The twin threats of "hidden persuasion" and artificial intelligence have now convinced most of us that Google and its ilk are almost uniquely powerful. These threats are overrated. The digital giants can do less than we fear – and we risk regulating them where we should not. 1...

Continue reading →

Let us divide the countries in Europe that have at least 1 million inhabitants into three groups: the ones that had high movement restrictions in 2020, the ones with almost no restrictions, and the ones in between. The graph below gives you the punchline that countries with mo...

Continue reading →

Together with Benno Torgler and Katharina Gangl, I published a piece recently on how to tax the powerful and sophisticated. Our substantive argument on what one should do becomes relatively simple once you understand what happened in the world of Western taxation the last 50 y...

Continue reading →

News Corp is telling us what Google should really pay for linking to its sites. It's telling us in code – HTML code. And the answer is ... $0.00. What is an Internet link worth to the linker? For most of the Internet's life, this question has been pointless. On the Internet, l...

Continue reading →

Stock markets give us a glimpse what people with money have deduced about world events before they happen. Investors can make mistakes, sometimes terrible mistakes, but they are honest mistakes: you don’t buy a stock at a 100 if you actually honestly believe that same stock wi...

Continue reading →

[caption id="attachment_34242" align="aligncenter" width="2304"] I really love this design by Casey Finley, who was kind enough to allow me to publish it here. He has a very distinctive style which is really coming into its own as he works on it. For instance, see here and her...

Continue reading →

[caption id="attachment_33674" align="aligncenter" width="3840"] Not sure Winston ever said that, but it sounds like the kind of thing he might have said. Quote investigator doesn't tell me sadly. Grateful for any others' researches in comments below.[/caption] The subject of...

Continue reading →

The mass hysteria of the corona crisis is raging, with the resulting self-isolation of whole economies and populations. The loss seems greater with every new forecast on the economic collapse than I initially though t, and the benefit of imprisoning and terrorizing the populat...

Continue reading →

[caption id="attachment_32410" align="alignright" width="458"] A particularly grotesque example of many things, only marginally related to the red tape busting agenda.[/caption] This post is worked up from a comment of mine on this Mandarin post on a new submission to the Thod...

Continue reading →

In all ways that we measure these things, physical violence has reduced in Western countries in the last 70 years, particularly mainland Western Europe. What about psychological violence though? Psychological violence, ie the inflicting of mental pain, takes many forms. It inc...

Continue reading →

In the engine room of nation states, ie the tax departments, the coming battle with platform providers is taking shape. Uber, airbnb, facebook, linkedin, ebay, jobseek, and a myriad of specialised platform providers facilitate micro-trades that are largely untaxed by the autho...

Continue reading →

https://www.youtube.com/watch?v=bRrlkEqWpZA&t=12s Here's a presentation I gave at the anniversary of Australian Policy Online which has been cunningly rebranded under its old acronym as Analysis and Policy Observatory. I gave a similar one at Kings College London a few weeks p...

Continue reading →

Sometimes, it feels like 1910 all over again. Then, a confident Germany was the up-and-coming industrial power house, fearing an even more up-and-coming Russia, with the UK and France desperately holding on to their colonial empires. Now, a confident China is the up-and-coming...

Continue reading →

My latest column for The CEO Magazine looks at the bank regulator's latest enthusiasm: changing banks' cultures. APRA is now doing what the Dutch have done for several years now: bring in a team of organisational psychologists to work out what drives behaviours within a bank,...

Continue reading →

The Effects of Marijuana Liberalizations: Evidence from Monitoring the Future by Angela K. Dills, Sietse Goffard, Jeffrey Miron - #23779 (HE LE PE) Abstract: By the end of 2016, 28 states had liberalized their marijuana laws: by decriminalizing possession, by legalizing for me...

Continue reading →

Let me indulge, purely for entertainment value, in some fan-speculation on what we will see on-screen after the Long Night is over and the final 6 episodes Of Game of Thrones are run in 2019. Let me first talk about the end-game aspects I think the books and the tv-series seem...

Continue reading →

Cross posted from the Mandarin It is six years since Australia’s Artist Resale Royalty scheme (ARR) commenced and three years since submissions to its Post Implementation Review (PIR) closed, though the review itself has never been published. However, in the absence of a healt...

Continue reading →

In part 1, I looked at whether it made sense to have random individuals inserted into parliament, or to let policies be decided by juries full of randomly chosen individuals. Both were argued to be unworkable and likely to lead to more corruption, rather than less: policies th...

