Re-thinking the U-Curve of Inequality with Vincent Geloso

What follows is an edited transcript of my conversation with Vincent Geloso.


Petersen: My guest today is Vincent Geloso of the Free Market Institute at Texas Tech University. Vincent, welcome to Economics Detective Radio.

Geloso: It’s a pleasure to be here.

Petersen: So the paper we’ll be discussing today is titled “A U-curve of Inequality? Measuring Inequality in the Interwar Period” which Vincent has co-authored with John Moore and Phillips Schlosser. The paper casts doubt on the claim from, most notably, Thomas Piketty and others that inequality fell from the 1920s to the 1960s and rose thereafter. So, Vincent let’s start by discussing the inequality literature prior to this paper. What is this U-curve and where did it come from?

Geloso: The U-curve is probably the most important stylized fact we have now in the debate over inequality and the idea is that, if you look at the twentieth century, there’s a high point of inequality in the 1910s, 1920s and then from the 1930s onwards up to 1970s, it falls dramatically to very low levels and re-increases thereafter, returning to 1920s-like levels of inequality. So the U-curve is the story of inequality in the twentieth century. It’s mostly a U.S. story because for other countries it looks less like the U-curve than an inverted J. So it’s higher in the 1920s, it still falls like in the U.S. but really increases much more modestly than the United States in places like Sweden, or France, or Canada. But the general story is that there was a high level of inequality at the beginning of the century well up to the mid-second-half of the twentieth century and it re-increased in the latter years and then we have been on a surge since then. Continue reading Re-thinking the U-Curve of Inequality with Vincent Geloso

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

Identity is the Mind-Killer

There’s a joke among anarchists: “What’s the difference between a minarchist and an anarchist? Six months!”

For context, a minarchist is someone who believes in a minimal state. The joke is commenting on the large number of people who discover libertarian philosophy and end up gradually becoming more extreme in their views until they conclude that the state should not exist.

This is part if a broader pattern that affects other ideologies as well. Have you noticed that self-professed socialists tend to be left-wing activists? And that left-wing activists are much more likely to identify as socialists than, say, politically inactive non-voters?

In fact, the connection between extreme views and political engagement is so strong, we often don’t bother to distinguish between the two. The word “extremist” is used interchangeably to describe people with extreme viewpoints and people who take extreme action for their views. But there’s no reason why someone with moderate political views can’t be marching in the streets, circulating petitions, joining activist circles, burning down buildings, and the like, all in the name of moderation. There’s also no reason someone can’t have extreme views while not engaging much with political or social activism. And yet, extreme views tend to go hand in hand with activism. To borrow Jason Brennan’s terms, you have the Hobbits, who have low political engagement and moderate views, and the Hooligans, who have high political engagement and relatively extreme views.

Why is this so? And how come the difference between a minarchist and an anarchist is six months? Continue reading Identity is the Mind-Killer

How Land Use Restrictions Make Housing Unaffordable with Emily Hamilton

What follows is an edited transcript of my conversation with Emily Hamilton about land use regulations’ effects on affordable housing.


Petersen: My guest today is Emily Hamilton. She is a researcher at the Mercatus Center at George Mason University. Emily, thanks for being on Economics Detective Radio.

Hamilton: Thanks a lot for having me.

Petersen: So, Emily recently wrote a paper titled “How Land Use Regulation Undermines Affordable Housing” along with her co-author Sanford Ikeda. The paper is a review of many studies looking at land use restrictions and it identifies four of the most common types of land use restrictions. Those are: minimum lots sizes, minimum parking requirements, inclusionary zoning, and urban growth boundaries. So Emily, could you tell us what each of those restrictions entail?

Hamilton: Sure. So, starting off with the first, minimum lots sizes. This is probably what people most commonly associate with zoning. It’s the type of Euclidian zoning that separates residential areas from businesses and then within residential areas limits the number of units that can be on any certain size of land. And this is the most common tool that makes up what is sometimes referred to as Snob Zoning, where residents lobby for larger minimum lots sizes and larger house sizes to ensure that their neighbors are people who can afford only that minimum size of housing. Continue reading How Land Use Restrictions Make Housing Unaffordable with Emily Hamilton

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

Writing and Thinking Less Badly with Mike Munger

In this episode, I discuss the process of writing and being successful with Mike Munger. What follows is an edited transcript of our conversation.


Petersen: My guest today is Mike Munger of Duke University. Mike, welcome to Economics Detective Radio!

Munger: It’s a pleasure to be on your show!

Petersen: So first I stole EconTalk’s format and now I have stolen Mike Munger as well, so if Russ Roberts sends me a cease and desist letter, I’ll completely understand why.

Munger: Russ and I have an open relationship. We both date other people.

Petersen: Oh good, good. I have many jokes I could make about that, but I won’t!

Munger: Thank you for not.

