Quotulatiousness

October 9, 2013

Reasons not to be fearful of “China’s economic threat”

Filed under: China, Economics, Government — Tags: , , , , — Nicholas @ 13:50

If you’ve been following the blog for a while, you’ll probably have picked up some of my disdain for the “OMG! China’s going to eat our (economic) lunch!” meme that is pretty much a copy-paste of the same worry over Japan in the 1980s. In Maclean’s, Colby Cosh explains why you shouldn’t put too much effort into worrying about the Chinese economic Colossus crushing us any time real soon:

What I always wonder when I encounter a China bull or a Chinaphobe — for they are two sides of the same coin — is this: Even if they think “socialism with Chinese characteristics” is economically superior to ordinary capitalism, where in China are the parallel cultural institutions to support prolonged capitalist-style growth? Maybe China doesn’t need reciprocal free trade to blow our doors off in the race to utopia. Maybe it doesn’t need untidy democratic quarrelling. One presumes it won’t need a high level of achievement in basic science, either, judging by the Nobels: It is well-documented that the Chinese civilian research establishment is awash in fraud and plagiarism, to say nothing of the destructive favouritism inherent to a one-party state.

Rowan Callick’s new book The Party Forever: Inside China’s Modern Communist Party makes a simple, compact judgment on the general state of Chinese higher education: Just look where the Party leadership sends its own children to university: the U.S. Another important leading indicator of cultural progress is press freedom, which, if history has anything to say on the matter at all, appears to be utterly integral to sustained prosperity. But Mainland China has no newspapers as we understand them; it is not even clear that the regimented, spoon-fed “reporters” there could assemble one, even if the Party would allow it.

The Diane Francises of the world would have us reject the relevance of the Soviet experience to China’s future, to the point of ignoring familiar Soviet themes that are increasingly apparent in China: the vast infrastructure projects standing unused in the middle of nowhere, the blind environmental despoliation, the dodgy economic statistics. Beyond mastery of trading, interior China has simply never possessed much of the cultural technique upon which the advanced stages of economic development would seem to depend. Hong Kong is the exception, but having taken it over, China shows little appetite so far for imitating its social openness and individuality — or for those of Taiwan or Japan or South Korea. It still requires a strange leap of faith to believe it possible for China to economically surpass these neighbours, and ourselves, without becoming a great deal more like us.

Regular visitors to the blog know that I’ve been rather skeptical about the official statistics reported by Chinese government and media sources.

Mismeasuring American poverty

Filed under: Bureaucracy, Economics, Government, USA — Tags: , , — Nicholas @ 08:47

It’s always headline-worthy to say that some absurdly high number of Americans are living in poverty — that the richest country in history still has desperately poor people in vast numbers. It’s shocking to see … and it’s mostly bogus:

We get told they do often enough I know, the latest example being this:

    About 15% of Americans live in poverty, so why is no one talking about it?

It isn’t true.

    In a nation where, according to the US Census Bureau’s poverty statistics released last month, 46.5 million people (roughly 15%) of the nation’s population lives in poverty,

Sorry, but their repeating it does not make it true.

The correct formulation is that 15% of Americans would be living in poverty if it were not for the things that are done to alleviate poverty.

There are two things that make this correction really rather important. The first being that everyone else measures poverty after all the things that are done to alleviate it. Thus any comparison across countries is going to leave the US looking very bad indeed: for others are talking about the residual poverty left after trying to do something about it and the US is talking about the poverty before alleviation. Very different things I hope you’ll agree.

There are reasons why this meme won’t go away (aside from it being a handy eye-catching headline to attract readers for newspapers and websites), including the fact that many civil servants are employed in federal, state, and local organizations to work on programs intended to alleviate poverty. If they are too successful, their caseload goes down and so will their budget and headcount. Any bureaucracy has a prime directive quite separate from their original reason for existing — organizations have primal motivations for surviving and growing. Their incentive is thus merely to ease the problem, not to solve it, or else they’re working to put themselves out of business.

