Morning Ed: Economics {2018.05.10.Th}


Will Truman

Will Truman is the Editor-in-Chief of Ordinary Times. He is also on Twitter.

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47 Responses

  1. Avatar Kolohe says:

    Ec3 – I got to think that signatures are still going to be a thing for a while at sit down table service restaurants.Report

    • Avatar James K says:


      In New Zealand you usually either get up from the table to pay, or they bring a mobile EFTPOS machine over.Report

      • Avatar Kolohe says:

        That also seemed to be the thing in Italy.

        (Btw it still always gets me when someone abreviates Point Of Sale. It took me months to realize that this was what the Waiter Rant guy was refering to.)Report

    • Avatar dragonfrog says:

      Canada does the same as New Zealand, I think – I haven’t signed a paper credit card slip in probably a decade, except during power failures when someone dug the old paper forms out of the back room.Report

  2. fillyjonk fillyjonk says:

    Ec3: for the first time in weeks upon weeks, I did “big” grocery shopping (at the Kroger’s). Almost $100. I was shocked when I was not asked to sign and asked the checker if there was some error. She said “No, they passed some law not requiring signatures any more, isn’t that weird?” and I agreed it seemed weird.

    I guess some people actually found that a burden, and I also guess the signatures didn’t help much – I know there were a couple times mine was scrawlier than normal and the computer still accepted it, because obviously they don’t compare it against a stored model or anything.Report

    • Avatar Michael Cain says:

      …because obviously they don’t compare it against a stored model or anything.

      Right. There’s no checking, it’s just recorded at some miserable low resolution. At one time, many years ago, corporate travel required signed receipts — even just an indecipherable scrawl that looked nothing like the ordinary signature — to satisfy IRS rules should the tax folks decide to audit claimed deductions and reimbursements.

      If the goal is fraud prevention, studies have shown that it is much better to compare the “rhythm” of signing to a stored record than to compare appearance. Pauses and variations in pressure become muscle memory and are recognizable even when the signer is asked to disguise their signature. That rhythm is almost impossible for forgers to duplicate.Report

      • Avatar Kazzy says:

        I always assumed it was there as a check in the event of a fraud claim. If I insist I didn’t make a purchase, they can pull out a signed receipt and if it is close enough to what is stored, than my claim likely doesn’t move forward. Is that not how it works?Report

        • Avatar Michael Cain says:

          Long ago, I suppose. I got my first credit card when I was 18, some 46 years ago — one of the banks in the university town decided to offer low-limit cards to incoming freshmen who had been accepted into an honors program. Good thing; there was another Michael Cain in town who passed bad checks, and no one but the university would take my checks. Everything was actual carbon copies run through one of the old manual sliding machines, and the signatures were legible enough that people could actually compare them. Today? Pretty much only restaurants and liquor stores give me an option to sign in a way that could be compared.

          Interesting related story… In Colorado’s vote-by-mail system, in my county, some dozens to low hundreds of ballots are initially rejected each election because the signature is too far from what’s on record (there’s a well-defined procedure to deal with the problem, identifying fraud if that’s what it is and counting the ballot if that’s what’s appropriate). It made the papers when the Sec of State’s grown daughter had a ballot rejected based on signature. She was, IIRC, 19 and said that she was experimenting with new versions of her signature.Report

          • fillyjonk fillyjonk says:

            I’m also old enough to remember the slider machines, and also the deal for a while in the 1980s when some stores had little newsprint books of what were presumably “bad numbers” and the cashier had to look them up.Report

            • Avatar Michael Cain says:

              Back when I was an undergraduate, so mid-70s, one of the perks for businesses who joined either the Chamber of Commerce or BBB was a book issued quarterly with the names of the people who had passed multiple bad checks in the last year or two. The other Michael Cain had a different middle initial, but that wasn’t enough for most of the stores to take the chance. The bookstores would take my checks if I showed them my student ID (I believe the university required that). Beyond that and the utilities, no one. At one point I considered putting my accounts under “M. Eugene Cain”, despite how I felt about my middle name.Report

    • Avatar LeeEsq says:

      What I found is that I’m no longer required to sign for small purchases but for anything around $20 or more, I still have to sign.Report

      • fillyjonk fillyjonk says:

        That’s been in force here for over a year; this was new – not having to sign for a $94 (IIRC) grocery billReport

      • Avatar dragonfrog says:

        My debit card (and probably my credit card too) has the NFC pay-by-bonking chip in it. All you have to prove is physical possession of the card. I think it’s a $50 limit.

