Tuesday, June 30, 2009

Review of Environmental Economics and Policy and Co-Editing Tasks

On July 1st, Rob Stavins will step down as the editor of REEP. Under his leadership, this journal has gotten off to a great start. Charlie Kolstad will step in as editor and I will co-edit this journal along with Carlo Carraro.

I am looking forward to this new job and hope that I can function well. One's joy in editing a journal hinges on the quality of the submissions.

Do I have any innovative ideas about how I want to co-edit this journal? Maybe. If you have some smart ideas, please get in touch with me about possible topics.

This journal is intended to facilitate communication and research findings with the policy community. I believe that the Journal of Economic Perspectives (but focused on environmental issues) is the vision. Ideally, I would like to see this journal act as glue connecting firms, policy makers and researchers. A firm might have conducted a funky field experiment and may not even be aware that they are sitting on a gold mine of data because of an unintended randomization of some "treatment". By offering a relatively low cost introduction to some serious literatures, this journal could generate more interesting phone calls and "win/wins" between academics and non-academics. I do not simply mean consulting opportunities. More to the point, I mean that there is a productive discussion that can and should be taking place between policy makers , firms, and environmental economists and this journal could productivity encourage this dialogue.

As many of my friends have heard me babble; the first step is for firms and policy makers to admit that they "know that they do not know" certain economic parameters (perhaps demand elasticities for green products) that they wish they did know. This journal may offer some "eye openers" on creative ways that green freakonomicists have attempted to glean new insights. I'm hoping that there are open minded firms and policy makers out there who are willing to explore new ideas and data testing techniques when they smell a possible opportunity. Note, that the policy maker and the firm should pursue this because of their own self interest and not some "higher cause" of furthering basic research.

I'm also interested in data collection in the developing world. I would love to see this journal offer insights to policy makers in the developing world concerning how to design data collection systems to help to create an accountable capitalism that mitigates its pollution effects in the fast growing LDC nations.

These are not my only interests for the journal. I also hope to ghost write long pieces about the history of my own economic thought but I will discuss this some time in the future.

Shifts in China's Asset Portfolio

China will be selling its U.S Treasury bonds and using the $ to purchase up natural resources such as oil in Iraq. What would Hotelling think of this? Fear of inflation would suggest that treasury bonds will be offering a low rate of return and if China believes in "Peak Oil" then the returns to holding inventories of oil and other non-renewables will be high. For details read this NY Times article on China hoarding natural resources .

The real issue here is "induced innovation". Imagine two polar cases. In case #1, China is unable to hoard gas at low prices and recognizes that its growing middle class and upper class want to drive private vehicles that run on gasoline. In this case, China would make a push to increase its fleet's fuel economy. Abstracting from a severe rebound effect, anticipated scarcity of oil would create incentives for China to develop its own "green cars" for home use and potentially world export.

In case #2, if China believes that it can tap into oil endowed places such as Iraq for billions of gallons of gas then the imperative of innovation on the green front fades as the current fossil fuel technology can live on providing driving services to the newly wealthy Chinese.

For those who care about climate change mitigation, case #1 is the better one.

What about Ben Bernanke? Has he calculated how much higher will equilibrium interest rate for U.S T-bills will be if China reduces its purchases by 20%, 40%, 60%? If China does shifts its portfolio and this becomes public knowledge, will this information reduce demand by other smaller buyers as they feel that "China must know something" and this could set off a nasty spiral.

Sunday, June 28, 2009

A Return to Westwood

Given the impending UC 8% pay cut (and some talk that faculty who are well paid should volunteer to take a 10% or 12% pay cut), I've been thinking about going on my own Wildcat strike. That's why I stopped blogging for 10 days.

I used my time away from blogging to attend the UCEI Energy Camp at Berkeley. This summer conference brings together some of the best people doing work at the intersection of energy/IO/environmental topics. I had a great time and it was good to see my old friends, co-authors and future co-authors. I even learned some economics.

While in Berkeley at my in-laws' house, I sat down and took pages of notes on a variety of projects that I'm working on. This helped me to "recharge my batteries" and I'm now quite excited about these projects.

