Monday, December 15, 2014

CBO on uncertainty

Here's a nice overview of how CBO addresses uncertainty in its fiscal forecasts, from the director. One of the big challenges with the traditional "high, medium, and low" scenario ranges that appear in CBO and other forecasts is that implicit assumptions about the covariance structure of processes like mortality, fertility, and productivity are extreme and unrealistic.

Thursday, December 11, 2014

Men Not At Work

The NYT reports on men who aren't working, and one angle they left out is what prospective wives or partners perceive about the gains to marriage. Much is written about the opportunity costs of working, namely the foregone disability benefits and child care, and the article notes how relatively few men who aren't employed have young kids. AEI scholars have claimed that men's retreat from marriage and fatherhood can explain more than a third of the decline in employment since 1979. An accounting exercise like that is helpful, but it raises the question of why choices have trended the way they have, and I suspect women's choices are important.

Wednesday, December 10, 2014

Queens College: Affordable for Students and Hollywood

Queens College Campus Event Services announced via email that the upcoming film "Still Alice" was partially filmed at QC.  It's unclear whether these scenes made the final cut, but it's a fun reminder that Queens College is affordable. For students, mostly, but apparently also for Hollywood!

Take that, Columbia University!  Queens College is the Vancouver to your Los Angeles!

From the Office of Campus Event Services:

Campus Event Services markets and coordinates space rentals at Queens College. In April 2014, the college was selected as a location for the film Still Alice (rated PG-13)starring Julianne Moore. The film was also shot at a home in Long Beach and other locations in the New York City area. The movie is based on Lisa Genova's novel by the same name about a Columbia linguistics professor who learns she has early-onset Alzheimer's disease. 

The following campus sites were used in the film:
Campbell Dome
Kiely Hall 258
Fifth-floor Rotunda window, Rosenthal Library
President's Conference Room 1, Rosenthal Library
Dean Craig Michael's office, Powdermaker Hall 100
Hallway in the Remsen Building

Should you choose to see the film, we hope you enjoy seeing the familiar QC locations! 

Sunday, December 7, 2014

Matching models

Marriage (50s-style), med school, or NYC high school, the game theorists have a method for the madness, per the NY Times.

Tuesday, December 2, 2014

Budgetball

Oakland A's baseball has been popularized as "Moneyball" in the eponymous book and movie, but I'd  prefer to call it "Budgetball" for one important but often overlooked reason. Not only is A's baseball profitable in a relatively small MLB market, it is also consistently affordable and exciting for fans.

As is obvious from my Twitter page, I'm an Oakland A's fan and have been since around 1997 or 1998, when I was an economics Ph.D. student at UC Berkeley about 10 miles north of the Oakland Coliseum. The A's recently departed assistant GM Farhan Zaidi is an alumnus of the same program. I wasn't following the team when the front office traded Rickey Henderson in the 1980s or Jose Canseco in the 1990s, the latter infamously from the on-deck circle. But I was in the stands before the Mark McGwire trade in 1997, which didn't seem to catch the fans in the left field bleachers too much off guard. "He isn't even trying," one had complained after a routine out. I was in the third deck watching "The Flip" by Derek Jeter in game 3 of the 2001 ALDS, but that's a story for another day.

The simple point I want to make with "Budgetball"* is that price and quality of the product are important factors motivating fans' demand for baseball, and the A's have been delivering on both fronts for years. This is an ode to a high-quality, affordable product: a seat at the Oakland Coliseum, site of spectacular highs and lows, and the occasional discharge of raw sewage. There are plenty of other intangible things that motivate fans, as essayist Steve Almond and many others have written about, but affordability matters. When I was a student, "Dollar Wednesdays" at the Coliseum actually cost a dollar to attend. The round-trip cost of the BART train ride was probably 5 or 6 times that and still made going to the ballgame eminently affordable. The team in 1997 won just 65 games, the worst in a full season since 1977. But the team brought Rickey back in 1998, and the product throughout was plenty worth it.

