Tuesday, January 31, 2006

UAE residents: UAE most likely to democratize :: Gulf News

A "Gulf News YouGov survey reveals [that] UAE residents are very optimistic about democratisation in the region. More so, they said, the country most likely to adopt change in 2006 among other Arab nations is the UAE. UAE nationals as well as Arab, Western and Asian expatriates chose their resident country."

I don't put much stock in online polls. Still, it is encouraging that the expectation of democratization exists amongst respondents - expectation of change can be an impetus to change.
Technology and Class Attendance :: Economist's View

A thoughtful post generates an even more insightful dialog amongst the commenters.

I never cease to be amazed at the number of students who think that staring passively at Power Point lecture notes is how you learn.

Monday, January 30, 2006

Palestinian bourse plummets after election :: Reuters

[Welcome PJ Media readers. If you are reading this in your pajamas stop long enough to enjoy other posts here at The Emirates Economist. Thanks for visiting.]

Apparently, Condeleeza Rice wasn't the only person caught off guard by the Hamas victory.

Quoting the Reuters article:
Worried Arab investors, mainly from the United Arab Emirates, as well as Palestinian shareholders have continued to call Rajab looking for any news that might ease their concerns.

"It's a total crash," Rajab said. "They (investors) don't trust the market, because they don't know whether Hamas will hold talks with Israel."
Hispanic Pundit finds the money quote. Again.

(Link corrected.)
Counting is not merely an exercise :: Undercover Economist

how many official signatures does a farmer in the Central African Republic need to obtain before he’s able to get his bananas on a ship bound for America or Europe - 38. How many official procedures must a businessman in Lagos go through in order to legally buy a warehouse - 21.
Public education sector enlists private partners :: Gulf News

The project aims to build a new education system in Abu Dhabi to restore public trust and confidence in public education, said an Abu Dhabi Education Council official.
. . .
Shaikh Mansour Bin Zayed Al Nahyan, Minister for Presidential Affairs and Vice-President of the Abu Dhabi Education Council, said the partnership is intended to increase the professional standards of national staff while ensuring their professional development.

Shaikh Mansour noted the partnership provides a measure of independence to each school administration.
. . .
Principals and teachers, including national staff, will get improved job incentives and professional development opportunities.
I am impressed. Perhaps someone has been listening to economists?


Blogging is not a fad :: Corante

The economics of blogging as brought to you by Arnold Kling.

Sunday, January 29, 2006

Petroleum Intelligence Weekly: Kuwait's reserves half those officially stated :: Reuters

A story from last week that I missed. Perhaps you did as well. Since it's not created a stir in the markets could it be that no one in the market ever believed Kuwait's official numbers? Don't ask me.

Saturday, January 28, 2006

'American Vertigo: Traveling America in the Footsteps of Tocqueville,' by Bernard-Henri Levy - The New York Times Book Review

The closest this book gets to Tocqueville is the title.

Money quote from Keillor's book review:
You've lived all your life in America, never attended a megachurch or a brothel, don't own guns, are non-Amish, and it dawns on you that this is a book about the French. There's no reason for it to exist in English, except as evidence that travel need not be broadening and one should be wary of books with Tocqueville in the title.
(Via Marginal Revolution.)
Fake firms :: Khaleej Times

"Unfortunately, some nationals are involved in licence racketeering and are living on that. Such people know nothing about the operation and status of their companies," he pointed out.

"In a certain case, the ministry succeeded over two years to pressurise a national who was the partner, owner and local agent of more than 20 companies to cancel the false companies. Despite that he is still facing problems with some of the eight remaining companies. What sort of business did he have? And, shouldn't he personally supervise the working of the companies, or at least follow up on what is happening there? wondered the official.

He added that the proposed computer link and other rules will help prevent the occurrence of such mess in the future.
I wonder what government regulations cause such behavior? As always, the comments are open for your suggestions.

Friday, January 27, 2006

Student Movement Coordination Committee for Democracy in Iran

A mere bus rider once galvanized a movement, and shook a system to its roots. Why not bus drivers?

UPDATE. Publius Pundit brings us this disturbing news:
dozens of drivers have been wounded and some of their wives have been kidnapped.
Read the whole thing (links rich).


No, I am not bloviating from Blovas, er, Davos. Perhaps my invitation was lost in the mail. Damn.
China :: StrategyPage

It was just last that some new friends and I were noting how China seemed to be proving that capitalism and democracy don't necessarily go hand-in-hand.

Well, the link above provides more evidence for the proposition that once you experience the freedom of a market economy, you want more that just economic freedom.

One more reason to embrace capitalism.


Dubai Schools announces launch of flagship school :: AMEinfo

Dubai Schools (DS), an initiative of The Dubai Education Council (DEC), has announced the launch of its flagship school, Repton School Dubai, in response to the demand for world-class education from Dubai's growing multi-cultural population.
Earlier, at sheikmohammed.co.ae:
“The council is setting new standards for private schools. The purpose of this project is to improve the standards and quality of education in Dubai for both UAE nationals and expatriates,” said DEC Chairman Ahmed bin Byat.

The goal is to have a well-educated generation in line with the pace of development in Dubai.

After they graduate from high school, some public school students find they don’t have all the skills they need to start university.
Bravo. There's nothing like getting to the point.


Search for president narrowed to five finalists :: Brainerd Dispatch

Quote (reg. req.):
Central Lakes College announced its five finalists for the college's top administrative post.

Officials said Thursday the finalists for president of the college, which has campuses in Brainerd and Staples, will be interviewed on campus the week of Feb. 6 and a president is expected to be on the job July 1.

The five finalists:

- Eric Radtke, director of planning, budget and human resources and director of academic services at the Higher Colleges of Technology in Abu Dhabi, United Arab Emirates. ....

The things you learn with googlenews........
Dubai pushes for Asian manufacturers :: Shanghai Daily

Dubai, the commercial hub of the United Arab Emirates, has managed to diversify its economy beyond oil with a focus on trade, services and real estate development. It now plays a role much like the port cities and financial centers of Hong Kong and Singapore, but like them it is also reluctant to have its fortunes based entirely on less-tangible activities.

