Saturday, February 28, 2009

CGE Models and Environmental Policy: The Case of Corn Based Ethanol

All economists are interested in the unintended consequences of government policy. When the Bush Administration passed pro-ethanol policies, some Princeton researchers (Searchinger et. al) argued that such policies would have severe consequences.

Now Tom Darlington has written his critique of the critique. Darlington's Ethanol Report

As an outsider, I find this interesting and important but I'm struck by how complicated this is. There are a huge number of parameters that need to be well estimated in order to generate a "best guess" concerning the likely size of the unintended consequences of ethanol policy. Put a standard error on each of these parameters and the confidence interval for the final prediction will be quite large.

When our best models yield such loose bounds on the likely consequences, are we useful people for the politicians?

New Summer 2009 Sustainability and Business Course at UCLA

Executive education is a worthwhile pursuit. This summer UCLA is introducing a "green" executive education 2 week course. My colleagues and I at the UCLA Institute of the Environment (www.ioe.ucla.edu) will be the teachers. To learn more, click here.

Friday, February 27, 2009

Los Angeles Crime Declines Improve Compton's Quality of Life

Fear of crime scares of mobile people (human capital) and physical capital (new stores and restaurants) and this creates a viscious urban cycle as the "consumer city" part of a city is destroyed. People spend less time outside and this makes the streets even less safe and this feeds on itself. Fortunately, there appears to be some empirical evidence that this process can reversed. In the LA Times today there is a sunny booster article arguing that Compton, Los Angeles recovers. I wonder if the rap group NWA would agree with the article. The next time I see ICE Cube, I'll ask him.

A 11/08 Duke University Study on Green Jobs

Next monday radio listeners in Philadelphia will have a treat. I'll be on the 1020am NPR radio show along with Duke's Gary Gereffi and we will be talking about "green jobs". I anticipate that I will be asked to play "bad cop". Gary has staked out the role of "good cop" based on his November 2008 Green Jobs Study by Duke's Gary Gereffi et. al.

In his report Gary, discusses promising green manufacturing industries;

Chapter 1: LED Lighting
Chapter 2: High-Performance Windows
Chapter 3: Auxiliary Power Units
Chapter 4: Concentrating Solar Power
Chapter 5: Super Soil Systems
Chapter 6: Heat Pump Water Heaters
Chapter 7: Recycling Industrial Waste Energy

For each of these industries, I have a few questions;

1. Are these industries where the "first mover" will have a long run cost advantage? Are there reasons to believe that there are sharp learning by doing effects here such average cost declines with cumulative experience?

2. What human capital is required for workers in such jobs? Do you need a PHD to do these jobs or are these guys hammering green nails?

3. Given that the UAW and other labor unions have sponsored this research, I'm guessing that these will be union jobs. In the short run these will be "high" paying jobs relative to alternative work but in the medium term, will this artificial wage premium push these industries to locate in China and other cheaper countries? How will U.S manufacturing avoid repeating with these green jobs what happened in the car industry?

put bluntly, what is our comparative advantage in producing these goods? If anyone can make then, then these industries will migrate to low wage nations.

4. What government policies do these nascent industries want to help them get off the ground? Would a carbon tax suffice? or do they need government to "pick winners" and offer explicit subsidies?

I agree with Gary that these industries offer the prospects of some job creation but other jobs will be destroyed by carbon taxes. To answer what is the net effect requires some knowledge of the shape of demand curves for various products. If aggregate demand for energy intensive goods is highly price sensititve (elastic demand), then a carbon tax will "destroy" many jobs for this industry as its long run cost function shifts up.

There are some general equilibrium issues that the sociology team needs to think through. Despite this point, I certainly find his study to be interesting.

Thursday, February 26, 2009

Quoted in the NY Times on the Energy Secretary's Remarks on Climate Change

When is a political leader a "Chicken Little" versus when is he a prudent educator helping the distracted populace have the right priorities and perceive the correct subjective probabilities of future climate change outcomes?

It appears that Energy Secretary Chu is facing this issue. This has allowed me to be quoted at length in today's New York Times click here.

I like my quotes today more than my front section quote in yesterday's Times on economic models of AB32.

If you find my witty sound bites irresistible, then you can find many more here.

Wednesday, February 25, 2009

Slightly Misquoted in the New York Times

Each morning I read the New York Times front section backwards. I start at the editorial page (to learn from Dowd and Krugman) and then move towards the front page. I was reading page A14 today when I saw my name and a quote of mine on the topic of California and climate change. I was thrilled but a little surprised. Here are two paragraphs from this Times Article ;

"But the projections were strongly criticized as unrealistic by the affected industries and by independent economists who reviewed the analysis — including two from the Pew Center on Global Climate Change, which supports the emission reduction goals.

In one withering review, Matthew E. Kahn of the University of California, Los Angeles said the analysis unconvincingly portrayed the law as “a riskless free lunch.” Another economist, Robert N. Stavins of Harvard, said the regulators were “systematically biased” in ways “that lead to potentially severe underestimates of costs.”"

I object to the adjective "withering". As stated it appears that this is my view of "AB32" when instead this is how I view the CGE economic analysis that I was asked to review.

If the reporter had read through my report on the AB32 document here is what she would have read;

Introduction

This memo provides my answers to the set of questions that I have been asked to comment on. Before I present my views I would like to state that I am a 100% supporter of the Air Resources Board’s efforts to translate the broad, vague mission embodied in AB32 to produce a game plan for achieving sharp reductions in California’s greenhouse gas emissions by 2020 and even greater emissions reductions by 2050. I want to see the ARB succeed in achieving its greenhouse gas mitigation goals. By pursuing this effort, California will reaffirm its world leadership in tackling environmental issues. By acting as a “guinea pig”, the state will help to educate governments around the world on cost effective techniques for reducing carbon emissions.

While I support the Governor’s broad AB32 goals, I must admit that I am troubled by the economic modeling analysis documents that I have been asked to read. As presented, AB32 will be a riskless “free lunch” for Californians. These economic models predict that we will enjoy a “win-win” of much lower greenhouse gas emissions and economic growth caused by this regulation. According to my arithmetic 95.6 MMTCO2 reduction or 57% of the AB32 2020 offers a net benefit of $132 million per MMTCO2. This would be a large free lunch! I would like to believe this claim but after reading through the Economic Analysis and the five appendices there are too many uncertainties for me to believe this.

In this review, I will highlight why I believe the current modeling exercise underestimates the costs of meeting AB32’s goals and I will sketch a research methodology for collecting the necessary data to truly test whether the optimistic numbers reported in Table I-2 of http://www.arb.ca.gov/cc/scopingplan/document/economic_appendix1.pdf could be accurate estimates of the expected net costs of this program.

In this review, I will point to other economic modeling efforts being conducted by some expert economists who conclude that the introduction of carbon pricing will entail small but significant costs on our economy. I will also highlight the fundamental uncertainties we face because of the ambitious 33% Renewable Portfolio Standards. Nowhere in this economic document could I find any mention of the words “risk” and “uncertainty”. Yet, each day we buy insurance and hold “safe” portfolios (i.e U.S Treasury Bills) to protect us against unforeseen contingencies. We are risk averse. AB32 is a gamble. It will force us to deviate from our “business as usual” ways of running our economy. This offers potential large benefits but it also raises the potential for bad scenarios whose probabilities and costs if they ensue have not been quantified in the documents I have read through.

Finally, this report will emphasize the need for more data collection and for field experiments to be conducted so that we can learn about how diverse real Californians and California firms will respond to the incentives embedded in AB32. Whether AB32 offers “negative costs” hinges on a number of micro-economic factors that the documents I have been asked to review do not touch on.

To see my full review go here:

http://mek1966.googlepages.com/publishedpapersandworkingpapers

and click on the first link.

Tuesday, February 24, 2009

New NBER Working Paper on China's Major Cities

Working with Siqi Zheng and Hongyu Liu of Tsinghua Univ. in Beijing, I have managed to write a new NBER Working Paper on China's Major cities. Starting in the late 1970s with the compensating differentials research of Sherwin Rosen and Jennifer Roback, many urban economists have used U.S data to estimate the implicit prices for non-market goods (i.e air pollution, climate). Intuitively, why are home prices higher in Los Angeles than Detroit by roughly 10 times? You might claim that it is productivity differentials but I don't believe this. I believe the quality of life is higher in LA and this is capitalized into city price differentials. If migration costs are low across cities, there can't be the same housing prices in Detroit and LA because everyone would move from Detroit to LA (arbitrage).

While researchers have studied the U.S too much, there has not been enough research on measuring compensating differentials in a booming LDC such as China. Using unique data sets, this is what we do in this new paper.

Here are our main findings;

1. Across, cities --- ambient air pollution is capitalized into home prices and this price premium appears to be rising over time.


2. Cities with more inelastic housing supply experience greater house price appreciation when local demand for housing increases (Glaeser and Gyourko are right in China)

3. Cities experiencing FDI inflows have lower air pollution. This will surprise the pollution havens crew. One possible explanation for this finding is a greener technique effect.

4. We find evidence of a within sample Environmental Kuznets Curve. Since we only have 35 cities and observe each for 6 years, we estimate a simple air pollution production function. Bigger cities have a higher pollution levels. This population elasticity of .3 to .4 is very similar to U.S estimates. Regressing PM10 on a quadratic in city per-capita income, we find a within sample turning point such that all else equal, richer cities have lower PM10 levels.