Continue reading →

I've been arguing that our current approach to efficient regulation is blockheaded for as long as I can remember. I've even pointed out how one might possibly do quite a lot better with a less ideologically Manichean approach in which regulatory policy is a battle between Good...

Continue reading →

Political parties and institutions in Australia and the US are increasingly dominated by interest groups representing the few, leading to a large policy-induced increase in inequality in recent decades and a long raft of new policies favouring the few by giving them the tax re...

Continue reading →

Regulation has a special place in the heart of this blog and superannuation is a particular fave. I've offered some connoisseurship of Self Managed Super Fund regulation in the past . I could say that this takes the cake, but really it's just pretty par for the course. It's ce...

Continue reading →

As Greece's situation has gone in recent days from bad to worse to worser to even-worserer-than-that, I've seen a lot of claims that the European authorities treated Greece's private creditors too generously back in 2010-2012. My natural tendency was to accept those claims, pa...

Continue reading →

A Tale of Repetition: Lessons from Florida Restaurant Inspections by Ginger Zhe Jin, Jungmin Lee - #20596 (IO) Abstract: We examine the role of repetition in government regulation. Using Florida restaurant inspection data from 2003 to 2010, we find that inspectors new to the i...

Continue reading →

If you want to understand what bank regulators were doing in 2008, and what people like APRA and the Reserve Bank worry about here, try reading Matt Levine's latest column . Leviine's piece is nominally about a weird court case involving AIG, the insurance behemoth which almos...

Continue reading →

The current inquiry into institutional child abuse holds some interesting lessons about the nature of religion, which I'll stay clear of here. But it also holds a larger lesson about the ability of organisations to act morally and to act properly in the absence of external reg...

Continue reading →

"as much as I don’t understand it, Jeffrey Sachs really, really, really doesn’t understand it." Nina Monk, author of The Idealist "I don’t want to argue with you Jeff, because I don’t want to be called ignorant or unprofessional. I have worked in Africa for 30 years. My collea...

Continue reading →

In the last 5 years, I have made a point of giving clear predictions on complex socio-economic issues. I give predictions partially to improve my own understanding of humanity: nothing sharpens the thoughts as much as having to actually predict something. Another reason is as...

Continue reading →

On Friday 9th August Nicolas Rothwell published this article in The Australian on the state of indigenous art in Australia. Nicolas's article details how, over the past 6 years, the old free market indigenous art sector has largely been replaced by a state backed official Indi...

Continue reading →

On Thursday 8th august the Australian ran this article by Nicolas Rothwell about the toxic debacle that is the reality of the governments Artists Resale Royalty scheme. The article concluded with an examination of the circular nature of the government funded lobbyists for ARR:...

Continue reading →

That Government bureaucracies at times create 'phantom employees' to publicly argue the 'public' interest-need for.... more bureaucrats, is a well known historical truth. What follows is what Paul Frijters called: A classic case of what Niskanen spoke about. The review has fin...

Continue reading →

The adoption of ARR as policy for governments (in about 2002) was driven by a small cluster of publicly funded, 'arts societies' management representatives, that were/are closely linked to a global network of copyright collection societies managements. The real aim of these lo...

Continue reading →

Meanwhile political correctness idiocy proceeds apace. Here's an email I received today. Your expertise and experience . . . makes you ideally placed to inform this research. We would appreciate the opportunity to capture your thoughts . . . . The interviews will be carried ou...

Continue reading →

This post is a very slightly scrubbed up comment on Paul Frijters' comment on my recent column on regulation review and DIY super. I have no silver bullets, but I think the whole area is dominated by a kind of category mistake. It has been assumed - by the reg review crowd and...

Continue reading →

Here's this Wednesday's Age and SMH column . [caption id="attachment_36877" align="aligncenter" width="620"] Illustration: John Spooner[/caption] In the last fortnight the Government has ticked one of its boxes for next year’s election, launching policies to tackle over-regula...

Continue reading →

"Make the media more accountable for their sins, and worry less about new technologies and freedom of speech". That's a one-line summary of Ray Finkelstein's Independent Media Inquiry . It argues for a new system of media regulation to apply to journalists, commentators and mo...

Continue reading →

Not so long ago ALP politicians controlled the governments of every state. I think they still did at the end of 07, though I may be wrong. In any event, it was an obvious opportunity an amazingly rare opportunity. For that reason I spent a bit of time on this blog and on the p...

Continue reading →

The disclaimer below the fold is used by Virgin in their lounges when you log onto their wi-fi. Yet, like so many disclaimers, although it takes a good while to read, it contains terms almost all of which would be implied in the absence of such a disclaimer. Indeed, if there a...

