Tuesday , April 7 2020
Home / Tag Archives: Economics

Tag Archives: Economics

Measuring the Cost of Regulation: A Text-Based Approach

We derive a measure of firm-level regulatory costs from the text of corporate earnings calls. We then use this measure to study the effect of regulation on companies’ operating fundamentals and cost of capital. We find that higher regulatory cost results in slower sales growth, an effect which is mitigated for large firms. Furthermore, we find a one-standard deviation increase in our preferred measure of regulatory cost is associated with an increase in firms’ cost of capital of close to 3%...

Read More »

Morning brief: Oil Jawboning, Cellphone data for social distancing

A family member’s word-a-day calendar yesterday was “jawboning” and that was apparently what the President was doing related to oil markets and Russia and Saudi Arabia (New York Times link). I will not say that is not a surprise, nor that it is unwarranted. What remains to be seen is if it works. In the past some Presidents could get away with such an announcement and force the desired outcome, but that does not seem to be the world we live in right now. I am a bit skeptical of...

Read More »

The fiscal multiplier during World War II

WWII is viewed as the quintessential example of fiscal stimulus and exerts an outsized influence on fiscal multiplier estimates, but the wartime economy was highly unusual. I use newly-digitized contract data to construct a state-level panel on U.S. spending in WWII. I estimate a relative fiscal multiplier of 0.25, implying an aggregate multiplier of roughly 0.3. Conversion from civilian manufacturing to war production reduced the initial shock to economic activity because war production...

Read More »

Morning Brief: Radio today, Unemployment Claims

I will be on the radio this morning. I think unemployment will be a topic of conversation. US claims continued their rise from 3.3 million last week to 6.6 million this week. You can read articles in (Marketwatch link and the New York Times link). In North Dakota the Governor announced claims so far this year already exceeded last year’s total. The number from two weeks ago was 5,976 and the number released today (which is for the week ended March 28, 2020)is 12,591. Pretty large...

Read More »

Retail Pull Factors and Shutdown

Where social distancing and other factors will have a significant economic impact? The easy answer is: everywhere. That, however, is not very helpful for an answer. For any kind of policy discussion and response you need a better answer, or at least the start of one. It is also important when North Dakota has so many factors at play: flooding, oil price issues, and social distancing. So I looked at the retail pull factors in 2019 as a sign of regions most susceptible to decline....

Read More »

FDA Prevents Import of Masks

The KN95 mask is China’s version of the N95 mask. 3M, America’s largest manufacturer of N95 masks, said in January that the masks are equivalent. But the FDA is not allowing KN95s into the country. Buzzfeed: The KN95 mask is a Chinese alternative to the scarce N95 mask, but the FDA refuses to allow it into the country. …By law, masks, along with most medical devices, can’t be imported or sold in the United States without the Food and Drug Administration’s say-so. Last week,...

Read More »

Running ahead of Pandemics: Achieving In-Advance Antiviral Drugs

From Jaspreet Pannu (an EV winner, by the way, Jassi Pannu), here is a new, short Mercatus policy brief.  Excerpt: I propose adopting innovation prizes with awards large enough to justify investments in broad-spectrum antiviral drugs developed up to phase III clinical trials in the FDA drug approval process. I also emphasize the importance of starting this effort with pathogen families of known pandemic potential, such as respiratory viruses. …the medical community needs—and currently...

Read More »

Econometrica Submission Fees

Econometrica Submission Fees March 31, 2020 in academic satire, economics, Pricing strategies This morning, a missive from the Econometrics society arrived in my in box announcing “two modest fees associated with the submission and publication of papers in its three journals.” As of May 1st 2020, the Society will assess a submission fee of $50 and a page charge of $10 per page for accepted papers. With papers on the short side running to around 30 pages and 10 page appendices...

Read More »

A Solution if We Act

Many simulations have been run in recent weeks using standard epidemiological models and the emerging consensus, as I read it, is that test, trace and isolate can be very effective. Paul Romer’s simulations are here and he notes that a COVID-19 test does not have to be especially accurate for the test, trace and isolate strategy to work. Indeed, you don’t even need to trace, if you test enough people. Linnarsson and Taipale agree writing: We propose an additional intervention that...

Read More »

Oregon Closes Online Schools!!!

Well this has got to be the dumbest thing I have read all week: WW: The Oregon Department of Education has closed the state’s online charter schools under Gov. Kate Brown’s order to close public schools to halt the spread of COVID-19, according to a document obtained by WW. …Marc Siegel, a spokesman for the Oregon Department of Education, confirms that although Brown’s order did not explicitly call for the closure of online charters, state education officials...

Read More »