Switching gears, here is Marty's work on fat tails and losses from climate change.
Weitzman papers on fat tails and losses from climate change.

Fat Tails and Predicting our Environmental Future

Steven Chu is a Nobel Laureate and our new Energy Secretary. He has been quoted as saying that climate change could make water so scarce in California that agricultural production may grind to a halt there by 2100. Today in John Tierney's NYT Article fumbles the ball. He asks a good question. Why is this really smart guy (Chu) making statements that sound extreme? Tierney spends his whole article quoting Roger Pielke. I would have suggested a more diversified academic portfolio. He should have also talked to Marty Weitzman.

Is Dr. Chu simply trying to scare the American people to stop being complacent in order to mobilize political support to take costly anti-greenhouse gas emissions actions today? While this is possible, consider the following.

Climate change may impose some states of the world where our economic and quality of life losses are very large. Given that we know that we do not know the probabilities of these scary states of the world, we face fat tail ex-ante uncertainty about future scenarios. We do not have a "symmetric loss function" with respect to future states of the world. We lose more from extreme weather events and it is important for somebody to make us aware of the possible future states of the world and how little we know about their probability of taking place.

If we sat down with Chu, I doubt that he would say this his "best" modal guess of our future in California is no more water but he is saying that there is some positive probability that this will occur and a rational populace should take steps today to get ready for these potential tough days ahead.

A Green City in the Desert?

Ever since I published my Green Cities book in 2006, I have thought about writing a sequel on green cities and climate change. In the new edition of MIT's Technology Review, there is a long excellent article on one case study; A "Green City" in the desert .

Monday, February 23, 2009

Laguna Beach and Some New Press Coverage

This weekend we were in Laguna Beach in Orange County. I thought that Santa Monica has a nice beach but Laguna wins. We didn't like the restaurants and we didn't like our hotel. Don't stay at the Hotel Laguna. It appears to have been built in 1875. I don't need antique plumbing. I am a princess.

Switching gears. If you want to see some 3rd party praise for the new Costa/Kahn book then click here or here. We will be doing a 3pm radio interview today on Los Angeles radio. Tune in and maybe I will say something interesting.

Thursday, February 19, 2009

Who Merits an Obama Bailout?

What would Larry Summers have to say to Tony Mills? Tony posted this entry at the end of Ed Glaeser's blog post today on the Obama Housing Proposal.

"I’m just kicking myself for not taking on a mortgage I couldn’t afford when I was offered the chance back in 2005. What was the point of being cautious and deciding to rent instead ? What’s in the bailout package for me ? It sounds as though my job now is to help pay the mortgages of people who shrugged off common sense and plunged into debt up to their necks. The losers have become the winners."

— Tony Mills

The Power of Positive Thinking

Some good game theorists should explain how we co-ordinate beliefs when we receive common signals about the economy. Wouldn't we all be better off if we could be convinced that the economy's outlook is improving? Would this be self-fulfilling? Instead, we all read the same bad news from the New York Times. This gloom convinces us that Orphan Annie isn't right that the "Sun will come out tomorrow". How do we co-ordinate our optimism? What sunspot will we fixate on? Who is an influential in our economy who can lead us by solving the coordination problem? Perhaps A-Rod?

Switching gears. Please take a look at Page 3 of today's California section of the Los Angeles Times. You will see an ugly picture of me and a pretty picture of Dora and you will laugh. The article is excellent. The picture is excellent. One of the subjects in the picture just didn't deliver.

Wednesday, February 18, 2009

Google's Efforts on Energy Conservation

Google's letter to the California PUC. Larry and Sergey please get in touch with me. I have a few ideas on how to harness your energy technology. My ideas will promote the public good and will only cause a little bit of evil. I'm hoping that these wealthy men have always aspired to a higher calling such as publishing in the JPE.

On a different subject, I read an important paper by a young, under-appreciated economist today. I suggest that you read it.

Los Angeles Times Article on the New Costa/Kahn War Book

Dora and I are grateful that the Los Angeles Times was willing to run an article about our new book today. With so much attention focused on the macroeconomy and "panic", we applied microeconomists still need our day in the sun.

How to Balance Harvard's Budget? Cut Out Free Bagels at Faculty Meetings

This is the age of diminished expectations. Perhaps some over-eating will decline as we academics face a higher price per tasty calorie. Such food cuts must be the tip of the iceberg. As the Deans look for fat in the school budgets, I wonder if they should take a close look at the libraries. A quantitative leader might ask; how many journals do we subscribe to? Based on electronic downloads, which journals have fewer than 10 downloads on our campus per year? Do we really need to keep those journals?

On my campus, another budget item that I would shrink down is campus beauty and maintenance. At UCLA, there are all of these dudes loudly pushing leaves around (with polluting leaf blowers) and cutting shrubbery. Why do we need them? I know that we have union rules protecting their jobs but why does the campus have to look like a golf course? I don't want garbage to be strewn around but I have no problem with some wild native plants rather than grass everywhere. Yes, students shouldn't sit on a cactus.


Harvard Departments To Cut Food from Budgets
Published On 2/18/2009 1:21:12 AM
By ELYSSA A. L. SPITZER and NOAH S. RAYMAN
Crimson Staff Writers


With departments seeking to “cut the fat” from their budgets to the tune of a 15 percent reduction requested by the FAS administration, bagels and bacon will be the first to go. Rather than eliminating central costs such as employees and course materials, department chairs are looking to cut down on non-essential expenses such as food and office supplies as they set the next year’s budget.

In the past, departments have offered food at faculty gatherings—coffee and pastries at breakfast meetings and catered sandwiches at lunch. With the entire university charged with the task of tightening its belt by FAS Dean Michael D. Smith, nearly every department has had to scale back.

According to History of Science Department Chair Anne Harrington, even though the department’s food cost is only a small portion of the overall budget, the move is “partly symbolic politics.”

“It’s about changing the culture of expectation,” said Harrington, “so that you get used to buying your own piece of pizza on your way up [to a meeting] instead of expecting a sandwich and drinks when you get there.”

Two weeks ago, the history department had its first faculty lunch-time meeting without providing lunch, said Professor of American Studies and Department Chair Lizabeth Cohen. “Much at Harvard had been lubricated with food and drink,” she said.

Faculty members were advised in an e-mail to bring their own lunch, “but some people didn’t read to the bottom of the e-mail,” she said. Those who did not pack a lunch found themselves sharing a banana with their colleagues, Cohen said.

Even with cuts to their food budgets, departments have not entirely abandoned snack-food. Departments are turning away from Crimson Catering to more cost efficient options like Costco.

Crimson Catering, the subdivision of Harvard University Dining Services that caters to events ranging from faculty meetings to gala dinners, declined to comment on any changes in sales. But they have begun advertising a special “Give Your Budget A Break” menu on their Web site, in an apparent recognition of the budgetary constraints sweeping the campus.

Harrington said that next year, the annual History of Science Christmas dinner will be transformed from an expensively catered event to a pot-luck, saving the department roughly $5,000.

Anthropology Department Chair Theodore C. Bestor said that in recent years, while the department has provided coffee to its faculty and staff, drinkers were expected to leave 25 cents for each cup consumed. But Bestor said that the $2,000 the department spent on coffee brought in only $400 worth of quarters. The department will not continue to offer coffee this year.

But, Harrington said, food is not everything. “It doesn’t cost anything to have a really engaging conversation.”

—Staff writer Elyssa A.L. Spitzer can be reached at spitzer@fas.harvard.edu. —Staff writer Noah S. Rayman can be reached at nrayman@fas.harvard.edu.


http://www.thecrimson.com/article.aspx?ref=526595

Tuesday, February 17, 2009

Have UCLA Geographers Pinpointed Bin Laden's Hideout?

UCLA geographers urge U.S. to search 3 structures in Pakistan for bin Laden

Basic logic, principles of geography point to Parachinar as likely hideout


Meg Sullivan, msullivan@support.ucla.edu


While U.S. intelligence officials have spent more than seven years searching fruitlessly for Osama bin Laden, UCLA geographers say they have a good idea of where the terrorist leader was at the end of 2001 — and perhaps where he has been in the years since.



In a new study published online today by the MIT International Review, the geographers report that simple facts, publicly available satellite imagery and fundamental principles of geography place the mastermind behind the Sept. 11 attacks against the U.S. in one of three buildings in the northwest Pakistan town of Parachinar, in the Kurram tribal region near the border with Afghanistan.



"If he's still alive, he honestly could be sitting there right now," said Thomas W. Gillespie, the study's lead author and an associate professor of geography at UCLA. "It is still the safest tribal area and city in the Federally Administered Tribal Areas (FATA) of northwest Pakistan and one of the only tribal areas that the U.S. has not bombed with its unmanned Predators."



Despite keen interest in the terrorist recluse and a $25 million reward for information leading to his capture, academics have shied away from getting involved in the quest to find him, the researchers contend. Meanwhile, dramatic improvements in remote-sensing imagery have improved the odds of civilians doing so.



