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November 30, 2006
November 29, 2006
links for 2006-11-29
November 28, 2006
Shorts, vol. 1
"Dermatologists Target Ethnic Skin Woes" | Carla Johnson | AP
Two interested things about this article. First, it shows that there are still some times and places where it is not only okay, but actually advisable to target people because of their skin color. Secondly, it brings to mind some things that entertainer Michael Jackson and Michael Richards have in common other than the same first name and fair skin: neither of them will be asked to endorse the products of L'Oreal, a major sponsor of a yearly "ethnic skin research symposium at Howard University, a historically-black college in Washington, D.C.
John Edwards' folly: A book signing gone wrong | Manchester Union-Leader
This story about a Senator hawking his book speaks volumes:
(Senator John) Edwards is holding his book signing at Barnes & Noble instead of Wal-Mart. Which is too bad for his anti-low-wages campaign, because in Manchester Wal-Mart pays hourly employees more than Barnes & Noble does. The Barnes & Noble where Edwards will hawk his book pays $7 an hour to start. The Wal-Mart that sits just yards away pays $7.50 an hour. Oh, the humanity! From 7 to 8 p.m., Edwards will bring business to a retailer that pays wages he thinks are so immorally low that they should be illegal. Meanwhile, right behind him, thousands of Granite Staters will be supporting a business that pays an Edwards-approved starting wage, but which Edwards wants everyone to boycott.Here Come the Economic Populists | Louis Uchitelle | New York Times
“We are at a point where the Reagan era might finally be over, including the eight years of Bill Clinton,” said Jeff Faux, a fellow at the Economic Policy Institute, a labor-oriented research group partly financed by the A.F.L.-C.I.O. “The historic juncture here is whether the Democrats can come up with policies that get to the level of the problem.”
The "problem" of which Mr. Faux speaks is an economy that is too globalized and whose industries are not sufficiently regulated.
Lure of Great Wealth Affects Career Choices | Louis Uchitelle | New York Times
Another fine article by L. Uchitelle about how many doctors are being lured away from research medicine for careers on Wall Street, where they can apply their hard won skills for much higher pay, and as management consultants. For seven years at MIT I taught strategic management to scientists, engineers, technologists who had aspirations towards careers in business. The combination of domain-specific expertise and and appreciation for rigorous logic and the scientific method has a place in management and increasingly people like the ones mentioned in this article are finding it.
November 26, 2006
links for 2006-11-26
November 25, 2006
Brits Tell Fishing Poles to Stop Carping!
Today on the BBC I heard that over 1 million Polish citizens have left their native land to search for better jobs. Many have gone to Western Europe; so many in fact that two years ago, when the Poland joined the EU, the mythical "Polish Plumber" became a symbol for the influx of cheap labor that could suppress wages and take jobs away from workers in the more advanced member economies like France and the UK. No one thought much at the time about the dietary preferences of Polish plumbers or nurses or travel agents, let alone the impact said preferences could have on the environment . They are thinking about it now:
Tucking into a succulent turkey is the traditional way of celebrating Christmas in Britain. But to make sure tens of thousands of Poles living here do not feel homesick when they sit down for their festive dinner, one supermarket chain is selling carp. Carp is a delicacy in Poland - traditionally served up on December 24.
Sounds like the basic economic love story- When Supply Met Demand. But like all good stories, there's always a catch, in this case quite literally a catch:
Such is their appetite for the fish - generally considered inedible by Britons - that Eastern European immigrants have become embroiled in a row with English anglers over the number being caught and killed. Anglers have also demanded tough new laws to prevent poachers depleting British rivers of carp.
Continue reading "Brits Tell Fishing Poles to Stop Carping!" »
Strip Searched
The opening sentence of Bloomberg's account (via the Baltimore Sun) of Google's recent settlement with Belgian photographers and journalists is rather unremarkable:
Google Inc., the world's most-used Internet search engine, reached a settlement with Belgian photographers and journalists yesterday in a copyright dispute over how the company's news service links to newspaper content.
The next sentence, however, grabbed me by the seat of my pants:
The agreement removes two of five groups from a Brussels lawsuit that seeks to prevent Google from linking to Belgian newspaper articles for free. ... The settlements may show that Google is willing to resolve disputes with content providers trying to prevent the company from linking to Web sites without compensation.
