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Offsetting Behaviour

This New Zealand based economics blog was created by two economists, Eric Crampton and Seamus Hogan. They explore a range of fascinating topics from sports economics to housing and much more. Sharp and easy to follow analysis.

Media shakedown

Newsroom's co-editor wants the government to shake down Facebook for a hundred million dollars to give to newsmedia, under threat that the government would impose worse regulations on Facebook if it didn't pony up the dough.I'm not exaggerating.Here's what Mark Jennings wrote: The best thing the Government could do to help New Zealand media right now is to get the Prime Minister on a Zoom call with Facebook boss Mark Zuckerberg and ask him for $100 million. In return for saving the New...

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Public Health Priorities

New Zealand's public health system has pivoted admirably to focus on the current pandemic. But the neglect of communicable disease for rather a long time ahead of this has had costs.The public health system's focus on noncommunicable disease may make sense if you only look at the current burden of disease, prior to this year. But contagious and noncommunicable disease are very different things. If I decide to live an unhealthy lifestyle and have worse health as consequence, the costs of that...

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Climate and recovery

Eloise Gibson over in the Dom Post rounds up comment on climate priorities as we come through the Covid-19 mess.I suggested pushing harder and faster on getting the ETS into proper order; Eloise briefly covers my comments there. I'll expand on them here.So much in this space seems to get things backwards. Let's work it forwards first, then show the problems we get in thinking backwards.A properly working ETS will set a binding path to hitting NZ's commitments, but with one fudge that I'll...

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Removing rigidities

Coming out of the mess will be easier where labour markets are less rigid. People will need to be able to shift to the areas seeing increased demand - both geographically and by industry sector.  At least in the US, occupational licensing regulation makes that hard. If you're certified by one state's board, you may not be recognised by the next state over.Much of that licensing was never really necessary. But it's even less necessary where there are better feedback mechanisms providing...

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NZ’s excellent trade response to Covid-19

In the Stuff newspapers this week, I laud New Zealand's maintained commitment to free trade in critical goods.  Back in March, Canada, Australia, Chile, Brunei and Myanmar signed on with NZ and Singapore to a statement endorsing keeping supply chains open and removing restrictive measures on essential goods.Last week, Singapore and New Zealand fleshed out what that means for them, with a list of a pile of products that will be moving to tariff-free status. It's an open plurilateral...

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Morning roundup

The worthies on the culling of the browser tabs:The Adam Smith Institute reminds the UK government it needs a plan for exiting lockdown. The Atlantic, on how the WHO failed, but why defunding it may not be the best response. William Nordhaus on the need for a Climate Club: basically, the Club consists of countries willing to commit to carbon prices hitting no less than agreed targets, and carbon-equivalent tariffs on imports from outside of the Club. He suggests it may be too hard to run...

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Compare and contrast: Covid-19 funding edition

On 24 February, New Zealand's Health Research Council announced that up to $3m would be available for Covid-19 research. We're pleased to announce up to $3 million in funding will be made available for a range of research projects to address the current COVID-19 threat as well as future infectious diseases. @minhealthnz @SunnyCollings https://t.co/6wSNVyLmsD — HRC New Zealand (@HRCNewZealand) February 24, 2020 The Spinoff reported on Friday 17 April that they've awarded $3.8 million to...

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Benefit principles and cost-recovery

Tony Burton makes an interesting point over at The Spinoff.When we're thinking about paying for all of this mess, should we be running the benefit principle somewhere in the back of our minds?The benefit principle of taxation says that the burden of paying for something should, where possible, fall on the beneficiaries of it. These are the kind of extraordinary times when the government might consider extraordinary responses. Will they recognise the main beneficiaries of the lockdown are...

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Can track and trace scale?

New Zealand's new Parliamentary arrangement, with the Leader of the Opposition chairing a committee that holds the Executive to account while bringing in expert advice, has been superb. It's been great in actually getting answers. But I'm still none the wiser on how and whether New Zealand will be able to scale up contact tracing to the levels needed. Looking through the course requirements and learning outcomes for the public health papers at Otago, contact tracing seems a bit like...

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If a tree falls in the forest, can it be exported?

Forestry Minister Shane Jones has been arguing for export controls on logs. That seems a terrible idea, with risks beyond forestry. A snippet from my column in Newsroom this week (ungated): BusinessDesk last week reported that Jones is considering levies on log exports to fund some kind of “re-setting” of local industry, or a variety of regulations to ensure domestic lumber processors have their needs met before logs are exported.The story noted how local lumber processors are struggling...

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