"We believe our work represents the first scientific approach to establishing bin Laden's current location," said John A. Agnew, study co-author and UCLA geography professor. "The methods are repeatable and could easily be updated with new information obtained by the U.S. intelligence community."



The researchers advocate that the U.S. investigate — but not bomb — the three buildings. They warn that if bin Laden indeed remains to this day in the tiny city of Parachinar, or even elsewhere in the relatively thinly populated tribal area of Kurram, he may move to the city of Peshawar (population 1.4 million) in the neighboring tribal area of North-West Frontier Province if Peshawar falls to the Taliban. News reports have warned of that possibility since last summer.



"If bin Laden were to move to Peshawar, which would become an option if the Taliban were in control there, the search would become much more complicated," Gillespie said. "It's the difference between looking for someone in L.A. versus in Big Bear," he added, referring to a mountain resort town 90 miles east of Los Angeles.



The findings are based on the last information on bin Laden's whereabouts to be made public by U.S. intelligence sources, which have closely guarded the details of any efforts to locate him. One and a half months after the coordinated attacks on the World Trade Center and the Pentagon claimed the lives of more than 3,000 people, a walkie-talkie radio broadcast placed bin Laden in Tora Bora, a cave complex in eastern Afghanistan. In an unsuccessful attempt to capture bin Laden, U.S. forces attacked the caves the following month.



The UCLA findings rely on two principles used in geography to predict the distribution of wildlife, primarily for the purposes of designing approaches to conservation. The first, known as distance-decay theory, holds that as one travels farther away from a precise location with a specific composition of species — or, in this case, a specific composition of cultural and physical factors —the probability of finding spots with that same specific composition decreases exponentially. The second, island biogeographic theory, holds that large and close islands have larger immigration rates and will support more species than smaller, more isolated islands.



Inspired by distance-decay theory, the seven-member team started by drawing concentric circles around Tora Bora on a satellite map of the area at a distance of 10 kilometers — or 6.1 miles — apart.



"The farther bin Laden moves from his last reported location into the more secular parts of Pakistan or into India, the greater the probability that he will be in an area with a different cultural composition, thereby increasing the probability of his being captured or eliminated," Gillespie said.



Then, informed by island biogeographic theory, the researchers scoured the rings for "city islands" — or distinctly separate settlements of considerable size.



"Island biology theory predicts that he would find his way to the largest but least isolated city of that area," said Gillespie, an authority on measuring and modeling biodiversity on Earth from space. "If you get stuck on an island, you would want it to be Hawaii rather than one with a single palm tree. It's a matter of resources."



The approach netted 26 cities within a 12.4-mile radius of Tora Bora on imagery from Landsat Enhanced Thematic Mapper Plus (ETM+), a global archive of satellite photos managed by NASA and the U.S. Geological Survey. With a 2.7-square-mile footprint, Parachinar turned out to be the largest and fourth-least isolated city, the team determined.



"Based on bin Laden's last known location in Tora Bora, we estimate that he must have traveled 1.9 miles over a 13,000-foot-high pass into Kurram and then headed for the largest city, which turns out to be Parachinar," said Agnew, who is the current president of the Association of American Geographers, the field's leading scholarly organization.



The researchers ruled out cities on the Afghanistan side of the border because the country was occupied at the time by U.S. and international forces and has been particularly unstable ever since.



"The Pakistan side of the border is much better for hiding because of its ambiguous political status within the country and the formal absence of U.S. or NATO troops," Agnew said.



Faced with the prospect of picking from more than 1,000 structures clearly portrayed in the satellite imagery of Parachinar, the team decided to come up with a short list of the criteria that bin Laden would need for housing, based on well-known information about him, including his height (between 6'4" and 6'6", depending on the source), his medical condition (apparently in need of regular dialysis and, therefore, electricity to run the machine) and several basic assumptions, such as a need for security, protection, privacy and overhead cover to shield him from being spotted by planes, helicopters and satellites.



So they looked for buildings that could house someone taller than 6'4" and were surrounded by walls more than 9 feet tall (both as judged by mid-afternoon shadows depicted on the satellite imagery), and that had more than three rooms, space separating them from nearby structures, electricity and a thick tree canopy.



Only three structures fit the criteria. The buildings also appeared to be the best fortified and among the largest in Parachinar. Two are clearly residences, the study states. The third may be a prison. But whatever the third structure is, it has "one of the best maintained gardens in all of Parachinar," the study says.



While the three structures meet all six of the criteria that the researchers believe would be required for lodging bin Laden, an additional 16 structures in Parachinar appear to meet five of the six criteria. If bin Laden is not in the first three structures, the U.S. military should investigate these other buildings, the study urges.



The outgrowth of an undergraduate geography course in remote sensing, the study lists five 2008 UCLA graduates as co-authors. The students have since gone on to a range of endeavors, from selling real estate and attending law school to earning a master's degree from Oxford University. One now works for a remote-sensing company.



Undergraduates had attempted to take on the same study in 2006, but at 30 x 30 meters — or nearly 100 x 100 feet — the resolution of publicly available satellite images of the area at the time was insufficient. In contrast, today's resolution is 0.6 meters, or just under 2 feet, Gillespie said. The remote-sensing company that employs one of the alumni authors plans soon to unveil a 0.4-meter resolution of the entire world.



"Technology has caught up to the question," said Gillespie, who serves as the director of the Spatial Demography Group for the UCLA-based California Center for Population Research.



"Finding Osama bin Laden: An Application of Biogeographic Theories and Satellite Imagery" is not the first attempt by Gillespie and Agnew to bring scientific analysis to nettlesome political issues. In September 2008, they received widespread attention for a satellite study of the density of lights in the night sky of Baghdad in the time leading up to, during and immediately following the U.S. military surge of 2007. The findings cast doubt on the role claimed by the U.S. military in quelling violence during that time and suggest instead that intra-sectarian conflict was responsible for clearing whole portions of the city, leaving them both dark and devoid of the objects of Iraqi-on-Iraqi violence.



Due to the low cost of conducting the study, it received no outside funding. However, past research by Gillespie has received funding from the National Institute on Aging, the MacArthur Foundation and the National Science Foundation.



The MIT International Review is a peer-reviewed interdisciplinary journal of international affairs that is dedicated to solution-oriented discourse on challenges facing the global community.



UCLA is California's largest university, with an enrollment of nearly 38,000 undergraduate and graduate students. The UCLA College of Letters and Science and the university's 11 professional schools feature renowned faculty and offer more than 323 degree programs and majors. UCLA is a national and international leader in the breadth and quality of its academic, research, health care, cultural, continuing education and athletic programs. Four alumni and five faculty have been awarded the Nobel Prize. For more news, visit the UCLA Newsroom.

Feed the Rich

These are tough days. I still believe that California could close its budget deficit by taxing water consumption. Choose a non-linear pricing system such that low consumption households would face a lower marginal price than pool owners and grass growers. The state needs new sources of revenue. The UC schools could do great things with more $ and so could these expensive cities. Beverly Hills 90210 Needs a Bailout

Sunday, February 15, 2009

43rd Birthday

I no longer like birthdays. 43 may be a prime number but that doesn't make me feel any better about it. While I think of myself as an Assistant Professor, the truth hurts. I think that my research is getting better over time. Some referees seem to disagree but I disagree with their disagreement. Some sociologist should build on the David Galenson work on productivity over the lifecycle by doing a detailed analysis of time allocation over the lifecycle for an academic. Larry Summers has clearly reallocated his time relative to what he was doing at Harvard circa 1985.

As academic economists get older, how many hours are they;

1. reading
2. teaching
3. private consulting
4. public consulting (i.e Obama stuff)
4'. attending conferences as the grand old man.
5. writing blog stuff
6. writing conference volume stuff
7. writing hard stuff for peer reviewed publication
8. writing popular books
9. writing textbooks
10. doing administrative stuff at their University
11. editing a leading journal
12. advising PHD students

These 12 dimensions may span the set of legal activities. For different people
at top 5, top 10, top 20 departments --- as we age how do we allocate our time across these activities?

I would like to see the minutes count for #7 ---- how many people stay in the game and try to convince themselves that they are just a lowly assistant professor who hasn't done anything yet?

While I know that my #7 minute count has fallen --- I would counter that my productivity per minute has gone up. Looking back to when I was an assistant professor at Columbia, I wasted a huge amount of time. Teaching used to exhaust me. Perhaps too much chalk inhalation in the pre-powerpoint slides days.


I seem to recall that 2/16 is also John Whitehead's birthday. It is also Brooke Shield's birthday. So, I'm not sure what point is but I do wish us all a good peaceful day.


I would like to turn back the clock. My son and I watched a Star Trek episode on time travel tonight where Kirk and the gang went back to 1968. Maybe this agenda would give our Physics Department something to do. I would be grateful.

The Next Hilary Clinton or Laura Bush? New Evidence on Women's Long Run LFP for a Large Sample of Harvard Graduates

Harvard people appear to be doing well in the new Obama Administration. This must be due to both selection (who gets in) and treatment (what they learn and who they meet) while at this elite school. Now that women represent more than 50% of college graduates, it is interesting to ask whether at mid-career (15 years out) who is in the labor force versus who has opted out. Standard household economics would ask questions about substitution and income effects. All else equal, if a woman would earn a high wage if she works -- this should encourage participation. If she is married to a partner who earns a huge salary --- this income effect should encourage her to opt-out. Using a unique data set covering a large number of women Harvard graduates from the classes from 1988 to 1991, this New Paper on female Harvard graduate's labor force participation at age 37 has many interesting things to say. Doctors are more likely to be still working than MBA graduates. What about PHD economists?