That's not a misprint or a misquote. Belgian media firms are suing Google for doing what search engines are supposed to do, directing the users of search engines to information for which they are searching. Essentially Belgian content providers want compensation from Google for the right to linking to their content. This is a rather amazing demand. Given how hard it is to get found on the internet without a search engine, you'd think that they'd be paying Google for the links rather than the other way around.
Commentary
The fact that the Belgian are demanding payment says a lot about a lot, in particular the sorry state of mainstream media, both here and abroad; and perhaps the low quality of their content, the apparent collapse of their business and revenue models; a failure to comprehend the rudiments of information economics, network externalities, and internet-enabled social-networking.
November 24, 2006
Like Nobody's Businessman II: A Dish Served Cold
Reuters is reporting that the poisoned Russian spy Alexander Litvinenko may have received his fatal dose in a sushi bar:
Police investigating the death of a former Russian spy from suspected radiation poisoning have found levels of radiation in a London sushi bar where he ate just before he became sick, health officials said on Friday."The police reported that they had found some radiation there (in the Sushi bar). We are assessing the level of that and the potential risk to people that might cause," Pat Troop, head of the independent Health Protection Agency, told the BBC.
The HPA said polonium 210, a radioactive isotope, had been discovered in the body of Alexander Litvinenko, who died overnight at a London hospital after wasting away during three weeks of illness.
Commentary
Some gruesome and public was the murder of Mr. Litvinenko that if I owned a sushi bar right now in London I'd be very worried. Logically, that the late spy may have been poisoned in one sushi bar should in no way constitute an indictment of all London sushi bars. And logically, no one who isn't on the wrong side of the Russian mob or other unnamed, revenge-seeking parties should have to worry about being deliberately poisoned anywhere at anytime.
Continue reading "Like Nobody's Businessman II: A Dish Served Cold" »
Like Nobody's Businessman
The title of the story currently above the fold at Drudge is "Poisoned Russian Spy Dies." One of the related links in the upper-left corner reads "Businessman says he, 2 others, met Russian ex-spy." The story opens this way:
A Russian former intelligence officer was quoted in a newspaper on Friday as saying he and two other men met ex-spy Alexander Litvinenko in a London hotel on November 1, the day before Litvinenko complained of feeling unwell.
Given Russia's long-standing antipathy to Anglo-American capitalism, plus the fact that the phrase "Russian businessman" was for 8 decades an oxymoron, reading that line made me wonder what line of "business" this former intelligence officer was in. While the story never specifies precisely what said "businessman" does, there are a few valuable clues:
End It Like Beckham
In a bid to boost its competitiveness, its image, and its gate receipts, Major League Soccer (MLS) is changing its rules. The rules concern not who does what on the field, but rather who gets to play on it in the first place. The informal name given to it- the "Beckham Rule" - tells you both who and the kind of who that the MLS wants to see on the pitch:
This past weekend, Major League Soccer approved a change to the league's salary cap by introducing the 'Beckham Rule'. The rule stipulates that each MLS team can sign one player who will not count against the US$2 million salary cap. Such a move would be a major boost for the MLS competition. It could attract other world stars, thus reviving US club football's 1970s glory days when legends such as Pele, Franz Beckenbauer, Johan Cruyff, George Best and Bobby Moore played out the twilight of their careers there.
Commentary
In business-speak we might say that MLS is reducing, if ever so slightly, the barriers to entry into the game. In most industries low or lowered barriers are associated with greater rivalry among incumbents and lower profits. But the professional sports industry differs in that competition is the name of the game, literally and figuratively. Competition is the product and, unlike a typical industry, more competitiveness between teams will result in higher profits for the owners and higher salaries for at least some of the players.
November 23, 2006
Not-So-Smooth Criminals
When the East Coast gangsta rap anthem "Criminal Minded", was released in 1987 it became an immediate classic. At the time I recall wondering whether fans of the record were aware that the title contained a grammatical error and if they didn't, whether that said anything about their intelligence or just about their environment.
Today I look at the lives lead by the most die-hard fans of this genre, with its misogynistic, counter-productive, and utterly self-defeating ethos, and I still wonder if the criminal-minded among us are less intelligent. As I have indicated elsewhere, there are two ways to approach a question like this- anecdotally and empirically. Let's do the first first. Below is a video quite popular on You Tube at the moment. It goes under many titles such as "Very Stupid Criminal" and "Dumbest Criminal" and "World's Dumbest Criminal."
