Category: Tea

Special EconTea: The Nuclear Option

There will be a special Econ Tea on Tuesday, May 20 at 2:30 p.m. in Briggs 217 to discuss this paper:

Joseph Michael Newhard, “The Stock Market Speaks: How Dr. Alchian Learned to Build the Bomb,” Forthcoming in Journal of Corporate Finance.

The paper covers the remarkable story of Armen Alchian’s attempt to figure out the fissile material in nuclear weapons.  Here’s Alchian’s telling of the story:

We knew they were developing this H-bomb, but we wanted to know, what’s in it?  What’s the fissile material? Well there’s thorium, thallium, beryllium, and something else, and we asked Herman Kahn and he said, ‘Can’t tell you’… I said, ‘I’ll find out’, so I went down to the RAND library and had them get for me the US Government’s Dept. of Commerce Yearbook which has items on every industry by product, so I went through and looked up thorium, who makes it, looked up beryllium, who makes it, looked them all up, took me about 10 minutes to do it, and got them. There were about five companies, five of these things, and then I called Dean Witter… they had the names of the companies also making these things, ‘Look up for me the price of these companies… and here were these four or five stocks going like this, and then about, I think it was September, this was now around October, one of them started to go like that, from $2 to around $10, the rest were going like this, so I thought ‘Well, that’s interesting’… I wrote it up and distributed it around the social science group the next day. I got a phone call from the head of RAND calling me in, nice guy, knew him well, he said ‘Armen, we’ve got to suppress this’… I said ‘Yes, sir’, and I took it and put it away, and that was the  first event study. Anyway, it made my reputation among a lot of the engineers at RAND.

You can get an ungated version of the the paper here.

As per usual, the availability of refreshments is subject to estimated demand and prevailing market prices.

Pro-Market v. Pro-Business

George Mason economist, and letter-to-the-editor writer extraordinaire, Don Boudreaux, has an opinion-editorial in the Christian Science Monitor explaining his distinction between public policies that are pro-business and those that are pro-market.

Economists (especially the free-market variety) – concerned always to keep outputs of goods and services as high as possible – typically defend business against counter-productive government interference. We economists do so, however, not because we have special fondness for business. We do so because we understand that government interference in business often results in fewer goods and services for ordinary men and women – as consumers – to enjoy.

In short, an economy’s success is best measured by how well it pleases consumers, not by how well it pleases businesses…

“Competition” sounds good. But businesses don’t like competition; they like protection from competition – along with subsidies, special tax breaks, and other government favors that relieve them from the need to cater energetically to consumer demands. So a pro-business president is prone to curry favor with businesses by shielding them from competition…

The irony is that such policies – which really should be labeled “crony capitalist” – are often labeled “competitiveness” policies. Because these policies increase the profits of some domestic businesses, they are mistakenly believed to make the domestic economy more “competitive” when, in fact, they make it less so.

This seems to me to be an important distinction.  I try to convey to you all that no one hates competition more than business does.  If you set up a profitable business, say, selling hot dogs on a street corner, the absolute last thing you want is a competitor to park her cart next to yours.

And, while we’re on the subject, don’t forget to join us for tea at 4:21 for Econ TeaBA.


Yes, it’s back! After the long break, aren’t we all starved for cookie, coffee, tea, and conversation? Well, I know I am, so I am bringing the cookies. And in an effort to make the holiday season last till Valentine’s Day at least, I am bringing some genuine, imported German holiday cake (“Stollenkuchen” for those who know). Come join us on Monday, at 4:21, in Briggs 217!

Welcome Back, Econofolks

Hello and welcome to the friendly Appletonian confines for the 2010-2011 academic year.   A few noteworthy elements:

  • The first Economics TeaBA will be Monday, September 20 at 4:20.  The location is TBA, but it will certainly be somewhere on Briggs 2nd.
  • Professor Gerard is out of town until Wednesday, and may be difficult to locate around campus until then.
  • There is plenty of room in Economics 300.   If you are interested, register or put your name on the waiting list, and enroll in The Moodle (enrollment code 0300).  It will meet Monday this week, but not Tuesday.  There is a quiz Wednesday.  The class meets M, Tu, W, F at 3:10.
  • Notice the fall course offerings include history of economic thought with professor emeritus, Jules LaRocque.  This could be a one-shot deal as far as history of thought goes for many of you, so you might poke your head in there on Tuesday and see how it sounds.
  • Schumptoberfest™ is October 22-24 up at the Björklunden facility. I will post more about this later in the week.  Those of you interested, should see Professor Gerard (when he gets back; see above).