The one funny thing to happen in Berkeley was that the UC Energy Institute is 2 blocks from People's Park . I went to this park to take a phone call from my book editor. I'm making progress on a book that will interest you when it will be published next summer! If climate change interests you, if cities interest you --- then this book may interest you. Returning to my boring story, as I discussed strategies and writing outline with my book editor --- several bums started to converge on me in the park. The paranoid New Yorker, that I am, thought that I would be cooked for dinner by this motley crew. I got up and abandoned ship and had to retreat to a safer haven to finish my phone call. Say what you want about UCLA but this does not take place in Westwood.

Friday, June 19, 2009

Does Abortion Reduce Crime? Round 16 of the Fight

While the 7 equation structural model on page 12 may not interest everyone, this new Ted Joyce Review Paper is worth reading. One of the great joys of modern empirical applied micro is our focus on measuring the unintended consequences of private and government choices. The original Donohue and Levitt paper merits the attention it has received. But, it is tricky stuff to test hypotheses about individual behavior using state/year data. In general, that was a 1970s approach. Joyce makes some nuanced points about how a structural econometrician might approach this tough question.

Pay Cuts and the Future of the University of California

The UC faculty has been warned that a 8% pay cut is coming in August 2009 . While you shouldn't feel too sorry for us, 8% is a big number and it will have long term consequences.

When the private universities are feeling richer 2 years from now, we will see a huge flow of talented academics moving away from the California sunshine towards safer harbors.

Dora and I are worried about gross flows. A faculty can grow if exits decline or if new faculty sign on. At UCLA, we will see more faculty leaving to go to private universities and few private university faculty being willing in the future to take the gamble of moving to UCLA. The President of the UC is creating a dangerous precedent and recruiting will suffer for a decade.

Now, he would say that he has no choice. That's not obvious to me. There is extensive building construction going on across the 10 campuses. They contine to build the UC Merced campus. All of this could come to a halt. Tuition at the UC is still quite low relative to the prviates. It should increase 25%. We are selling a quality product.

I'm eager to see the UCLA Chancellor and the senior Deans use this crisis to run UCLA like a cost minimizing business.

I've been telling Dora that we should think about retiring but she has told me that we would only collect 6% of our salary in annual pension under the defined benefit flow formula.

Faculty here at UCLA are whispering to each other that the elite stature of UC Berkeley and UCLA as worthy competitors of the privates is at stake here. Our nightmare scenario is that in 25 years, we may be just like any other state university with good sports teams and little else in terms of academic excellence. I don't want to see this happen and I'm hoping that we have a master plan to recover from this major misstep.

UPDATE:


The Chronicle of Higher Education has posted some
outstanding letters on the situation. #44 makes a lot of sense. There are some smart people who are really worked up about this issue.

Ignoring my own personal loss of income here, the core issue is that human capital is California's best hope of staying great. Gut the best research universities here and this state better count on importing ivy league graduates.

Skilled, disciplined people are costly to produce and they tend to increase income inequality at the same time that they generate new ideas and innovations. Whether the median voter is willing to vote tax dollars to help this "unfair" small but crucial group, remains an open question but I'm growing more pessimistic.

Monday, June 15, 2009

UC Berkeley's Dara O'Rourke's New Green GoodGuide Firm

Today the NY Times has an interesting piece on Prof O'Rourke's "Moonlighting" as the boss of GoodGuide. He has a fledgling 24 person firm that provides information on how "green" is a product when you use your cellphone to provide data based on its bar code. Read this article .

Two questions. If I was the Dean of Prof O'Rourke's division, I might want to know how many hours a week he spends on this activity and whether this crowds out any research or teaching time? Now, if I was O'Rourke --- I would use the information my website collects to write a paper about "green concerns". He would face a selection issue concerning the fact that a non-random sample of people go to his site.

I would also like to know whether everyone agrees with his index weights? "For instance, Toms of Maine deodorant gets an 8.6 (score)". O'Rourke uses information on both the known carcinogens in the product (but does he know exactly what is the magic formula of how much is used or is this a checklist) and "whether the company has women and racial minorities in executive positions or faces labor lawsuits." A Dick Cheney might care about not getting cancer but he may also not care about this diversity box. As in all "green" work, the key issue is whether the consumer has the same preferences (i.e index weights) at the ranker. A dick Cheney would put a weight of "0" on the diversity criteria.