        Over that, it’s chip-and-pin for payment. Nothing uses paper signatures on a credit card statement.Report

    • Avatar CJColucci says:

      Many years ago, when I took Commercial Transactions in law school, the professor explained that banks almost never check the signatures on checks below certain amounts. That day, I went to the law school bookstore, bought something, and paid with a check signed “E. Allan Farnsworth,” the professor’s name. The bookstore took the check, the bank cleared it, and I presented a copy of the cancelled check to the professor, who got a kick out of it.Report

  3. Avatar Kolohe says:

    Ec8 – except that’s the irony, right? ‘The Iron Sheik’ trafficked in Arab stereotypes, not Iranian ones. It was like when a Swedish actor pretended to be Russian so an American actor could defeat him in a boxing match in front of a dollar store Gorbachev.

    An anti-Iranian sterotype would have included a turban (instead of what was closer to a keffiyeh), and would have worked the word ‘Ayatollah’ in some way. E.g. a tshirt of the time – ‘Ayatollah Cola, it tastes like Shiiite’ (an actual tshirt, worn by a fellow 10 year old on my little league team)Report

    • A bit of pushback here. Yes, and in fact before taking on the Iron Sheik persona Khosrow’s first gimmick was as an Arab, creatively name Hossein Arab. But he was legitimately Iranian, born in Tehran and even having been directly involved with the Shah’s family at one point. His rise to fame as the Sheik coincided with the hostage crisis and went from there, so stereotype as it may be it was good marketing strategy with enough real to make it work. His story is actually amazing reading, this piece by BleacherReport is good and there is also a documentary out. Fascinating, if certifiably nuts, character.Report

    • Avatar Jaybird says:

      Part of me wonders if this isn’t just the whole issue of American Innocence. They (The WWE) see heat between Saudi and Iran and think “this is just like Nikolai Volkov and/or the Iron Sheik!” and see an opportunity to make money capitalizing on how they have a heel that will get booed out of the building without doing *ANYTHING* more than having the guy come out and say “hello”.

      You can’t *BUY* that!

      So they run with it and don’t realize that cultures over there don’t exactly work the way that culture does in the US and so stuff that is dancing right around the line of appropriate/inappropriate in the US is the sort of thing that counts as stoking a thousand year war over there.

      Unfortunately, we don’t have a whole lot of tools to talk about how something that is perfectly fine in the US isn’t okay for those people over there to do.Report

      • Avatar Kolohe says:

        It was probably over the line even the 80s, (because as Andrew says above, it plays on the conventional wisdom that all Near East/Middle East/Southwest Asians are alike*’). What probably keeps it on the ok side of the line was not that ‘it was the times’, but that in the pantheon of all the national stereotypes used there was a decent regional mix in the cadres of both the good guys and the bad guys.

        *except people knew that there were also Jewish people, though ironically enough, a good chunk of that population at the time would look like ‘Middle Easterners’ to the casual observer.Report

        • This stereotyping is actually an important conversation to have re: Iran, as these exact issues, such as lumping all ME countries under “arab” warps many peoples ability to process foreign policy. Tell a proud Iranian, like my dear friend Hadi Banei, they are Arab, see what happens.Report

          • Avatar Maribou says:

            Heh… My uncle is Persian-Canadian, immigrated in his 20s. Should you bring out such a gaffe over dinner, he would politely point out that he is Persian, not Arab (he doesn’t object to Iranian but also doesn’t use it unless he is talking about the country itself, though he wouldn’t mention that, you just notice it after a while). Then he would continue to serve your dinner while masterfully effecting a total change of subject, and then probably never invite you to his house again unless you were family, in which case someone (probably my Aunt) would be asked to explain to you why you should never EVER say that.

            No harsh words would be uttered by him at any point during this process.