"We believe manufacturing should play a role in our economy. We don't believe Dubai should depend only on services," said Arif Mubarak, director of the Asia Pacific Region for the Dubai Development & Investment Authority. The government body has just opened an office in Hong Kong, its first in Asia, and also plans to open offices in London and New York.
HAMAS Wins Historic Election, What's Next? :: Free Muslims Coalition

This is the first time in modern Arab history that a ruling party gracefully accepts its losses. The Palestinian people have become the most democratic people in the entire Arab and Muslim world and this is a cause for celebration.
. . .
The Free Muslim Coalition applauds President Mahmoud Abbas of Palestine and his FATAH party for respecting the results of democracy in light of their substantial losses to the radical Islamic group, HAMAS.
U.S. Bureau of Labor Statistics may need to consider new labor force participation rate: the family rate.
Bangladesh tax amnesty :: Khaleej Times

[Finance and Planning Minister M Saifur Rahman's] announcement sparked resentment among the civil society as the tax for the disclosed money is 25 per cent and for the black money only 7.5 per cent. According to the NBR sources, although the Finance Minister's announcement triggered resentment among the taxpayers, it would yield a good amount of money for the exchequer.
Nothing irritates me more than when people who play by the rules get treated better than those that do not. Mister Rahman, will you still be around when the exchequer feels the future consequences of your current actions? You've just created the belief that if one pay his taxes one is a fool. Fool me once the jokes on me - and you.

Perhaps a better policy to increase tax revenues would have been to lower tax rates to everyone, and increase fines on scofflaws.
Measures to check employment of national PROs :: Gulf News
(PRO = public relations officer)

"If they hire a UAE national PRO, they must send him to the ministry," Al Ka'abi [Minister of Labour and Social Affairs] said, "and not an expatriate PRO with papers to prove the company has hired an UAE national."

"I want to see UAE nationals working. They are not to be hired on paper only." The minister said more than 700 UAE nationals have now been hired as public relations officers.
. . .
At least one large company which hired a UAE national PRO to abide by the new decision is now facing mounting fines after the new employee "decided not to answer his phone", a senior company official there said.
Water for rural Bolivia at what price? :: Division of Labour

Five years ago in Cochabamba, Bolivia, the New York Times reports, local leftists ran an American monopoly franchise (Bechtel) out of town for trying to raise water rates. A victory for the people!

One small catch: today, because the local public utility has kept the old low rates, they can’t cover the cost of keeping the pipes filled, let alone extending them. Half the population still has no piped water service (they rely on wells and freelance water trucks), while even for the lucky households the taps run only a few hours of the day. Maybe not such a victory for all of the people.
See, also, The EclectEcon's take.

This story got me to reminiscing about Don Cox's song written for Bob Barley and The Complainers. The context is to imagine what The Complainers would sing about after the true revolution, when all major problems of the world have been solved. The song* went something like this:
Ring around the collar
Those dirty rings
You try washing them out
You try scrubbing them out...
*Can be sung to the tune of any song ever written by Bob Marley.
Dave Barry Explains Why We Left the Gold Standard :: Division of Labour

Dave Barry makes me laugh. Dave Barry writing about economics makes me laugh real hard.

Thursday, January 26, 2006

Should bloggers police their own ranks? :: TigerHawk

Cassandra posting at TigerHawk has some reasonable observations about comment sections of blogs.

For background, see this recent WaPo online chat on the subject. Actually, I found the quality of the chat rather low brow, but I did learn what got some readers of a certain WaPo blog so upset and how they reacted.

Aside: It's interesting to me how, in the UAE, Secret Dubai's blog has become the place to meet and comment. It's become a focal point for comments that persists because it is a focal point. How it became a focal point is another story.
High-rise condos go cold :: TIME

Could it happen in Dubai?
Action - More inspectors to monitor workers' rights :: Gulf News

The UAE is moving in the right direction, and asking the right questions:
A labour inspector will now check on the rights of every 21,062 workers, after 50 inspectors formally began work at the Labour Ministry yesterday. On January 21, Gulf News reported that the Ministry of Labour and Social Affairs had only 80 labour inspectors to check on the rights of about 2,738,000 expatriates, working for about 246,420 UAE-registered companies employing one worker or more. That meant there was one labour inspector for every 34,225 workers in the UAE.

The situation is likely to improve somewhat after the ministry absorbed some administrative staff as labour inspectors after a six-month training course.
. . .
Some inspectors complained to Gulf News that they were paid between Dh5,000 and Dh11,000 a month. Salary problem still has not been solved, admitted Dr Ali Bin Abdullah Al Kaabi, Minister of Labour and Social Affairs.

That's still a low inspector to worker ratio, but it is a move in the right direction. If more nationals are to be attracted to these posts, the salary will need to improve.

Internal reorganization is usually not easy or pleasant. It is a healthy sign that the MoL has redeployed some administrative staff as labor inspectors.

UPDATE, 28 January: The Khaleej Times has more. "An independent authority for labour inspection, to operate under the umbrella of the Labour and Social Affairs Ministry on the country’s level, will be set up during this year to enable better control on the private sector, revealed Dr Ali bin Abdullah Al Kaabi, the Minister of Labour and Social Affairs. . . . The authority, in cooperation with a specialised company, will prepare statistical studies and integrated maps about the labour force and companies operating in the country, which are estimated at 250,000."

Wednesday, January 25, 2006

National women demand equal citizenship rights :: Gulf News

[Welcome to lgf readers. Thanks to RTLM whose comment brought you here. I encourage you to take a look around The Emirates Economist. And before you leave I want to be sure to impress upon you that the United Arab Emirates is not to be confused with Saudi Arabia. Not in the least. The sorts of issues women face here I put on par with the issues American women faced 50 years ago or less. And progress has been rapid and continues.]

This is the first public protest UAE national women have carried out to demand equal rights.
. . .
"This protest is to ask for our equal rights as citizens of the UAE," a spokeswoman said. "We should have the same rights as men when it comes to marrying foreigners. Our children should be citizens, and have access to free university education, health care and passports."
The Khaleej Times report treats the protest as minor news.


Emiratization database :: Gulf News

Quote (scroll to end of Gulf News article):
During a meeting held in Abu Dhabi between the UAE Ministry of Labour and Social Affairs, General Pension and Social Security Authority, Abu Dhabi Retirement Pension and Benefits Fund and Tanmia Dr Khalid Al Khazraji, Undersecretary at the Ministry of Health, highlighted the resolution and system adopted to facilitate the creation of a comprehensive database of UAE nationals and GCC employees in private sector.
Actually, this is a pretty big step. Without this integration it is not possible for Tanmia to determine whether an employer is meeting emiratization targets. Every working Emirati is a member of the pension system whether they are working in the public or the private sector. The pension authority's database has the information needed to track where Emiratis are working.

UPDATE: Labour minister vows to crackdown on the company that created sham jobs to meet emiratization targets.

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Officials - It is high time to clean up labour market :: Gulf News

Humaid Bin Deemas, assistant undersecretary at the labour ministry, said there are around 250,000 illegal workers whose whereabouts are unknown. "The workers have either expired labour cards or they have failed to get a labour card after they have been granted a permit."
250,000 illegals. That's a lot relative to the number of citizens which is around 1,000,000 or the number of ex pats which is around 4,000,000.
Rationalizing water and electricity fees?