Sunday, June 14, 2009

Book Reviews

How does the NY Times select what books it will review? Or more specifically, why did they choose to review this "brilliant" book about West Los Angeles? This book appears to offer people in NYC, who are unable to move to LA but wonder what their life would be like if they moved to Los Angeles, a good reason for not moving to LA. This book sketches an LA that I don't see. Despite the fact that a spouse is a UCLA faculty member, this is not my Los Angeles.

Los Angeles is New York City in the sun. In Westwood and Santa Monica, you can re-create the urban density of Manhattan. Yes, we own a car but we drive it 5 miles a week. We make 2 round trips by car by week; One to the Beverly Hills Farmers' Market and one to Whole Foods in Westwood Village.

Los Angeles may have more rich immigrants than Manhattan does. The characters who live in Queens, New York can be found as richer guys in West LA. Perhaps, we need a novel about these guys. I might read that.

Saturday, June 13, 2009

The Heckman Equation Project

Well, he already is a stata command, so why not introduce an entire equation for Jim Heckman? Most people West of Chicago believe that he merits another Nobel Prize. Would he agree?

Flipping through the slides of the Heckman Equation Project, I see a media push to solidify the intellectual case for investing more in the very young. Children cannot "buy" their parents. In a world where parents have ample discretion over investments of time and $ in children, some children may be left under-invested in during a critical phase. Learning begets learning, skill begets skills. Economists have fancy words such as dynamic complementarity but at the end of the day -- a well functioning adult is a mixture of ability, focus , ambition and tenacity. Each of these can be learned and need to be reinforced.

The challenge is the political economy. The young people tend to be immigrants and minorities while the older people whose tax $ would pay for these programs tend to be white. There is the whole diversity and redistribution literature that is pessimistic about the likelihood of a democracy making the investments that Heckman calls for.

Now there is one way out. Chris Mayer has done some interesting work on why home owners (old white people) favor good schools in their district even when they don't have kids going to school in the district. He argues that the schools are capitalized and this raises the price of the asset.

In the Heckman case, migration actually attenuates the Mayer point. If kids were stuck and couldn't move, the rich in the community would have a greater incentive to invest in them because they would grow up and be thugs and trouble the neigbhorhood --- or in a Moretti/Rauch sense they could raise the neighborhood's human capital level.

Thus in a world with migration, the Feds have to finance this. I hope that Jim Heckman can use his considerable clout to push this debate forward. The political economy here hinges on cross-group bridging social capital (see Luttmer's JPE paper on the taste for redistribution).

Similar to Poterba's old JPAM paper, the public finance behind Heckman's plan in an over lapping generations model is a transfer from rich, old whites today to young minority kids. Because the old whites die, unless they are very altruistic to the minority kids or to their descendents, the young minority kids who will receive the investments under the Heckman plan have no way to pay back the old white "donors" even if they do earn 10% a year on their investment.

Thursday, June 11, 2009

A Green Paris and the Joys of Urban Planning

The NY Times has a nice piece on the future of Paris as a "Green" compact city . I respect that they are thinking ahead about how to handle growth and its implications for housing markets and transportation and hence congestion in the city. I do not fully understand the height limit restrictions on housing towers. I appreciate that views are nice but building up has its advantages especially if the public health and crime costs of density have been tamed. It would interest me if Paris has its own Don Trumps and what these private developers are lobbying for? I also don't know how monocentric Paris is. Is everyone still trying to get downtown like in New York City or does it have multiple gravitational centers like Los Angeles?

Can the Public Balance California's Budget?

The LA Times has a cool web site that gives you a menu of tax increases and expenditure cuts to see what you would do to balance our state's budget.

Who knew that interactive media is so much fun?

I was able to balance our budget without too many tricks such as dipping into the 2010 revenue pot or by taking any $ from the community colleges or UCs. I emptied out the jails and furloughed a few people but somebody has to make the tough choices and the buck stops here!

http://latimesblogs.latimes.com/lanow/2009/06/fixing-california-here-are-some-of-your-ideas-1.html

Wednesday, June 10, 2009

Hints about Ed Glaeser's 2009 Book

As a book author and occasional book reader, I have been curious about Ed Glaeser's forthcoming Penguin Press book. While I am not Sherlock Holmes, I did discover this. It sounds fascinating and I'm sure it will sell a lot of copies. My mom will ask me why I didn't write that book and I'll have to tell her the truth. I am hoping that similar to Freakonomics that each of his past co-authors will get a piece of the royalties.

