economics

At the record company meeting, on their hands — a dead star

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I do have a problem in reference to electronic dance music and pop culture in general. It is becoming more and more difficult for actual artists and talented people to survive. It’s turning every product that’s made in the culture into a commercial. Now, in order for anyone to make money, they have to be a part of an artisanal beer commercial. I can speak for me personally that I write pretty introspective thoughtful records; not good for selling beer. Technology has de-valued not just music, but the idea of artistry and people are no longer willing to pay.

{ Jay Denes | Continue reading }

The music business is something one suffers through in order to be able to make music full time. That being said, most of what gets made is simply a result of economic conditions in a given time period. There’s been no artist development in the record biz for over 20 years now. So, of course music has suffered greatly. People didn’t suddenly get untalented or insincere, there’s just no economic infrastructure left to support the development of excellence. So when it occurs it tends to be a bit of good luck, a hit on a first record that allows an individual or group to have a long enough career to develop their skills.

Jay Denes | Continue reading }

screenshot { Sean S. Baker, Tangerine, 2015 }

Eat the meat and spit out the bones

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In an update on an old story, an investment banker asks the client to pay by placing one penny on the first square of a chessboard, two pennies on the second square, four on the third, doubling the number on each square that follows. If the banker had asked for this on only the white squares, the initial penny would double thirty-one times to $21,474,836 on the last square. Using both the black and the white squares, the sum on the last square is $92,233,720,368,547,758.

People are reasonably good at estimating how things add up, but for compounding, which involved repeated multiplication, we fail to appreciate how quickly things grow. As a result, we often lose sight of how important even small changes in the average rate of growth can be. For an investment banker, the choice between a payment that doubles with every square on the chessboard and one that doubles with every other square is more important than any other part of the contract. […]

Growth rates for nations drive home the point that modest changes in growth rates are possible and that over time, these have big effects. […]

If economic growth could be achieved only by doing more and more of the same kind of cooking, we would eventually run out of raw materials and suffer from unacceptable levels of pollution and nuisance. Human history teaches us, however, that economic growth springs from better recipes, not just from more cooking.

{ Paul Romer | Continue reading }

‘There’s only one corner of the universe you can be certain of improving, and that’s your own self.’ –Aldous Huxley

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After medicine in the 20th century focused on healing the sick, now it is more and more focused on upgrading the healthy, which is a completely different project. And it’s a fundamentally different project in social and political terms, because whereas healing the sick is an egalitarian project […] upgrading is by definition an elitist project. […] This opens the possibility of creating huge gaps between the rich and the poor […]Many people say no, it will not happen, because we have the experience of the 20th century, that we had many medical advances, beginning with the rich or with the most advanced countries, and gradually they trickled down to everybody, and now everybody enjoys antibiotics or vaccinations or whatever. […]

There were peculiar reasons why medicine in the 20th century was egalitarian, why the discoveries trickled down to everybody. These unique conditions may not repeat themselves in the 21st century. […] When you look at the 20th century, it’s the era of the masses, mass politics, mass economics. Every human being has value, has political, economic, and military value. […] This goes back to the structures of the military and of the economy, where every human being is valuable as a soldier in the trenches and as a worker in the factory.

But in the 21st century, there is a good chance that most humans will lose, they are losing, their military and economic value. This is true for the military, it’s done, it’s over. The age of the masses is over. We are no longer in the First World War, where you take millions of soldiers, give each one a rifle and have them run forward. And the same thing perhaps is happening in the economy. Maybe the biggest question of 21st century economics is what will be the need in the economy for most people in the year 2050.

And once most people are no longer really necessary, for the military and for the economy, the idea that you will continue to have mass medicine is not so certain. Could be. It’s not a prophecy, but you should take very seriously the option that people will lose their military and economic value, and medicine will follow.

{ Edge | Continue reading }

and go we know not where

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This article examines associations between the Great Recession and 4 aspects of 9-year olds’ behavior - aggression (externalizing), anxiety/depression (internalizing), alcohol and drug use, and vandalism - using the Fragile Families and Child Wellbeing Study, a longitudinal birth cohort drawn from 20 U.S. cities (21%, White, 50% Black, 26% Hispanic, and 3% other race/ethnicity).

The study was in the field for the 9-year follow-up right before and during the Great Recession (2007-2010; N = 3,311). Interview dates (month) were linked to the national Consumer Sentiment Index (CSI), calculated from a national probability sample drawn monthly to assess consumer confidence and uncertainty about the economy, as well as to data on local unemployment rates.

[W]e find that greater uncertainty as measured by the CSI was associated with higher rates of all 4 behavior problems for boys (in both maternal and child reports). Such associations were not found for girls.

{ Developmental Psychology | Continue reading }

photo { Yosuke Yajima }

‘If you have a garden and a library, you have everything you need.’ –Cicero

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Most people own things that they don’t really need. It is worth thinking about why. […]

A policy aimed at curbing luxury shopping might involve higher marginal tax rates or, as a more targeted intervention, a consumption tax. As it becomes harder to afford a Rolex, people will devote more money to pleasures that really matter. Less waste, more happiness.