November 22, 2006
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November 21, 2006
links for 2006-11-21
November 20, 2006
links for 2006-11-20
November 19, 2006
links for 2006-11-19
November 18, 2006
Be Ye Like Little Children
Verily I say unto you, Except ye be converted, and become as little children, ye shall not enter into the kingdom of heaven. - Matthew 18:3
I held off posting anything concerning ex-Senator John Edwards' inquiries to Wal-Mart about obtaining a PlayStation3 until more facts came to light. Boy did they ever. The reason why this story is news is because Edwards has become a very vocal critic of Wal-Mart of late. Clearly aware of the rank hypocrisy of trying to get a copy of PS3 before it goes on sale to the general public and from a retailer that one has just attacked the day before, the Edwards camp yesterday shifted the blame onto a "young" volunteer:
Wal-Mart Stores Inc. said Thursday that a staff member for former Sen. John Edwards -a vocal critic of the retailer- asked his local Wal-Mart store for help in getting the potential 2008 presidential candidate a Sony PlayStation 3. Edwards said a volunteer did so by mistake. Edwards told The Associated Press that the volunteer "feels terrible" about seeking the game unit at Wal-Mart a day after his boss criticized the company, saying it doesn't treat its employees fairly.
"My wife, Elizabeth, wanted to get a Playstation3 for my young children. She mentioned it in front of one of my staff people," Edwards said. "That staff person mentioned it in front of a volunteer who said he would make an effort to get one. He was making an effort to go get one for himself. "Elizabeth and I knew nothing about this. He feels terrible about this. He made a mistake, and he knows he should not have used my name," Edwards said. Edwards said the volunteer was "a young kid" unaware of what he called flawed Wal-Mart policies. He called the Wal-Mart statement an effort to divert attention from its own problems.
Commentary
links for 2006-11-18
November 17, 2006
The Plural of Anecdote II: Wal-Mart's Impact on Mom and Pop
Part I of "The Plural of Anecdote" is here.
Here is one of the claims made by Wal-Mart critics, in this case WalMart Watch, that is addressed head-on by economists Russell Sobel and Andrea Dean in their recently published working paper "Has Wal-Mart Buried Mom and Pop?: The Impact of Wal-Mart on Self-Employment and Small Establishments in the United States"
Wal-MartWatch, one of the largest Anti-Wal-Mart organizations, features an academic article claiming that in Iowa, Wal-Mart’s expansion has been responsible for widespread closings of ‘mom and pop’ stores, including 555 grocery stores, 298 hardware stores, 293 building suppliers, 161 variety shops, 158 women’s stores, and 116 pharmacies.
Here is Sobel and Dean's argument in a nutshell:
Wal-Mart is big enough to have significant macroeconomic effects. Hausman and Leibtag (2004), for example, find that the Consumer Price Index (CPI) is biased because of the failure to specifically account for Wal-Mart. ... because of its sheer size, if Wal-Mart has a negative effect on small business activity, this effect should be discernable in aggregate U.S. data.
They continue by noting that if Wal-Mart is big enough to have the effect that critics claim, then the data ought to show it:
... because Iowa is a fairly representative state in the sample, an extrapolation would suggest that ...the overall size of the small business sector in the United States should have fallen by about one-third relative to days prior to Wal-Mart’s expansion across America. Has this one-third reduction in U.S. small business activity really happened? If so it should be clearly visible in the raw data on U.S. small business activity, and this is the first evidence we will examine.
In short, their results show that:
Continue reading "The Plural of Anecdote II: Wal-Mart's Impact on Mom and Pop" »
Inconvenience Store
The Smoking Gun has a video of a confrontation at a Florida convenience store between a machete-wielding would-be robber and a machete-wielding clerk:
On Tuesday (Nov. 14), a man wearing a blue sweatshirt and baggy jeans approached the counter of the Lil' Saints store in Stuart and pulled the weapon from his pants. After he moved away from the counter for a moment, clerk Guillermina Sanchez, 46, grabbed her machete from under the cash register. After a 20-second standoff (during which time the man frantically pressed keys on the register in a bid to open it), the robber left the business. Detectives believe the suspect in the November 13 incident was also behind a mid-October robbery at the store which netted him about $500.