New Pew Trust Report on Green Jobs by State

This Pew Trust Study is interesting and probably merits getting a serious academic involved in counting these "green jobs". I respect that these guys actually state a definition (based on industry categories) of what is a green job and look at medium term growth trends (from the mid-1990s until now) by state. The green jobs total counts do look small to me. California (a state with 35 million people)has 125,000 green jobs and 6.5 billion dollars worth of venture capital invested? (see page 8).

The key issue here is the potential for this sector of the economy to accelerate. If Waxman/Markey don't sign a serious bill or if AB32 in California fizzles, will the "green job" sector fizzle? We appear to be approaching a key public sector/private sector synergy here. We need carbon pricing to gain some momentum. In the absence of carbon pricing or carbon cap & Trade, we need some "Peak Oil" and price spikes for exhaustible fossil fuels to push companies to invest in green R&D.

Some Serious UCLA Research on Local Air Pollution

Economists are interested in asymmmetric information issues. My colleague Arthur Winer has helped to level the information playing field. We already know that you don't want to live near a highway due to noise and air pollution but how close is "too close"? The conventional wisdom was that if you live 1,000 meters or further from the highway that you don't face its soot. But Arthur's new work finds that the threshhold is 2.5 km away. This is "new news" and new news should immediately be capitalized into asset prices. While I know that people are pissing on the efficient markets hypothesis, maybe research on its predictive ability should continue?

How much will home prices decline by for homes that are 1,400 meters from the I-405? The people in these homes are now facing more PM2.5 small particulate matter than they though they were. Will rents decline immediately? Will sorting occur in the face of the new news such that those at risk move out or will the newly discovered victims just sit there and suffer? This is a nice natural experiment of the capitalization hypothesis. Or is soot not salient enough (it kills too silently unlike violent crime) for home buyers to notice. Arthur should have sold short homes located 1,400 meters away before he released his study!


If you were hoping to read something by me, then read this.



Air pollution from freeway extends further than previously thought


Sarah Anderso


Environmental health researchers from UCLA, the University of Southern California and the California Air Resources Board have found that during the hours before sunrise, freeway air pollution extends much further than previously thought.



Air pollutants from Interstate 10 in Santa Monica extend as far as 2,500 meters — more than 1.5 miles — downwind, based on recent measurements from a research team headed by Dr. Arthur Winer, a professor of environmental health sciences at the UCLA School of Public Health. This distance is 10 times greater than previously measured daytime pollutant impacts from roadways and has significant exposure implications, since most people are in their homes during the hours before sunrise and outdoor pollutants penetrate into indoor environments.



The study was published last month in the journal Atmospheric Environment, with Dr. Shishan Hu, a postdoctoral scholar at the UCLA School of Public Health, as lead author.



"To measure the pollution levels, we equipped an electric vehicle with no emissions of its own with fast-response instruments for gaseous and particulate air pollutants, a GPS and video monitor, and instruments to measure temperature and winds," Winer said. "In both winter and summer of 2008, we drove toward and away from Interstate 10 on a route perpendicular to the freeway in Santa Monica between the hours of 4 a.m. and 7 a.m."



A second striking finding of the study was that although traffic volumes are lower in the pre-sunrise hours, the air pollution concentrations measured by the team were higher than even those during daytime traffic congestion peaks. Concentrations are higher before sunrise even though emissions are lower because of the unique weather conditions. In the pre-sunrise hours, wind speeds are generally very low, and while the wind direction is somewhat variable, the predominant direction is from the northeast in the winter months and the northwest in the summer months.



This means that areas south of Interstate 10 are generally downwind in the pre-sunrise hours and areas north of the freeway are generally upwind; this is consistent with the observation that vehicle-related pollutants are found much further from the freeway on the south side in the pre-sunrise hours, compared with the north side.