October 7, 2013

Even the “revised” official Chinese economic stats are dodgy

Filed under: China, Economics — Tags: , , — Nicholas @ 09:23

In a survey of China’s military and economic status, Strategy Page mentions the perennial issue of unreliable official economic statistics for China:

Chinese officials are becoming more open about the problems they have getting accurate economic information for such things like annual GDP and unemployment rates. Apparently Chinese GDP has not been growing steadily at near ten percent a year for decades. Chinese officials do eventually (months or years later) get more accurate data and while Chinese GDP has actually been steadily growing over the last three decades the annual growth has actually varied from 5-15 percent. Chinese official policy was to keep everyone calm by issuing less variable annual growth rates. In short, the official numbers were doctored. For more accurate and immediate indicators of economic activity Chinese and foreign economists and business leaders use things like electricity production, railroad traffic and similar data that cannot be manipulated by local officials to make their city or province look more successful. Many financial exerts inside and outside China fear that all this official manipulation of economic data (an ancient practice in China) is masking some serious economic problems that could go sideways at any time and cause a banking crises that would paralyze the economy for a while and cause political chaos. It’s very much a crouching tiger and hidden dragon. This is an ancient phrase warning that behind seeming success and talent lurks the possibility of imminent disaster. Chinese are ever mindful of these bits of ancient wisdom.

October 5, 2013

Climate models, trust, and spin

Filed under: Environment, Media — Tags: , , — Nicholas @ 08:58

In Reason, Ronald Bailey asks whether we can trust the IPCC’s climate models:

On Monday, the U.N.’s Intergovernmental Panel on Climate Change (IPCC) released the final draft of Climate Change 2013: The Physical Sciences Basis. The report’s Summary for Policymakers flatly states: “Warming of the climate system is unequivocal, and since the 1950s, many of the observed changes are unprecedented over decades to millennia. The atmosphere and ocean have warmed, the amounts of snow and ice have diminished, sea level has risen, and the concentrations of greenhouse gases have increased.” Pretty much everyone concerned with this issue agrees that those are the facts. But what is causing the planet to warm up? Here is where it gets interesting.

[…]

The IPCC report acknowledges that almost all of the “historical simulations do not reproduce the observed recent warming hiatus.” Not to worry, it assures us; 15-year pauses just happen, and you can’t really expect the models to simulate these kind of random natural fluctuations in the climate. Once this little slow-down passes, “It is more likely than not that internal climate variability in the near-term will enhance and not counteract the surface warming expected to arise from the increasing anthropogenic forcing.” In other words, when the warm-up resumes it will soar.

John Christy, a climatologist at the University of Alabama in Huntsville, has come to a different conclusion. Christy compared the outputs of 73 climate models for the tropical troposphere used by the IPCC in its latest report with satellite and weather balloon temperature trends since 1979 until 2030. “The tropics is so important because that is where models show the clearest and most distinct signal of greenhouse warming — so that is where the comparison should be made (rather than say for temperatures in North Dakota),” Christy explains in an email. “Plus, the key cloud and water vapor feedback processes occur in the tropics.” When it comes to simulating the atmospheric temperature trends of the past 35 years, Christy found, all of the IPCC models are running hotter than the actual climate.

[…]

Average of model results compared with temperature trends

Average of model results compared with temperature trends

To defend himself against any accusations of cherry-picking his data, Christy notes that his “comparisons start in 1979, so these are 35-year time series comparisons” — rather longer than the 15-year periods whose importance the IPCC disputes.

Why the discrepancy between the IPCC and Christy results? As Georgia Tech climatologist Judith Curry notes, data don’t speak for themselves; researchers have to put them into a context. And your choice of context — say, the year you choose to begin with — can influence your conclusions considerably. While there may be nothing technically wrong with the way the IPCC chose to display the comparison between model data and observation data, “Curry observes, it will mislead the public to infer that climate models are better than we thought.” She adds, “What is wrong is the failure of the IPCC to note the failure of nearly all climate model simulations to reproduce a pause of 15+ years.”

September 25, 2013

Redefining “austerity” (again)

Filed under: Economics, Government, USA — Tags: , , — Nicholas @ 07:51

At Coyote Blog, an illuminating comparison of “austerity” measurements, responding to a piece in Mother Jones by Kevin Drum:

He uses this graph to “prove” that our fiscal response to this recession is weak vis a vis past recessions. The graph is a bit counter-intuitive — note that it begins at the end of each recession. His point is that Keynesian spending needs to continue long after (five years ?!) after the recession is over to guarantee a good recovery, and that we have not done that.

