Summary: While labor's share of world GDP is over one half, capital's share is close to one third. When considering altruistic interventions to increase economic output, as in GiveWell Labs' exploration of U.S. policy, efforts to increase saving and investment should be considered alongside efforts to improve effective labor supply. Compulsory savings schemes and government savings schemes have been used in other developed countries to induce savings far above U.S. levels, and global adoption of such schemes could produce annual gains of many trillions of dollars, although the potential gains are substantially less than the potential gains of labor mobility. Regulatory changes to default pension/investment contributions might also capture important, albeit smaller, gains.
Thursday, June 05, 2014
Tuesday, May 27, 2014
Summary: While some estimates that open borders would double gross world product implicitly project the migration of most of the developed country labor force, a much smaller quantity of migration might cut global poverty rates by half or better. The additional income to the poorest required to bring them above extreme poverty lines is in the hundreds of billions of dollars per annum, while doubling world product would approach a hundred trillion dollars of additional annual output. Legal barriers to migration, and blocked desire to migrate, are most extreme for the poorest countries, suggesting extra migrants from those sources. While migrants may receive more income gains than are needed to escape absolute poverty remittances to family, trade, and investment may help to distribute the gains more widely. Overall, the case that migration liberalization for less skilled workers could eliminate most absolute poverty is significantly more robust than the most extreme estimates of global output gains.
Wednesday, May 14, 2014
Summary: Some notes on migration to the United Arab Emirates (UAE). As in some other Gulf oil states, e.g. Qatar, almost the entire UAE private sector workforce is composed of foreign guest workers. The ratio of foreign workers to natives is high enough that if achieved by all developed countries it could absorb the labor force of the developing countries. The distribution is dominated by less skilled workers and workers from poor countries, who enjoy much higher wages than at home, but much lower than in countries such as the United States. Emirati tolerance of extremely high immigration may be related to the almost complete insulation of Emirati nationals private labor markets, and the exclusion of migrants from citizenship and access to government revenues. In Dubai, the native population primarily subsists on taxes on the foreign-dominated private sector, enjoying an extremely prosperous standard of living. The UAE shows that truly massive guest worker programs can greatly benefit migrants and natives when politically feasible, and could eventually eliminate most global poverty if broadly imitated.
Wednesday, May 07, 2014
Summary: Several advocates of increased labor mobility have suggested taxes on migrants to compensate natives of destination countries for any inconveniences and to increase the reward of accepting more migrants, as a theoretical matter. In practice Singapore already accepts an exceptionally large number of unskilled and less skilled temporary workers, taxes them heavily, and uses the extensive net revenue to make a significant contribution to the public accounts. It appears that Singapore captures most of the economic surplus of migration, although migrants also benefit significantly. However, the system produces great local inequality and has a number of other problems that may outweigh fiscal benefits in its political appeal. While Singaporean migration policy seems much better than most developed countries', it is not first-best from a humanitarian point of view, and the model's value in promoting labor mobility elsewhere is uncertain, although intriguing.
Monday, May 05, 2014
Summary: Efforts to improve scientific integrity must grapple with both questionable research practices that fall within the current "rules of the game" and outright misconduct. Survey and audit data suggest disturbing lower bounds for misconduct, and suggest the possibility of rates high enough to meaningfully distort readings of the scientific literature. The problem could be worse for "null fields" studying nonexistent effects, and for studies that seemingly have top methodological standards. I discuss this analysis in the context of cold fusion and parapsychology, commonly thought to be null fields. These fields may be more at risk of fraud than others, but may also provide a warning about the potential for misconduct in more conventional domains.
Thursday, March 13, 2014
Summary: A rough breakdown of the 2013 Forbes billionaire list members classified to the technology and finance sectors, in terms of numbers, total wealth, and age. While finance-related billionaires outnumber tech billionaires substantially, the advantage is much less in terms of total wealth. Tech is better represented among American and especially among younger billionaires. Many disclaimers apply, and data on these extremes should not be given excessive weight in evaluating the expected financial returns of careers, which are primarily driven by much less extreme outcomes, and must be adjusted for human capital and population.
Tuesday, March 11, 2014
Summary: A juxtaposition of the work of economist Justin Wolfers and colleagues on the relationship between reported subjective well-being and income, and the Haushofer and Shapiro (2013) RCT estimates of well-being impacts for GiveDirectly.