Khaleej Times:
The UAE Ministry of Energy is currently revising the existing water and electricity charges, but it is not yet clear whether the rates will be hiked, according to Dubai Electricity and Water Authority (Dewa).

Khaled Nasser Lootah, executive vice-president (projects and engineering), Dewa, told Khaleej Times that the ministry was restructuring the fees and under the new arrangement the consumers, who use less water and electricity will pay less, while those who cross the limit will end up paying more. The water and electricity usage limits and ceilings are currently being worked out by the ministry, he said, adding that the process of revising the fees has been going on for the last three to four months.
Gulfnews: UAE seeks to rationalise price structure for utilities
The UAE Government is reviewing the pricing structure for electricity and water consumption to make them more rational as the country's power generation, transmission and distribution move towards a single national grid to be operational later this year, senior officials said.
. . .
TARIFFS [at present]

Emirate Electricity (kwh) - Water (gallon)
Abu Dhabi 15 fils - 0.01 fils
Dubai 20 fils - 03 fils
Sharjah 20 fils - 2.5 fils
Ras Al Khaimah* 15 fils - 02 fils

* The tariffs in Ajman, Fujairah and Umm Al Quwain are also the same

>Rates for UAE nationals are negligible and in some places free
>Employees of the utility service provider get discount in some emirates
>Commissioning of Emirates National Grid could help unify the rates
There is probably an interesting political dance going on between the seven emirates. To unify various electric systems will mean giving up one lever of local economic policy and political discretion.

Also, real rationalization of rates would include charging all customers rates that correspond to the cost of service. At present most nationals receive water and electricity for free, and, naturally, they use those services as if they had no cost.

As most students of intermediate microeconomics learn, it would be possible to eliminate this perk of citizenship (free electricity and water): use a lump sum transfer to compensate the individual for the loss of the benefit, and leave the government/utility better off.

It will be politically tricky, though, to rationalize the prices nationals pay for electricity and water. By now free utilities are viewed as a right. Iraq and Iran face the same problem but with respect to rationalizing petrol prices.

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Telecom options to double :: EmiratesToday

Synopsis: Etisilat's competitor will not be competing on price.

UPDATE: It is confirmed. They won't be competing on price.

UPDATE2: Adventures in Dubai has a post on the subject which is both edifying and amusing.

Tuesday, January 24, 2006

On Darfur :: Kristof

normblog quoting Kristof:
it's appalling that the publishing industry manages to respond more quickly to genocide than the UN and world leaders do.
normblog on the UN:
what legitimacy can be retained by a set of international institutions that, time and again, stands inert and ineffective while entire communities are violated, massacred, destroyed?
Too often, for whatever reason, the US goes it alone. In Darfur, for whatever reason, the US has not intervened. The door stands open for the UN to prove that it is more than a talking shop. By its inaction the UN proves it is merely a talking shop.
Qatar arrests ticket scalpers for largest IPO :: Gulf News

For those of us teaching economics, here is a nice example of ticket scalping. Economic theory tells us that ticket scalping is a good thing; assuming prices are so low* that lines appear, ticket scalping helps ensure that tickets get into the hands of those who value them the most.

Some extracts from the article:
"We've had some people trying to sell their positions in the queue to others. This is not permitted and is not being tolerated," a police officer said. A 20,000-seat Doha stadium has been hired to process applications but because of a lack of electronic applications, investors have been queuing for hours outside the stadium.

"I've seen some people sell their tickets for up to 1,000 riyals ($274.9) - all depending on how good a [position in the queue] they have," said an official of Qatar National Bank. "Some investors have been offering to take application papers from other people further down the queue, and they're making some pretty good cash from that too," he added.

Authorities have deployed riot police at the stadium following a scuffle that broke out after the offer opened last week.
Scuffles are an excellent way to increase the buzz about your IPO.

*Why prices are that low is another question.
Jobs in police force find few takers among nationals :: Gulf News

Just 16 of the 455 UAE national job seekers accepted employment with the Dubai Police force, said Police chief Lieutenant General Dahi Khalfan Tamim. Lt Gen Dahi told Gulf News that the department had initially expected more than 80 per cent of the applicants to join the Dubai Police force.

The police chief blamed parents and the easy lifestyle of youngsters for the low acceptance of job offers. "Some parents are indirectly encouraging their children to be dependent on them by providing them with all they want.

"If a youngster needs a car, he knows that his parents will provide him with it," Lt Gen Dahi said.
Despite repeated efforts to reach the applicants for more than a month, Lt Gen Dahi said 274 of them had switched off their telephone numbers, provided wrong numbers or did not answer.

He said 65 of them did not report to the Human Resources Department of Dubai Police to finish their appointment procedures.
These applicants really, really don't want the job on the terms they are being offered. And the parents' behavior is not going to change any time soon.

In order to meet the emiratization goals, the Dubai Police will have to offer greater compensation and better working conditions. The government could also change policies that undercut the incentive to work, such as the size of unemployment compensation and the conditions upon which unemployment compensation is received.

I can't help thinking these applicants only applied under some duress; maybe they have to appear to be actively looking for work to keep certain government financial support.


Sunday, January 22, 2006

Iranian freedom babes are photoshopped into anti-American cheerleaders. Publius Pundit has the story and the pics.
Public school teachers quit en masse to take advantage of retirement law :: Gulf News

Perhaps the idea is to replace the retiring teachers with underemployed staff from the Ministry of Education. (I'm jesting.)

People respond to incentives. The old law on teacher retirement requires you to work 15 years to earn a full pension; the new law would require 20 years. Teachers are rushing to retire under the old law.

It has proved difficult to attract sufficient numbers of teachers to government schools; changing the retirement age makes teaching that much less attractive. There's no mention of other changes to the compensation package. It's at least conceivable, though, that the idea is to redesign compensation in a way that attracts teachers who are inclined to stay in teaching for more than 15 years. But to do that the increase in the retirement age would have to be combined with an increase in teacher salaries.

For more, see my earlier post on the same subject.

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UAE weddings are big, really BIG.

Do you think there should be a law against this? There is, but it is flouted.
Workers' plights or workers' rights? :: Gulf News

Nicholas Coates, Assistant Editor at the Gulf News, writes a strongly worded opinion piece on the low-income labor market in the UAE. I shall not quote it extensively; read the whole thing.

A few extracts, beginning with the opening paragraph:
It is disgraceful what many low-income workers have to suffer. Delayed salaries; poor living conditions; illegal charges made upon their incomes; inadequate or non-existent time off, including holidays; absence of medical coverage; compulsory purchase of visas and government fees; financial penalties for any defaulting behaviour.
The items listed above are not all of the same kind. Delayed salaries, for instance, are a clear contract violation. Poor living conditions are not necessarily a contract violation. Indeed, if government were to enforce a minimum on living conditions workers could end up worse off. This is because workers may not value the improved living conditions as much as it costs the firm to provided them. That is, the worker may prefer the cash to the improved living conditions.