This description is deficient in at least three regards. First, it fails to mention is that the robber didn't leave the business until the Guillermina's machete had been passed (out of view of the camera) to a fairly burly man, presumably her boss or co-worker. When he appears behind the counter with machete in hand, the robber bolts and it looks as if the man gives chase. Second, the description fails to mention that there was briefly another female clerk behind the counter with Ms. Sanchez. Finally, it neglects to state that the store was somewhat busy at the time. There were two customers helped immediately before the attempted robbery and at least one more immediately after. Thus, this was anything but a late-night stand-off between a robber and a clerk.
These facts are noteworthy because of a serious debate that has been underway for several years between the National Association of Convenience Stores (NACS) and various state and local government agencies responsible for workplace security. The particular bone of contention is whether or not the presence of multiple staff members deters crime in convenience stores. Not surprisingly, the NACS thinks it does not. Interestingly, on its "Industry Resources" page one can find detailed talking points arguing against the "two-clerk" solution. And on another page that take exception with the Occupational Safety and Health Administration's "Recommendations for Workplace Violence Prevention Programs in Late-Night Retail Establishments", circa 1998.
OSHA asserts that the presence of two clerks is an effective deterrent to robbery. No reliable basis exists for that proposition. Rather, factors such as effective cash management, adequate lighting, and customer traffic are far more effective in deterring robbery. Because the location and environment of each outlet is unique, different strategies are appropriate for different outlets. OSHA's apparent belief that "one size fits all" is completely unrealistic.
Commentary
November 16, 2006
Product Placements & Silver Smoke Screens
According to the AP, officials from the Philip Morris company, the nation's largest cigarette maker, have been meeting recently with representatives of the entertainment industry. The ostensible reason is to devise a campaign to curb youth tobacco use.
Richmond-based Philip Morris USA said Wednesday that it will run advertisements in Daily Variety, The Hollywood Reporter and other trade publications imploring moviemakers: "Please Don't Give Our Cigarette Brands a Part in Your Movie." The ad campaign begins this week and will last several months, Philip Morris spokesman David Sutton said.
Critics are nonplussed:
Matt Myers, president of the Campaign for Tobacco-Free Kids, said the industry has been unmoved by previous appeals to shield children from smoking scenes. "Hollywood has ignored the very serious problem that smoking in the movies contributes to youth tobacco use," said Myers, adding that "the problem goes beyond which brands are shown."
Indeed it does go beyond that. Although Philip Morris denies permission for its brands to be shown in movies intended for general audiences, film makers are not required to ask permission. If PM really wanted them to stop then it could, as another critic suggests, threated to sue. But they wouldn't dare do that. These are not stupid men and they are not pick a fight with an industry that provides them with billions of dollars of free advertising:
Continue reading "Product Placements & Silver Smoke Screens" »
Google Spies
An acquaintance asked this question:
"(I) have heard that Google accounts can act as a CIA (i.e. gain access too all one's information -- somehow or other. Have you an opinion on this?"
My reply:
I hadn't heard about this but worry little about it being true. Though Google may want to do this (may being the key word here), people in the internet industry are fiercely protective of their privacy. If word ever got out that Google was amassing and scrutinizing user data like this (and word would get out) the Google brand name and stock price would drop through the floor. By my reasoning, it is simply not in Google's economic self-interest to do such a thing.
Tags: Google | CIA | Iinternet | privacy | spying |
On the Job Training
Two recent articles in the Dubai press stress the importance of job training at both ends of the labor pool. Regarding the shallow end we have this Gulf News story, "Dubai Central Jail inmates learn how to repair vehicles"
Inmates at Dubai Central jail learn how to repair vehicles as part of the jail's rehabilitation programme, a senior police official said. Brigadier Khamis Saeed Al Suwaidi, Acting Director of Dubai Police's Punitive and Correctional Establishments, said the department is keen on rehabilitation programmes that will help inmates after they are freed. He said the education and training department at the jail organised the vocational course in cooperation with the Al Futtaim training centre. The course targeted 14 UAE national inmates. All passed the course and six were released from jail. The inmates have secured jobs as helpers at Al Futtaim as soon as they had taken the course and received the certificates. Lieutenant Colonel Tariq Kalentar, Director of Dubai Central Jail, said many inmates showed interest in taking the course. However, the 14 were selected based on interviews, their behaviour and their English language proficiency.