"Our research shows that under the low wind speeds and shallow temperature inversions during the early morning, before sunrise, air pollution from freeways is trapped near the surface, limiting dilution and creating a zone of influence many times greater than during the day," said Dr. Suzanne Paulson, a professor in the UCLA Department of Atmospheric and Oceanic Sciences and a co-principal investigator of the study. "These meteorological conditions are very common in the hours before sunrise."



In comparing the winter and summer early mornings, researchers found much higher levels of air pollution in the winter.



"This is because the sun rises later in the winter, so the early morning period captures more of the early morning rush hour," Paulsen said.



"Our findings confirm previous work showing peak levels of ultrafine particles (UFP) immediately adjacent to the freeway, but we found high concentrations persisted for up to 1.5 miles downwind of the freeway during the pre-sunrise hours," said Dr. Scott Fruin of the USC Keck School of Medicine. "Elevated UFP concentrations also extended up to 600 meters upwind of the freeway, another strong difference from daytime observations, which typically show little or no vehicle-related pollution directly upwind from freeways."



In the present study, other pollutants, including nitric oxide and particle-bound polycyclic aromatic hydrocarbons, also extended far from the freeway during the pre-sunrise hours.



Other members of the research team included Drs. Kathleen Kozawa and Steve Mara of the California Air Resources Board, which sponsored the study.



"The study raises more questions about the significant health outcomes caused or exacerbated by freeway traffic," Winer said.



Numerous epidemiologic studies have already shown that traffic-related pollution is linked to increased risk of asthma, respiratory illness, cardiovascular disease and premature mortality.



The researchers recommend that residents living near freeways should consider keeping their windows closed at night and minimize outdoor exercise near major roadways in the hours before sunrise.



For more news, visit the UCLA Newsroom.

Tuesday, June 09, 2009

Social Capital and Baboons

UCLA Anthropologists have a good life. In past work, they have investigated what kind of junk we keep in our garages. In new work, they are hanging out with baboons.

Close social ties make baboons better mothers, study finds
by Meg Sullivan


Baboons whose mothers have strong relationships with other females are much more likely to survive to adulthood than baboons reared by less social mothers, according to a new study by researchers at UCLA, the University of Pennsylvania and other institutions.



"If you're a baboon, the strength of your mother's relationship with other females is the best predictor of whether you'll live to have children yourself," said Joan Silk, the study's lead author and a UCLA professor of anthropology. "The study adds to mounting evidence of the biological benefits of close relationships among females."



The findings are significant because "survivorship to reproduction is the gold standard in evolutionary biology," said co-author Dorothy Cheney, a professor of biology at the University of Pennsylvania. "Females who raise offspring to a reproductive age are more likely see their genes pass along, so these findings demonstrate an evolutionary advantage to strong relationships with other females. In evolutionary terms, social moms are the fittest moms — at least when it comes to baboons."



The study appears online in the Proceedings of the Royal Society B, a peer-reviewed journal published by the national academy of science of the United Kingdom and the Commonwealth.



Silk, Cheney and seven other researchers from the University of Pennsylvania, the University of Michigan and the University of St. Andrews in Kenya analyzed 17 years worth of records on more than 66 adult female baboons in the Moremi Game Reserve, a 2,000-square-mile national park in Botswana that teems with wildlife.



Collected on the ground by primatologists who tracked the baboons six days a week, 12 months a year, the records reflected the sex and survival rates of baboon offspring, as well as telling details of the mothers' social lives, including their ranking within the group, as measured by the direction of approach/retreat interactions, and the amount of social interactions they had with each of the group's other females.



In addition to showing how often one animal approached another, the records of social interactions included details of grooming, which is known to be the primary form of social interaction in Old World monkeys. The researchers noted how much time — frequency and duration — the females spent grooming each other and how often they solicited grooming from other females.



Of all the factors studied, the strength of a mother's social bonds with another female had the most significant effect on the survival rates of offspring. A mother's dominance rank proved to have no affect on the survival rate of her offspring.



"We really expected dominance status to be more influential than it proved to be," Silk said.



Offspring from the most social mothers turned out to be about one-and-a-half times more likely to survive to adulthood than offspring from the least social mothers.



The strongest social bonds were measured between mothers and adult daughters, followed by sisters and all other potential relationships, including aunts, nieces, cousins and baboons with no familial ties. Bonds between mothers and adult daughters proved to be three times stronger than those between sisters and 10 times stronger than relationships with other females.