There are clearly great possibilities for abuse, however, under the conditions by which low-income workers are hired in the UAE and other GCC countries. First, these workers are recruited from abroad and have limited education. They may believe many unwritten promises that are not fulfilled. Second, and very much related, once they arrive in the UAE their work visa does not allow them to change jobs. The second condition is the root of the problems we see.

Another quote from Mr. Coates:
It is no use government officials asking an unpaid worker, who is without pay for 5 or 6 months, for a fee to register the complaint, when the worker cannot even afford food. Greater sympathy and understanding of the issue must be shown.
It is these people who suffer most when a company defaults in paying its workers' rightful entitlements: wages. For, if the company is in financial difficulties not only do staff go without a salary, they often find conditions in their work camp rapidly deteriorate and food no longer provided. Without proper living quarters and without food (and often water and electricity), the deprivation workers go through is totally inhuman.

It is the reporting of conditions of such workers that brings disgrace upon the business community in the UAE, and ultimately shame upon the whole nation as the reputation goes abroad that workers' rights are not protected.
. . .
It is long past time the government took harsher measures against recalcitrant or errant companies and the managements. Too many company managers are allowed to flout authority and the labour laws and abuse the rights of their workers.
I agree. And what does disgrace and shame bring? If low-wage workers being recruited to come to the UAE know anything they know that one needs to be skeptical of the promises recruiters make - because news of the troubles with enforcement of contracts and unfulfilled promises in the UAE does get back to source countries through the media and by word of mouth.

So, who else is a victim of unscrupulous employers in the UAE? The majority of employers who are honest, but have to live under the cloud of the reputation the country has earned. The dishonesty of other employers is hurting them in the pocketbook. This, too, is a reason for firm government action.

I concur with Coates' suggestions for improvements (see the article for details). But, again, I would go farther and make the work visa portable so the worker can leave the employer and take up employment elsewhere in the UAE. Without that power in the hands of the worker, the government will be very busy if its aim is to protect workers from abuse.

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Dubai and Rodeo Drive :: ITP Business

Longish article on upscale retailing in Dubai. If you read it, look for the line about Sofia.

Saturday, January 21, 2006

Ministry in 'state of stagnation' :: Khaleej Times

Lengthy article. Quote:
A number of experts from the Ministry of Education (MoE) have confessed that they have not accomplished the job they were hired for during the last one and a half years, but they continued to draw their salaries. They admitted that they came to their offices every morning, sit there and chatted, and read the newspapers, mostly to keep track of developments in the financial markets.
Hydropolis - The World's First Underwater Hotel :: Impact Lab

Currently under construction in Dubai, Hydropolis is the world's first luxury underwater hotel. It will include three elements: the land station, where guests will be welcomed, the connecting tunnel, which will transport people by train to the main area of the hotel, and the 220 suites within the submarine leisure complex. Great photos.

It is one of the largest contemporary construction projects in the world, covering an area of 260 hectares, about the size of London's Hyde Park.

"Hydropolis is not a project; it's a passion," enthuses Joachim Hauser, the developer and designer of the hotel. His futuristic vision is about to take shape 20m below the surface of the Arabian Gulf, just off the Jumeirah Beach coastline in Dubai. The £300 million, 220-suite hotel is due to open at the end of 2007 and will incorporate a host of innovations that will take it far beyond the original blueprint for an underwater complex worthy of Jules Verne.
Scroll to the bottom to see some fantastic artist's impressions.

I wonder how far you'll be able to see. Is this for real?
Illegal expats run booming job rackets :: Gulf News

Information filled article by Diaa Hadid. Worth reading in full if you follow labor practices in the GCC.

Is it a racket or a service that is valued by all? It is illegal; should it be regularized rather than irradicated?

They serve a key market niche by directing people employed during the day to construction projects in dire need of workers.

So well established is their network that they also trade manpower supply among themselves.
. . .
These "recruitment agents" look inconspicuous and resemble ordinary construction workers. Lack of proper office space is no problem for them as they operate from small cafeterias and typing centres located in some of the busiest areas in Deira and Bur Dubai.

They charge both the illegal workers and the companies. The charge is Dh10 to Dh15 for the workers and Dh20 to Dh25 for companies per illegal worker.
. . .
Ask them about the trends in the labour market and they will provide you with their expertise like a seasoned market analyst.

"Do you really think that the labour market can do without the illegal manpower? The demand for labour is growing. When there are so many illegal residents roaming the streets of UAE, there is not need for the companies to import more labour," said Shoiab, an Egyptian 'recruitment agent'.
. . .
Market needs are dictating the regulation of the UAE labour force, including workers officials know are illegal, a top Labour Ministry official admitted to Gulf News.

"There is a need in the market and that is filling it," he said, explaining the absence of any crackdown on absconding and illegal labourers who were effectively running manpower organisations for other illegal labourers. Alternative measures introduced last year, including legally renting workers from other companies, have so far not succeeded.

The official said this was because of the high fees the ministry demanded for the transaction. Companies that legally rent out labourers from other companies are also obliged to provide all benefits to workers, including medical cover. They are also legally responsible for the workers, which industry insiders said dissuade companies from renting out workers through the Labour Ministry.
I need to line up some of these seasoned labor market analysts this semester to speak to my labor economics students.

Friday, January 20, 2006

Chris Matthews shock :: Confederate Yankee

Chris Matthews compares Michael Moore to Bin Laden. Predictably, the Left becomes more unhinged - is that categorically possible?
Tourism and Chad

A colleague recently returned from a trip to Chad. She said it was difficult to get in with all the petty bribes you had to pay at entry. But once you got into the country it was great because it was so uncorrupted by tourism.

Yeah, that sounds about right.
Iran money supply 'growing too fast' - Trade Arabia

Iran's money supply is growing too fast, impeding efforts to curb inflation and threatening future economic growth, Central Bank Governor Ebrahim Sheibani was quoted as saying. Speaking at a banking convention, Sheibani said growth in the M2 broad money supply was on track for an annual rate of 35 to 36 per cent by the end of the current fiscal year on March 20. That would be up from 30.2 per cent in the previous fiscal year.

"The liquidity growth rate is dangerous for the national economy," the official Irna news agency quoted him as saying.