When Economists Fight in Public

MIT's Peter Temin wrote a tough book review in late 2008 published in the Journal of Economic Literature. He clearly stated that the Minnesota world view is not useful for understanding the Great Depression. Here is a well known Nobel Laureate Prescott's Response.

In 2059 when future macro guys take a look at the crisis of 2009, what economic models will they use?

I think that the Journal of Economic Literature should be reconfigured into a "professional wrestling journal". Take a contentious issue and have one set of scholars write up one side of the issue and then let the other scholars write up their views and publish them side by side. This could be done for the minimum wage, carbon taxes, structural estimation, legal origins versus settler mortality as initial conditions for institutional quality today, etc.

Today economists (such as Barro and Krugman) are battling in blogs. These 300 word public essays are too short without footnotes and nuances but there is clearly great demand for these tight debates.

Saturday, February 14, 2009

Three Cheers for the LA Times

These are tough days for the newspaper industry. The New York Times today tried to make the case for why it is a relevant institution. Today's LA Times makes a more cogent case for its relevance in my life. In this article below, they mention my son. While he's no Bobby Fischer, he is saner than that guy. The LA Times also scores big points with me and Dora for sending over an excellent reporter and photographer to interview us last thursday. We talked at length about our new book.

http://www.latimes.com/entertainment/la-ca-chess15-2009feb15,0,1961478.story

From the Los Angeles Times
CHESS
Gata Kamsky to face Veselin Topalov
By Jack Peters
International Master

February 15, 2009

Position No. 6042: Black to play and win. From the game Pedro Tomas Perez Aleman-Theo Hommeles, Gibraltar 2009.

Solution to Position No. 6041: White gains a piece by 1 Qe4 Kg8 2 Qxe5 Ne3+ 3 Qe4. If 1 . . . Qe6, both 2 Ne3+ and 2 Nxd4+ f5 3 exf5 Qf6 4 Nf3 win for White.

Two significant events begin this week. Former U.S. champion Gata Kamsky faces Bulgarian star Veselin Topalov in an eight-game match in Sofia, starting Monday. The players will split a prize fund of $250,000. The winner earns the right to a world championship match against Viswanathan Anand of India this year.

Topalov's current rating of 2809, best in the world, makes him a clear favorite against Kamsky, ranked 17th at 2725.

The rating difference predicts a Topalov victory by one or two points. However, Kamsky's tenacious style is perfect for match play, while Topalov seems better suited to tournaments. Also, Kamsky has notched upsets in previous matches.

The official website, wccc2009.com, will broadcast the games.

World champion Anand returns to action Wednesday in an eight-player double round robin in Linares, Spain. He hasn't played since defending his title against Vladimir Kramnik of Russia in October.

Anand won the Linares tournament, often the best of the year, in 2007 and 2008. This time, he must overcome the formidable resistance of Vassily Ivanchuk of Ukraine (ranked third in the world), Magnus Carlsen of Norway (fourth), Teimour Radjabov of Azerbaijan (seventh) and Levon Aronian of Armenia (11th). The tournament will pay 314,000 Euros (about $400,000) in prize money.

Local news

The Western States Single Grade Scholastic Championships will be held Saturday and next Sunday at the Ventura Beach Marriott, 2055 E. Harbor Blvd. in Ventura. The tournament, now in its 12th year, attracted a record 382 entrants in 2008. This year, the 10-section event will offer a host of individual and team prizes to students in grades K-12. For details, call Jay Stallings at (661) 288-1705 or see the flier posted at aaachessclub.com.

There was a good turnout of 75 players Feb. 7 at the 15th Warner Winter Scholastic at Warner School in Westwood. Sections were won by Eric Demer, Ethan Minafoor, Jovanni Scagliotti, Kevin Headrick, Tony DePesa, Kevin Quisumbing, Thomas McKinley, Kai Lim, Alok Elashoff (playoff over Bryan Toubi), Evan Wainer, River Benyair, Alexander Kahn, Oscar Logevall and Nathan Tabib. John Surlow directed.

Jesse Victoria scored 4 1/2 - 1/2 to win the 40-player Dr. Richard Lewis Memorial at the Pasadena Chess Club. John Hale and Robert Xue were next at 4-1. Jerry Harrison, David Minasyan and Kevin Qian earned class prizes.

The six-round Pasadena Chess Club Championship begins at 7 p.m. Friday in the Senior Center, 85 E. Holly St. in Pasadena. Call Randy Hough at (626) 282-7412 for information.

Friday, February 13, 2009

The Page 99 Test

Marshal Zeringue has created a great website for people who like books. He approaches authors of new books and encourages them to discuss their book's page 99. This random sampling design was good for me and Dora. Page 99 of our Heroes and Cowards is actually interesting. It displays a bar chart of the predicted desertion probabilities for 5 different soldiers. Based on the biography of each of these soldiers, we explain why we believe they differed so sharply with respect to their willingness to sacrifice for the common good. See The page 99 test . Recall that the U.S Civil War was deadly. If your sole goal was to survive, you should have deserted. One of our puzzles is why were desertion rates so low? Why did only 9% of white Union Army soldiers desert?

Thursday, February 12, 2009

Interesting E-mail on Water and Politics in California

I appreciate a thoughtful memo. This email was more interesting than 98% of the stuff that I receive. I can't tell if Wayne is aware that I co-wrote the paper that he comments on below but I appreciate his honesty. An economist would say that the introduction of water markets and flexible pricing for water would go a long way to address his concerns. Farmers of California --- get ready to sell your water endowments to the urbanites! The price of California strawberries is about to go up.


To Matthew Kahn, UCLA

From Wayne Lusvardi, Pasadena, CA
wlusvardi@yahoo.com

Re Help the Environment, Stay in the City

FYI

THE REAL GREEN PARADOX: STAYING IN CITY REDUCES C02, BUT IMPORTING CITY WATER IS UNSUSTAINABLE
by Wayne Lusvardi

Harvard economist Edward L. Glaeser asserts that people living in cities, especially in the moderate weather of California, may emit relatively less carbon than those in suburbs (see: *Help the Environment, Stay in the City,* DCExaminer.com, Feb 11 - http://www.dcexaminer.com/opinion/Help-the-environment-stay-in-the-city-39422222.html#comments. Glaeser calls this the Green-Brown Paradox.

Glaeser estimates the amount of carbon dioxide that an average household would emit from home heating, driving, electricity, and public transportation in cities versus suburbs. His major finding is that cities, especially in a moderate climate such as Southern California, emit relatively less carbon dioxide than suburbs.

However, steering new development into coastal cities in Southern California also results in unsustainable use of water resources. Cities may emit less carbon (Green) but this forces a reliance on imported water supplies (Blue) instead of more sustainable local groundwater supplies in non-coastal areas. The real paradox is not Green vs. Brown as Glaeser asserts but Green vs. Blue.

Glaeser fails to mention new legislation in California, Senate Bill 375, will divert new development to cities as opposed to the suburbs purportedly to reduce carbon footprints and urban sprawl and promote
*smart growth.*

Under this legislation, water will no longer be gold in California. Rather, cliches about reducing global warming and producing green power will be Californiaʼs new foolʼs gold. Los Angeles is now facing the grim reality of an 85 percent cut in imported water deliveries from Northern California through the California Aqueduct due to a court order to protect the tiny Delta Smelt fish. California should consider how embracing popular cliches about environmental protection, such as Glaeser's, has resulted in what might be called the perfect drought, which stems more from political than natural causes.

SB 375 requires regional planning agencies to put into place sustainable growth plans. It will require that new housing development be shifted from the urban fringe, where groundwater resources are more abundant, such as San Bernardino County, to highly dense urban areas near public transit and light rail lines, such as Los Angeles and Pasadena, where local water sources are patchy and often polluted. The environmental intent of SB 375 is to reduce auto commuter trips, air pollution and gasoline consumption.

However, the legislation will unintentionally result in more reliance on imported water supplies from the Sacramento Delta, Mono Lake and the Colorado River for thirsty cities along Californiaʼs coastline instead of diverting development to inland areas that have more sustainable groundwater resources.

This can be clearly seen by viewing the U.S. Geological Survey map of Groundwater Basins in California. The populous coastal areas of the state have spotty groundwater resources, while the inland areas have the most abundant water basins to sustain new development - see: http://capp.water.usgs.gov/aquiferBasics/calcobag.html

SB 375 makes no sense from even a global warming perspective. Higher temperatures are generated in dense urban areas with more buildings and pavement, and less vegetation. Conversely, suburban and urban fringe areas with less hardscape and more vegetation are generally cooler. This is called the Urban Heat Island Effect. Concentrating housing development in already highly dense urban areas will only worsen the urban heat island effect and thus increase spot global warming.

Moreover, by virtue of shifting to reliance on imported water supplies, California will need to buy more imported coal-fired and natural gas-generated electricity to pump that water to urban centers located far from the sources of water. Glaeser doesn't factor in the increased energy demand from imported water into his carbon footprint equation. Nor does he consider that most of the electricity for Southern California is imported from outside the state, creating an alleged carbon footprint in sparsely populated rural areas of the Southwestern United States.