{ Boston Review | Continue reading }

photo { Teale Coco by Ben Simpson }

For when Eric eats a banana an amazing transformation occurs. Eric is Bananaman.

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Chinese ice cream is different, and those differences reflect a different economic and technological context. American ice cream is mainly sold by grocery stores in large containers to be eaten at home. So the basic assumption is that people have freezers at home in which to store the ice cream. Even when ice cream is sold on-the-go, it is sold out as scoops out of those big containers. But historically in China most people did not have freezers at home, though many more of them do now. Ice cream in China is therefore usually sold by convenience stores or roadside stalls, in small packages to be eaten immediately. So rather than big vats of ice cream, it is mostly individual bars.

These constraints have pushed innovation in Chinese ice cream in different directions. You can get all kinds of amazing wacky ice cream flavors in the US, but they are all delivered in mostly the same form: a tub of ice cream eaten with a spoon. Chinese ice cream innovates on form and texture more than with ingredients, with many bars featuring not just crunchy outer layers of chocolate but interior elements made of various yummy substances.

The structural complexity of some ice-cream bars is so great that it’s common for the package to have a 3-D cutaway diagram to illustrate all the goodies on the inside.

{ Andrew Batson | Continue reading }

Hats off to da rich ones who flash and floss

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Business Insiders is expecting to make 65 million dollars next year. […] It employs 325 people, meaning it currently brings in roughly $132,300 in revenue per employee. […]

BuzzFeed … $208,333 per employee

Gawker … $211,538 per employee

Vice … $457,500 per employee

The New York Times Company … between $440,000 and $450,000 per employee

{ The Awl | Continue reading }

‘Loves die from disgust,
 and forgetfulness buries them.’ –Jean de La Bruyère

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The wedding industry has consistently sought to link wedding spending with long-lasting marriages. This paper is the first to examine this relationship statistically. We find that marriage duration is either not associated or inversely associated with spending on the engagement ring and wedding ceremony. Overall, our findings provide little evidence to support the validity of the wedding industry’s general message that connects expensive weddings with positive marital outcomes.

{ PDF | via Improbable }

‘It’s about a guy who acts like he knows everything and then comes back crawling on his knees, which has happened to me so many times.’ —Claire Boucher

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An experiment was carried out in a French bar. A waitress briefly touched (or not) the forearm of a patron when asking him/her what he/she want to drink. Results show that touch increases tipping behavior although giving a tip to a waitress in a bar is unusual in France. The familiarity of tactile contact in France was used to explain our results.

{ International Journal of Hospitality Management | Continue reading }

still { Ingmar Bergman, The Passion of Anna, 1969 }

‘Where is the knowledge we have lost in information?’ —T.S. Eliot

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We meta-analyzed the effects of sexual media, violent media, sexual ads, and violent ads on the advertising outcomes of brand memory, brand attitudes, and buying intentions. The meta-analysis included 53 experiments involving 8,489 participants.

Analyses found that brands advertised in violent media content were remembered less often, evaluated less favorably, and less likely to be purchased than brands advertised in nonviolent, nonsexual media. Brands advertised using sexual ads were evaluated less favorably than brands advertised using nonviolent, nonsexual ads. There were no significant effects of sexual media on memory or buying intentions. There were no significant effects of sexual or violent ads on memory or buying intentions.

As intensity of sexual ad content increased, memory, attitudes, and buying intentions decreased.

When media content and ad content were congruent (e.g., violent ad in a violent program), memory improved and buying intentions increased.

Violence and sex never helped and often hurt ad effectiveness.

{ Psychological Bulletin/American Psychological Association | PDF }

related { Allegation that ad-serving companies deliberately slow down web pages to maximise profit }

‘now available in black: rainbows!’ —‏@lady_products

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“Water fountains have been disappearing from public spaces throughout the country over the last few decades,” lamented Nancy Stoner, an administrator in the Environmental Protection Agency’s water office. […]

By 1930, Chapelle says, bottled water had become “low class,” used only in offices and factories that couldn’t afford plumbing.

Attitudes began to shift in the 1970s, when Europe’s Perrier set its sights on the American market. In 1977, the company spent $5 million on an advertising campaign in New York, selling itself as a chic, upscale product. Yuppies lapped it up. “It was a lifestyle-defining product,” Chapelle says. By 1982, U.S. bottled-water consumption had doubled to 3.4 gallons per person per year. […]

U.S. consumption of bottled water quadrupled between 1993 and 2012 (reaching 9.67 billion gallons annually). […]

Today, 77 percent of Americans are concerned about pollution in their drinking water, according to Gallup, even though tap water and bottled water are treated the same way, and studies show that tap is as safe as bottled.

{ Washington Post | Continue reading }

art { Roy Lichtenstein, Girl in Water, 1965 }

A jink a jink a jawbo

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After the near‐collapse of the world’s financial system has shown that we economists really do not know how the world works, I am much too embarrassed to teach economics anymore, which I have done for many years. I will teach Modern Korean Drama instead.

Although I have never been to Korea, I have watched Korean drama on a daily basis for over six years now. Therefore I can justly consider myself an expert in that subject.

{ Uwe E. Reinhardt, Princeton University | PDF | via Chris Blattman }

photo { Ji Yeo | plastic surgery in South Korea }