Sheibani blamed high liquidity growth on a massive influx of petrodollars due to high oil prices, and on lax fiscal discipline. The government funded current spending on salaries and subsidies by withdrawing billions of dollars from a rainy-day fund designed to store surplus oil revenues for leaner years.
. . .
Central Bank officials have recently complained that the bank now has to seek approval from parliament in order to issue local bonds known as Participation Papers - its principle tool for soaking up excess liquidity.

Emphasis added.

I like the current arrangement. Inflation can lead to revolution.


Sleep easy, Iran is awake

9 hours ago-
Iran News - Iran denies shifting assets for fear of sanctions:
LONDON, January 20 (IranMania) - Iran denied reports that it was moving billions of dollars in hard currency from European banks to Asia and said Europe had no right to freeze its assets, said AFP.

Economy Minister Davoud Danesh-Jafari dismissed a report in pan-Arab newspaper Asharq al-Awsat that Iran had ordered government departments to withdraw currency from European banks, fearing possible sanctions over its disputed nuclear programme.

Danesh-Jafari described the news report as "politicised" and "media-driven."

"International law does not allow Europeans to do such a thing (freeze assets)," Danesh-Jafari said.

"Should they do it, it would be contrary to their interests because oil-producing countries... and other countries would become anxious and would transfer their financial reserves to more secure locations," he added.

The London-based Arabic newspaper had quoted an unnamed Iranian central bank source as saying Iran had decided not to allow the Europeans the chance to freeze its bank accounts in case of a political or military confrontation over its nuclear ambitions.

"A number of Iranian regime-linked figures have already withdrawn their private capital from European banks and deposited it in private banks in Hong Kong, as well as Dubai, Beirut, Singapore and Malaysia, over fears of account freezing," the source said.

"The size of these deposits amounts to eight billion dollars -- a quarter of Iran's hard-currency deposits," the source said, adding that the step did not involve Swiss banks.
4 hours ago:
Iran, at risk of U.N. sanctions, says moving assets - Reuters.com
TEHRAN (Reuters) - Iran is moving its foreign assets to an undisclosed destination, apparently to shield them from any U.N. sanctions over its nuclear program, the central bank governor was quoted as saying on Friday.
Iran, threatened with referral to the Security Council for possible punitive measures, has bitter memories of its U.S. assets being frozen shortly after the 1979 Islamic revolution.

"We transfer foreign reserves to wherever we see as expedient. On this issue, we have started transferring. We are doing that," Ebrahim Sheibani told the ISNA students' news agency when asked about the need to shift Iran's holdings.

There was no immediate confirmation of the Iranian action, but Sheibani's remarks indicated how seriously the Islamic republic is taking the threat of U.N. sanctions.
However, Iran's Central Bank chief Ebrahim Sheibani denied "the freezing of Iran's hard-currency accounts in European banks," according to the official IRNA news agency.

Asked Wednesday about the possible freezing of Iranian assets, he said: "We will do all that is necessary." He also joked: "Sleep easy. We are awake."


Parents queue all night for child's nursery admission :: Gulf News


The school office opened at 8am on Wednesday to start the admission process and registration for kindergarten classes on a first-come-first-served basis. But desperate parents queued up as early as 9pm on Tuesday, almost 12 hours in advance.

"It was a surreal spectacle as hundreds of men and women, some with children in tow, braved the cold wind and spent the entire night just standing. Some of them had anticipated the rush and had come well prepared for the night out.
. . .
Not everybody was lucky. As many as 400 parents couldn't make it in time to collect the tokens which would have ensured admission and are now on the waiting list.
. . .
Administrative officer Raghunath said the management is contemplating introducing a lottery system next year.
Questions: How much is one of those tokens selling for now? Why is the school charging so much less than the price that would ration the seats available?

I do note that without a queue there would be no publicity.
Illegal trade in labour permits exposes workers to exploitation :: Gulf News

Dubai: A roaring trade in labour permits and tourist visas is continuing in Dubai, threatening public health and making workers vulnerable to exploitation, a labour official said.
. . .
"A lot of workers have no idea who their sponsor is. All they know is some Indian man took their passport at the airport."
I hope someone in authority understands that much of this problem goes away if the worker pays his or her way here, is the possessor of the work permit, can change jobs if he or she wishes to, and cannot transfer the work permit to anyone else.
Economic Rent

A friend here in the UAE hired a low income expat to walk her dog while she is at work. A kind-hearted person, she paid him much more than the going rate.

Recently a stranger appeared at her door and announced (with hand gestures and broken English) that her dog walker had left the country and assigned the job to him. This job transfer occured without consulting her! The new man even had the key to her apartment.

I suspect that the original dog walker capitalized the wage premium by selling his job to the new dog walker. In effect the new dog walker is earning the market wage, not the premium wage my friend wanted to pay.

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Rape cases :: Gulf News
Annals of people-respond-to-incentives


November: Court of First Instance started investigating the case of four Gulf nationals who stormed into a flat rented by a number of Filipinas, assaulting and raping one of them and stealing their mobiles and money.

October: Court of First Instance started investigating the case of six UAE nationals, aged between 19-21, for allegedly kidnapping and raping a 23-year-old British woman in a deserted area. Court of Appeal confirms a year's imprisonment against two nationals for molesting an Arab female student in a 4X4 vehicle.

September: Juveniles' Court placed two national teenagers under rehabilitation for kidnapping and raping a 23-year-old Uzbek female. Court of First Instance placed five teenagers under legal supervision for kidnapping, raping and sexually molesting a 15-year-old boy.

July: Court of Appeal confirmed a five-year jail term against three nationals for kidnapping a Russian female on the street and raping her in a remote area.


Aren't these sentences rather light?

Shouldn't the nationals involved be named? That would have a substantial deterrent effect. It is unavoidable that we are weighing the chance that an innocent man will be named against the rights of the victim. Why is it that the protection of the man's reputation is put ahead of the protection of women from this heinous crime?
The Cost of Not Paying Attention :: The Herald

The study shows modern-day staff work for just 11 minutes before they are interrupted by an e-mail, phone call or a metaphorical tap on the shoulder from a colleague.

Researchers have calculated that interruptions consume an average of 2.1 hours of every working day, or 28% of the average person's routine.

It has reached such an extent that workers are becoming locked in what was described as a mire of multi-tasking, and one expert said there had been a tenfold rise in the number of people suffering from what he called work-induced attention-deficit disorder.

The two hours of lost productivity included not only unimportant interruptions and distractions, but also the recovery time associated with getting back on track.

Once people are interrupted, it takes an average of nearly half an hour to return to the original task, but some workers admit their concentration is ruined for the rest of the day.
I note that some of these interruptions are within my control to avoid.
UAE Journalistic freedom :: Dubai Sunshine: there is some progress when it comes to journalistic freedom in this country. Although censorship still exists, we are now made aware of some of the crimes that are commited. The UAE is no longer depicted as this perfect place where nothing bad ever happens, which is a good thing.Although Abu Dhabi and Dubai are generally safe cities (save the dangerous driving), we, as residents, need to be made aware of these issues.

