Monthly Archives: April 2010

From 10th December 2005:

Cheap foreign labour has recently made inroads into the economy of Family Harford. My wife pays a student, “Sally”, to look after the imperious Miss Harford for a few hours a week, so that my wife can get on with running her photography business. This is the simplest and most straightforward of transactions. My wife is happy, Sally is happy and even Miss Harford appears to approve of the arrangement.

How strange that if it were judged by the conventional wisdom applied to trade negotiations by newspapers, pub pundits and even our own trade negotiator, this arrangement would be regarded as economic suicide on both sides.

Continued at timharford.com.

Energy. Ambition. Confidence. Patience. Fearlessness. All these traits are associated with that mysterious quality of “entrepreneurialism”. Self-made men, such as Richard Branson and Alan Sugar, seem to exude different qualities from ordinary wage slaves.

But that is not the way things look to economists. It’s not that we are blind to the very idea that personality matters; it’s just that the evidence suggests a different story.

The remainder of the article can be read here. Please post comments below.

Would it be very wrong to go on holiday and miss voting in the forthcoming general election? We have an excellent constituency MP (Tory) who has a reasonably safe seat. I don’t agree with all his party’s policies, such as they are, but he has an excellent voting record and works very hard. I’d like to see him retain his seat – but not as much as I’d like to go on holiday.

Last election, the Liberal Democrats came second in my constituency and Labour came third, with a turnout of 70 per cent. If my vote were material in preventing a Labour government, I would be prepared to forego the holiday. Should I?

Unmarried UK Voter

The answer to this question can be read here. Please post comments below.

From 26th November 2005:

The Harford family would like to hear the patter of tiny feet in stereo, but we discovered the first time around that having a baby is not cheap. So, in between practising, we have been looking into the possibilities of getting someone else to make a financial contribution.

As our first baby was born in the US, we’ve had an opportunity to compare and contrast. In Britain, employers pay for six months of maternity leave and reclaim the money from the government. In the US, on the other hand, the mother pays. With no legal right to maternity pay, many women scrape together some paid time off using their holiday and sick-leave entitlement instead.

Continued at timharford.com.

Imagine a recession on Planet Vulcan. Thanks to weak demand, an able and hard-working Vulcan subordinate is simply not doing enough business to justify his salary.

The Vulcan boss calls his subordinate into the corner office for a frank and logical discussion of the options. They agree that it would be illogical to continue under the present arrangements, and that the Vulcan employee will accept a pay cut of 20 per cent for the time being. Both congratulate themselves on avoiding the bizarre human practice of sacking marginally profitable workers rather than adjusting their salaries.

The remainder of the article can be read here. Please post comments below.

As canvassing for the general election gathers speed, I’ve been thinking about the gambling possibilities. Without going into specifics, I’m considering placing bets on the rival team’s victory – as insurance in the event of having to live in a world not entirely to my liking.

Would this be psychologically effective, or am I wasting my money? What price should I place on my political ideals?
Justin, south-east London


The answer to this question can be read here. Please post comments below.

Those of you who listen to Radio 4 will understand why I’ve not been blogging much for the last few days. Wearing my other hat as presenter of Radio 4′s “More or Less”, I’ve been appearing on “Today” and “PM” to puncture some of the sillier statistics of the election campaign, and perhaps more importantly to put others into a context where they mean something.

The More or Less team are working flat out on this but we’re all having fun. You can take a look at the More or Less “ElectionWatch” site – which is neither 100 per cent reliable nor 100 per cent up to date, but is still pretty handy. Or please send your suggestions to moreorless@bbc.co.uk.

A few appearances that haven’t yet made it onto ElectionWatch include us popping Phil Woolas’s bubble on BBC2′s Daily Politics, explaining the new Liberal Democrat exchange rate of 2.5 cappuccinos to the bombshell, and this morning at 6.50am, pointing out that the UK Independence Party is still using a highly doubtful statistic nine months after More or Less told them they’d got it wrong.

From 19th November 2005:

My wife can buy cheaper car insurance than I can because she’s a woman and, fairly obviously, I am not. Is this sexual discrimination? Some people would claim that wrongful discrimination is treating somebody differently because they are a member of an identifiable group – a woman, for example, or a black person. That is a sensitive definition but not a useful one. I spent more time in my 20s pursuing girlfriends than boyfriends, and I must admit that this bias was everything to do with the fact that the girls were all members of an identifiable group.

In any case, it can be discriminatory to treat two people identically. Women are, on average, safer drivers and cheaper customers for insurance companies. If they were offered the same insurance rates as men, that would be discrimination.

Continued at timharford.com.

Not all taxes are created equal. They vary in obvious ways, such as who has to send money to the government. They vary in subtle ways, too – such as who actually pays the tax.

The remainder of the article can be read here. Please post comments below.

When I sneeze, people often say to me – I know not why – “bless you”. I do not reciprocate when others sneeze, for I refuse to subscribe to any form of superstition.
It follows that my well-wishers clearly are superstitious. Therefore, my exceptional politesse dictates that I ought to offer them a blessing whenever they expel extraneous sinal mucus.
But perhaps the whole of humankind believes that everyone else is superstitious and so this absurd tradition continues between people who ought to know better, each of them fearing that they will cause offence. It is an awful superstition-fearing spiral. How, dear economist, to break out of it?
Hugh Costello

The answer to this question can be read here. Please post comments below.

The Undercover Economist: a guide

Publishing schedule: Excerpts from "The Undercover Economist" and "Dear Economist", Tim's weekly columns for the FT Magazine, are published on this blog on Saturday mornings.
More about Tim: Tim also writes editorials for the FT, presents Radio 4's More or Less and is the author of "The Undercover Economist" and "The Logic of Life".
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