It’s shaping up as a good year.

No Holiday Econ TeaBA

Grill, Baby, Grill

We kick off the final week of classes with a holiday, perhaps an apt metaphor for where many of you have been mentally for the past week.  The holiday preempts the usual slot for the Economics TeaBA, paving the way an afternoon barbecue for the missus and me.

We get back to serious business in my courses Wednesday. In environmental economics (Econ 280), small groups will be reviewing the cost-benefit analysis of the Minerals and Management Services offshore leasing program. Then in the afternoon, the political economy of regulation course  (Econ 240) will be going through some of the administrative regulations governing offshore drilling, truly a look at how the sausage is made.  If you are interested, stop on in to see whether they’ve learned anything.

So, I’m headed over to the parade.  Hope to see you there.

Penultimate TeaBA

It’s time to get ready for the penultimate Economics TeaBA of the 2009-2010 season. As per usual, the fun starts at 4:15 Monday in Briggs 217.

The Economics TeaBA came pretty much out of nowhere and has become a centerpiece of the economics co-curricular activities at Lawrence. Dozens of students have been treated to hot beverages, high-calorie snacks, along with both casual and serious discussions with the economics faculty and other esteemed attendees. In the past few weeks, we’ve enjoyed the company of EPA Administrators, mathematics professors, professors emeriti (is that the plural of emeritus?), and visiting economists /standup comedians.

So, we never really know what the Economics TeaBA will hold. All I can say is that this week’s will be the penultimate experience.

Economics TeaBA returns

As we have just seen, there is a lot going on around Briggs second these days.   We’ve got the attention of the University with the This is Lawrence video, there is the upcoming Chicago weekend, we are in the midst of class registration, and the Entertainment Industry Summit is on the horizon.

That means there is no better time than now to join us for the Economics TeaBA in Briggs 217 at 4:15.  You never know who’s going to show up. Last week we were joined by visiting Scarff professor and Povolny lecturer, George Wyeth, as well as comic genius and fellow Povolny lecturer, Yoram Bauman.  This week, perhaps it will be all-time hockey great, Henri Richard.

Well, perhaps not, but it promises to be a good time. As ever, the menu is subject to the department income and changing relative prices.

See you after class.

This week’s SpecialTea: Fresh Ideas in Innovation

Our weekly EconTeaBA will get an intellectual boost from physicist and in-house innovation expert Professor Brandenberger on Monday. As this post noted a few days ago, he recharged and refreshed his thinking on innovation at a conference in Berkeley, where the world’s top thinkers on innovation gathered two weeks ago. The conference was organized by The Economist, and the list of speakers included Amar Bhidé, Robert Reich, Clayton Christensen, David Kelley, Michael Porter, Jared Diamond, Ray Kurzweil… and the list goes on. Professor Brandenberger will tell us about what these great minds had to say about the future, about innovation, and how that has changed his views on the subject. And there will be cookies, tea, coffee.

Schumpeter Day Tea, That Is

The folks over at Organizations & Markets remind us that it’s Schumpeter Day again (where does the time go?). The nation-wide celebrations commemorate the birthday of the prominent economist, who plied us with such memorable lines as this:

The process of Creative Destruction is the essential fact about capitalism … it is not [price] competition which counts but the competition from . . . new technology . . . competition which strikes not at the margins of profits . . . of existing firms but at their foundations and their very lives.

The Economics TBA / Schumpeter Day High Tea at 4 p.m. today (along with “Reading Days”) will serve as a kick off for the Innovation and Entrepreneurship Reading Group. We will begin blogging the text later this week.

See you at 4

Update: The tea was once again a resounding success, with the student faculty ratio of better than 3:1. I still think offering caffeine could boost our numbers.