Thursday, January 19, 2006

Capital-Labour Substitution in University Education :: The EclectEcon

Great post by The EclectEcon on the growing podcasting of university lectures.

Will salaries in academia follow the same path as in electronic media where superstars earn super salaries?

Here's another thought about the Ludditian fears about lecture podcasts: I have this "friend" who isn't such a great teacher. If his colleagues start podcasting what conclusions can we draw about his teaching?


Communications severed in Nepal ahead of planned anti-govt rally :: Khaleej Times

KATMANDU, Nepal - Nepal’s government severed telephone and Internet services on Thursday, cutting off communications in an apparent attempt to foil organizers of an anti-government rally planned for the following day in Katmandu.

Look for more countries to adopt this strategy. As we saw in several cases in 2005, mobile phones and the Internet have revolutionized coordination of revolutionaries.
RAK fish export ban imposed as traders struggle to meet demand :: Gulf News

We've had several days of rough seas, unusual in the Gulf. Most local fishermen have stayed in port because their boats are not equipped for these conditions.

It bemuses me the extent to which government will intervene in markets at a moment's notice. I rather doubt this intervention will have the desired effect.

Wednesday, January 18, 2006

Robert Kuttner Speaks With Milton Friedman :: Hispanic Pundit

One of my most reliable human browsers, Hispanic Pundit, comes up with another gem, this Robert Kuttner interview of Milton Friedman.

In his post, Hispanic Pundit quotes from the interview on the topics of health care and education. Friedman's points apply equally well in the UAE as in the US. One example:

A program for the poor would be a poor program. . . .

There is no reason whatsoever why government should be producing schooling. You can make an argument for subsidizing schooling, you can make an argument for requiring compulsory schooling, though I think it is weak. Those you can do. But why should government be producing schooling, and not producing automobiles? What is it that makes government a better producer of schooling than private enterprise, and differentiates it from other sectors?

. . . government can subsidize the function without running the schools. Government can give food stamps to people, but it doesn’t run grocery stores.

The lion, the witch and the wardrobe,
and the Sharjah Islamic Bank

Enclosed with my monthly statement: A glossy insert announcing that I can increase my chances of winning tickets to see Narnia by using my Sharjah Islamic Bank Visa at the Dubai Shopping Festival.

Kids in my neighborhood are playing with Narnia action figures. Interesting.
American Universities in the Arab World :: Bidoun

Quote: The AUW website describes AUS as "engaged in the experiment of growing an American-style institution in the soil of a traditional Islamic society." Waxing lyrical about the KFC opposite the campus mosque, it's the kind of hearts and minds stuff that nervous State Department officials presumably visualize to help them sleep at night.

Tuesday, January 17, 2006

Blogosphere politics :: Michael Barone

Wishful thinking? Quote:
The left blogosphere has moved the Democrats off to the left, and the right blogosphere has undermined the credibility of the Republicans' adversaries in Old Media. Both changes help Bush and the Republicans.
Harvard-educated economist? :: ReliefWeb

Liberia's new president earned a Master of Public Administration at Harvard. She subsequently worked as an economist at the World Bank. Thus, she is a Harvard-educated economist that does not hold an economics degree from Harvard. Got that?
Workers' rights website lobbies for unions in UAE :: Gulf News

Dr Khalid Khazraji, Labour Undersecretary in the Ministry of Labour and Social Affairs, said he took the website "very seriously."

"I follow it because it concerns me. I want to know what people are thinking, and this is one way labourers can make their voices heard." Dr Khazraji said although he could not comment on the website's legality, he said it was a valid channel for people to express their opinion "in a peaceful way."
Remember the Hushaphone :: Adventures in Dubai
Disingenuity in telecom sector

Another good one from Keefieboy. The state wants to protect consumers from inexpensive long distance calls that may be of poor quality.

Consumers can readily sort out for themselves, at little risk, whether a long distance provider is giving good service. We don't need government protection from those providers.

What we need is the removal of government protection of the monopoly telephone company that provides rather expensive not-so-great service because it is protected from competition.

As is my wont, here's another example of the annals of protection of a telephone monopoly. Foreign attachments are not as titilatting as they might sound at first blush.

Is disingenuity a word? It should be.
Take Off Those Deep Tinted Glasses :: Adventures in Dubai

In answer to someone's defense of reckless driving, Keefieboy nails it:
So that's ok then. Nothing at all like me wanting to master the art of shooting by practicing with live ammunition in a crowded shopping mall.
. . .
When a country loses such a high proportion of its young men in avoidable traffic accidents, surely the authorities should be doing something. Better driver education, acceptance of personal responsibility and police/judicial enforcement unencumbered by wasta would be a good start.
Read the whole thing. Sorry to say, I don't think this behavior has anything to do with driver education, but has everything to do with socialization at home and in school. Including learning the art of wasta rather than respect for others. And, no, I am not a perfect driver and I have driven recklessly especially when I was younger.

Monday, January 16, 2006

Life ‘was good’ under Taliban :: Emirates Today: First sentence - "The days of systematic beheadings, amputations and pointblank shootings hold many fond memories for Mohammad Nasir."

Sunday, January 15, 2006

Britain and the bad food trap :: Marginal Revolution

Interesting comments on this topic over at Marginal Revolution. Did the industrial revolution and urbanization drive the UK into a bad food cuisine? And are recent improvements driven by demand - as more people travel to exotic places and acquire taste for better food, or by immigration driving introduction of new dishes, or by falling cost of bringing exotic ingredients in?

What I know is, it is to my benefit when others in my vicinity share the same taste for good food that I do.

Sharjah has a decent restaurant. No, really, that's its name, Decent Restaurant. I need to take a picture of the place and post it.
Iraq and the Corruption Trap :: Arnold Kling

The World Bank's Philip Keefer says that young democracies are fragile because governments are weak. Weak governments, unable to sustain broad-based power, turn to corruption in order to retain narrow-based power. However, corruption discredits the government, making broad-based power even less available. This makes the government even more dependent on corruption for survival. I call this the Corruption Trap.

The corruption trap helps explain why bad government tends to stay bad. Russia and other former Soviet republics appear to be caught in the corruption trap. The corruption trap may explain the perennial disappointment in many African and Latin American countries. Conversely, economic growth in Asia may reflect an escape from the corruption trap.

