Thursday, February 27, 2003

Critical thinking

I don’t do it enough, or well enough, or deep enough. Let me give you an example. Take my last post, where I first lay out the research question the guy tried to answer. I can see deeply enough into the problem to point out one potential issue, the fact that using actual data may not be a perfect test of revealed preference, because the retailer may have already reduced the choice set facing the consumer and therefore the data may not represent what people are truly willing to pay for recycled paper towel.

So, this might be fairly obvious to better minds, but it is a big insight for me. Yet, I still can’t get my mind around how the reduced choices, could actually bias the data. That is too say I believe it is probably true, I can say it, but I can’t articulate it in a clear concise argument. And I might never, unless I spend more time on it. People with better, more well honed critical thinking skills could do this, and do it quicker, and do it deeper. By deeper I mean they can see several issues down the road, that may be more interesting, or they see a bigger problem.

I think chess might be a good analogy. I can see one or two moves ahead. The people with better critical thinking skills can see more then that, maybe three, four or more moves ahead. And more importantly, they’ll also have perspective, the ability to step back from the problem, and understand the situation, so they don’t waste time looking at moves in the wrong areas, but rather they recognize the situation, and seem to search for moves in areas that will pay off. How is it that they always know which areas will payoff? Is this learned? Is it merely experience? How do you get it? I’m not sure what that is, but the people who have it routinely demonstrate it.

Take Paul Krugman as an example. He seems to offer clear insight into problems he discusses, and what’s nice is he takes you on the intellectual journey his mind went through to get to the point where he is. The problem is I’m always left amazed. I’ll think to myself, I understand that connection, another interesting connection, and then wammo. He hits you with the ultimate conclusion that you didn’t see coming. He tied his argument into an important insight, and one I’m sure I might never have come up with, but one he can clearly convey, and I can thoroughly understand. I understand part of this is his writing technique, but as they say writing is thinking.

So how do you teach this? How do you learn this? I think I’m finally a mature enough learner to be able to identify this, but how I improve it is a bit more daunting a task. Am I confined by nature? Or is this truly a skill like swinging a hammer that can be learned?

I do think that it can be learned to some degree. I do think that deep thinkers employee techniques that they’ve developed, and those techniques have been learned. I’m not sure these techniques are entirely transferable; I think they may be unique to the owner. So other then getting students to think deeply about problems I’m not sure I can teach them.

Keywords: Critical Thinking, Learning

Wednesday, February 26, 2003

Buy Recycled, Buy American

Just a quick note. A grad school buddy just told me about a job talk he sat in on. It concerned the extra amount people were willing to pay for recycled paper towels. He said survey results put the number in the narrow range of 6-30 % (I didn’t get the details on this). Interestingly the presenter also looked at actual data, from Peapod, and found as a matter of revealed preference that people were only willing to spend 5% extra for recycled paper towel. I mentioned that I’ve heard, from a Wal-Mart buyer, that they are only willing to pay a 10% premium for recycled or made in America goods. My buddy said there may be a problem with the revealed preference data, since the retailer may be making some of the decision for the customer. Interesting...and if Wal-Mart is willing to pay 10%, but people are only willing to pay 5% are they subsidizing it? Narrower margins? Are they really environmentally friendly patriots? Doubt it. No matter they are still scary stores to patronize at 2am.

Future topics

My first experience with losing a post. Let this be a lesson to me. Anyhow, here is a list of topics I’d like to write on sometime in the near future.

State Budgets
The catch-22 problem. The progressivity of taxes, means tying state revenues to those (rich people) with highly variable incomes. The variability in revenues, in states with balanced budget amendments, results in a painful boom bust cycle for spending. The problem is seeking out sources of revenue, less variable often means decreasing the progressivity.

There seem to be a lot of people who mistake relative price changes for deflation/inflation. I’d like to lay out the import distinctions between the two, so that I don’t have to read anymore articles on good deflation versus bad deflation. I imagine it is an issue Uncle Milt has recently commentated on, I’ll have to search it out.

