At the age of 47, I'm still sending about 6 different papers a year to journals for publication.  Yesterday, I had a paper rejected based on a truly silly referee report.  So, today I take some pride that the Quarterly Journal of Economics thinks that I'm a good referee.  Here is the list of the 2012 QJE Excellence in Refereeing team.

I spent several happy and productive years on the faculty at the Fletcher School at Tufts University.  As I understand it, the School is searching for a new dean.  This NY Times article about Dennis Rodman's visit to North Korea suggests that he could be a good candidate.  

Traffic congestion in LA is nasty.  In West LA, many people have nice homes that they have configured into their own pleasure palaces.   The road traffic and the nice homes have nudged many people to work at home.   Many LA workers have their own firms and the firm is based in their house.

But, what about workers who work for "real" companies?  In this age of the Internet, wouldn't you expect that many of them would want to telecommute?  There could be gains to trade between the firm and worker as both might want the worker to telecommute.  If such workers can be motivated to avoid shirking then the firm needs less real estate and the workers can be paid less (because they aren't losing time to commuting).

But,  today  Yahoo has announced that workers must come back to work.  This is another data point for Glaeser's 1990s vision that information technology would increase the demand for face to face communication and hence strengthen cities (i.e the corporate headquarters).   Nick Bloom et. al. have run a field experiment in China documenting the productivity gains for a call center that allowed workers to telecommute.

What this literature needs is to investigate the productivity effects of working from home for different types of jobs.  If higher wage workers have a higher value of time, then they should prefer working at home more.  Conversely, it is possible that higher wage workers already live closer to their jobs because they value their time more and can afford more expensive housing.  This raises the question of how workers jointly choose their place of work and place of residence. If they knew they could unbundle the two because they could work from home, would they have lived in a very different neighborhood and home?

This NY Times profile of NYU Dean Peter Henry nudged me to track down his 2009 AER P&P paper that contrasts the economic performance of Barbados vs. Jamaica.   Here I quote the paper's witty conclusion:

"It may be tempting for readers to regard this paper as a quaint tale of two exotic islands better known for their beaches, music, and Olympic sprinters than their significance in the global economy."

Peter argues that macro policy (not institutions) explains why Barbados has outperformed Jamaica.   The Acemoglu research agenda needs more data points.   There were only 63 colonies studied in the original AJR paper.     If researchers start to test for "heterogeneous effects" of institutions by continent and other observable factors then the "large sample" of 63 colonies will suffer from a curse of dimensionality and there won't be enough data to test hypotheses.

If you'd like to see another pairwise comparison, here is a paper that contrasts Croatia and Latvia.

I don't drive.  I have a license but I haven't driven 1 mile in the last 5 years.   Los Angeles is a car town so this means that when I have to go somewhere somebody gives me a lift.  At 815am this Saturday morning,  I took a 25 minute cab ride from Westwood to USC.  As I walked the USC campus, I took this photo.


I sat down at a bench and graded ten of my students' essays (there are 100 registered students).  Each of them had written a memo related to a REEP paper they had read and thought about.  I could have graded more but I got tired of reading them.  I walked into the lobby at the Sol Price School of Policy at USC and was immediately recognized by one of my past UCLA students who is now a graduate student at USC. She asked me if I had joined the USC faculty and wanted to know why I was there at 845am on a Saturday.  I told her that I didn't think that I had joined the USC faculty but that there certainly exists an offer such that I would.   Having been one of my students, she knows that I think "at the margin".  I then went up to the third floor and participated in the morning Agglomeration Conference.   Jenny Schuetz presented the first paper of the morning.  She presented new research findings investigating the determinants of where retail stores open in California metropolitan areas.  Under what circumstances would a Walmart open near the Staples Center?  I then presented the last paper of the morning focused on urban governance in China.  Here is the paper's title page:



 

