30 May 2008
Economic Incentives that Work:
How to stop 'flopping'
by Richard Belzer
in Regulatory Economics, Amusements
The Washington Post's Ivan Carter writes that the NBA has decided to fine players who 'flop'. Will it work? More...
29 May 2008
Information Quality and Peer Review:
Are disclaimers in draft documents effective?
by Richard Belzer
in Information Quality
Since 2002, federal information quality guidelines have required agencies to avoid disseminating scientific information that is not objective, and to have effective administrative systems for managing requests for the correction of information that a petitioner believes is incorrect. The burden of proof of error rests with the petitioner.
All information that is "disseminated" is covered by these rules, but information that is made public solely for the purpose of scientific peer review or public comment is exempt from the definition -- provided that it is accompanied with a specified disclaimer (p. 8):
The purpose of this disclaimer is to deter people from relying on draft documents. An empirical question is whether the prescribed language is strong enough.
An interesting test case has arisen with respect to the industrial chemical bisphenol A (BPA). More...
28 May 2008
Gas Tax Holidays, Part 4:
Pressure in favor mounts in Europe
by Richard Belzer
in Legislation, Regulatory Economics
Public discussion about a federal gas tax holiday has abated in the U.S., but according to the Washington Post it is heating up in Europe. More...
27 May 2008
More Evidence that Consumers Respond to Gas Prices
Increases observed in mass transit use
by Richard Belzer
in Regulatory Economics
During the short-lived debate about suspending the federal gas tax to ease prices, economists quoted in the news seemed to agree that consumer demand is highly inelastic -- that is, as price increases a lot, the quantity demanded changes very little.
The news increasingly contains stories suggesting that consumers respond more to changes in the price of gasoline than economists have assumed is the case. Example: rising use of mass transit. More...
24 May 2008
To Save Gas, Consumers Accept More Safety Risk and Emit More Air Pollution
Some costs of switching to motor scooters
by Richard Belzer
in Regulatory Economics
The Wall Street Journal reports that at the same time consumer demand for low-mileage SUVs and trucks has plummeted in response to high gasoline prices, consumer demand for high-mileage motor scooters has intensified. This tradeoff is entirely predictable. Scooters are ubiquitous commuter vehicles in European cites, where because of high taxes gasoline prices have for years been as high as they are now in the U.S.
Consumers are making two less obvious (but just as predictable) trades to get higher gas mileage: increased risk of injury and death from motor vehicle crashes and more air pollution. More...
8 May 2008
Gas Tax Holidays, Part 3:
Do economists' predictions make economic sense?
by Richard Belzer
in Regulatory Economics
It has been widely reported that over 200 recognized economists, spanning the political spectrum, have signed an open letter opposing the federal gas tax holiday proposed by Sens. John McCain (R-AZ) and Hillary Clinton (D-NY). Despite the ubiquitousness of reporting about the letter, we've been unable to locate an authoritative copy of it. Still, what we have have found raises questions about the economists' economic reasoning. More...
Gas Tax Holidays, Part 2:
The value of symbolic benefits
by Richard Belzer
in Regulatory Economics
Economists often complain that they are ignored when they make policy recommendations, or recommend against policies they believe are ineffective, inefficient, or counterproductive. A large number of economists have signed a joint letter objecting to the gas tax holiday proposed by Sens. John McCain (R-AZ) and Hillary Clinton (D-NY).
Clinton has responded saying "I'm not going to put my lot in with economists." This remark appears to have been widely interpreted as a dismissal of the economics profession with respect to its area of specific expertise. An alternative interpretation is that she believes economists have little or no expertise with respect to politics, and the value of a gas tax holiday is political, not economic.
Today, economist Bryan Caplan of George Mason University writes in support of a gas tax holiday because of these symbolic benefits. More...
2 May 2008
Gas Tax Holidays...
...and how they conflict with the candidates' energy policy proposals
by Richard Belzer
in Regulatory Economics
Recently, Sens. John McCain (R-AZ) and Hillary Clinton (D-NY) have proposed a "gas tax holiday" in which the federal government would suspend its collection of motor fuel taxes during the summer vacation travel season. Sen. Barack Obama (D-IL) has opposed it because it would provide minimal relief.
The proposed gas tax holiday is an odd idea to dominate an energy policy debate. All three candidates have promised to take action if elected that would dramatically and permanently increase gasoline prices. More...
