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Archive for May, 2008

As I come increasingly nearer my return to the United States, any opportunity to enjoy a tasty libation is accompanied by a concern:

How—oh how—will I be able to gauge accurately my consumption and the honesty of the server without the measure of volume marked conveniently on the side of the glass?

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After what has been perhaps the busiest day of my internship, I am calling it quits for the week and heading to Berlin for the final conference of my program. The break will be welcome, as not only today but also most of the past two weeks have wholly consumed many in my office as we prepare to send off a political and business delegation to the USA next week. So busy were we—and so crucial was I, it seems— that my boss tinkered with the idea of excusing me the conference due to “sickness.”

One of the more time-consuming tasks was translating about 50 pages of speeches for the minister of economics of Mecklenburg-Vorpommern. One element present in two of his speeches makes for a funny intercultural story that I hope to share on the blog when I return.

Until then, however, I’m going to Berlin.

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Though my line of work has me handling a lot of different business cards, a curious difference between those from Americans and Germans had escaped my notice until a colleague pointed it out to me: taking a pile sitting on my desk, he demonstrated that while all American business cards were the standard 3.5” × 2” format, the German business cards followed no standard dimension and could be grouped into at least three different formats.

The disarray of many different business card sizes hardly seems in Ordnung, but I’ve found that German businesses tend to be far more individualistic and more interesting in graphic design than their American counterparts, in contrast to what might be the expectation.

As it happens, just a day after this discovery I came across a collection of nifty business card designs from all around the world. A few of my favorites are below the fold…↓

(more…)

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Everyone who passed Econ 101 please take a step forward—not so fast, City Council of Roseville!

The city of Roseville has already declared a “stage one” drought alert, and is considering a drastic step to ease the crisis: Offering residents cash to give up their lawn.

Fifty percent of all the water that’s used by homeowners in Roseville is for watering lawns. The city is considering giving residents up to $1000 to tear out the grass and put plants, rocks and mulch in its place.

If only there were some simple mechanism that efficiently rationed resources by conveying information to consumers about that resource’s scarcity and consumers’ preferences for it–wouldn’t that be a wonder!?!

“Wait a tic, that wondrous mechanism seems an awful lot like an everyday market price!“ cries out Fig.

And right you are Fig. The fact that the Roseville is in a “stage one” drought and 50 percent of water is still used for lawn watering indicates that the price is artificially low, for unless Roseville citizens are inordinately fond of their lawns, the high price of such scarce water would certainly have compelled them to cut back on their use of it for such trivial purposes.

The price of water might be too low because the market is failing take account of a negative externality, or it might be because municipal water is priced by government decree rather than supply and demand, or it might be both. In any case, the most efficient policy would be to “get the price right,” either by letting the utility charge a price reflecting market conditions, or by passing a tax that raises the price to the best estimate of the market-clearing level. This increased price will signal individuals to reduce their consumption, and best of all, allow them to choose for themselves the best way to do it, rather than having city council impose a one-size-fits-all solution. It’s worth keeping in mind that no government council told Germans to take 3-minute showers—it’s simply a rational response to the most expensive water in the West (Germans of course claim their short soaks are a result of their eco-friendliness).

If Roseville’s residents responded to high prices like the Germans they might not smell as sweet, but then again, that might not be as important to them as a pristine and well-irrigated garden–full of rosebushes, perhaps?

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Trading Places

This week’s Economist has a briefing on world tourism. These two sentences caught my attention:

About 85% of American travel and tourism is domestic. Only one-fifth of American citizens have passports.

As a kid, I traveled within the continental United States extensively (over 40 states by the time I was 16), but once I started college, my domestic tourism wholly ceased and all my travels were all to Europe. Indeed, aside from one drive to Michigan for a wedding a year ago, I can’t think of any noteworthy travel within the US I’ve done since I was in high school. To me, traveling became synonymous with traveling to Europe, and the idea of traveling within the US did not enter my mind.

After having spent the past five years focused on Europe, however, I find myself thinking more and more about finally visiting the places in the US I’ve never been, and perhaps achieving a goal I had when I was younger to visit all 50 states. It now seems such utter foolishness to have ignored low-hanging domestic fruit in favor of the harder-to-reach exotic types.

***

Playing golf some time ago, a German lawyer mentioned to me that the farthest east he had traveled in Europe was to Berlin—in other words, he had never been to Central or Eastern Europe. How strange, I remarked, not to have been even in those countries which border your own, like Poland or the Czech Republic.

As we finished the hole, the lawyer mentioned how much he does however enjoy his visits to Mexico.

Never been, I replied.

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I found this chart astounding:

Though I haven’t read the report, it apparently claims that the large number can be explained by an “established culture of philanthropy and charity” as well as “a generous tax regime.”

Using CIA World Factbook estimates for population, the private giving per person in the top three countries was:

  1. USA – ≈$114
  2. Britain – ≈$22
  3. Germany – ≈$19.50

Here I would add two cents to the $34 billion pile:

  1. Economists often talk of “crowding out,” which was originally a theory about how government borrowing might crowd out private investment, but has since become a general term to describe how when a government engages in an activity, it usually (if not always) will have the effect of discouraging private efforts in that activity. It is worth noting that the US is often criticized for having a low percentage of federal foreign aid as a percentage of GDP relative to other OECD countries, but it is perhaps by virtue of this low level of federal charity that so much private charity takes place.
  2. In line with this, a strong case can be made that over time, a government’s crowding out of a private activity has the effect of changing the public’s views towards that activity from something that requires personal attention to just another public service that needn’t be worried about. This shifting of responsibility and the subsequent indifference it engenders (i.e. “The government will handle it”) has an especially baneful effect on charity, I fear.

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Costs & Benefits

As I rode my bike past the Schweriner Schloss at 5:30 AM today on my way to catch a train, I realized that I had never before seen the castle illuminated in the colors of dawn. So vibrant and stunning was the juxtaposition of warm peachy hues and light shades of azure that I knew catching another sunrise at the castle on film would make for some great photos.

Still, it was 5:30 in the bloody morning.

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