On the other hand, good government tends to stay good -- not perfect, but good. Once the public comes to expect honesty, this expectation becomes self-reinforcing. Corrupt officials are exposed and denounced. Periodic reforms and house-cleanings address the worst offenses.
If young democracies are most at risk, how do some manage to be drawn into the virtuous equilibrium rather than being sucked into corruption trap? Kling suggests that in the case of the U.S. it was inheritance (rather than mere application) of British culture. I suggest, instead, that the U.S. we were quite fortunate to have a virtuous and widely-respected leader, George Washington, who garnered widespread electoral support and power. Of course, the hypotheses are not mutually exclusive, and together they are reinforcing of the result.

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Excellent documentary :: UAE community blog

If you are interested in gender issues in the UAE from the perspective of young nationals, check out the link to the video posted by Secret Dubai at UAE community blog. Your patience will be rewarded.
Algae - like a breath mint for smokestacks :: csmonitor.com: "Fed a generous helping of CO2-laden emissions, courtesy of the power plant's exhaust stack, the algae grow quickly even in the wan rays of a New England sun. The cleansed exhaust bubbles skyward, but with 40 percent less CO2 (a larger cut than the Kyoto treaty mandates) and another bonus: 86 percent less nitrous oxide. After the CO2 is soaked up like a sponge, the algae is harvested daily. From that harvest, a combustible vegetable oil is squeezed out: biodiesel for automobiles."
Mahmoud Ahmadinejad :: The Independent

This explains his reckless attitude, say his critics. If the final triumph of Islam can be brought closer by provoking a nuclear war with Israel or America, why hold back?

It might be possible to dismiss this as scaremongering if it were not for a DVD circulating in Iran which shows the president in conversation with a conservative ayatollah. Ahmadinejad is speaking about his defiant address to the UN General Assembly last autumn, in which he refused to back down on Iran's nuclear programme. "One of our group told me that when I started to say 'Bismillah Muhammad', he saw a green light come from around me, and I was placed inside this aura," he says. "I felt it myself. I felt the atmosphere change, and for those 27 or 28 minutes, all the leaders of the world did not blink. When I say they didn't move an eyelid, I'm not exaggerating. They were looking as if a hand was holding them there."


A common story in the GCC: disputes over timely payment to workers :: Arab Times

These stories are worldwide coverage. For example, here, here, and here.


The challenges of outsourcing: Can Dubai's vision become a reality? :: Khaleej Times

Nice piece of business journalism. Take a look if you are interested in the question.
Ministry of Labour arm twisting on Emiratization of PRO jobs :: Gulf News

Once again we see the fundamental conflict created when employers can hire a world market wages, and the nation wants to see nationals employed in the private sector while nationals are not willing to accept the same salary and working conditions as nonnationals.

PROs, public relations officers, are the representatives of employers in their dealings with the Ministry of Labour and other government ministries. Enforcement of emiratization of this job category would appear to be relatively easy - the MoL can simply refuse to deal with nonnational PROs.

Enforcement, however, is not so easy. At least one company has solved the problem by hiring a national PRO who only needs to report for work when the company needs a transaction with the MoL:
Another PRO for a major construction company said: "Our company pays a UAE national GRO Dh7,000 a month, but he refuses to stay in the office. We may call him only when we need transactions completed."

PROs said despite Tanmia training courses, it was difficult to find UAE nationals willing to work in their profession.


Monopoly and the GCC :: Mahmoud's Den

Mahmoud on a common government practice in Bahrain, and other GCC countries:
For tens of years businesses in Bahrain made their money not only because of their industriousness or creativity, there obviously was some measure of those to be sure, but also because of monopolistic practices that enriched them without them lifting a finger. The story was until recently that a business can sign an exclusive agreement with a supplier and based on that agreement, the business would register that agreement with the Ministry of Commerce which enforces it by not allowing anyone in Bahrain to import any goods from that supplier except via the local exclusive trader. That was enforced at the Customs where they would not allow anyone but the "agent" to clear the goods for entry into the country.
My emphasis.

Just to be clear: Without the hand of government, these petty monopolies could not exist. With the hand of government, they pervade the economy. The same goes for price fixing agreements - more often than not, government is not just turning a blind eye to these agreements, but fostering them.


Saturday, January 14, 2006

SOB Americans stick out

Flying back to Dubai yesterday, I arrived in London at 7:30 AM, always a busy time. On this occasion the line for the transfer security check was taking 90 minutes to go through. Most arriving passengers’ planes were not able to get to a proper gate and these arrivals were ferried by bus and arriving at the same point about midpoint of this Terminal 4 queue. From there airport personnel were directing those going to Terminal 4 to walk to the end of the queue, nearly 0.5k away from the security checkpoint. (Obviously not a situation anyone was happy with – the solution will be to greatly expand the screening stations. At present there are only 3 screening machines.)

I joined the end of the line, and just after I passed that midpoint in the line a group of plain clothed American military (or ex military now working a military contractors) cut into the queue, and refused to comply with the airport employee’s instructions about where to join the queue.

Gentlemen, we are in a war and one of the fronts is public opinion. You lost that battle today, and you endangered fellow Americans actually serving in harms way. Your behavior was repugnant. For the love of God, we are standing in that line waiting for inspection because of a few terrible people who hate us. Don't give ammunition to the rest of the world that shares your values of openness and freedom. Please, don't.

Later, on the plane to Dubai, I gradually came to the realization that my seatmates were quiet Americans working in Afghanistan. And it occurred to me how easy for the ugly minority to stick out and form the basis for shaping opinion of the average American. And that I was one of those who too quickly jumped to a quick generalizations.

So, you sons of bitches - allow me reiterate, I despise you.

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STRATEGYPAGE on Algeria and its terrorists. Bye bye. (Via Instapundit.)

Given my recent posting tear, I guess there's a reason I was not accepted into the Economics Roundtable, but was accepted into the Politics Roundtable.
A truly salient economics classroom experiment. Somehow the second picture reminds me of Toht from Raiders of the Lost Ark.
Speaking of the U.S. Senate, let's see what George Galloway is up to these days. Apparently, his mental sparing with the Senate Committee has left him in a diminished mental capacity. If that is possible.

UPDATE: See what 7Days has to say. I, for one, see great benefit in paying him an MP's salary to spend a few more weeks in the house. I hope he's not voted off anytime soon. And here is what Big Brother is saying about GG (scary pics).
Size of Senator Kennedy's staff compared to that of the average Gulf emir.
Bilmes and Stiglitz on the costs of the Iraq War :: Marginal Revolution

For far more analysis and insight than has been provided on the subject here, head over to Marginal Revolution (link above) and read Tyler Cowen's post, and the comments that follow. You'll be able to begin to build your own informed opinion.

The comments begin answer a question I had - which is how Bilmes and Stiglitz compares to the Topel, Murphy and Davis paper.