And in the deep end of the talent pool we have AMEInfo reporting on the launch of Standard Charter's Graduate Career Development Program:
Standard Chartered, one of the leading international banks in the UAE, has launched two new development programmes to attract high-level graduates to careers within the Bank. 'The Al Tahadi Educational Support Programme provides a monthly financial support to selected UAE national students until they graduate,' explains Aida Hamza, Standard Chartered Head of Emiratisation, UAE. The International Graduate Programme is a two-year development programme that has been active globally and only set to launch in this region at the end of October, specifically designed to develop a robust pipeline of diverse, potential future leaders for the Bank. ... (the IGP) provides graduates of all nationalities with an opportunity to train in a specific function department (wholesale banking or consumer banking) at the Bank after graduation, fast-tracking them for success on an international career path.'
Commentary
Though the education and skills, the nature of the work, and the height of the career of these two groups couldn't be more different, there are a few common themes.
November 15, 2006
links for 2006-11-15
November 14, 2006
links for 2006-11-14
November 13, 2006
Call and Response
Mr. Ron Sherman of the Chico (California) Enterprise-Record published an article today entitled "Wal-Mart survey flawed". It reads as follows:
A few decades ago, studies financed by tobacco companies showed that cigarette smoking is not harmful to your health. Recently, studies financed by oil companies showed that global warming is not caused by burning fossil fuels. Now, Bob Linscheid's study, financed by a $5,000 payment from Wal-Mart, shows that Wal-Marts are actually good for communities. Can you see a pattern here?Linscheid's "impartial survey" consists of questions presented only to economic development officials and chamber of commerce officials, all people such as himself, whose main agendas are encouraging large-scale business expansion. The questions asked were of Linscheid's choosing, excluding areas of inquiry that could result in responses contrary to his desired results. He seems more like a Wal-Mart lobbyist than an independent researcher.
It's obviously of no concern to Linscheid that a Wal-Mart supercenter built in north Chico would forever ruin that entire beautiful area of our community. One need only look at places like Fresno or Stockton to see what results when people like Linscheid are successful in promoting big-time economic expansion.
Another study prepared by credentialed Ph.D.s and respected economists, who, unlike Linscheid, considered all relevant areas of concern, found that a Wal-Mart expansion would have a "devastating impact" on our local economy.
Wal-Mart spokesman Kevin Loscotoff said the Linscheid study was "done by a credible third-party organization." Does Loscotoff also have some oceanfront property in Arizona for sale?
I left the following comment on the webpage where this article appeared:
November 12, 2006
Pent-up demand
Here's how economists describe the term pent-up demand:
When demand for a product is exceptionally strong, perhaps because the demand built up during a recession when people could not afford to buy the product or because the product was temporarily not available to be sold.
Here's a more general, non-economic definition based upon the one above:
When demand for something is exceptionally strong, perhaps because the demand is built up because of repression or because the demanded something is otherwise unavailable:
And here's an example, courtesy of the New York Times, of pent-up demand in Dubai:
links for 2006-11-12
November 11, 2006
The Plural of Anecdote: Does Wal-Mart Hurt "Mom-and-Pop" Businesses?
"The plural of anecdote is data." - Berkeley political scientist Raymond Wolfinger
The aforementioned aphorism is one both true and truly in need of appreciation by Wal-Mart critics. Said critics have, for years now, claimed that when the Wal-Mart juggernaut comes to town it decimates small, family-owned, mom-and-pop, and fledgling local enterprises. Even after setting aside the self-righteous indignation, absolute certitude, and moral superiority with which critics have laid such charges at Wal-Mart's (and only Wal-Mart's) doorstep, I still have serious reservations about the critics' assertions.
The reservations stem from the fact that the "evidence" cited in support of such claims is always anecdotal. That is to say, some critics try to make their point by pointing to one region or county or city where Wal-Mart opened one or more stores and, as they tell it, local businesses were sent to an early grave.
The problem with this line of thinking is that while no thinking person doubts that some or even many local businesses may go under after Wal-Mart's entry, that fact alone in no way establishes either causality or ubiquity. It is an empirical question as to whether there is a Wal-Mart effect and, if so, whether it is the same in all times and climes.