Continue reading →

I didn't really expect that my recent posts about the somewhat indeterminate aims of the "Occupy ..." protest movement would result in a lively discussion thread about what I imagined was the entirely uncontroversial proposition that the limited liability corporation is by and...

Continue reading →

ASIC, one of our main financial markets regulators, has today declared that short-selling is a "legitimate business in the market" . Good on them. Markets need short-sellers, far more than most people realise. The reason is that financial markets are markets in ideas - ideas a...

Continue reading →

You'll be pleased to hear that the Mortgage Industry Association of Australia is on a campaign to ramp up the qualifications of mortgage brokers. Just because all they do is sell loans and fill out forms - and otherwise manage the process by which you apply for a loan - is no...

Continue reading →

There's something of interest in this piece by Cass Sunstein, Obama's chief of regulation (It has become common to call him 'Regulatory Czar' for some reason - not 'Regulatory Strongman' or 'Regulatory Hulk Hogan', but 'Regulatory Czar'). It speaks not just of the costs of reg...

Continue reading →

"States that require dental hygienists to be supervised by dentists suffer a 1 percent annual reduction in the output of dental services." The Effect of Licensing on Dentists and Hygienists by Morris M. Kleiner and Kyoung Won Park, NBER working paper No. 16560. As states requi...

Continue reading →

If you look at the picture on the left, you'll see a ladder on the upper right window looking at the entrance to the Church of the Holy Sepulchre. You may not believe it, but there's more chance than is usually the case with relics that the church is on the right spot. It's lo...

Continue reading →

A bunch of new rules are being introduced to Parliament today governing what is usually called the "financial planning" industry. Big new regulatory schemes often have large unintended consequences, and this one could too. But if ever an industry needed to change its behaviour...

Continue reading →

I've posted before on New Zealand's Regulatory Responsibility Bill which has become the Regulatory Standards Bill on its passage from advisory taskforce into the Parliament (and it's often referred to in this post as the Regulatory Responsibility Bill or RRB). In the spirit of...

Continue reading →

One of the things I have against academics is that they are supposed to be smart. They are smart. Yet get enough of them together and you get this - from Robin Hanson . Words fail me. Once upon a time some researchers gave people diseases without their consent or knowledge. Ot...

Continue reading →

Saul Eslake asked a bunch of people for comments on the recent Grattan Institute study of productivity and I sent him back a long email which I reproduce with some editing here. Nothing very surprising for people who are regular visitors here, but perhaps worth posting in case...

Continue reading →

I'm reading Kevin Kelly's What Technology Wants which is quite good. It is a 'book of the article' type of book, but I like it nevertheless. Part Two and some of the chapters at the end are the best part of the book. Copying from the top review on Amazon sets out the basic plo...

Continue reading →

Business is not happy with Barack Obama - and why should they be? After all they were spoiled by having a real pro in the job before Obama got there. Anyway, Obama has been leaning heavily on all arms of government - fiscal policy (obviously), monetary policy (OK, well via the...

Continue reading →

I was reading an article the other day that I can't now find, by a pollster whose name I can't remember (increasing age is like that). It dealt with Coalition strategist Mark Textor's highly successful four part 2010 campaign theme for Tony Abbott: stop the boats, no big new t...

Continue reading →

Foreword: I discovered this post - which I'd entirely forgotten about - the other day. It's a cracker, and because I wrote a comment on it, it's received some further comments on account of turning up in the 'recently commented on threads' list. So I'm sticking it on the front...

Continue reading →

In Part I of this post I explored factors that might account for the massive proliferation in the volume of legislation and subordinate regulation in Australia over the last 30 years or so. The post was prompted by an article by the IPA's Chris Berg. In the previous part I sug...

Continue reading →

Salma Hayek, who is apparently unrelated to Friedrich and may well be totally uninterested in either rule of law or regulatory reform ... That isn't gratuitous , is it? Chris Berg of the conservative thinktank Institute of Public Affairs takes aim at the proliferation of regul...

Continue reading →

Many of the agendas associated with economic reform have been big successes. Deregulation of things that shouldn't have been regulated, like trade, shopping hours, airlines, you name it has worked well. Financial regulation . . . ehem not so well. Indeed, in terms of the wellb...

Continue reading →

The regulation requiring medicines to be sold with consumer product information guides is a good idea in principle. But in the attempt to find out a little more about an over-the-counter pill I sometimes take to get to sleep - Restavit - I found myself reading one. It's got so...

Continue reading →

An honours student approached me to interview me on an interesting thesis she is writing currently entitled "The conceptualization of political participation by advocates of Government 2.0". Naturally enough I agreed to what turned out to be an excellent interview (I do like i...