And it has remained worth it. According to Team Marketing Report, the 2014 A's ranked 19th in the majors in their Fan Cost Index, and 23rd if you looked at ticket prices alone. By contrast, the 2014 World Series champion and cross-bay rivals San Francisco Giants ranked either 5th or 8th most expensive. The graph below plots wins (y-axis) against TMR's average ticket price (x-axis) for all 30 teams in 2014. The Oakland A's are on the upper left side of the cloud, suggesting they offer good results for the money.



Why am I writing about this now? Baseball fans recall how the A's controversially traded their cleanup hitter in the middle of their 2014 pennant chase, and now the team has done it again, trading away MVP candidate and fan favorite Josh Donaldson last week. Many fans aren't happy, and I was struck by Ken Arneson's lengthy piece on the topic. It hurts to lose a familiar face, a player who consistently makes the highlight reel with his bat or glove or both. And player continuity is part of the quality of the product; following a team or sport is more fun when it consists of distinguishable personalities rather than just numbers. More fun translates into profitability, just ask Amazon and Twitch why a gamer named "Nadeshot" is so popular.

But I think what has made Oakland A's baseball so great is a bifurcated approach to winning under budget constraints, one that preserves a little continuity while aggressively seeking to maintain or improve the winning record. In the aughts, they signed their last Gold-Glove 3B Eric Chavez to a long-term contract and stuck with the Big Three for a while. This decade, they inked deals with CF Coco Crisp and RP Sean Doolittle while ruthlessly letting go Grant Balfour and trading their right-handed power hitters. The 2012 season was magical, and I was there in person at all the critical games, watching the team clinch the wild card and then the division on the last game of the season.

The A's strategy produces "Budgetball." I can afford to go in person to a game or ten, and it's a great product, even when the team comes up a little short. I could have gone to three more A's games if I hadn't gone to that one Giant's game this year, that's the kind of price difference we're talking about if it's not nosebleed seats.

It's still a fun team to watch, departures and all, and I can afford it. Sign me up, and keep dealing, Billy Beane. I won't pretend it doesn't hurt, but if it keeps the product's quality high and price low, my feet have voted long ago.


(*Apologies to the Peter G. Petersen Foundation for appropriating their term "Budgetball," which they coined in 2009 for a team game of cognitive and physical skill about federal fiscal policy.)

Less divorce for younger cohorts

The Times discusses lower divorce rates among cohorts married in the 1990s and 2000s, according to the SIPP. It's a nice update to work last decade by Stevenson and Wolfers.

Update: Another nice piece by Wolfers discusses changes in the economic role of marriage and connections to the rising acceptance of gay marriage.

Update 2: A tweet by Wolfers led me to this recent study on marriage and specialization exploiting a 1988 change in Swedish pension laws.

Update 3: Josh Goldstein pointed me in the direction of this 2014 piece in Demography by Kennedy and Ruggles calling into question some of the patterns in SIPP data, reviewed here last spring.

Wednesday, October 22, 2014

Economists' "Survey-Says" moment on Piketty

Not news, but here's a roundup of some of the thinking in North American economics departments about Thomas Piketty's Capital in the Twenty-First Century.

A broad collection of perspectives is available via the IGM Economic Experts Panel, although I think the way IGM phrased the question may have doomed it. Rather than asking about longer historical periods, Europe, or the future, it asked about the U.S. since the 1970s, and economists broadly agree to disagree with the relevance of Piketty's most parsimonious point about r > g, at least for that period.

Related to that are essays by Acemoglu and Johnson, who perhaps expectedly would rather talk about institutions than "laws" of capitalism, and slides by Justin Wolfers that draw from several other sources, including the ingeniously titled "Nit-Piketty" by Debraj Ray.  Also available is the April book review in the New Republic by Robert Solow, a springtime review by Larry Summers, and a recent review in J Econ History by Alex Field.

I think two of the main points about the relevance of Piketty's work to understanding modern inequality are that (1) a lot of U.S. inequality seems to be driven by labor income and/or technology, and not plausibly by excess growth of wealth over income as suggested by the r > g argument; and (2) how big r is relative to g may ultimately be an empirical question, but the empirical estimates vary depending on the time period and the definition of capital, and the theoretical reasons are also important (i.e., Eric Maskin's point that r and g are both determined by other stuff). I'm sure I've missed other important points!