Fortunately, someone has finally addressed this question head-on with a data set covering the entire US and with the application of empirical and econometric methods suited to the task. The someone in question is actually a someones- Professors Russell Sobel and Andrea Dean of West Virginia University. In their recently-released working paper, Sobel and Dean present results of a study whose abstract reads as follows:
Saving traditional small ‘mom and pop’ businesses has been a justification for political and court decisions preventing Wal-Mart from opening new stores virtually everywhere across the United States. We present the first rigorous econometric investigation of how Wal-Mart actually impacts the small business sector. We examine the rate of self- employment and the number of small employer establishments using both time-series and cross-sectional data. Contrary to popular belief, our results suggest that the process of creative destruction unleashed by Wal-Mart has had no statistically significant long-run impact on the overall size and profitability of the small business sector in the United States.
Because my thoughts on the research design and implications of the findings are deserving of an entire post by themselves, I will end this post with excerpts taken from Sobel and Dean's summary and conclusion:
Continue reading "The Plural of Anecdote: Does Wal-Mart Hurt "Mom-and-Pop" Businesses?" »
Dubai, the Retail Mecca
As anyone who lives in the UAE knows, Dubai is well on its way to becoming a retail and shopping mecca. As MENA Report noted last month:
By 2009, Dubai is expected to have the highest retail spend in the GCC, higher than Saudi Arabia and despite having a population one-twentieth the size. Most of this spend will be generated from the expected 15 million tourists. ... At the helm of its long list of projects that incorporate malls of various sizes, shapes and themes is the Dubai Mall, which will be constructed close to the Burj Dubai Tower, and will be the largest mall in the world. The mall is being pegged to be larger than the gigantic West Edmonton Mall in Canada and the Mall of America in Minneapolis, USA.
Fifteen million tourists may seem like a lot of people until you realize that there is both a great deal of wealth and great number of people within a two-hour flight of here, particularly in oil rich central and southwest Asia:
Dubai has been targeting a market of 1.5 billion people with a GDP of US$1.1 trillion from the Middle East, South Asia and the entire Caspian region. "While for 300 million people in the US, there are a number of hubs, for 300 million people in the Middle East, there is only one hub ~ Dubai," he said. "Moreover, Dubai caters to over 1.5 billion people who are less than two hours flying time away. So, as a hub, as we gear up to serve a wider number of consumers in and beyond the region, we will need more malls." ... Analysing some of its surveys, Retail International's principal Simon Thomson says: "Dubai is on course to become possibly the most densely shopped city on the planet.
The numbers sound so good that it is easy to understand why reports like this one from AME-Info are now so commonplace, expected in fact:
Dunhill, the maker of luxury goods for men, is opening two new boutiques in the UAE before the end of March 2007, and will then expand into other GCC countries, the company said. It has four stores in the UAE at present.
On the other hand, if everything is so rosy, why in the same week would we see news articles like this about Harrod's, the upscale British retailer owned by Saudi financier Mohammad al-Fayed:
links for 2006-11-11
November 10, 2006
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November 8, 2006
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November 7, 2006
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November 6, 2006
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November 5, 2006
End of the Rainbow
In a post back in September entitled "Somewhere Over The Rainbow" I wrote about Wal-Mart's decision to partner with the National Gay and Lesbian Chamber of Commerce. In that post I cited an article from "The Morning News" of northwest Arkansas which stated attributed Wal-Mart's move as an effort "to help advance diversity within the Bentonville-based retailer’s operations."
What I overlooked at the time was the anger and disappointment by several parties, some of whom had been very supportive of Wal-Mart up to that point. I did take their palpable dismay as genuine, but I did not think it would lead to calls for a boycott, as reported yesterday by Bloomberg:
Some Recent Social Science Research
Hot off the Berkeley Electronic Press
Summary: John Donohue wonders if the Disney case means that the courts of Delaware will cleverly find the facts they need to allow managers to waste corporate assets however they please.
Summary: James K. Galbraith and Travis Hale argue that the IT bust and the subsequent fall in the NASDAQ led toward a convergence of income across American counties; yet amidst this movement toward greater equality, several counties have gone from rich to richer mainly due to increased government spending under the Bush administration.