Continue reading →

President Obama's 'Wall Street' speech on Thursday was good news for the future of capitalism and for civilisation as we know it. He seems to mean business, urging finance leaders and their Republican servants to accept the main elements of the bill now being prepared for the...

Continue reading →

Gather round and listen to this tale. One of the promises made by the current government in opposition that they managed to get in place without much difficulty was the Lobbyists Register . This was to make the whole lobbying process more transparent. Any firms wanting to lobb...

Continue reading →

The Sydney Morning Herald has been trumpeting a study they supported by on the future of Sydney's public transport and urban structure. Beneath the being overly pleased with themselves, with we're above petty politics harrumphing there is a genuine effort to talk about the pol...

Continue reading →

Ever since I read his marvellous The Truth about Markets I've been a fan of John Kay - an economist who doesn't like to get too far away from reality. He's also not a zealot for any particular view of the world, except that pathetic kind of vagueness and pluralism to which I a...

Continue reading →

The High Court has ruled that people serving alcohol are not at risk of of massive claims for damages if a drinker comes to grief on the way home. One would hope that commonsense will prevail and folk will conform with responsible serving guidelines. Some of the claims were a...

Continue reading →

Jeffrey Friedman has produced a special edition of Critical Review devoted to various perspectives on the crisis. Among the contributors are Friedman himself, Joe Stiglitz, Vernon Smith and Lawrence White All the abstracts are here . Friedman wrote a long lead article. ABSTRAC...

Continue reading →

It it not necessary to be a fan of the Rudd administration or the alcopops tax to deplore the horse-trading that is going on to hold the Government to ransom on legislation to ratify the tax. Abuse of the Senate is not a novely and the man from Tasmania was probably the worst...

Continue reading →

Note to self: Where morale is high - for instance in a workplace or a community - at least some regulations - for instance dome designed to make sure people don't cheat or free ride are unnecessary as very few people do this and when they do they are detected and sanctioned. I...

Continue reading →

One of the recommendations that I think of as most important in the Review of the National Innovation System is one that will cost next to nothing. As a result, it costs next to nothing. We spent a fair bit of our time focusing on the question of how we could accellerate innov...

Continue reading →

These are difficult times for liberals. The mood around the world is turning against them. Politicians find it easier to blame crazy economists and greedy managers for financial turmoil than to understand and fix their own mistakes. Free-marketers still have the evidence of ec...

Continue reading →

Interesting to see that the ACT party , led by Rodney Hyde, has a slice of the action in New Zealand. The party is described as the most free market party to have seats in Parliament anywhere in the world. When I ran into Rodney Hide at the Mont Pelerin conference in Christchu...

Continue reading →

In light of the massive interventionism that is being practiced by governments to handle the financial crisis, a warning needs to be repeated regarding two very different kinds of government action. The warning can be found in Chapter 17 of The Open Society and its Enemies , s...

Continue reading →

Last week I was privileged enough to go to the PM's Science Awards in Parliament House. Kevin was, as usual enjoying his place in the centre of the stage, and gave a good speech which impressed his audience. But the highlight was the scientists. Just five got awards - two were...

Continue reading →

There are important lessons to be learned from the Great Depression but I have the impression that the left emerged with the view that the New Deal was required to save the US from rampant capitalism. There is an alternative account . For an MP3 version of the story . The New...

Continue reading →

"Goodbye and f.... you!" A hemp-inspired comment maybe? This came out of the farewell letter from Andrew Lahde, manager of a small California hedge fund, Lahde Capital, which recentlyreturned 866 percent betting against the subprime collapse. He has retired to live the good li...

Continue reading →

On this analysis two major factors in the train wreck were the regulations that pushed lenders to water down prudent criteria for lending and the flight of speculators from the housing market when prices ceased to rise. A nuance in this analysis is to point out that it was not...

Continue reading →

I recently received an offer to buy some David Jones shares of mine - bought for the discount that I think they're in the process of phasing out. The offer is to buy the shares for $2.04 per share when their market value - at the time the letter was sent was $4.08. All this is...

Continue reading →

For people who have the time or the need to get into the details of the proposed bailout package, this link provides a section by section summary of the bill. Given the size of the bill, something like this is the only way that most people will ever get a glimpse of the mechan...

Continue reading →

The way the proposed bailout is being talked up, you get the impression that the whole world depends on the Bush administration and the Fed coming to the party with the best part of a trillion dollars. The US economy depends on it, our economy depends on it, the capacity of th...

