Environmental and Urban Economics

The NY Times reports about Beijing's use of a vehicle registration lottery to attempt to reduce traffic congestion in Beijing.   Since such lotteries do not raise the marginal cost of driving at congested rush hour times, they will not reduce road congestion.  Siqi Zheng and I discuss the economics of car ownership and use in China's cities in our recent 2016 book;  Blue Skies Over Beijing (you can read chapter 1 here).

A more subtle point is that we know how to "solve traffic congestion".  Watch this video of Singapore's Electronic Road Pricing.    Due to this policy, vehicles move at 40 MPH at any time.  Since the roads are priced, this nudges people to use public transit.

In 2016, we are finally allowed to talk about urban resilience to climate change.  As I have argued for 8 years now, richer cities can "take a punch".  Go visit Singapore to see proof.  The NY Times writes a "city section" piece that the recent week of extreme heat caused NYC residents to stay inside and to suffer when outside but that long term damage was minimal.

Pretty hot. Days were in the low to mid-90s, but felt more like the low 100s with the humidity.

Andrew Browne has written a fascinating piece in the WSJ sketching a new tragedy of the commons such that China is using its military muscle to harvest valuable resources in disputed waters in the South China Sea. Mr. Browne tells a story that the powerful Chinese Navy is providing cover for Chinese resource extractors to come in and grab resources such as big clams, turtles, sharks, eels and oysters.  Mr.

Mark Thoma's recent piece caused me to briefly think.  He writes about why he started blogging.   I started blogging to help market my academic work.   Think back 25 to 50 years ago when there was no email, tweets or blogs.  A few elite economists wrote for Business Week or Newsweek.  Their names were Samuelson, Friedman, Becker, Krugman, Dornbusch, Barro.

I've joined an ambitious institution.   It is clear to me that USC aspires to be "Stanford South".  I respect that goal.  As the new academic year starts in 4 weeks, USC Economics welcomes five new faculty (including myself).  Here are some details.

David Zeke (Top Left),  Mattthew Kahn (top center), Michael P. Leung (Top Right),  Fanny Camara (bottom left) and Romain Ranciere (bottom right) join the faculty.  Dr. Zeke works on macroeconomics and finance topics. Dr.

Jacob Mincer was a great labor economist at Columbia University. We were colleagues together in the 1990s.  He didn't think I was funny but he was very kind to me and to Dora.   Here is a Mincer Regression that I doubt he ever ran.  I take Federal Employee data from 1998 to 2014 (I'm hiding some details because I'm not ready to publish this yet).

The NY Times reports that the Democratic Party seeks a winning issue.   Some argue that "infrastructure" could be that issue.  Why?  Such bricks and mortar would create American jobs and it would build up our capital stock and presumably this would foster long term economic growth.  What are the problems with this argument?

1. Public sector construction unions will charge too high of a labor bill and this will mean that taxpayers will not receive that much "new capital" per $ invested.

Secretary John Kerry made an interesting claim as he equates the risk from terrorism and climate change.   While I understand why he said this, I disagree with him.  I have published a paper on this topic.  

In my paper, I argue that Mother Nature is not a strategic opponent.   There is a predictability to where she throws her punches.  Florida experiences hurricanes. New Orleans and Manhattan face sea level rise.

The NY Times published a piece two weeks ago making the well known points that economists endorse carbon pricing but the leading Democrats are not willing to endorse such  a policy.  One leading economist offers the quote: "“But it’s not surprising, given the politics, that Secretary Clinton would not want to explicitly talk about carbon pricing.”

As serious economists, let's think about the "politics" here.  The article doesn't bother to delve into such details.

I was very sorry to learn that Chip Case recently passed away.   I work at the intersection of environmental and urban economics.   In 2016,  environmental economics is a young person's field.  I am one of the "graybeards" in this area.   In urban economics, there are many great active researchers (see the recent Handbook) but in recent years we have lost John Meyer, John Kain, John Quigley and now Chip Case.  All of these great scholars had close links to Harvard.