Fortunately, the new law doesnʼt yet mandate local governments to comply with the plans. No real changes are expected until regional planning agencies adopt the sustainable-communities growth policies called for in the law three years from now. However, if cities choose not to comply now, that will allow state regulators to divert state transportation tax funds to compliant cities. That SB 375 is a license for greedy coastal cities in Democratic strongholds along the coast to capture the taxes of inland cities in Republican territory is never mentioned in the media. Environmentalism serves as a cover for politics by other means.

Laws like SB 375 continue dependence on costly imported wholesale water, say at $500 per acre foot (a football field of water one foot high, which is enough to sustain two families per year) compared with cheap local groundwater at roughly $50 per acre foot. Imported water results in a ten-fold "drain" on local economies. That is why water is metaphorically colored gold in the Golden State of California.

That this piece of legislation was passed by green Gov. Arnold Schwarzenegger, endorsed by Los Angeles Mayor Antonio Villaraigosa and signed by every state legislator representing Los Angeles, and without dissent from local water agencies and even air-quality resource boards, is indicative of how environmental policy is based on powerful political-cultural imagery beyond science and common sense. Incredibly, the implementation of SB 375 will even be granted certain breaks for transit-oriented development under the California Environmental Quality Act.

California is shifting from valuing water as gold to a Foolʼs Gold Rush to reduce global warming and generate green power. Paraphrasing a Latin proverb, (political) hay is more acceptable to a donkey than gold.

Glaeser asserts that there is a paradox is between fewer carbon emissions per average person in cities versus more carbon emissions in suburbs. But the real Green paradox is the trade off between carbon emissions and unsustainable imported water in coastal cities in California.

Note: Wayne Lusvardi worked for The Metropolitan Water District of Southern California for 20-years. The views expressed are his own.

Job Creation at Harvard's Economics Department

Harvard's Economics Dept. has made a credible case that it should receive some of the Obama Stimulus $ to help create new teaching jobs in their excellent department.
How will their Deans respond to this plea? Will they burry $ in bottles and tell the senior faculty to go look for it? More generally, as Universities get ready for serious budget cuts for the 2009-2010 academic year, will Economics Departments do better than other departments. While everyone talks about academic "excellence", we are about to get a market test of whether preserving and building economics is a higher priority to Deans and Provosts than building up other fields.



Econ. Dept. May Cut Seminars

Shortage of economics faculty may bring end to junior seminars

Published On 2/12/2009 1:13:25 AM

By NOAH S. RAYMAN and ELYSSA A. L. SPITZER

Crimson Staff Writers


Junior seminars in economics—the only small undergraduate courses taught by the department’s faculty—may become yet another victim of the University-wide strain borne of the financial crisis.

With faculty departing and Harvard’s hiring slowdown hindering their replacement, the already stretched department does not have enough faculty members to teach the seminars, according to some department members.

“We have a shrinking pool of faculty to teach the same pool of students,” said Economics Professor Claudia Goldin, who taught a seminar this fall. “How can we teach as effectively when our faculty is down so many people?”

The decision to cancel junior seminars for the ’09-’10 academic year—which Goldin said has already been discussed by the department as a very likely option—will not be finalized until at least mid-March, when the first draft of the department’s list of offerings is due for the course catalogue, according to the department’s Academic Coordinator Clare MacLean.

The economics department—which has one of the highest student-to-faculty ratios—introduced the 16-person courses three years ago as a result of a College-wide push to increase student interaction with faculty members.

“The student-teacher ratio is well out of whack,” said Sendhil Mullainathan, an economics professor who also taught a seminar this fall.

Recent departures have worsened the situation. In the past few weeks, the department has lost several faculty members to the Obama administration.

Former University President Lawrence H. Summers, who was slated to co-teach a junior seminar this spring, left to head the President’s National Economic Council.

Professor David M. Cutler ’87 departed to work with Obama on health care policy, and Professor Jeremy C. Stein joined Summers at the NEC. Visiting Professor Owen A. Lamont and Professor Raj Chetty have replaced Stein and Cutler, respectively, but department members said they are still anxious about the hiring slowdown.

“If economics is going to remain as popular as it has been for the last 20 years, we need to have more faculty resources in order to provide the educational experience that would be more comparable to what other departments are able to,” said Economics Professor Benjamin M. Friedman.

Next year, the department plans to open courses that were formerly seminars to a higher number of students. thus eliminating their 16-student caps and losing their seminar designation.

Junior seminars are non-required courses “designed to introduce students to research in a particular field of economics,” according to the course catalogue.

While only a fraction of the 238 current junior economics concentrators have elected to take the courses, enrollment is not guaranteed. This semester, 97 students lotteried for 48 slots, according to Jeana Lee, an undergraduate course assistant.

“I thought it was one of the best experiences I had in the econ department,” said James S. Williams ’10. “There was tremendous opportunity for interaction with the professor.”

—Staff writer Noah S. Rayman can be reached at nrayman@fas.harvard.edu. —Staff writer Elyssa A.L. Spitzer can be reached at spitzer@fas.harvard.edu.


http://www.thecrimson.com/article.aspx?ref=526475

Wednesday, February 11, 2009

Green Consumption in Los Angeles

I was interviewed today for half an hour by a talented interviewer named Devin Browne. She is preparing a 4 minute radio piece on the ecovenience movement. I'm hoping that she will find some of my witty quotes about the demand for green products useful. For example, I offered some deep thoughts on how to get Dick Cheney to try out green products. I also offered the "Locali" store (see Green Los Angeles Store) some free advice on how to grow their business into the next Starbucks.

If you are wondering why I should have any credibility on such green marketing issues, then you should read My 2007 JEEM paper and my stunning paper with ryan vaugh on the geography of hybrid vehicles and LEED buildings. To get a free copy click here .

The Economist Magazine liked that paper!

Tuesday, February 10, 2009

Troy Aikman will Graduate from UCLA

Maybe I will go to graduation this year. I'm unlikely to see Jim Morrison there but I may spot Troy Aikman. The average lifetime earnings of UCLA sociology majors is about to rise. Dora says that this sounds like the plot of a Simpson's Episode.

Aikman getting college degree 20 years later

DALLAS (AP)—Troy Aikman’s passing days didn’t end when he retired from the Dallas Cowboys.

The Hall of Fame quarterback says he’s passed his two final college courses and will graduate in June from UCLA—20 years after he left for the NFL.

The Dallas Morning News reported Tuesday that Aikman is getting a bachelor’s degree in sociology and will participate in UCLA’s graduation ceremonies.

The 42-year-old Fox Sports broadcaster says he’s “finally taking care of unfinished business.”

Aikman says he promised his mother, when he left school just two courses shy of a degree, that he would return and finish.

Aikman’s final two courses included a class on race and ethnicity, and another on aging.


He earned an “A” for both.

Compensating Differentials During War Time and the Arbitrage Process

Everbody is clucking that economic theory has not helped us with this financial crisis. But, I keep seeing economics being relevant in day to day situations. In this narrative below, I like the quote from the Israeli looking for an arbitrage opportunity during the recent battle. "Kobi said he didn’t live nearby. He came to sniff around. Now that Beersheba’s in rocket range, it has opened up quite a few real estate possibilities. Land values will drop; the state will hand out extra construction permits. In short, an entrepreneur who plays his cards right can find great opportunities."

New students who have not thought about economics before are often surprised by our optimism that opportunities will be seized by somebody. Does this cute little story have any implications for the "macro crisis" today?

This Kobi may not be Kobi Bryant but his individual actions help to keep our vibrant world system going. What are you doing for me?


New York Times Magazine
February 8, 2009
Lives
Matchstick War
By ETGAR KERET

When the fighting in Gaza began last month, I found myself with a lot of spare time. The university in Beersheeba where I teach was within the range of missiles fired by Hamas, and they had to close it. But after a couple of weeks, it reopened, and the next day I found myself taking an hour-and-a-half train ride from Tel Aviv, where I live, to Beersheeba again. Half the students weren’t there — mainly the ones from the center of the country — but the other half, those living in Beersheeba itself, showed up. The bombs were dropping on them in any case, and conventional wisdom among the students was that the university’s classrooms were better protected than their dorms and housing projects.

While I was having my coffee at the cafeteria, the bomb-shelter alarm started blaring outside. There wasn’t time to get to a proper shelter, so I ran with some other people into the thick-walled, almost windowless entrance of a nearby university building. Around me were a few frightened students and a grave-faced lecturer who went on eating his sandwich on the concrete steps as if nothing were happening. A couple of the students said they’d heard an explosion in the distance, so it was probably safe to leave, but the lecturer, his mouth still full, pointed out that sometimes they shoot more than one missile and that we’d be better off waiting a few more minutes. It was while I was waiting there that I recognized Kobi, a crazy kid from my childhood in Ramat Gan who liked fifth grade so much he stayed in it for two years.

At 42, Kobi looked exactly the same. It’s not that he looked especially young; it’s just that, even in elementary school, he seemed to be approaching middle age: a thick, hairy neck, powerful body, high forehead and the smiling yet tough expression of an aging child who had already learned a thing or two about this stupid world. In retrospect, the malicious rumor among the kids at school that he was already shaving was probably true.

