Tuesday, October 30, 2012

Some readings

1. Alwyn Young argues that measures of GDP and consumption growth in Africa are flawed by mismeasurements, and that the Demographic and Health Survey, which collects "information on the ownership of durables, the quality of housing, the health and mortality of children, the education of the youth and the allocation of women's time in the home and the  market", enables a better and more consistent data source. The implications could be important for our view of Africa's development compared to other developing regions, as Young finds that
since 1990 real material consumption in sub-Saharan Africa has been rising at a rate three and half to four times that recorded by international data sources such as the PWT and UN, and on par with the growth  taking place in other regions of the world.
2. Here's a cool graph of how the Fed works

3. Alcott and Rogers find that for behavioral interventions to work, they need to be sustained for a period of time. They find that an energy conservation intervention where people were repeatedly reminded to save energy led to strong (but decreasing over time) responses after each warning, and that the long-term impact was only significant when the the intervention was long enough
attention is malleable, not static: an intervention can draw attention to one set of repeated behaviors, but that attention gradually returns to its baseline allocation. Second, our empirical results document how repeated intervention can eventually cause people to change the composition of their responses, which generates more persistent changes in outcomes.
One simple example they use to explain their findings is that if you repeatedly go to the (same?) gym, you'll find a gym buddy and develop a routine. There must be something like this in Charles Duhigg's book on the power of habit! From his NYT magazine piece last February:
One study from Duke University estimated that habits, rather than conscious decision-making, shape 45 percent of the choices we make every day...The process within our brains that creates habits is a three-step loop. First, there is a cue, a trigger that tells your brain to go into automatic mode and which habit to use. Then there is the routine, which can be physical or mental or emotional. Finally, there is a reward...
And on the gym example specifically:

In one project, 256 members of a health-insurance plan were invited to classes stressing the importance of exercise. Half the participants received an extra lesson on the theories of habit formation (the structure of the habit loop) and were asked to identify cues and rewards that might help them develop exercise routines.
The results were dramatic. Over the next four months, those participants who deliberately identified cues and rewards spent twice as much time exercising as their peers... According to another recent paper, if you want to start running in the morning, it’s essential that you choose a simple cue (like always putting on your sneakers before breakfast or leaving your running clothes next to your bed) and a clear reward (like a midday treat or even the sense of accomplishment that comes from ritually recording your miles in a log book). After a while, your brain will start anticipating that reward — craving the treat or the feeling of accomplishment — and there will be a measurable neurological impulse to lace up your jogging shoes each morning.

4. The New York Times has an interesting piece on the rise of the part-time worker. The switch is striking:
“Over the past two decades, many major retailers went from a quotient of 70 to 80 percent full-time to at least 70 percent part-time across the industry,”...the Bureau of Labor Statistics has found that the retail and wholesale sector, with a total of 18.6 million jobs, has cut a million full-time jobs since 2006, while adding more than 500,000 part-time jobs...in two leading industries — retailing and hospitality — the number of part-timers who would prefer to work full-time has jumped to 3.1 million, or two-and-a-half times the 2006 level, according to the Bureau of Labor Statistics. In retailing alone, nearly 30 percent of part-timers want full-time jobs, up from 10.6 percent in 2006
Those part-time workers take drastically lower pay:
part-time workers in service jobs received average compensation of $10.92 an hour in June, which includes $8.90 in wages plus benefits of $2.02. Full-time workers in that sector averaged 57 percent more in total compensation

The factors the NYT points out are
workers’ schedules have become far less predictable and stable. Many retailers now use sophisticated software that tracks the flow of customers...
...when Walmart spread nationwide and opened hundreds of 24-hour stores in the 1990s, that created intense competitive pressures and prompted many retailers to copy the company’s cost-cutting practices, including its heavy reliance on part-timers...
...the use of part-timers had also escalated because of the declining power of labor unions. “They set a standard for what a real job was — Monday through Friday with full-time hours,”...  

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