"What really matter to these girls are mother-daughter bonds," Silk said. "They're really strong, and they last forever. If your mom is alive, she's one of your top partners, always. But more importantly, it's the strength of these bonds, because females whose bonds with their mothers and daughters were strong had higher offspring survival than females whose bonds with these relatives were weak."



Silk's past research with Jeanne Altmann, the Eugene Higgins Professor of Ecology and Evolutionary Biology at Princeton University, and Susan C. Alberts, a professor of biology at Duke University, on baboons in the Amboseli Basin of Kenya had found a higher survival rate for baboons with social mothers, but the research only tracked offspring through the first year of life.



For the new study, researchers followed offspring from 1 year of age through sexual maturity — roughly 5 years of age. The new study also differs from past baboon research by focusing on the strength and duration of relationships between pairs of females rather than on the amount of social interactions in general.



"The benefit comes not from being wildly social — it's about having close social bonds," said Cheney, who runs the Moremi baboon-tracking project with University of Pennsylvania psychology professor Robert M. Seyfarth.



"These females form strong relationships with particular partners," Silk said. "They don't treat everyone the same. They spend a lot more time with — and a lot more time grooming — some females than others, and these relationships tend to be very long-lasting."



Additional research is needed to determine how the female bonds improve infant survival, but it may have to do with such stress hormones as cortisol, Silk said. Research has shown that prolonged elevations of stress hormones in primates can lead to cardiovascular disease and other serious health problems. Research has also shown that grooming tends to lower these stress hormones in baboons.



"Our research suggests that somehow there is a link between the kind of social relationships you form and the natural, normal stresses that occur in everyday life, and that seems to have — at least in baboons — a long-term effect on reproductive success," Silk said.



Said to share 92 percent of their DNA with humans, baboons are close relatives of humans. Baboons and humans last shared a common ancestor about 18 million years ago. The new findings on social interactions among mothers parallel recent research that has shown health benefits for humans who enjoy particularly close social networks.



"Our findings suggest benefits from forming close relationships are built into us from a long way back," Silk said.



The research received funding from the National Geographic Foundation, the Research Foundation of the University of Pennsylvania, the Institute for Research in Cognitive Science at the University of Pennsylvania, the National Institute of Health and the National Science Foundation.



For more news, visit the UCLA Newsroom.

I'm in a Detroit State of Mind

Who knew that Billy Joel once had hair? Here he is in 1978 singing "I'm in a Detroit State of Mind." Whoops, I'm confusing my Superstar Cities. But --- I'm thinking about Detroit after reading this N.Y Times wisdom about its new efforts to reinvent itself in a Post-General Motors world.

This quote caught my eye;

"Michigan is also pursuing wind-power technology, solar-panel manufacturing, even production of railroad cars — any viable industry that might be interested in hiring the thousands of engineers who used to work in the auto industry.
“This community still has a lot of things going for it,” said Senator Carl Levin, Democrat of Michigan. “This is the heart of the automotive research capital of the world, and there’s a strong structure to build on.”

This will be an interesting test. Can a labor union friendly town with some specific human capital reinvent itself in the new "green economy"? I hope so and you will soon see some new academic writing by me on this subject.

Switching subjects, http://www.nber.org/papers/w15060 --- this looks interesting. I knew that my friend Ryan K is a good runner but now you tell me that he's a good economist. Those two skills are usually negatively correlated. Al Harberger and Larry Summers have the real look of a modern economist. But, back to Ryan's work.


NBER Working Paper No. 15060
Issued in June 2009
NBER Program(s): EEE IO PR


This paper examines the importance of learning-by-doing that is specific not just to individual firms, but to pairs of firms working together in a contracting relationship. Using new, detailed data from the oil and gas industry, I find that the joint productivity of an oil production company and its drilling contractor is enhanced significantly as they accumulate experience working together. This learning is relationship-specific: drilling rigs generally cannot fully appropriate the productivity gains acquired through experience with one production company to their work for another. This result is robust to other ex ante match specificities.