“Well, what do you know?” Kobi said, hugging me. “You haven’t changed a bit” — by way of accuracy, adding, “even the same height, just like elementary school.”

Kobi and I caught up a bit, and after a while people around us felt safe enough to start making their way out of the protected space, leaving it for us. “That rocket was a stroke of luck,” Kobi said. “Just think: if it wasn’t for that Qassam rocket, we could have walked right past each other and never met.”

Kobi said he didn’t live nearby. He came to sniff around. Now that Beersheba’s in rocket range, it has opened up quite a few real estate possibilities. Land values will drop; the state will hand out extra construction permits. In short, an entrepreneur who plays his cards right can find great opportunities.

The last time we met was almost 20 years ago. There were missiles then too, Scuds that Saddam Hussein rained down on Ramat Gan. Kobi was still living at home. I’d gone back to be with my stubborn parents, who refused to leave the city. Kobi took our friend Uzi and me to his parents’ apartment and showed us what he referred to as his Weapon and Matchstick Museum. There, on the walls of his childhood bedroom, hung an impressive collection of weaponry: swords, pistols, even flails. Beneath them stood a huge Eiffel Tower and a life-size guitar he had made out of matchsticks. He explained to us that the museum had originally been devoted to weapons alone, but after he was convicted of stealing grenades for the exhibition, he took advantage of his eight-month sentence to build the Eiffel Tower and the guitar and added them to the collection.

In those days, he was especially worried that an Iraqi missile strike would shatter the Eiffel Tower, on which he’d spent most of his jail time. Today, his matchstick creations are still at his parents’ place, but Ramat Gan is outside the effective range of the missiles and rockets. “As far as the matchstick Eiffel Tower goes,” Kobi said, “my situation over the last 20 years has definitely improved. I have my doubts about the rest.”

On the train from Beersheba I read a paper that someone had left behind on a seat. There was an item about the lions and ostriches at the Gaza Zoo. They were suffering from the bombing and hadn’t been fed regularly since the war began. The brigade commander wanted to rescue one particular lion in a special operation and transfer it to Israel. The other animals were going to have to fend for themselves. Another, smaller, item, without a picture, reported that the number of children who had died in the bombing of Gaza so far had passed 300. Like the ostriches, the rest of the children there would also have to fend for themselves. Our situation at the level of the matchstick Eiffel Tower has indeed improved beyond recognition. As for the rest, like Kobi, I have my doubts.

Etgar Keret is a filmmaker and the author of several books, most recently “The Girl on the Fridge: Stories.” This essay was translated by Anthony Berris from the Hebrew.

Submissions for Lives may be sent to lives@nytimes.com. The magazine cannot return or respond to unsolicited manuscripts.

Monday, February 09, 2009

Becker and Murphy Make Sense

With 100s of academic economists all speaking at once, how is my mom to know who to believe during this stressful time? If she called me, I would suggest that she read this Gary Becker and Kevin Murphy WSJ Piece.

In this piece they present some credible reasons for why the "stimulus plan" may not deliver what the new Administration claims it will deliver. The problem with macro policy of course is that these guys can't run a "pilot program" to demonstrate that whatever treatment in vogue might really work. I'd be happier with the policy thinking if they could be clever enough to run a credible field experiment to demonstrate the likely positive effects of this stimulus plan on "confidence".

Permit me to suggest a new policy to stabilize this economy. For anybody who bought a home after January 1st 2006, the Obama Administration will buy the home at the price the household purchased it for. For anybody who bought a stock after January 2006, the Obama Administration will buy that stock at the price the person paid for it.

The Administration will then give away all of these assets to people whose household income is less than $100,000 per year.

Would this "policy" lead to a return of "confidence"? A one time income redistribution bundled with erasing 3 years of ex-post mistakes?

Nature vs. Nurture in Explaining Junk Food Consumption

It turns out that Parents do matter. Now, I am worried about myself and my son's future. If your dad likes beer, you like beer. Nature or nurture? Bruce Sacerdote looked at a set of kids (some of whom were adopted and some were biological offspring) and concluded that many inter-generational correlations must be nurture because the adopted kids acted like their parents. UCLA researchers are working on similar questions but they do not appear to be as ambitious in terms of teasing out the "why".

So, to rephrase a key statement made by Jim Heckman; "burgers beget burgers, fries beget fries".


New factor in teen obesity: parents

Research shows teens more likely to consume fast food, soda if parents do


Gwendolyn Driscoll, gdriscoll@ucla.edu
310-794-0930


There may be a reason teenagers eat more burgers and fries than fruits and vegetables: their parents.



In a new policy brief released today by the UCLA Center for Health Policy Research, researchers found that adolescents are more likely to eat at least five servings of fruits and vegetables a day if their parents do. Contrarily, teens whose parents eat fast food or drink soda are more likely to do the same.



Every day, more than 2 million California adolescents (62 percent) drink soda and 1.4 million (43 percent) eat fast food, but only 38 percent eat five or more servings of fruits and vegetables, according to the policy brief, "Teen Dietary Habits Related to Those of Parents."



The cause of the deficit of healthy foods in teen diets has been attributed in part to the high concentration of fast food restaurants in certain cities and neighborhoods and other environmental factors.



The new research is a reminder, however, that "good dietary habits start at home," according to center research scientist Susan H. Babey, a co-author of the policy brief. "If parents are eating poorly, chances are their kids are too."



Nearly one-third (30 percent) of California's teenagers are overweight or obese. Poor dietary habits, along with environmental and other factors, are strongly linked to obesity.



The policy brief, which was funded by a grant from the California Endowment, drew upon the responses of thousands of California teenagers queried by the center-administered California Health Interview Survey (CHIS), the nation's largest state health survey. Among the brief's findings:



· Teens whose parents drink soda every day are nearly 40 percent more likely to drink soda every day themselves than teens whose parents do not drink soda.

· Teens whose parents eat five servings of fruits and vegetables daily are 16 percent more likely to do the same than teens whose parents do not eat five servings a day.

· Nearly half of adolescents (48 percent) whose parents drink soda every day eat fast food at least once a day, while only 39 percent of teens whose parents do not drink soda eat fast food at least once daily.

· 45 percent of teens whose parents do not eat five servings of fruits and vegetables daily eat fast food at least once a day, while only 39 percent of teens whose parents eat five servings a day eat fast food at least once daily.



"The research shows us that one of the keys to solving the teen obesity crisis starts with parents, but we must also improve the abysmal food environments in many low-income communities," said Dr. Robert K. Ross, president and chief executive officer of the California Endowment. "While parents are the primary role models for their children and their behavior can positively — or negatively — influence their children's health, it is also essential that local officials representing low-income communities work to expand access to fruits, vegetables and other healthful foods."



Educating parents about unhealthy food choices, as well as how to plan and prepare healthier fare, would help in reducing teen obesity, according to the authors of the policy brief. They also recommend employment policies that promote a better work-life balance. Given a more flexible schedule, more families might have time to prepare food at home and engage more often in family meals — an activity that has been linked to healthier lifestyles.



Healthy "food environments," such as supermarkets, farmers markets and other retail food outlets that offer fruits and vegetables instead of fast food, are also important in helping parents and teens practice healthy behaviors, the brief's authors said.



The California Endowment, a private, statewide health foundation, was established in 1996 to expand access to affordable, quality health care for underserved individuals and communities and to promote fundamental improvements in the health status of all Californians.



The California Health Interview Survey (CHIS) is one of the largest health surveys in the United States. The CHIS is conducted by the UCLA Center for Health Policy Research in collaboration with the California Department of Public Health, the Department of Health Care Services and the Public Health Institute.



The UCLA Center for Health Policy Research is one of the nation's leading health policy research centers and the premier source of health-related information on Californians.

Sunday, February 08, 2009

Shrinking Your Carbon Footprint

Well a deep recession certainly helps to shrink your carbon footprint but perhaps there are other ways to be good "green citizens"? The nice people at PGE offer some clues at that this website; http://www.pge.com/myhome/environment/calculator/assumptions.shtml

Glaeser/Kahn paper on standardized urban carbon footprints

I would like to see PGE think about how to design some research for measuring how different "treatments" such as information provision affect a household's electricity consumption. I have been working on this topic and I would encourage PGE to get in touch with me if this topic interests them.


