Market Power

Book List

John Palmer has tagged me in the game of listing of books. 

How many books have I owned?
I really don't know.  Counting textbooks, including those that have been given to me by publishers, I'd have to say that I've owned about 700-800 books.
How many books do I own?
Probably around 500 or so.  I have a whole box of Civil War books that I haven't read yet.
The last book I bought.
My buying of books goes in bunches.  The last book I received was a complementary copy of Sunday Money, a new book about NASCAR.  The last books I bought were The Complete Works of Plato, The Complete Works of Aristotle (Volume 1), Milton Friedman's Capitalism and Freedom.  When I travel to San Francisco in two weeks for the WEAI conference, I will take along Aristotle to keep me company when I'm not in the bar or at a session.
The last book I read.
Steve Levitt's and Stephen Dubner's Freakonomics
5 books that meant a lot to me.
Andrew Zimbalist's Baseball and Billions
Campbell McConnell's Principles of Economics book.  This was the text I had in my undergraduate principles courses at Morningside.  I didn't have a particularly interesting professor, but the book drew me into the wonderful world of economics.  Interestingly, I have never used this textbook as a professor, instead preferring to use the text by Frank and Bernanke
Shelby Foote's The Civil War trilogy.
Milton Friedman's Free to Choose.
Neil Peart's Ghost Rider.  My life's complications pale in comparison to Neil's tragedy:  the loss of his only daughter to a car accident and his wife to cancer within 6 months.
Tag 5 people.
This is a tough one because most if not all of the bloggers that I know and would feel comfortable tagging have been tagged at least once.  On this one, I plead "no contest."

Sweatshops

From the Louisville Courier Journal:

(Fruit of the Loom, which has its headquarters in Bowling Green, Ky., refused repeated requests for interviews for this story. It also refused requests for visits inside its factories and has a policy forbidding employees to speak to the press about their employment or about the business.) ...

Froot of the Loom officials must have something to hide.  Otherwise, they would have talked to the reporters, right?  The next part of the article describes the mornings that many of the workers lead as they head to work.

They come for jobs that may pay them as little as $5.04 a day, putting them among the working poor in a country where poverty is a way of life.

The national minimum wage in the US is $5.15,  per hour, 11 cents more than these people make per day.  Froot of the Loom must be exploiting these people.  I knew they must have something to hide.

Maybe not.

Before she came to Fruit of the Loom, Graciela Rivera, 35, said she had been a street vendor in Sonsonate. She said she was robbed and the thieves took everything she owned. Through her friends, she got a job at the plant. Six years later, she said she is happy and well-treated there.

Vilma Ruth Erazo, 30, was a bookstore cashier in Sonsonate. She said she is making more money at the plant than at the store, allowing her to better support her mother and two children.

"All the (job) slots are full," Erazo said. "There's not much turnover. Why would anybody stay with a company where they don't want to be? Everybody must have a favorable impression of the place, otherwise they would quit."

Several employees said that machine operators can earn up to $290 a month. The company offers three months of maternity leave, and employees' jobs are waiting for them when they return.

Workers also are awarded efficiency prizes, and the employees who score the highest get a one-day, all expenses paid trip to resorts in Guatemala and El Salvador. Employees said they get 15 days of paid vacation each year and a Christmas bonus.

The factories produce jobs for their workers and for the scores of vendors who gather across the street selling everything from breakfast and snack food to children's clothes.

"If the maquilas closed, I would be out of business," said Maria Martinez, a 47-year-old vendor who sells snack food. "I could go somewhere else, but there would be fewer sales."

These people have made a rational choice:  of all the available alternatives, this is the one that works out the best for them.   The initiatives of those who want to raise the wages of the sweatshop workers, while admirable at the basest level, will have the opposite effect (and an unintended one) - it will provide an incentive for the companies who offer these types of jobs to look elsewhere and many will leave, forcing these workers to look for other jobs - jobs that must, by necessity of voluntary choice, make them worse off.

HT to Division of Labour.

I Want One!

What could be cooler than this?

College Vs. High School

Here are 25 differences between college and high school.  My favorites (with comments in italics) include:

25. In high school, you do homework. In college, you study.

22. In college, the professors can tell you the answer without looking at the teacher's guide. (that's because we have lots of training in our fields)

17. In high school, you're told what classes to take. In college, you get to choose; that is, as long as the classes don't conflict and you have the prerequisites and the classes aren't closed and you've paid your tuition.  (which is one of the reasons why I prefer teaching college - another being that to a larger extent, students have more choice of where to go to college)

16. In high school, if you screw up you can usually sweet-talk your way out of it. In college, you're lucky to ever talk with the professor. 

14. In college, any test consists of a larger percentage of your grade than your high school final exams ever did.
 
13. In high school, when the teacher said, "Good morning," you mumbled back. In college, when the professor says, "Good morning," you write it down. (Damn straight)

11. In college, weekends start on Thursday. (and the good administrative folks at Minnesota State thought this only occurred here.)

3. In college, when you miss a class (or two or three), you don't need a note from your parents saying you were skip... uh, sick that day. (or that gramma died, or that your dad is taking the entire family to [insert place name here] on the day you are to take a final - and he's already bought the tickets]
 
2. In high school, you can't go out to lunch because it's not allowed. In college, you can't go out to lunch because you can't afford it.