Government spending after recessions

[…]

I took roughly the same data and started each line two years earlier, so that my first year is two years ahead of his graph and the zero year in my graph is the same as the zero point in Drum’s chart. His data is better in the sense that he has quarterly data and I only have annual. Mine is better in that it looks at changes in spending as a percentage of GDP, which I would guess would be the more relevant Keynesian metric (it also helps us correct for the chicken and egg problem of increased government spending being due to, rather than causing, economic expansion).

Here are the results (I tried to use roughly the same colors for the same data series, but who in the world with the choice of the entire color pallet uses two almost identical blues?)

Government spending before and after recessions

That second image tells a radically different story to the first one, doesn’t it? Hard to make that fit into the traditional definition of the word “austerity” though…

September 22, 2013

Statistical fail for political axe-grinding

Filed under: Environment, Media, Politics, USA — Tags: , , — Nicholas @ 11:29

Coyote Blog views with alarm a recent article in Rolling Stone which abuses statistics to make a point that apparently isn’t true:

What I want to delve into is the claim by the author that wildfires are increasing due to global warming, and only evil Republicans (who suck) could possibly deny this obvious trend […]

These are the 8 statements I can find to support an upward trend in fires. And you will note, I hope, that none of them include the most obvious data — what has the actual trend been in number of US wildfires and acres burned. Each of these is either a statement of opinion or a data point related to fire severity in a particular year, but none actually address the point at hand: are we getting more and larger fires?

Maybe the data does not exist. But in fact it does, and I will say there is absolutely no way, no way, the author has not seen the data. The reason it is not in this article is because it does not fit the “reporters” point of view so it is left out. Here is where the US government tracks fires by year, at the National Interagency Fire Center. To save you clicking through, here is the data as of this moment:

Wildfire averages 2004-2013

Well what do you know? The number of fires and the acres burned in 2013 are not some sort of record high — in fact they actually are the, respectively, lowest and second lowest numbers of the last 10 years. In fact, both the number of fires and the total acres burned are running a third below average.

The one thing this does not address is the size of fires. The author implies that there are more fires burning more acres, which we see is clearly wrong, but perhaps the fires are getting larger? Well, 2012 was indeed an outlier year in that fires were larger than average, but 2013 has returned to the trend which has actually been flat to down, again exactly opposite of the author’s contention (data below is just math from chart above)

Wildfires average acres per fire 2004-2013

In the rest of the post, I will briefly walk through his 8 statements highlighted above and show why they exhibit many of the classic fallacies in trying to assert a trend where none exists. In the postscript, I will address one other inconsistency from the article as to the cause of these fires which is a pretty hilarious of how to turn any data to supporting your hypothesis, even if it is unrelated.

September 16, 2013

Speed Kills … Your Pocketbook

Filed under: Cancon, Law — Tags: , , , , , , — Nicholas @ 11:06

Does speed really kill? Sometimes, yes, but when the speed limits are set artificially low, and enforcement is targeted to those areas where the limit is far below traffic speed, then all the speed kills campaign does is keep drivers complacent about paying fines that don’t improve safety.

In this video, I investigate the culture and science surrounding speed enforcement in BC, coupled with my trademark Simpsons, Supertroopers, and Family Guy references.

September 12, 2013

This is rather sinister

Filed under: Health, Science — Tags: , , , — Nicholas @ 10:46

At Marginal Revolution, Alex Tabarrok talks about a statistical study which concluded that being left-handed had serious impact on your lifespan:

In 1991 Halpern and Coren published a famous study in the New England Journal of Medicine which appears to show that left handed people die at much younger ages than right-handed people. Halpern and Coren had obtained records on 987 deaths in Southern California — we can stipulate that this was a random sample of deaths in that time period — and had then asked family members whether the deceased was right or left-handed. What they found was stunning, left handers in their sample had died at an average age of 66 compared to 75 for right handers. If true, left handedness would be on the same order of deadliness as a lifetime of smoking. Halpern and Coren argued that this was due mostly to unnatural deaths such as industrial and driving accidents caused by left-handers living in a right-handed world. The study was widely reported at the time and continues to be regularly cited in popular accounts of left handedness (e.g. Buzzfeed, Cracked).