Carbon Footprint Calculator Assumptions


General Information

Typical PG&E Residential Customer — Monthly Household Energy Use1
Electricity Usage: 540 kilowatt-hours (kWh)
Natural Gas Usage: 45 therms (winter 60 / summer 24)
ClimateSmart Rates1
Electricity: $0.00254 per kWh
Natural Gas: $0.06528 per therm
PG&E Carbon Dioxide (CO2) Emissions Rates2
Electric: 0.524 lbs CO2 per kWh
Natural Gas: 13.446 lbs CO2 per therm

Minimizing Your Carbon Footprint – Estimated Avoided CO2 Emissions

Switch to Compact Fluorescent Light Bulbs
Avoid 34 lbs CO2 per bulb per year
Assumptions:
Compares a 100-watt incandescent bulb to a 23-watt compact fluorescent
Lighting used 2.34 hours per day3

PG&E emissions rate (electric): 0.524 lbs CO2 per kWh
Install an Energy-Efficient Clothes Washer
Avoid 260 lbs CO2 per year
Assumptions:

Avoid up to 15 therms per year and up to 128 kilowatt-hours per year
Based on California Energy Commission-rated Tier 3, 2.65 cubic feet clothes washer supplied by a gas water heater — savings will vary greatly depending upon number of loads and size of washer, whether front- or top-loading, and whether electricity or natural gas is used for water heating
PG&E emissions rate (natural gas): 13.446 lbs CO2 per therm
PG&E emissions rate (electric): 0.524 lbs CO2 per kWh
Purchase an Energy-Efficient Water Heater
Avoid 120 lbs CO2 per year
Assumptions:
Avoid up to 9 therms per year
30 to 50 gallon 0.63 Energy Factor (EF) natural gas water heater — EF is a measure of energy efficiency
PG&E emissions rate (natural gas): 13.446 lbs CO2 per therm
Install High Efficiency Central Furnace
Avoid 1,000 lbs CO2 per year
Assumptions:

Avoid up to 74 therms per year
Based on installation of a more efficient furnace (94% AFUE) to replace a less efficient unit (70% AFUE) of the same size (67.611 kBtuh rating) — AFUE stands for Annual Fuel Utilization Efficiency and is a measure of heating efficiency on an annual basis
PG&E emissions rate (natural gas): 13.446 lbs CO2 per therm


Install Solar Electric Panels
Avoid 3,300 lbs CO2 per year
Assumptions:

Typical residential system is 3-5 kW
18% capacity factor
Operating 8,760 hours per year
PG&E emissions rate (electric): 0.524 lbs CO2 per kWh
Switch to Hybrid-Electric Vehicle
Avoid 2,900 lbs CO2 per year
Assumptions:
12,000 miles per year for average automobile4
Compares hybrid-electric subcompact with comparable vehicle: 2007 Toyota Prius (46 miles per gallon average fuel efficiency) and (non-hybrid) 2007 Honda Civic (29 miles per gallon average fuel efficiency)5
Burning 1 gallon of gasoline produces 19.4 lbs CO26
Average Per Capita CO2 Emissions (Energy and Vehicle Use)
Average Californian
22,941 lbs CO2 per person
Assumptions:

2005 California Per Capita Electricity Usage: 7,032 kWh7
2005 California Per Capita Natural Gas Usage: 422 therms7
California Emissions Rate for Delivered Electricity: 0.879 lbs CO2 per kWh8
Emissions Rate for Natural Gas: 13.446 lbs CO2 per therm9
12,000 miles per year and 21 miles per gallon for average passenger vehicle10
Burning 1 gallon of gasoline produces 19.4 lbs CO26

Average American
32,607 lbs CO2 per person
Assumptions:

2005 United States Per Capita Electricity Usage: 12,347 kWh7
2005 United States Per Capita Natural Gas Usage: 504 therms7
United States Emissions Rate for Delivered Electricity: 1,363 lbs CO2 per kWh8
Emissions Rate for Natural Gas: 13.446 lbs CO2 per therm9
2004 United States Per Capita Vehicle Usage: 464 gallons per person7
Burning 1 gallon of gasoline produces 19.4 lbs CO26
Average Global Person
8,750 lbs CO2 per person11
Sources
PG&E’s ClimateSmart program, authorized by the California Public Utilities Commission in Decision 06-12-032

PG&E’s ClimateSmart program, authorized by the California Public Utilities Commission in Decision 06-12-032 — The most accurate measure of emissions from power generation involves calculating the emissions from each plant operating in the portfolio of generating assets for each hour of the day and year, and this can vary considerably by time of day, year, and with seasonal variations in weather.

To avoid this complex approach, it is common to approximate emissions from electric usage through the use of an average emissions rate such as the California Public Utilities Commission (CPUC)-approved ClimateSmart electric emissions rate of 0.524 lbs CO2 per kWh — This reasonable approximation is based on the average emissions rate for PG&E’s electric portfolio, consistent with the emissions rate that is independently certified and registered each year with the California Climate Action Registry (see www.climateregistry.org). The CPUC-approved ClimateSmart natural gas emissions rate is 13.446 lbs CO2 per therm.


Database for Energy Efficient Resources, California Public Utilities Commission and California Energy Commission


Emission Factors (EMFAC) Model 2007 Version 2.3, Average Annual Mileage from Air Basins in PG&E Service Territory

U.S. Environmental Protection Agency, 2007 Miles-Per-Gallon Updates

U.S. Environmental Protection Agency, Overview: Pollutants and Programs Average Carbon Dioxide Emissions Resulting from Gasoline

California Energy Commission.

U.S. Environmental Protection Agency eGRID (Updated April 2007)

California Energy Commission (CEC): Inventory of California Greenhouse Gas Emissions and Sinks: 1990 to 2002 Update, Page A-24, CEC-600-2005-025, June 2005. The average emissions rate for customer use of natural gas is 11.7 lbs CO2 per therm. For comparability purposes for this calculator, we use the CPUC-approved ClimateSmart rate of 13.446 lbs CO2 per therm, which includes both customer use and distribution of natural gas.

Emission Factors (EMFAC) Model 2007 Version 2.3

World Resources Institute Climate Analysis Indicators Tool Version 3.0 (2002 Emissions Data), which is based on:
U.S. Department of Energy, Energy Information Administration 2004. International Energy Annual 2002
International Energy Agency. 2004. CO2 Emissions from Fuel Combustion (2004 Edition)
Marland, G., T.A. Boden, and R. J. Andres. 2005. Global, Regional, and National Fossil Fuel CO2 Emissions — in Trends: A Compendium of Data on Global Change — Carbon Dioxide Information Analysis Center, Oak Ridge National Laboratory, U.S. Department of Energy, Oak Ridge, Tenn., U.S.A.
Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat, 2005 — World Population Prospects: The 2004 Revision
Return to Carbon Calculator

Friday, February 06, 2009

A Rare TV Appearance

For 18 years now, students have been telling me that I'm not funny. After watching this 2 minute Reuters television clip, I'm now thinking that they are right. Maybe I should stick to radio. I do thank the Obama Team's green job push for letting me have some "mike time". The media likes to find somebody to play "bad cop" and I've been enjoying this role.

Environmental Bloggers of the World Unite!

Prof. Rob Stavins of Harvard has started a new blog. I will encourage my UCLA students to read it. Some people have told me that mitigating greenhouse gas emissions represents a low priority for Larry Summers. Is this true? If true, does this mean that this issue will be a low priority for President Obama? Who at the CEA will fight the green fight?

Thursday, February 05, 2009

A Brief History of U.S Public Transit

Are you worried that President Obama will put a cap on academic economists' salaries? To put your mind at ease, I thought that a history lesson might help. Given that public transit is "shovel ready" stuff, it is important to know where we have been. I'm hoping that after this "big push" that Los Angeles has a subway system like New York City's and perhaps in the name of network effects these two systems could be connected by a dedicated east/west subway.


Milestones in U.S. Public Transportation History
http://www.apta.com/research/stats/history/mileston.cfm