First, I want to plug my new Ziman Center short piece on commercial electricity consumption.  Now, I'd like to turn to a quick case study of why amenities and conferences are complements.  Over the last two days, the Federal Reserve Board of San Francisco and UCLA have partnered to throw a very successful conference focused on "Housing and the Macroeconomy".    For the last two days it has been 70 degrees, sunny and blue skies in Westwood.  Perhaps because of this, an excellent set of economists showed up.   My old friend and co-author Joe Tracy participated.   As Joe and I talked throughout the conference, we sketched out a new paper we are planning to write together. He taught me a couple of things related to the social cost of the Great Recession as the plunge in home owner equity affects their investment patterns.  This got me thinking and now we have a plan to write something serious.  If we hadn't started talking at the conference, we wouldn't have written this paper.  Progress not regress!

The Journal of Economic Perspectives has published a fascinating piece about a high stakes competition that took place in the early 1950s in academic economics.  The author concludes that Lionel McKenzie merits much more credit for his research on general equilibrium than he has received.  The good news is that in this age of Google and "thick international markets" in economics that this "inside baseball" couldn't happen again.    

Matt Turner and Giles Duranton wrote a nice AER paper arguing that in the absence of road pricing that new urban infrastructure (such as highways and bridges) does not reduce traffic congestion.  In today's NY Times,  Turner has a smart quote focused on his pessimism that a billion dollar investment linking Kentucky and Indiana will have a key quality of life impact. This is a nice example of "trickle down" economics.  Turner's nerdy AER paper has real world policy implications.   Too many cynics seem to think that economists focus on abstract issues.  In reality, our work is highly policy relevant but it is often the case that policy makers have already made up their minds about which ribbon cutting events they want to participate in and they are looking for fancy Ph.D. economists to rubber stamp their dogmatic vision.   Simple common sense suggests that irreversible costly infrastructure is most valuable in growing areas.  I'm not convinced that this part of the U.S is growing slowly because it doesn't have infrastructure.      Even in this age of Keynes, we still need to double check that the expected PDV of Benefits of a given project > Expected PDV of costs

House Majority Leader Eric Cantor wants to offer the social scientists a NSF budget of $0.  He is a smart man who argues that there is an opportunity cost to giving the "wacky" social scientists $250 million a year.  He argues that the scarce $ could be handed to "real scientists".   He writes:

Republicans and ScienceTo the Editor:Paul Krugman paints Republicans as anti-science (“The Ignorance Caucus,” column, Feb. 11). Unfortunately for Mr. Krugman, facts don’t support the allegations. The effort to double funding for medical research at the National Institutes of Health began with Congressional Republicans. It was the Republican House alone that in November passed legislation ensuring that foreign-born students educated in the sciences at American colleges and universities have the opportunity to remain in this country and contribute to our nation’s scientific endeavors.
Mr. Krugman singled me out for criticism because I proposed increasing medical research funding to help save lives by reducing funding for lower-priority programs like social and political science research. Government can’t afford to pay for everything, and governing is about making choices. 

The National Science Foundation finances important research helping find cures for devastating diseases. But the foundation has only enough funds to support 15 percent of the applications it receives for research grants in the biological sciences. Yet we spend nearly $250 million annually on research in the social, behavioral, economic and political arena, such as a recent $266,821 grant to figure out why voters chose the candidates they did in the 2010 election. This money could fund another 1,000 grants in life sciences!
Reprioritizing government’s existing spending to favor saving lives over more political science research is not anti-science; it’s common sense.
ERIC I. CANTORWashington, Feb. 14, 2013The writer is the House majority leader.

Who can oppose a public policy that causes economic growth and reduces income inequality?  In this NBC clip, Jim Heckman concisely makes his case for early interventions.   The only problem with Dr. Heckman's solution is that the investment's effects will only be observed in the medium term and policy makers want instant results.   I would suggest sharply raising the gas tax and using this revenue to finance Heckman's field experiment.