of) the euro or else to inflict further domestic economic damage in the form of more fiscal contraction. We’re watching those fears and their consequences today move from country to country in real time.