            But perhaps younger folks are a bit fierier.Report

        • Avatar Jaybird says:

          it plays on the conventional wisdom that all Near East/Middle East/Southwest Asians are alike

          Is that what’s wrong with what the WWE is doing now?Report

          • Avatar Kolohe says:

            If the WWE is doing anything wrong, it’s making an error in the reverse direction. That is, steering into specific narrow stereotypes. To use an an extreme example, something like Bugs Bunny taking on a really racist caricature of a Japanese solider in WW2 cartoons. (again, that’s not even close to the magnitude of the vector the WWE has gone with this – but it is the direction the vector is pointing)

            I’m not convinced, however, they’re doing anything wrong. Everyone is an adult, and I’m not going to second guess the Daivari brothers for an artistic choice that is within their ‘rights’, for lack of a better term. (see also, for example, if the Archbishop of New York is ok with the Met Gala, then it’s ridiculous for anyone to get on a Bill Donohue-ish high horse about things)

            There is, though, also the questionable ethics of the WWE making money off stoking the conflict, a kinda Benicio del Torro at Canto Bight thing.Report

            • Avatar Jaybird says:

              Well, if we want to say that all the WWE is doing is a variant of what it did back in the 80’s… well, I’m down with that.

              We can probably agree that the Evil Foreigner storylines in the 80’s were tasteless and pandered to the worst impulses of the audience but in the same way that people complained about Punch and Judy shows, it was a class issue and not a moral issue.

              Maybe what people are most disturbed by is that all that money in Saudi Arabia didn’t buy any of those princes so much as a teaspoon of good taste.Report

              • Avatar Kolohe says:

                Evil foreigner story lines are still a thing, in that you can tell the bad guy in a movie if he has a British accent.

                The audience for panem et circenses are not the princes, but rather those to whom the princes are patrons.Report

              • Avatar Jaybird says:

                The audience for panem et circenses are not the princes, but rather those to whom the princes are patrons.

                Ooooh, touché.

                I always get distracted by the fact that the princes happen to have the best seats in the house.Report

              • Avatar Kolohe says:

                That’s how people know they’re worth something as a patron.Report

          • WWE took some flack for the Saudi show, but they have been running direct purchase (meaning the host pays for it such as Kuwait or Dubai, or in this case the Saudis) spot shows in the ME going back to the early 90s. I don’t think they are doing anything wrong with going, other than you can have the discussion of doing business in general with repressive regimes, etc.Report

            • Avatar Jaybird says:

              doing business in general with repressive regimes

              I’m, personally, of the opinion that WWE qualifies as a particular artform that is progressive for where Saudi happens to be right now. Even taking into account the whole “evil foreigner” storylines (that, maybe, are all in good fun), there is an emphasis on a handful of virtues that I happen to see as vaguely good things in the little morality play that is in most of the Booking 101 storylines that we see in a lot of the matches on the card (though, woo doggies, there were some serious years where we got nothing but morally questionable stinkers for a while, weren’t there?).

              That is to say, while America happens to be in a place where pro wrestling is regressive, not everybody can be progressive as we are.

              As such, I see doing business in general with this regime will actually help them move to where they ought to be.Report

  4. Avatar PD Shaw says:

    [Ec5] The methodology used by Alex is fairly poor. Here is a description of the index used to quantify regulatory stringency:

    RegData counts the number of restrictive words or phrases such as ‘shall’, ‘must’, ‘may not’, ‘prohibited’, and ‘required’ in each section of text.”

    The obvious goal is to be able to feed the Code of Federal Regulations into a computer program without actually needing to interpret or engage in subjective judgment. But each requirement connected to a restrictive word can vary significantly as to the burdens imposed. Each restrictive word can be attached to a single direction or to thousands of subparts. The word “may” frequently means “shall.”