Continue reading →

The travails of the financial markets have triggered a degree of jubilation among the usual left-leaning suspects, as though this episode reflects badly on "neoliberalism", deregulation and the free market order. This view is not sustainable because the problems can be traced...

Continue reading →

Hugh Stretton has been a persuasive advocate for the competition-enhancing role of government agencies in the private sector. His example was the South Australian Housing Trust which apparently operated on a commercial basis to provide alternative accommodation in the marketpl...

Continue reading →

A whilc back 'principle based' regulation was all the rage. Outcomes based regulation is another catch cry. In an interesting paper Chris Berg of the IPA argues that the 'mega regulators' of Australia - the ACCC, APRA and ASIC - have now carved out for themselves such discreti...

Continue reading →

The Fin asked me to write my summit idea up for them - so I did. 150 years after Adam Smith first expounded the miraculous way the markets invisible hand transforms private self interest into social prosperity, some economists argued that we could achieve the same result with...

Continue reading →

I was intrigued to find that when the Public Service Commission launched into the project of tackling red tape, they found they were beset by myths. Just like Lateral Economics said in its report on Regulation and Innovation for the Victorian Government: The finer points of mu...

Continue reading →

A while back, I came upon Beth Noveck who is doing some interesting things in trying to bring the techniques and possibilities of Web 2.0 to government. For instance in addition to theorising at American law journal article length about ways of moving governments into the Web...

Continue reading →

This month's edition of Ceteris Paribus the newsletter of the Victorian Economics Society carried the article below by Gerard Brody on regulatory gatekeeping. I don't agree with all of it, but it's general point (highlighting the fact that our regulation review institutions te...

Continue reading →

I can't. Confession 1 : American track star Marion Jones admits using performance-enhancing drugs and will almost certainly be stripped of the five medals she won at the 2000 Sydney Olympics. She will probably face a maximum of six months in jail for perjury, but that could be...

Continue reading →

For a fair while I've been interested in things like who appoints and pays for auditors of public companies and whether we've got it right (given that the information provided by auditors of companies for instance is a public or quasi public good when produced and firms have a...

Continue reading →

In a story in Today's Crikey! , Guy Rundle raises a subject dear to my heart about which I am, alas, ignorant. Why are so many of our planning regulations negative - the most obvious being height restrictions, when what we really want from regulation is collective action to ma...

Continue reading →

What have these two men got in common? And who the hell is the guy on the right anyway? Find out at a seminar I'll be leading tomorrow, Tuesday 25th September from 12.30-1.30pm in Seminar Room 4, on the 1st Floor of the J.G. Crawford Bldg - the Public Policy School adjacent to...

Continue reading →

Because I managed to say some things in the interview of the report on Regulation and Innovation more compellingly than had been said in the report (pdf) or in the op ed of the report , I was about to try to hunt someone down in India to transcribe the relevant part of the pro...

Continue reading →

A couple of weeks back I wittnessed a discussion meeting here at QUT on whether Hedgefunds should be outlawed, or at least heavily regulated. The main speaker was Dr. Robert Bianci who has sent a large part of his PhD degree on the functioning of Hedgefunds. The PowerPoint sli...

Continue reading →

The AIRC website reassures readers that: An employee who believes he or she has been unfairly or unlawfully dismissed has 21 days from the dismissal date to lodge an unfair or unlawful dismissal application with the AIRC. There is an application lodgment fee of $55.70. However...

Continue reading →

Tomorrow sees the publication of a Lateral Economics report commissioned by the Victorian Government on Regulation and Innovation. It argues that our current approach to 'regulation review', though laudable in intent, is having at best modest success and that the reason for th...

Continue reading →

Here's an op ed just published in today's Fin. John Howard has form on cutting red tape like Paul Keating had on making tax cuts the L.A.W. Having won government promising to cut red tape by 50 per cent, Howard then introduced a new tax which, as Treasurer in 1981, hed rejecte...

Continue reading →

I was in Washington DC yesterday renewing my passport. The US is still imperial, so to comply with Australian metric standards I had to order A4 paper and the photos took two goes before they were within the bounds of the 'biometric' software reader. But the passport is just a...

Continue reading →

I spoke with my accountant today and asked her if my company could lend me money - it's got more money than it needs and I've got less than I want. Actually having written that I realise it's not accurate. The point of borrowing money from my company is that I'm borrowing lots...

Continue reading →

Here's a nice illustration of the (hidden) costs of red tape. I've just signed up to let everyone know that I'm happy if they use bits of me for better purposes than feeding maggots if I'm dead. The letter I received with my card says that the details of my decision "are prote...

Continue reading →