Relationship-specific learning is consequential because it implies that relationship stability is important to productivity. When two firms accumulate experience working together, relationship-specific intellectual capital is created that cannot be appropriated to pairings with other firms. If the relationship is broken, this capital is destroyed and productivity decreases, thereby giving firms an incentive to maintain long-term relationships. Accordingly, the data indicate that production companies prefer to work with drilling rigs which they have accumulated considerable experience rather than those with which they have worked relatively little. I demonstrate that this contracting pattern is difficult to explain with switching costs or ex ante match specificities alone.


Empirical evidence on learning by doing --- whether its Denmark's wind turbines or hybrid vehicles --- will be the key parameter determining the fate of the green economy. I suggest that you start to work on this!

Wednesday, June 03, 2009

1971 Los Angeles was Dirty

Sometimes history matters. To get a sense of the "green city" progress that Los Angeles has enjoyed, take a look at some of these photos of Los Angeles back in 1971. No wonder Jim Morrison wrote such strange songs; his mind was altered by black smoke and he didn't even inhale.

Tuesday, June 02, 2009

Second Appearance on NPR

In case my mom is looking for my Texas NPR hour long interview today on the Green Economy, you can find here .

UCLA IOE Report Card on Lead Poisoning

Amherst's Jessica Reyes has taught us that when kids are exposed to lead that this is associated with higher crime rates 18 years later. Read her BE Press paper. So, those who care about crime and human capital development should care about early life lead exposure. Thus, you should read this new UCLA Institute of the Environment piece by my friend Hilary Godwin.

It turns out that Hilary was at the University of Chicago at the same time that I was there in the early 1990s. We never met there but UCLA features more cross-department bridging and after 2.5 years at UCLA --- I now feel that I know 85% of the serious faculty here.

Does Fame Last? The Stock vs. Flow of Greatness

In academics, if you accomplish one great thing you will always be remembered (think of the Coase thm, coase conjecture). Academics know that they are judged on their best past work (the stock). Unfortunately for Bryan Clay, sports does not appear to work this way. As you may recall, he won the 2008 Decathlon Gold Medal in Beijing. Yes he was on the cover of the Wheaties box but he has not pulled a Bruce Jenner. The New York Times claims that his Twitter site gets 1000 times fewer visitors than Oprah or Ashton Kutcher. Is that fair?

This raises a slightly interesting point. In sports, we expect to be pulsed. We see "kobe Bryant" quite often on TV showing us new amazing feats. So as guys retire such as Michael Jordan, does our memory of their greatness fade and thus their fame fades? Now a composition effect would say yes because my son (the new generation) never saw MJ play and the old forget what they saw.

This Bryan Clay did an amazing thing in Beijing but it looks like he won't be able to harness a very good life income (a flow of payments) from his past achievement. Why can academics harness this better than athletes? Prestige, learning spillovers?

Monday, June 01, 2009

My Texas NPR Debut at 11am PST tomorrow on "Green Jobs"

"This is Matthew from Los Angeles. I'm a long time listener, first time caller. I'd like to ask Prof. Kahn a question. Why are you trying to pick a fight with Van Jones?" Well, I would prefer to battle Van Halen but Van Jones is now a bigger draw.

A fundamental issue in public policy is whether there exist any "double dividends" where through one policy you can achieve two distinct goals. Through encouraging a public push for "green jobs" can we significantly increase energy efficiency and reduce urban minority unemployment? I hope this is the case but there are still a few open questions. I will be discussing some of these tomorrow on My Texas NPR Radio Tomorrow at 11am PST .

While economists have been typically pessimistic about the cost-effectiveness of job training programs, an optimistic Obama worldview is that under-employed adults can be trained in construction so that they can be part of a domestic green army who will retrofit our energy inefficient buildings and homes and can install the millions of new solar panels and wind turbines that will soon generate our power in a carbon regulated economy.

I like this vision but I wonder if it is right. In my preferred vision, private sector firms will be incentivized by carbon pricing to take a second look at whether they are consuming too much energy. My concern is that the Obama Team will justify a large public sector employment growth in the name of increasing energy efficiency.

What is the optimal size of the public employment sector? This paper has informed my thinking.

Urban Growth and Climate Change

Interested in how city growth affects greenhouse gas production? Interested in how different cities will cope with inevitable climate change? Please read my New Kahn paper . This is part of a larger research project that I will roll out in fall 2009.