Tag Archives: policy

Hard to counter China’s aging, even with change in one-child policy

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The change in China’s one-child policy may not have much effect on its demographics:

“The population in China is going to continue to age,” said Kristin Bietsch, a research associate at the Population Reference Bureau in Washington, D.C. “Even though they’re hoping to increase their fertility, they’re still going to have a substantial population aging — and this is going to happen even with the increase in fertility.”…Adrian Raftery, a professor of statistics and sociology at the University of Washington in Seattle, agreed: “The (United Nations) has already been projecting a small and slow increase in China’s fertility rates over the coming decades, and this news makes this even more likely to happen,” he said. “The increase is not likely to be large, though.”…

Like much of Europe, China’s population is aging rapidly — India’s population, now at 1.3 billion, is expected to surpass China’s within seven years, according to the United Nations…

But many demographers argue the birthrate would have fallen anyway as China’s economy developed and education levels rose. They foresee a looming crisis because the policy reduced the young labor pool that must support the large baby boom generation as it retires.

Three quick thoughts:

  1. See more about demographic transition here: as countries develop and have more wealth, residents have fewer children. Even as the one-child policy disappears, there may not be a rush to have two children.
  2. Governments have the ability to set policies such as these but one problem with influential policies is that they also need good timing. If the goal was to reduce the proportion of older residents, this change came late and it will now take more time to counteract the unintended consequences of the initial policy.
  3. I haven’t seen much about the real reasons China reversed this policy. Presumably, it has to do with aging – a modern society needs a broad base of young workers both for economic growth as well as to pay into the system to take care of older residents. Yet, this article brings up the population of India – might the shift also have to do with the population growth of India? Are there other reasons as well?

Why do more liberal cities have more expensive housing?

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After providing evidence that more liberal American cities have higher-priced housing, several explanations are offered for the phenomenon:

Kolko’s theory isn’t an outlier. There is a deep literature tying liberal residents to illiberal housing policies that create affordability crunches for the middle class. In 2010, UCLA economist Matthew Kahn published a study of California cities, which found that liberal metros issued fewer new housing permits. The correlation held over time: As California cities became more liberal, he said, they built fewer homes….

“All homeowners have an incentive to stop new housing,” Kahn told me, “because if developers build too many homes, prices fall, and housing is many families’ main asset. But in cities with many Democrats and Green Party members, environmental concerns might also be a factor. The movement might be too eager to preserve the past.”

The deeper you look, the more complex the relationship between blue cities and unaffordable housing becomes. In 2008, economist Albert Saiz used satellite-generated maps to show that the most regulated housing markets tend to have geographical constraints—that is, they are built along sloping mountains, in narrow peninsulas, and against nature’s least developable real estate: the ocean. (By comparison, many conservative cities, particularly in Texas, are surrounded by flatter land.) “Democratic, high-tax metropolitan areas… tend to constrain new development more,” Saiz concluded, and “historic areas seem to be more regulated.” He also found that cities with high home values tend to have more restrictive development policies…

“Developers pursue their own self-interest,” Kahn said. “If a developer has an acre, and he thinks it should be a shopping mall, he won’t think about neighborhood charm, or historic continuity. Liberals might say that the developer acting in his own self-interest ignores certain externalities, and they’ll apply restrictions. But these restrictions [e.g. historic preservation, environmental preservation, and height ceilings] add up, across a city, even if they’re well-intentioned. The affordability issue will rear its head.”

The options presented above include: (1) fewer housing permits; (2) environmental concerns; certain geographies that limit space, particularly along coastlines; (4) high taxes and high home values and (5) generally having more restrictions. Even though these factors are likely intertwined, it seems like it would be possible to look at the individual effects even when controlling for the other factors. One issue may be the relatively small sample size as such analyses are often limited to the 100 largest metropolitan areas. Even within the 100 biggest cities, there could be very different processes at work as Boise, Richmond, and San Bernadino are #98-100.

One common theme of these findings – outside of the geography argument – involves regulation and restrictions. Regulation doesn’t necessarily have to lead to less affordable housing. Regulations could also be used to push developers to include some units of affordable housing. Yet, it is hard for communities to turn down the big real estate money that can flow in; just see the recent happenings in New York City where high-priced units are still being built at a furious pace.