Wow, the rhetoric on this topic is enormous and at times confusing. I guess that is to be expected when people (Glenn Hubbard) are forced in to taking positions counter to what they've written. To be fair he has walked the line carefully. Anyhow, I want to comment on the position of the Deficit hawks. While I largely agree, they ignore the impacts of the size of the government. They talk about the effects on investment, from larger deficits, but ignore the potential impacts of larger government. For example, if the government budget is balanced and 10% of GDP versus balanced and 40% of GDP, I venture to guess the consequences for investment (and more importantly productivity growth) is different in both. That previous statement is almost a tautology...

I’ve recently read Alfie Kohn’s book entitled Punished by Rewards, and I’d like to make a few comments on it.

That's all for now.

Tuesday, February 25, 2003

Western Wisconsin Labor Force Statistics

As part of my job (Assisstant Professor of Economics at UW - La Crosse), I follow the local economy in Western Wisconsin. The area is now referred to as the 7 Rivers Region. So as data becomes available that may be interesting to residents and business leaders in this area, I'll comment on it, or at least provide a link to it. When I get a chance I'll sneak a peak at some of the profiles....

The County Workforce Profiles for each of the eight counties in Western Wisconsin (Buffalo, Crawford, Jackson, Juneau, La Crosse, Monroe Trempealeau, & Vernon) are complete and for the fifth consecutive year, it is my pleasure to share with you the most recent update of these profiles. The regional labor market economists and analysts in the Department of Workforce Development developed the county profiles which offer a concise picture of labor market developments.

Each profile includes information on the aging of labor force, commuting patterns, industry employment changes, the leading employers, select occupational wages, personal income, and much more on the individual characteristics of a county's work force and population. In these latest profiles, new data from the 2000 Census has been included.

These 2002 County Profiles not available in print format, but are available for downloading and printing from the Internet.

If you have any questions, comments, or suggestions: please contact William Brockmiller, your local regional analyst, either by phone: 608-785-9337, or email:

Feel free to share this email with anybody interested in labor market data for these counties.

Keywords: 7 Rivers

Monday, February 24, 2003

Comparing GDP

Here is an interesting idea from the Osgood Files....

The Osgood File. This is Dave Ross. On the CBS Radio Network.

Are we going to have to fight North Korea again?

Why is North Korea determined to rub its nukes in our face?

Wacky Dictator Kim Jong-il probably figured that with the US distracted by a war in Iraq, this would be the ideal time.

But instead it comes at a time when a war against Iraq gets harder to justify with each uneventful weapons inspection - leaving Washington with a military all suited up and nothing to bomb.

And now we're starting to see stories like this:
"Dateline WASHINGTON - With 1.2 million troops, North Korea has more soldiers, per capita, than any other. Its military is the fourth or fifth largest in the world. etc etc etc."

This only inflating the importance of Kim Jong-il. Who needs inflating because he's 5 3', maybe 5-5 if you count the elevator shoes and that bizarre pompadour.

No - we should measure North Korea the way we measure everything. Money.

The Gross domestic product of North Korea is 22 billion dollars a year.

22 billion dollars a year is about the same as the gross domestic product of. MONTANA.

Take Iraq. Iraq has a gross domestic product of 59 billion.

Same as Nebraska.

Cuba's gross domestic product - the same as Wyoming.

You see? The wonderful thing about America is that we are SO rich, that no matter which rogue country you name, we have a state that beats it.

I don't even know why we want to fight them as a nation. We could just assign each member of the axis of evil to a state in their peer group.

And not just the axis of evil, how about the axis of stubbornness? Look at France - gross domestic product 1.5 trillion dollars. Instead of wasting the time of highly trained national diplomats trying to argue with them, we could assign France to states of similar importance. California and Arizona would do it. Make the French deal exclusively with Grey Davis.

The Osgood File. This is Dave Ross. On the CBS Radio Network.

Wisconsin is the 20th largest state at 177 billion, which would make it the 23rd largest country, behind Austria, but ahead of Poland. The Metropolitan Statistical Area (MSA) of La Crosse at 4.12 Billion dollars is ranked 245th out of 318 metro areas. In the list of countries that would put us 114th, just ahead of Bosnia and just behind Laos. And of course ahead of pretty much every African nation, because they have leaders like Robert Mugabe.

Keywords: ECO120, ECO301, ECO305, GDP

Sunday, February 02, 2003


Just testing blogger's post mailing system.