1630 Boston--reputed first publicly operated ferryboat
1740 New York--reputed first use of ox carts for carrying of passengers
1811 New York--first mechanically operated (steam-powered) ferryboat
1827 New York--first horse-drawn urban stagecoach (omnibus) line (Dry Dock & East Broadway)
1830 Baltimore--first railroad (Baltimore & Ohio Railroad Co.)
1832 New York--first horse-drawn street railway line (New York & Harlem Railroad Co.)
1835 New Orleans--oldest street railway line still operating (New Orleans & Carrollton line)
1838 Boston--first commuter fares on a railroad (Boston & West Worcester Railroad)
1850 New York--first use of exterior advertising on street railways
1856 Boston--first fare-free promotion
1870 Pittsburgh--first inclined plane
1871 New York--first steam-powered elevated line (New York Elevated Railroad Co.)
1872 Great Epizootic horse influenza epidemic in eastern states kills thousands of horses (the motive power for most street railways)
1873 San Francisco--first successful cable-powered line (Clay St. Hill Railroad)
1874 San Francisco, CA--first recorded strike by street railway workers
1882 Boston--American Street Railway Association (APTA's original predecessor) formed
1883 New York--first publicly operated cable-powered line (Brooklyn Bridge)
1883 New York--first surviving street railway labor organization (Knights of Labor Local 2878)
1884 Cleveland--first electric street railway line (East Cleveland Street Railway)
1884 first public transportation-only publication (The Street Railway Journal)
1886 Montgomery, AL--first semi-successful citywide electric street railway transit agency (Capital City Street Railway Co.)
1888 Richmond, VA--first successful electric street railway transit agency (Union Passenger Railway)
1889 New York--first major strike by street railway workers
1892 Indianapolis--first national street railway labor union founded (Amalgamated Association of Street Railway Employees of America, now called the Amalgamated Transit Union)
1893 Portland, OR--first interurban rail line (East Side Railway Co.)
1894 Boston--first public transportation commission (Boston Transit Commission)
1895 Chicago--first electric elevated rail line (Metropolitan West Side Elevated Railway)
1897 Boston--first electric underground street railway line (West End Street Railway/Boston Elevated Railway Co.)
1897 Boston--first publicly-financed public transportation facility (street railway tunnel)
1898 Chicago--first electric multiple-unit controlled rail line (Chicago & South Side Rapid Transit Railroad Co.)
1904 Bismarck, ND--first state-operated street railway (State of North Dakota Capital Car Line)
1904 New York--first electric underground (& first 4-track express) heavy rail line (Interborough Rapid Transit Co.)
1905 New York--first public takeover of a private public transportation company (Staten Island Ferry)
1905 New York--first bus line (Fifth Avenue Coach Co.)
1906 Monroe, LA--first municipally-owned street railway 1908 New York--first interstate underground heavy rail line (Hudson & Manhattan Railroad to New Jersey)
1910 Hollywood, CA--first trolleybus line (Laurel Canyon Utilities Co.)
1912 San Francisco--first publicly operated street railway in a large city (San Francisco Municipal Railway)
1912 Cleveland--first street railway to operate buses (Cleveland Railway)
1916 Saint Louis--first public bus-only transit agency (St. Louis Division of Parks and Recreation Municipal Auto Bus Service)
1917 New York--last horse-drawn street railway line closed
1920 first bus not based on truck chassis (Fageol Safety Coach)
1921 New York--first successful trolleybus line
1923 Bay City, MI, Everett, WA, Newburgh, NY--first cities to replace all streetcars with buses
1926 highest peacetime public transportation ridership before World War II (17.2 billion)
1927 Philadelphia--first automobile park and ride lot and first bus-rail transfer facility for a non-commuter rail line
1932 New York--first publicly operated heavy rail line (Independent Subway)
1933 San Antonio--first large city to replace all streetcars with buses
1934 New York--Transport Workers Union of America founded
1935 Washington--Public Utility Holding Company Act of 1935 requires most power companies to divest themselves of public transportation operations and eliminates much private public transportation financing
1936 New York--first industry-developed standardized street railway car (P.C.C. car) (Brooklyn & Queens Transit System)
1936 Washington--first large-scale federal government public transportation assistance (Public Works Administration)
1938 Chicago--first use of federal capital funding to build a public transportation rail line
1939 Chicago--first street with designated bus lane
1940 first time bus ridership exceeded street railway ridership
1940 San Francisco becomes last surviving cable car transit agency
1941 New York, NY--first racially-integrated bus operator workforce
1943 Los Angeles--first rail line in expressway median (Pacific Electric Railway)
1943 New York--first issue of Transit Fact Book (then called "The Transit Industry of the United States, Basic Data and Trends")
1946 highest-ever public transportation ridership (23.4 billion)
1946 Washington--U.S. Supreme Court bans racial segregation in interstate transportation
1952 San Francisco--last new PCC car for U.S. transit agency placed in service
1958 authority for railroads to discontinue commuter service transferred from states to U.S. Interstate Commerce Commission
1961 Washington--first significant federal public transportation legislation (Housing & Urban Development Act of 1961)
1962 Seattle--first monorail (Seattle World's Fair)
1962 New York--first automated heavy rail line (Grand Central Shuttle)
1963 Chicago becomes last surviving city with interurban line (Chicago, South Shore, & South Bend Railroad)
1964 Washington--first major U.S. government public transportation program (Urban Mass Transportation Act of 1964)
1966 New York--first public takeover of commuter railroad (Long Island Rail Road Co.)
1966 Providence--first statewide transit agency (Rhode Island Public Transit Authority)
1968 Washington--agency administering federal public transportation program re-named Urban Mass Transportation Administration and moved to new Department of Transportation
1968 Minneapolis--first downtown transit mall (Nicollet Mall)
1968 Cleveland--first rail station at an airport opened
1969 Washington--first transitway (Shirley Highway)
1969 Philadelphia--first modern heavy rail transit agency replacing former rail line (Port Authority Transit Corporation)
1970 Fort Walton Beach, FL--first dial-a-ride demand response transit agency
1971 Washington--first federally subsidized intercity passenger railroad (AMTRAK)
1972 San Francisco--first computer-controlled heavy rail transit agency (Bay Area Rapid Transit District)
1972 public transportation ridership hits lowest point in 20th century (6.6 billion)
1973 Washington--some public transportation service required to be accessible to disabled (Rehabilitation Act of 1973)
1974 Boston, Cleveland, Newark, New Orleans, Philadelphia, Pittsburgh, & San Francisco become the last street railway systems
1974 Washington--first federal public transportation operating assistance legislation (National Mass Transportation Assistance Act of 1974)
1974 American Public Transit Association formed from merger of 2 organizations
1975 Morgantown, WV--first automated guideway transit agency (West Virginia University)
1977 San Diego--first wheelchair-lift-equipped fixed-route bus
1979 Washington--first standardized public transportation data accounting system (Section 15)
1980 San Diego--first completely new light rail transit agency in decades (San Diego Trolley)
1983 Washington--public transportation trust fund for capital projects created through dedication of one cent of federal gas tax
1989 Miami--first completely new commuter rail transit agency in decades (Tri-County Commuter Rail Authority)
1990 Washington--virtually all public transportation service required to be accessible to disabled (Americans with Disabilities Act of 1990)
1990 Washington--public transportation buses subject to strict pollution controls (Clean Air Act of 1990)
1991 Washington--federal government allowed to subsidize its employees' commuting costs
1991 Washington--first general authorization of use of highway funds for public transportation (Intermodal Surface Transp. Efficiency Act)
1992 Washington--first limitation on amount of tax-free employer-paid automobile parking benefits and tripling of value of tax-free benefit for public transportation use (National Energy Policy Strategy Act)
1993 Washington--public transportation workers in safety-sensitive positions subjected to drug and alcohol testing
1998 Washington--major expansion and restructuring of federal transportation program (Transportation Equity Act for the 21st Century)
2000 American Public Transit Association changes name to American Public Transportation Association
2005 Federal transit law (SAFETEA-LU) reauthorized extending federal funding through 2009

Tuesday, February 03, 2009

Declining Quality of U.S Public Transit?

Public transit is cheap and slow. Private vehicles are fast and expensive. Your value of time and whether you are trying to get downtown (the central focus of public transit) play key roles in determining which mode you choose. If you work in the suburbs, you are unlikely to commute using public transit. Today there is an interesting story in the NY Times on public transit quality. Due to budget cuts, public transit agencies are cutting back the quantity and quality of service at the same time that demand is rising. What will happen next? Do the bus takers have enough clout to move state, federal and local policy to devout more $ for their sake?

I've been interested in light rail/bus fiscal issues. If a city spends billions on a new light rail system, that money probably comes from the bus budget.
http://en.wikipedia.org/wiki/Bus_Riders_Union_(Los_Angeles)

In the year 2050, how will urbanites get to work and get around town?

Monday, February 02, 2009

Harvard Moves to Washington DC

Barro, Glaeser and Mankiw may need to do a lot of teaching for Harvard from now on. It appears that everyone else has left. Some great policy thinkers are heading to the capital to serve their country. Twenty years from now when we contrast the quality of the regulations and policies enacted by the Bush Administration versus the Obama Administration, we should have a pretty clean estimate of whether the eggheads make a difference in causing "better" policy to be enacted.

Sunday, February 01, 2009

Motley Crue Rocks a Westwood Mansion

Unless I am mistaken, I heard the great heavy metal band Motley Crue playing an outdoor gig at some mansion a 1/2 mile from my house tonight. From following the loud sound of "Girls, Girls, Girls", I traced the sound to a mansion just about here.

At around 930pm tonight, I was finally getting some work done. I started to hear this rock music in our house even though the doors and windows were all shut and we weren't playing the stereo. I wondered if our strange next door neighbors were responsible so I went outside. From there I started walking trying to find the source of the live music and then I came to the private wall of a large house and I swear that I could hear Vince Neal's voice. It felt like MTV from 25 years ago and I was a teenager again. But, things change. I'm a busy old guy now and the noise was bugging me. I thought about calling my alarm company to see if they would go to this house and shut down these teenagers.

I must admit that this kind of stuff didn't happen in Cambridge, MA. Los Angeles is one wild town.

Reich on the Medium Term Policy Issues Associated with the Stimulus Package

In the year 2011 when "confidence" is back and the economy is growing, what will be the size of the budget deficit? Will a dangerous precedent have been set? While Keynes talked about scaling back government "G" during good times, he didn't suggest a credible mechanism such that politicians would actually obey his dynamic plan. I do think that this Robert Reich post is worth reading.

I'm sympathetic to a number of his points. I would want to ask him how he suggests that we conduct the cost/benefit analysis of whether government $ has been well spent? Who would conduct this analysis? Would government agencies be confronted with this dynamic evaluation scheme and be aware that their budgets will be sharply cut if they don't meet the performance criteria? Will senators whose constituents would suffer a loss of public $ if the evaluation economists give a "thumbs down" promise not to rebel?

I am a fan of the "rules of the game" approach to government policy. If the Obama Administration could pre-commit to clear, transparent rules for how the fiscal policy will take place and how it will be paid for over the medium term , then I would be much happier with what we are about to embark on. Too few details have been provided. the head of the CBO should be clear about the dynamic balanced budget condition and how the evaluation of whether this $ has been well spent will take place.