How boundary work helps explains false equivalence in the media

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Read here for an explanation of how the sociological concept of boundary work is applied to the issue of false equivalence in media coverage:

Boundary work is a kind of rhetorical work that is performed in public argument: something is asserted to be science by stressing what it is not (pseudo-science, or faith, or religion, or what have you). Even Tim Geithner did it in his exit interview when he painted his own work as just a kind of technocratic problem-solving rather than politics, see this analysis.

It seems to me that our political discourse also contains a similar kind of boundary work — between “politics” and “policy.” Our politicians will always say: what I’m doing is just plain old common sense or the right thing or just good policy, or just the solution to a problem; whereas what my opponent is doing is playing politics. And if one sees politics as actually a way of managing relations between conflicting groups of people, one can see why they do that.

For instance, reforming the American health care system is almost certainly a matter of redistribution: taking money from older people and giving it to others (the uninsured, younger people, etc.). But one can’t say that if one is a politician, and so there is a delicate balancing act: one’s own work is constructed as problem-solving and policy-making, the opponent is portrayed as playing politics (where politics is understood to be trading off between different social groups).

I think this kind of boundary work exists in journalism too (and more on why it exists later); it’s what you call false equivalence (and Yglesias calls bipartisan think). Here the newspaper is seen as above politics, which is what grubby politicians do. And therefore the contrast between the policy that the newspaper is advocating (which is not politics but merely good moral sensible stuff), and that what the politicians are doing. It is imperative, I think, in this model that both parties be painted in the same brush. Because if you don’t, then you agree with one of the parties, which therefore makes you political.

Why should the newspapers practice this kind of boundary work? My sense (which comes straight from Paul Starr’s history of the media) is that it’s a holdover from the times when the newspaper industry changed. As we all know now (from arguing about partisanship), newspapers in the 19th century were unabashedly partisan. They also catered to niches, and made money from subscriptions. And that changed sometime in the 20th century when newspapers started to make money from advertisements — and therefore they had to be less partisan and attract more people. Hence the objective tone of the reported stories (he says, she says) — and also I think the false equivalence of the editorials.

The concept of symbolic boundaries is an important one in the sociology of culture. Groups or organizations engage in drawing boundaries between what they are (by their own definition) and what they say others are. Policing these boundaries is a consistent and tricky task; the changes the other groups make might force a group to redraw its own boundaries. Or, outside social forces and circumstances might push all groups to redraw or double down on their boundaries. A good application of this concept to defining social class in the United States and France is Michele Lamont’s book Money, Morals, and Manners.

Digging into the moral reasons the American middle-class doesn’t like paying taxes

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A new sociology study looks at the moral opposition middle-class Americans have to taxes. Here are some of the main findings:

“In this study, we demonstrate how people associate the income tax with a violation of the moral principle that hard work should be rewarded,” he added. “Our research has implications for how policymakers should frame fiscal issues. Because people intertwine fiscal issues with morality, approaches to tax policy that only emphasize economic benefits for the working and middle classes do not resonate with everyday understandings about what taxes mean to people.”…

Interview respondents saw themselves as morally deserving and hard-working people, whereas they perceived a tax structure that benefits the idle poor and the idle rich…

Respondents frequently associated their earliest memories of taxation with their first jobs, or wage labor, which in turn was associated with the absence of personal autonomy and dignity, or the ability to control one’s own time and work…

Hard work was viewed as a virtue, and respondents didn’t like idea of being taxed while they work, instead speaking in favor of a flat tax on consumption. “Tax whatever,” one respondent told the researchers. “Don’t take my paycheck.”

A note: the study is limited to a particular sector of the American public. Here is the study group: “24 semi-structured, open-ended interviews with white Southerners who owned or managed small businesses—a demographic group that is typically anti-taxation.” This study has a small N and a targeted group so this limits its generalizability but its value seems to be in hearing how people talk about and understand taxes.

This is another reminder that money is not typically exchanged in solely neutral economic transactions: there is a lot of social and moral weight in economic transactions. Thus, when talking about taxes, policy makers and citizens are making moral arguments in addition to straight-up financial arguments. This applies to some of the current budget debates in the United States: the two sides may be talking some about fiscal issues but there are also underlying moral issues about how money should be used, how it should be acquired, and more broadly, how social life should work.