What is less well known is that the conclusions of the Halpern-Coren study are almost certainly wrong, left-handedness is not a major cause of death. Rather than dramatically lower life expectancy, a more plausible explanation of the HC findings is a subtle and interesting statistical artifact. The problem was pointed out as early as the letters to the editor in the next issue of the NEJM (see Strang letter) and was also recently pointed out in an article by Hannah Barnes in the BBC News (kudos to the BBC!) but is much less well known.

The statistical issue is that at a given moment in time a random sample of deaths is not necessarily a random sample of people. I will explain.

September 4, 2013

“Despite a rash of deadly train crashes…”

Filed under: Media, Railways — Tags: , , , , — Nicholas @ 09:15

Coyote Blog indulges in a good old-time fisking of an article built on the claim that there has been a “trend” of increasingly deadly railway accidents:

The best way to explain the phenomenon is with an example, and the Arizona Republic presented me with a great one today, in the form of an article by Joan Lowy of the Associated Press. This in an article that reads more like an editorial than a news story. It is about the Federal requirement for railroads to put safety electronics called Positive Train Control (PTC) on trains by a certain date. The author has a pretty clear narrative that this is an absolutely critical piece of equipment for the public good, and that railroads are using scheming and lobbying to unfairly delay and dilute this critical mandate (seriously, I am not exaggerating the tone, you can read it for yourself.)

My point, however, is not to challenge the basic premise of the article, but to address this statement in her opening paragraph (emphasis added).

    Despite a rash of deadly train crashes, the railroad industry’s allies in Congress are trying to push back the deadline for installing technology to prevent the most catastrophic types of collisions until at least 2020, half a century after accident investigators first called for such safety measures.

The reporter is claiming a “rash of deadly train crashes” — in other words, she is saying, or at least implying, that there is an upward trend in deadly train crashes. So let’s ask ourselves if this claimed trend actually exists. She says it so baldly, right there in the first seven words, that surely it must be true, right?

[…]

So let’s go to the data. It is actually very easy to find, and I would be surprised if Ms. Lowy did not actually have this data in her hands. It is at the Federal Railway Administration Office of Safety Analysis. 2013 data is only current through June and seems to be set up on an October -September fiscal year. So I ran the data only for October-June of every year to make sure the results were comparable to 2013. Each year in the data below is actually 9 months of data.

By the way, when one is looking at railroad fatalities, one needs to understand that railroads do kill a lot of people every year, but the vast, vast majority of these — 99% or more — are killed at grade crossings. People still do not understand that a freight train takes miles to stop. (see postscript below, but as an aside, I would be willing to make a bet: Since deaths at grade crossings outnumber deaths from collisions by about 100:1, I would be willing to bet any amount of money that I could take the capital the author wants railroads to invest in PTC and save far more lives by investing it in grade crossing protection. People like Ms. Lowy who advocate for these regulations never, ever seem to consider prioritization and tradeoffs.)

Anyway, looking at the data, here is the data for people killed each year in US railroad accidents (as usual click to enlarge any of the charts):

Train accident deaths Oct-Jun

So, rather than a “rash”, we have just the opposite — the lowest number of deaths in a decade. One. I will admit that technically she said rash of “fatal accidents” and this is data on fatalities, but I’m going to make a reasonable assumption that one death means one fatal accident — which certainly cannot be higher than the number of fatal accidents in previous years and is likely lower.

Most of you will agree that this makes the author’s opening statement a joke. Believe it or not — and this happens a surprising number of times — this journalist is claiming a trend that not only does not exist, but is of the opposite sign.

September 2, 2013

Macroeconomics and math

Filed under: Economics — Tags: , , , — Nicholas @ 09:06

Noah Smith on the uneasy foundations of modern macroeconomics:

In macro, most of the equations that went into the model seemed to just be assumed. In physics, each equation could be — and presumably had been — tested and verified as holding more-or-less true in the real world. In macro, no one knew if real-world budget constraints really were the things we wrote down. Or the production function. No one knew if this “utility” we assumed people maximized corresponded to what people really maximize in real life. We just assumed a bunch of equations and wrote them down. Then we threw them all together, got some kind of answer or result, and compared the result to some subset of real-world stuff that we had decided we were going to “explain”. Often, that comparison was desultory or token, as in the case of “moment matching”.

