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Garett Jones' work seems relevant here. See this and this paper for instance. Short story: IQ has a modest effect on individual earnings but average national IQ has a large effect on a nation's GDP. He cites spillover effects as the cause, which, if true, renders the question in the OP a bit difficult to answer.

I have not read these papers carefully enough to comment on the statistical work contained therein.


Ha, clearly Gjvyvtug Fcnexyr vf Oryyngevk va qvfthvfr naq gur jubyr guvat jnf fbzr ovmneeb frghc gb znxr Uneel guvax Dhveeryy vf qlvat.


Some of the very basics I know from researching veganism:

Moderate meat-eaters seem to have longer lifespans than heavy meat-eaters and vegans. I can't remember if vegetarians are equivalent or a little shorter. This is epidemiological data so take it with a grain of salt--you can eat french fries all day and be considered a vegan, likewise many vegetarians probably substitute meat with unhealthy amounts of cheese. But eating meat-heavy meals for every meal appears to be bad for longevity.

Fish is effective at preventing alzheimer's. This does not seem to be reproducible by taking (overrated) omega-3 fatty acid capsules.

So, eating more vegetarian dishes and fish once every few days or so is probably a good idea. I have no clue what to help with short-term cognitive performance.

Also, moderate wine consumption is extremely good for you. 3 glasses a week can increase your lifespan significantly.


I don't know if accounting is underrated, and I don't know if anyone has made accounting look awesome and exciting on its own. But conditional on finding scam-busting interesting, which I guess a lot of skeptics do, there are several books on auditing, how companies cook the books, how to detect unethical accounting practices through various statistical techniques, etc. In fact most of the techniques are subtle because they tend to bend the rules just a little bit more than auditing professionals prefer. The rules can already be legally bent significantly because of how many different ways there are to operate a business.


For what goal? Longevity, weight loss, muscle gain, ethics?


Avoiding mockery is probably not a terminal value of most of the denominations you're referring to. Regardless, if you accept the doctrine of the Trinity, God gets to be both a third party and a first party to the transaction, problem solved! And most Christians probably see it more as God making a sacrifice to appease the cosmic legal system that he instituted rather than himself directly, if that makes any sense.


Vonnegut in Slaughterhouse Five. I think it comes off a little awkward--more a reminder that Vonnegut was himself in Dresden than anything pertaining to the story.


Scott Sumner is aware of free banking and seems somewhat supportive of it. Same for Lars Christensen. Alex Tabarrok is critical of the Fed and Cowen in response is critical of the anti-Fed case. (But note that the anti-Fed case is not the same as the case FOR free banking--I don't know Tabarrok's actual policy preference.) I can't find any Krugman mentions of free banking but he has offered arguments for a central bank. David Andolfatto, VP of the St. Louis Fed, has said that he sees some merit in free banking arguments but finds some of its modern proponents focusing on weak criticisms of the Fed. He even claims that he invited George Selgin to give a lecture on free banking to that Fed branch. Vera Smith, a Hayek student, claimed that central banking won out due to political motives and historical accident rather than sound economic theory. Keynes, in a passage that isn't quite about free banking, offered a criticism of bank incentives that suggests banks suffer a problem of liquidity preferences that central banks do not, and this can be read as an argument for central banking. (His argument is similar to yours about bank runs.) Brad DeLong included on a course syllabus a 1974 paper on free banking which argued that there was enormous variation in success in free banking in the U.S., with massive hyperinflation in some areas and stable currency in others. I don't know DeLong's actual position on the topic, but "the data suggests that free banking is unreliable" wouldn't surprise me. Of course the footnotes in that paper refer to other papers on central banking, and searching citation will find other research on free banking v. central banking, some of it negative. One of these papers, Whaples', surveyed economic historians and found they near universally agree that the free banking period in the U.S. didn't hurt the economy.

So, yes, I'd say Mankiw's opinion is within the range of normal economist variation. Obviously there are many professional economists who think there are sound market failure arguments in favor of a central bank or that the history of free banking shows a failure rather than success; Mankiw can only be saying that he finds their judgments inadequate, not that they don't exist. Otherwise, he's ignorant. And obviously one can't say that almost the entire economics profession has completely ignored the question. It's still an ongoing debate even among employees of the Fed.


Well, if you're looking for criticism, let's start with this: As someone who has almost certainly spent much more time around economists than you have, I think both of your explanations for the unpopularity of free banking are very bad. On the second point, self-interest has little influence on individuals' politics. This is a robust result in political science across a large range of policies, and so should be the default when discussing why others have the politics they do. Unless you have very good evidence, rather than weak conjecture, you should assume that people's salaries do not determine their political opinions. Your conjecture makes little sense anyway, since under free banking economists would be hired by private banks instead of the Federal Reserve, while getting paid nicely to help shape the economy, and only a small portion of economists work for the Fed anyway. So there's a reasonable case to be made that self-interest would encourage economists to support rather than reject free banking.

For your first criticism, I think you're starting from entirely the wrong assumption. Your argument seems to be, "economists naturally distrust the government except for here, where status quo bias prevents them from doing so."

More reasonably, I think, is that you are simply wrong about what most economists believe. The average economist is a moderate Democrat. They support many, many government monopolies when they think there is a market failure to correct. They support the regulation of natural monopolies, they support antitrust commissions to tell us whether a market is too concentrated, they support the EPA, etc.

Most economists are quite supportive of centralization in the face of market failure, and there is at least one market failure argument with regard to free banking that is quite obvious: you might get too many currencies, the constant exchange of which would cause a large deadweight loss. And that's not just the exchange rates, that's employees now tasked with manning money exchange booths all over town, time wasted going to such vendors, people holding more than the optimal amount of money, etc. Indeed, some people will tell you this is exactly what happened when Switzerland tried free banking. Heck, there's currently a quote regarding that case on the wikipedia page for free banking.

There are good arguments in response to that, and responses to other criticisms of free banking. But your post pretends that such arguments don't even exist. I can find several more.

Not to mention other reasons the typical economist might not spend too much time looking into free banking: Free banking is largely the product of Austrian economists, an unpopular group whose main idea separating them from the mainstream, their business cycle theory, is considered by most economists totally wrong. So a first pass at free banking might see it as an attempt to fix a problem that is incorrectly identified to begin with.

In short: far, far too much confidence on display here. That's what politics does to us, and I'd recommend reading a lot more before continuing your series. As a start, read the references in Selgin and White's papers, you're sure to find some genuine criticisms there.

(Disclaimer: I have no strong opinions on free banking. I think it might be worth a try, that it's a shame we can't run this experiment, and that it's also a shame our historical data isn't good enough to settle the question. I have a Master's in econ from GMU.)


I doubt it will much improve anyone's rationality. It does nicely illustrate a few issues on how science is done, and could be a fun way of explaining for the layman.

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