If It's Bad, Ban It

From The New York Times:

Most people who pay attention to their diets know that partially hydrogenated oil contains trans fat that clogs the arteries and reduces the "good" cholesterol that helps unclog them. Beginning next year, companies must disclose trans-fat amounts on food labels. But it is already clear that the Food and Drug Administration is going to have to do more to protect the public from heart-threatening fats. ...

The ultimate aim, however, should be to end the widespread use of partially hydrogenated oils. As things now stand, the F.D.A. acknowledges that trans fats are unhealthy at any level, and yet maintains that the partially hydrogenated oils that contain them are basically safe. The agency can't have it both ways. Public health would be greatly improved if the F.D.A. prohibited their use.

Of course that's the all-too common answer/reaction to these sorts of products:  ban them!  Ban them, as if they have no benefits whatsoever to the user.  Ban them because we know doing so stops their use**.  It's never enough to make consumers aware of the problem.  Ban them because we the consumers are not smart enough to make our own decisions. ***

**Update 1.  Note the sarcasm
*** Update 2.  Kip Esquire chimes in here.  Thanks to John Palmer for this link.

MIT Survey

Some folks at MIT are undertaking a weblog survey.  If you have a few minutes, click on the image below to take the survey.  I looked at the survey results and, for the most part, I'm pretty typical.

List of Eminent Domain Takings

The Strata Sphere is keeping a list, for awhile at least, on some recent eminent domain takings.

HT to the Coyote Blog.

Choice Overload?

From lucky Western Illinois University's newest economics faculty member, Bill Polley, comes this:

Do consumers have too much choice?  Stacy Schiff seems to think so. (NY Times)

In taking cluster analysis and its classifications to the logical extreme, are we not building a superfinicky society? Five minutes in any Starbucks line will answer that one. We used to be one nation, undivided, under three networks, three car companies and two brands of toothpaste for all. Today we are the mass niche nation. This is a country in which 40 percent of the eligible population doesn't vote, but can be expected to maneuver its way through a sprawl of options every time it heads out for tooth twine. Increasingly the brick-and-mortar world resembles the virtual one: an infinite landscape of microscopic subcategories, in which one loses oneself, twice.

A friend in Seattle - I'll call him Mitch, because that is his name - reports a full-scale identity crisis in the toothpaste aisle. There he stood, two coupons in hand. Was he ready to become a rejuvenating-effects, tartar-protection kind of guy, or was he wed to the fight against tobacco stains? And to think it all used to boil down to squeezing from the bottom.

The transformative power is dizzying. The pressure is on; the paralysis sets in. It's like a torture session with a demonic optometrist. If A is better than B, and 2 is better than 3, is A better than 2? How to choose among tartar-control and whitening and breath-enhancing? And moreover - this is America - why should we have to? I want it all. Darwinistically speaking, shouldn't "whitening" have automatically ceded to "extra whitening" anyway?

I happen to think consumer choice is good.  In fact, I can't get enough.  Russ Roberts (Cafe Hayek) agrees in this NPR interview from back in March.

I've had discussions with people on this very thing, and it amazes me (although it shouldn't) how many think people have too many choices.  Of course, when pressed, they don't seem to think they *personally* have too many choices, it's just too bad that other people have to have so many choices.  It's always easier to spend other people's money.  I guess it's also easier to restrict other people's choices.

The fact that we have so many choices shows how efficient production processes have become.  Back in the day of Henry Ford, anybody could have a Model T in any color, as long as it was black.  Nowadays, we can get cars in multitudes of colors with multitudes of options.  So what if those options are where car dealers/companies make their profits?  I have a good idea of what my choices are and what prices I'll have to pay.  If I want to include a stereo installed at the factory along with a sun roof and heated seats and, in the process, lift the profits of the car dealer, so be it.  It's my choice and I am responsible for it.

Tonight I went to the store to get bread, and the store had dozens of different styles of breads from several different companies.  I didn't stew over the varieties.  Instead, I merely chose some 12 grain, some potato bread, and some whole wheat bread.

I like variety and choice.  With choice comes competition and with competition comes a higher standard of living, and the higher the better.  And via Coyote Blog, comes this from Radley Balko:

Critics of capitalism once predicted that free markets would wreak mass starvation, depletion of resources, pollution, and death.

They're now reduced to bitching about too many flavors of mustard.

We've won the debate.

Unfortunately, Bob Geldof doesn't know that the debate has been won yet.

New Blogger at The Sports Economist

Stefan Szymanski has joined the ranks of the bloggers over at The Sports Economist.  Stefan joins Skip Sauer (managing director), Rod Fort, Brian Goff, John Palmer, myself, and many, many thoughtful commenters in the discussion of the economics of sports.  Stefan's first post, here, is about a sport that has received little attention over at TSE, rugby.

Pondering Eminent Domain

The Coyote Blog has this post about the recent decision by the SCOTUS on eminent domain.  He concludes:

While Bush, sometimes rightly, gets bashed by the Left for trying to create a corporate state, it is in fact the left side of the Supreme Court that has struck the strongest blow now in that direction.  This decision in a stroke gives local authorities nearly unlimited ability to engage in Soviet-style planning of their local economy.

The nation is a combination of local economies.  Unless state governments enact laws to restrict local (ab)use of eminent domain (why would they do this?), then we'll simply have little more than a planned economy.  It won't be federally planned, but planned it will be.