In other words, the math was no longer real. It was all made up. You could no longer trust the textbook. When the textbook told you that “Households maximize the expected value of their discounted lifetime utility of consumption”, that was not a Newton’s Law that had been proven approximately true with centuries of physics experiments. It was not even a game theory solution concept that had been proven approximately sometimes true with decades of economics experiments. Instead, it was just some random thing that someone made up and wrote down because A) it was tractable to work with, and B) it sounded plausible enough so that most other economists who looked at it tended not to make too much of a fuss.

We were told not to worry about this. We were told that although macro needed microfoundations — absolutely required them — it was not necessary for the reality of any of these microfoundations to be independently confirmed by evidence. All that was necessary is that the model “worked” after all the microfoundations were thrown together. We were told this not because of any individual failing on the part of any of our teachers, but because this belief is part of the dominant scientific culture of the macro field. It’s the paradigm.

Slate on the gender wage gap

Filed under: Business, Economics — Tags: , , , — Nicholas @ 08:56

Hanna Rosin debunks the meme that “women only get paid 77 cents for every dollar earned by men doing the same job”:

The official Bureau of Labor Department statistics show that the median earnings of full-time female workers is 77 percent of the median earnings of full-time male workers. But that is very different than “77 cents on the dollar for doing the same work as men.” The latter gives the impression that a man and a woman standing next to each other doing the same job for the same number of hours get paid different salaries. That’s not at all the case. “Full time” officially means 35 hours, but men work more hours than women. That’s the first problem: We could be comparing men working 40 hours to women working 35.

How to get a more accurate measure? First, instead of comparing annual wages, start by comparing average weekly wages. This is considered a slightly more accurate measure because it eliminates variables like time off during the year or annual bonuses (and yes, men get higher bonuses, but let’s shelve that for a moment in our quest for a pure wage gap number). By this measure, women earn 81 percent of what men earn, although it varies widely by race. African-American women, for example, earn 94 percent of what African-American men earn in a typical week. Then, when you restrict the comparison to men and women working 40 hours a week, the gap narrows to 87 percent.

[…]

Goldin and Lawrence Katz have done about as close to an apples-to-apples comparison of men’s and women’s wages as exists. (They talk about it here in a Freakonomics discussion.) They tracked male and female MBAs graduating from the University of Chicago from 1990 to 2006. First they controlled for previous job experience, GPA, chosen profession, business-school course and job title. Right out of school, they found only a tiny differential in salary between men and women, which might be because of a little bit of lingering discrimination or because women are worse at negotiating starting salaries. But 10 to 15 years later, the gap widens to 40 percent, almost all of which is due to career interruptions and fewer hours. The gap is even wider for women business school graduates who marry very high earners. (Note: Never marry a rich man).

I’ve posted similar articles on this topic before: August, 2012, June 2012, and July 2010.

September 1, 2013

America’s hidden (true) crime rate

Filed under: Government, Law, USA — Tags: , , — Nicholas @ 09:02

In a post from last year at n+1, Christopher Glazek explains why the official crime rate is failing to show the true level of violent crime in the United States:

According to government statistics, Americans are safer today than at any time in the last forty years. In 1990, there were 2,245 homicides in New York City. In 2010, there were 536, only 123 of which involved people who didn’t already know each other. The fear, once common, that walking around city parks late at night could get you mugged or murdered has been relegated to grandmothers; random murders, with few exceptions, simply don’t happen anymore.

When it comes to rape, the numbers look even better: from 1980 to 2005, the estimated number of sexual assaults in the US fell by 85 percent. Scholars attribute this stunning collapse to various factors, including advances in gender equality, the abortion of unwanted children, and the spread of internet pornography.