    I can go on, but I think the result shows no relationship between whether an industry is highly regulated and lightly regulated on economic dynamism because the methodology cannot distinguish between the two.Report

    • Avatar Oscar Gordon says:

      I’m willing to bet that is a terribly simplified explanation of what RegData does, since it’s coupled with an interpretive AI.Report

      • Avatar PD Shaw says:

        That’s a quote from the published study; I should have supplied a link. I think the interpretive AI is just used to figure out what industries are impacted by a given regulation:

        Although the titles of the CFR often have suggestive names such as ‘Energy’, ‘Banks and Banking’, and ‘Agriculture’, a single regulation in any CFR section can affect many industries so there is no simple way to connect the number of regulatory restrictions by section to an industry. To solve this problem, Al-Ubaydli and McLaughlin (2015) draw on developments in machine learning and natural language processing techniques.


        • Avatar Oscar Gordon says:

          Thank you for the link.

          It sounds like while the RegData is still not decisively interpretative of impact, it’s a far cry better than the standard used before, and much more capable of being enhanced for better understanding of the CFR.Report

          • Avatar PD Shaw says:

            Yeah, it is better than counting the number of pages, which I never liked either. I’ve thought a better metric would be regulatory attorney hours, but that data doesn’t exist. But I think it highlights the most direct cost of stringent regulation: they require specialized assistance to understand, but also presumably impose consequences for getting it wrong (from government enforcement, private litigation, blown build schedules . . .).Report

  5. Avatar greginak says:

    Ec5- Ahh, I meant to send that to you when i read it. Good on Taborrok for publishing something that didn’t support his beliefs.Report

  6. Avatar Brandon Berg says:

    Ec5: Not sure if the headline writer is dishonest or just doesn’t understand the issue, but that’s pretty misleading.

    It’s commonly claimed on the left that cutting redistributive spending is bad for the economy, because poor people consume all they can, and rich people save too much. This is deeply confused, but let’s put that aside for a second. Suppose that a study comes out finding no negative effect on economic growth from reduced redistributive spending. The Washington Monthly…well, it wouldn’t report on that study at all, but if it did, the headline wouldn’t describe it as a a study that makes the case for welfare cuts. Rather, it would be a study disproving (and even that’s a too strong, considering how often published studies contradict each other) one particular argument against cutting welfare spending.Report

    • Avatar James K says:


      Indeed, this is is a test of the hypothesis that the cumulative weight of regulations can have a deleterious effect on GDP, even if each regulation is justified on its own merits. It doesn’t even touch issues of allocative efficiency or whether compliance costs are driving market concentration.

      Still, it’s an important contribution to the literature.Report

      • Avatar Oscar Gordon says:

        Agreed. It’s not a license to regulate until nothing is left unregulated. Also, I’m not convinced that dynamism and regulatory deadweight loss are tightly coupled.

        Also, the article talks about how they only looked at Federal Regs, which are often quite generalized and apolitical, whereas state and local can be specific and downright punitive.Report

        • Avatar James K says:


          Also, I’m not convinced that dynamism and regulatory deadweight loss are tightly coupled.

          There’s certainly no reason to suppose they are.Report

      • Avatar Brandon Berg says:

        Indeed, this is is a test of the hypothesis that the cumulative weight of regulations can have a deleterious effect on GDP

        Is it? My understanding is that it was a test of the hypothesis that regulation impacts economic dynamism (on current margins). There are any number of ways it could affect GDP without impacting the measures of economic dynamism used.

        I agree that it’s an important finding, just objecting to the misleading spin WM is putting on it.Report

        • Avatar PD Shaw says:

          It’s not GDP that is used for dynamism, its startup rate, job creation rate, and job destruction rate. But yeah, he is trying to determine the cumulative effect of regulations. From the study:

          Notice that in Olson’s theory no single regulation or handful of regulations explains declining dynamism. Taken in isolation, each regulation might conceivably pass a cost-benefit test. Rather than any single regulation, it is the accumulation of regulations that reduces dynamism. Regulations in this view are like pebbles tossed into a stream. Each pebble in isolation has a negligible effect on the flow but toss enough pebbles and the stream is dammed.


  7. Avatar Oscar Gordon says:

    EC6: I wonder why it’s ending early, especially given the researchers don’t have enough data yet to reach a conclusion?Report

    • Avatar James K says:


      Most likely some political shift within the Icelandic government – policies are seldom implemented or cancelled for evidence-based reasons.Report