Petersen: So, our topic today is going to be writing and thinking. Let’s say that because, as we’ll go through, the two are intimately related. So Mike wrote a piece titled “Ten Tips on How to Write Less Badly.” Now you may be thinking to yourself, “Hey I thought this was an economics podcast! What does writing have to do with economics?” Continue reading Writing and Thinking Less Badly with Mike Munger

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

A Podcasting Revolution: Cast, Ringr, and Zencastr

Just three months ago, I wrote my podcasting gear guide to let potential podcasters know about my setup and the equipment I recommend. That guide represents the gold standard in podcasting that existed when I was starting out in 2014.

To recap, I recommended using a digital audio recorder like the Zoom H4n or the TASCAM DR-40 to record yourself and your guest onto two separate tracks, with the guest connecting through Skype and being plugged into the second track via a 1/4″ to 1/8″ adapter cable.

Here are the things a podcaster must have in a recording setup:

  1. Reliability. Your recording should not sporadically stop working 40 minutes in to your interview with a Nobel laureate.
  2. Multi-track recording. Each speaker must be recorded onto his own separate track to make it possible to edit them each separately.
  3. Clear audio, free of unnecessary noise.

Continue reading A Podcasting Revolution: Cast, Ringr, and Zencastr

New York Urbanism with Stephen Smith

Today’s guest is Stephen Smith, he is an analyst for a New York real estate firm.

Stephen did some research showing that at least 40 percent of the buildings in Manhattan could not be built under today’s zoning regulations. In fact, the number is probably significantly higher. Classic landmarks like the Empire State Building, with its floor-area ratio of 30, wouldn’t fly today. Continue reading New York Urbanism with Stephen Smith

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

Economics Detective Radio Named One of the Top 25 Economics Podcasts of 2016

Economics PodcastsThe Intelligent Economist has named Economics Detective Radio one of the top 25 economics podcasts of 2016!

I look forward to making the show even better in 2017, so stay tuned!

If you haven’t subscribed to the show, be sure to do so. You can do it through the built-in Podcasts app on your iOS device, or through any podcasting app on Android (Player FM is free and good).

Democracy Versus Epistocracy with Jason Brennan

My guest today is Jason Brennan of the McDonough School of Business at Georgetown University. He is the author of Against Democracy, which is our topic for this episode. The first chapter is available on the publisher’s website.

John Stuart Mill believed that getting more people involved in politics would make them smarter, more concerned for the common good, better educated, and nobler. In the intervening century and a half, we’ve gathered much more data on Mill’s hypothesis, and the results don’t look good:

The test results are now in. They are, I will hold, largely negative. I think Mill would agree. Most common forms of political engagement not only fail to educate or ennoble us but also tend to stultify and corrupt us. (p. 2)

Continue reading Democracy Versus Epistocracy with Jason Brennan

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

Urban Development, the Growth Ponzi Scheme, and Strong Towns with Chuck Marohn

Today’s guest on Economics Detective Radio is Chuck Marohn, founder and president of Strong Towns.

Strong Towns is a non-profit that seeks to reform America from the ground up, starting with its towns and cities. It aims to promote healthy local economies by improving local governance.

The Growth Ponzi Scheme

Chuck began recognizing the problems in America’s towns and cities when he was working as a civil engineer. He recounts a story of working in a little city in central Minnesota in the late 1990s. The city had a 300-foot pipe that had cracked, allowing ground water to leak in and overflow their treatment facility. Chuck proposed a $300,000 solution to fix the pipe. However, this was a tiny town with an annual budget of $85,000. So Chuck went to higher levels of government (the federal government, the USDA, etc.) to find someone to fund the project. They all said, “This feels like maintenance. We don’t have money for maintenance, so you need to pay for this yourself.” Since the feds would only fund expansion projects, Chuck devised a plan: He would propose the largest expansion project he could, then repair the pipe as part of the expansion. This wasn’t so much deviousness on his part as it was standard practice in his profession. He designed a couple miles of new pipe, doubled their treatment facility, and as part of that he included repairs for the old pipe. This new project cost $2.6 million. Continue reading Urban Development, the Growth Ponzi Scheme, and Strong Towns with Chuck Marohn

Subscribe to Economics Detective Radio on iTunes, Android, or Stitcher.

Will Socialism be able to save Venezuela as Bernie Sanders felt it could save America?

I answered this question on Quora. My answer was “No.” But it was a very detailed no. Here’s an excerpt:

Chavez was a true, dyed-in-the-wool socialist. He passed many reforms that would have crippled another nation. For instance, he made it illegal for private employers to fire anyone. Hiring an employee in Venezuela means paying that person a living wage until he quits or retires, regardless of whether he does any work or not. Imagine trying to run a business under that constraint! Chavez expanded state control of the economy in the name of socialism, but the country didn’t fall into chaos. As late as 2013, David Sirota was declaring it an “economic miracle.” This might seem like a win for socialist economics, but the truth is more dull than that.

Continue reading Will Socialism be able to save Venezuela as Bernie Sanders felt it could save America?

Garrett M. Petersen's blog about markets, institutions, and ideas.