[…]

Statistics are notoriously slippery, but the figures that suggest that violence has been disappearing in the United States contain a blind spot so large that to cite them uncritically, as the major papers do, is to collude in an epic con. Uncounted in the official tallies are the hundreds of thousands of crimes that take place in the country’s prison system, a vast and growing residential network whose forsaken tenants increasingly bear the brunt of America’s propensity for anger and violence.

Crime has not fallen in the United States — it’s been shifted. Just as Wall Street connived with regulators to transfer financial risk from spendthrift banks to careless home buyers, so have federal, state, and local legislatures succeeded in rerouting criminal risk away from urban centers and concentrating it in a proliferating web of hyperhells. The statistics touting the country’s crime-reduction miracle, when juxtaposed with those documenting the quantity of rape and assault that takes place each year within the correctional system, are exposed as not merely a lie, or even a damn lie — but as the single most shameful lie in American life.

From 1980 to 2007, the number of prisoners held in the United States quadrupled to 2.3 million, with an additional 5 million on probation or parole. What Ayn Rand once called the “freest, noblest country in the history of the world” is now the most incarcerated, and the second-most incarcerated country in history, just barely edged out by Stalin’s Soviet Union. We’re used to hearing about the widening chasm between the haves and have-nots; we’re less accustomed to contemplating a more fundamental gap: the abyss that separates the fortunate majority, who control their own bodies, from the luckless minority, whose bodies are controlled, and defiled, by the state.

An amazing bit of information from the article is that the US government didn’t even bother collecting statistics about prison violence until 2011. They used the formal complaint rate as a proxy for the actual rate of crime committed behind bars. That was around 800 per year. When they actually started taking note, the more realistic number was produced:

In January, prodded in part by outrage over a series of articles in the New York Review of Books, the Justice Department finally released an estimate of the prevalence of sexual abuse in penitentiaries. The reliance on filed complaints appeared to understate the problem. For 2008, for example, the government had previously tallied 935 confirmed instances of sexual abuse. After asking around, and performing some calculations, the Justice Department came up with a new number: 216,000. That’s 216,000 victims, not instances. These victims are often assaulted multiple times over the course of the year. The Justice Department now seems to be saying that prison rape accounted for the majority of all rapes committed in the US in 2008, likely making the United States the first country in the history of the world to count more rapes for men than for women.

To some — especially on the right — prison rape is considered part of the expected punishment for crimes. Comedians have used the notion for jokes for decades. Perhaps now it’s time to consider that this is actually a state crime against humanity?

H/T to Marginal Revolution for the link.

August 14, 2013

Ignore the inconsistencies in official Chinese statistics at your peril

Filed under: China, Economics — Tags: , , — Nicholas @ 08:40

It’s been a while since I reminded everyone that the official Chinese government statistics can’t be trusted. Here’s Zero Hedge on the same topic:

How Badly Flawed Is Chinese Economic Data? The Opening Bid is $1 Trillion

Baseline Chinese economic data is unreliable. Taking published National Bureau of Statistics China data on the components of consumer price inflation, I attempt to reconcile the official data to third party data. Three problems are apparent in official NBSC data on inflation.

    First, the base data on housing price inflation is manipulated. According to the NBSC, urban private housing occupants enjoyed a total price increase of only 6% between 2000 and 2011.

    Second, while renters faced cumulative price increases in excess of 50% during the same period, the NBSC classifies most Chinese households has private housing occupants making them subject to the significantly lower inflation rate.

    Third, despite beginning in the year 2000 with nearly two-thirds of Chinese households in rural areas, the NSBC applies a straight 80/20 urban/rural private housing weighting throughout our time sample. This further skews the accuracy of the final data.

To correct for these manipulative practices, I use third party and related NBSC data to better estimate the change in consumer prices in China between 2000 and 2011.

I find that using conservative assumptions about price increases the annual CPI in China by approximately 1%.

This reduces real Chinese GDP by 8-12% or more than $1 trillion in PPP terms.

Regular visitors to the blog know that I’ve been rather skeptical about the official statistics reported by Chinese government and media sources.