 

A call for better macroeconomic statistics

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As the economic crisis continues, one blogger suggests American macroeconomic statistics are “pretty weak” today:

In particular, the data coming out of the Bureau of Economic Analysis at the beginning of 2009 was way off. Here’s Cardiff Garcia, introducing an interview with Fed economist Jeremy Nalewaik:

The initial GDP estimate for the fourth quarter of 2008 showed that the economy contracted by 3.8 per cent. It was released on January 30, 2009 — about three weeks before Obama’s first stimulus bill passed. That number was continually adjust down in later revisions, and in July of this year the BEA revised it all the way down to a contraction of 8.9 per cent.

The BEA is happy to try to explain what happened here — but whatever the explanation, the original 3.8% figure was a massive and extremely expensive fail. It was bad enough to be able to get a $700 billion stimulus plan through Congress, but if Congress and the Obama Administration had known the gruesome truth — that the economy was contracting at a rate of well over $1 trillion per year — then more could and would have been done, both at the time and over subsequent months and years. Larry Summers warned at the time that the risks of doing too little were much greater than the risks of doing too much; only now do we know just how right he was on that front. (And even he didn’t push for a stimulus of more than $700 billion.)…

When I told Cardiff that the status of macroeconomic data-gathering has been declining for decades, I was making two separate statements — first that the quality of statistics has been declining, and secondly that the status of economists collating such statistics has been declining as well. Once upon a time, extremely well-regarded statisticians put lots of effort into building a system which could measure the economy in real time. Today, I can tell you exactly how many hot young economists dream of working for the BEA on tweaks to the GDP-measurement apparatus: zero.

Sounds like there is work to do. This commentator seems to suggest the government needs to offer the kind of money that would attract economists to this task. Are there economists out there right now who could handle this job and all it takes it some more money?

If we were looking at the causes of economic crises or perhaps what sustains them, could statistics really play a large role? Even with the best statistics, policymakers can still make bad decisions. But I suppose if the foundation of policy, the statistics that we trust to tell us what is really going on or what might, is faulty, then perhaps there is really little hope.

At the same time, I would suggest this isn’t only a macroeconomic problem: the world is complex, we want to tackle difficult problems, we are very reliant on statistical models, and there is more and more data to work with and collect. We need a lot of good people to tackle all of this.

WIPO points the way forward

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Intellectual Property Watch is reporting on a recent speech by the World Intellectual Property Organization (WIPO–Wikipedia backgrounder) Director-General Francis Gurry on the future of copyright law.  You can view the full speech on YouTube here (or here, if you want to skip the pleasantry-preliminaries), and you can read it here.

Gurry wastes no time in touching on the central issue of copyright policy:

How can society make cultural works available to the widest possible public at affordable prices while, at the same time, assuring a dignified economic existence to creators and performers and the business associates that help them to navigate the economic system?

Surprisingly, Gurry answers not by talking about retrenchment and enforcement but balancing competing interests:

It is a question that implies a series of balances: between availability, on the one hand, and control of the distribution of works as a means of extracting value, on the other hand; between consumers and producers; between the interests of society and those of the individual creator; and between the short-term gratification of immediate consumption and the long-term process of providing economic incentives that reward creativity and foster a dynamic culture.

Digital technology and the Internet have had, and will continue to have, a radical impact on those balances. They have given a technological advantage to one side of the balance, the side of free availability, the consumer, social enjoyment and short-term gratification. History shows that it is an impossible task to reverse technological advantage and the change that it produces. Rather than resist it, we need to accept the inevitability of technological change and to seek an intelligent engagement with it. There is, in any case, no other choice – either the copyright system adapts to the natural advantage that has evolved or it will perish. [emphasis added]

Perhaps Lawrence Lessig’s speech at WIPO last year has had a bigger effect than expected!  Gurry even outlines “three main principles that should guide us in the development of a successful policy response”:

  1. “[N]eutrality to technology and to the business models developed in response to technology.”
  2. “[C]omprehensiveness and coherence in the policy response.”
  3. “[M]ore simplicity in copyright.”

Gurry ends with this observation:

Future generations are clearly going to regard many of the works, rights and business agents that we talk about as cute artefacts of cultural history, much as the vinyl record has become in a very short space of time. The digital work is going to change dimensions. We see that happening with user generated content. We see it happening also with 3D printing or additive manufacturing, where the digital file is the manufacturing technology and factory. This is the realm of the blue sky and I hope that this Conference can start to develop the tools for exploring that sky.

Update: I reference this post in the comments section of a recent Copyhype post. Suffice it to say that there’s a lot of heated rhetoric on both sides; I think Gurry’s speech does a good job a forging some reasonable middle ground.