August 8, 2013

Canadian think-tanks

Filed under: Cancon, Economics, Media, Politics — Tags: , , , — Nicholas @ 00:01

An interesting article in Forbes charts the rise of Canada’s distinctive collection of think-tanks:

Think Tanks in Canada have been developing policy analyses and advocating market oriented solutions for decades. Some of the oldest think tanks and advocacy groups, such as the C.D. Howe Institute, founded in 1958, and the National Citizens Coalition, NCC, founded in 1974, are still active. The idea for NCC developed from the success of newspaper advertorials.

The first one published by Colin M. Brown in 1967 pointed out that despite not being engaged in the Vietnam War, Canada’s federal government spending in the early 1960’s rose at a faster rate than government spending in the U.S. Canadian civil society took notice and reacted. The Fraser Institute was founded in Vancouver, B.C. in 1974, and its success and generosity in sharing its expertise led to a gradual but almost steady investment in think tanks across the country. Lest we forget, Canada is a big place. It is the second largest country in the world. The longest distance from east to west is 5,514 km — similar to the distance from New York City to London, or from New York City to Lima, Peru. Canada has six separate time zones and its provinces have considerable cultural and political diversity which call for a multiplicity of regional think tanks and policy efforts.

The “2012 Global Go To Report” devotes a section of its think tank rankings to institutes in Canada and Mexico. A growing number of Canadian free-market think tanks are appearing among the top.

Fraser Institute takes the lead. It received more mentions (10) than any other Canadian think tank and ranked first in Canada and 25th in the world. It is well known for its motto: “If It Matters, Measure It.” Many of its products, like the “Tax Freedom Day” and its economic freedom indices, have been replicated across the globe. Think tanks all over the world look at Fraser’s research as a guide in developing their own programs.

Brian Lee Crowley, the co-author of The Canadian Century, founded the Ottawa-based Macdonald Laurier Institute in 2010. It ranked third in the world in the category of best young institute. As it hit the ground running with great policy products, it also managed to rank ahead of other older think tanks, including the Atlantic Institute for Market Studies (AIMS) in Nova Scotia, founded in 1994. Crowley was also the founding president of AIMS. AIMS itself an organization that produces interesting work on market reforms in Canada’s maritime provinces — a part of the country that typically prefers big government as opposed to market-oriented solutions.

The Montreal Economic Institute deserves special mention for working in one of the most challenging cultural environments. It publishes in French and English, and is the only think tank in Canada to focus its efforts entirely on Quebec. The institute was founded in 1985 but became consolidated when Michel Kelly-Gagnon, a talented intellectual entrepreneur, became its leader in 1999 and restructured the organization. Kelly-Gagnon’s expertise is in high demand also outside Canada, and his team has produced tremendous materials advocating specifically for reforms to government-controlled health care.

July 27, 2013

Jiangsu might as well be the Chinese name for Detroit

Filed under: China, Economics — Tags: , , , , — Nicholas @ 11:02

The South China Morning Post on the economic troubles of the provincial, municipal and local authorities in Jiangsu:

The nightmare scenario for China’s leaders as they try to wean the country off a diet of easy credit and breakneck expansion is a local government buckling under the weight of its own debt. Few provinces fit that bill quite like Jiangsu, home to China’s most indebted local government.

Hefty borrowings through banks, investment trusts and the bond market by Jiangsu’s provincial, city and county governments have saddled the province north of Shanghai with debt far higher than its peers, public records show.

Many of the province’s mainstay industries, including shipbuilding and the manufacturer of solar panels, are drowning in overcapacity. Profits are dwindling, and the government’s tax growth is braking hard.

[…]

Little public information is available on the total debt of Chinese local governments. Indeed, earlier this month China’s Vice-Finance Minister Zhu Guangyao said Beijing did not know the precise level of their debts either.

But from what ratings agencies and think-tanks can piece together, Jiangsu may be the standout debt risk among China’s 31 provinces.

Looking at bank loan books, they can see that China’s eastern provinces including Jiangsu have the highest concentration of government debt. Jiangsu then looms large because of its reliance on costlier and alternative forms of financing, which they said suggested that cheaper bank loans and land sales are not giving the authorities the funding they need.

The risk that Jiangsu might pose to the Chinese economy in a crisis is clear. On its own, the province would be a top 20 global economy with GDP greater than G20 member Turkey. Its 79 million population tops that of most European countries.

« Newer Posts — Older Posts »

Powered by WordPress