UPDATE. See also Mahalanobis:
by ignoring benefits that war proponents articulated (eliminating a threat before it is imminent, humanitarian relief, enforcing UN resolutions, democracy in Iraq, securing Iraq's oil) Stiglitz assumes this war had no valid principles, in which case his conclusion on the cost-benefit axis is preordained.


Postponed DSF boosts Sharjah :: EmiratesToday

Aside: can an annual event be postponed for a year? Cancelled for the year is the more appropriate term, isn't it? I note that the media is simply repeating the terminology chosen by the DSF.

Thursday, January 12, 2006

Stiglitz: Iraq war costs could top $2 trillion :: Christian Science Monitor

A new study (pdf) by Columbia University economist Joseph E. Stiglitz, who won the Nobel Prize in economics in 2001, and Harvard lecturer Linda Bilmes concludes that the total costs of the Iraq war could top the $2 trillion mark. Reuters reports this total, which is far above the US administration's prewar projections, takes into account the long term healthcare costs for the 16,000 US soldiers injured in Iraq so far.
UPDATE: Broken link to the pdf of the paper has been fixed.


Wednesday, January 11, 2006


The EclectEcon's latest post is on the unintended consequences of low volume toilets. The link above goes to one of the context-sensitive ads that google has associated the post. RONTFLMAO.
Site Meter - Counter and Statistics Tracker

Many visitors to this site arrive as the result of a google search. My favorite today was searching "AIU accreditation losing". The visitor's IP address: AIU/Career Education Corp located in Schaumbury, IL. Their search took them to this post.


Tuesday, January 10, 2006

Headline: Private car parks in Dubai's busy business districts make a killing

Hey, Gulf News, I'd say the better way to capsulize this story in a headline is:

"Man provides customers with highly valued service that few others provide."
Mafi Wasta

A recent anonymous commenter pointed to this site, Mafi Wasta. It's quite clever and amusing while at its heart it has very serious message and objective - reform of labor regulations in the UAE. Mafi Wasta and I will never agree on some things, but we probably agree on more than you would suppose.

So take a look, and spread the word about Mafi Wasta. I certainly will be making return visits and monitoring developments there. Somewhere down the road I'll find the opportunity to write more substantively about them.
A very talented economist can be smoked if that very talented economist lets his preconceived conclusions drive his, uh, analysis, such as it is.

Monday, January 09, 2006

Pat Robertson and Mahmoud Ahmadinejad :: WaPo
From the same mold - as in the organism

Christian television evangelist Pat Robertson and the president of Iran, Mahmoud Ahmadinejad, have a well-established affinity for the outrageous. This time their mutual embrace of indecency places them in a category all to themselves. As Ariel Sharon lay hospitalized and critically incapacitated by a massive stroke, Robertson, one of America's best-known religious extremists, and his Iranian counterpart — no slouch when it comes to religious demagoguery — suggested that Israel's prime minister had it coming. Speaking on his TV show, Robertson said the Bible "makes it very clear that God has enmity against those who 'divide my land.' " Sharon, Robertson asserted, "was dividing God's land, and I would say woe unto any prime minister of Israel who takes a similar course." As Robertson was offering up his thoughts about a man fighting for his life, Iran's president was expressing unrestrained hope that Sharon would simply die.
The American right must continue to disassociate itself from Pat Robertson. The shame isn't that Robertson is an idiot, but that he has numerous followers.


Bush derided as terrorist :: Detroit Free Press

Singer and activist Harry Belafonte called President George W. Bush "the greatest terrorist in the world" on Sunday and said millions of Americans support the socialist revolution of Venezuelan President Hugo Chavez.

Belafonte led a delegation of Americans including actor Danny Glover and Princeton University scholar Cornel West that met the Venezuelan president for more than six hours late Saturday. Some in the group attended Chavez's TV and radio broadcast Sunday.

"No matter what the greatest tyrant in the world, the greatest terrorist in the world, George W. Bush says, we're here to tell you: Not hundreds, not thousands, but millions of the American people ... support your revolution," Belafonte told Chavez during the broadcast.
If American leftists want to be taken seriously and have influence, they must disassociate themselves from these ignorant and dangerous crackpots.
Labor market flexibility :: New Economist

New research on labor market flexibility in Germany and France. The unifying element: flexibility is growing, stealthily.
0.9*ditto here.
What my fellow travelers have to say about Europe and Iran.


Producers abandon dairy price increase :: Gulf News


Dubai: Co-ops have resumed selling dairy products and fruit juices at December prices after producers gave up their attempt to raise prices to offset rising operating costs. After a meeting between the representatives of the dairy and juice association and co-op officials last week, the producers agreed to maintain the previous prices.

Dr Ahmad Al Tejani, Chairman of the Diary and Juice Producers Group, said all parties had agreed not to increase prices. "A meeting will be held after the Eid Al Adha holidays to discuss the need to reduce production costs and shelf fees," he said. "The group does no seek to monopolise the market," he said, adding that the problem was the rising cost of production. There is a need to find a solution to reduce costs, he said.
That sounds like doubletalk to me. Until the government took a dim view of the latest attempt to raise prices, the group was acting as cartel.

Official sources told Gulf News that the backdown by the dairy companies was a result of pressure exerted by the Ministry of Economy, the Ministry of Finance and Industry and the Ministry of Labour and Social Affairs. The three ministries stressed that the Council of Ministries decision regarding
price stability was non-negotiable. The source added that the decision by Saudi dairy giant Al Marai to maintain December prices considerably weakened the fruit and dairy association's case.
Isn't it interesting that a foreign dairy wanted to sell to UAE customers at prices lower than the UAE cartel had wanted to?
The agreement to keep the original prices was achieved after the co-ops said they would study the rate charged to producers for shelf space. The co-ops will also help to reduce production costs through combined marketing activities.
Ah, so the story is not simply that the cartel backed down.

Abdullah Al Saleh, Assistant Undersecretary for Economic Affairs and International Co-operation in the Ministry of Economy and Planning, warned that the ministry would take punitive action should a producer try to impose higher prices for its products.

"The Cabinet decision lifting protection on 16 commodities ended a monopoly."
That's cryptic. What does he mean?


Sunday, January 08, 2006

Gaza's collective self destruction :: BBC NEWS

Quote: there is now a growing appreciation of the depth of the malaise in Palestinian society. Hafiz Barghouti, the editor of the newspaper Al-Hayat Al-Jadeed, has written: "It appears we are neither prepared to change, nor admit that we have failed in running our own affairs. Everyone is busy calculating how to make the biggest possible gains at the homeland's expense. "While most Palestinians find it easy to blame the occupation for all our ills, it is a fact that the occupation was not as bad as the lawlessness and corruption that we are now facing."

Via The EclectEcon.

Others will still want to blame the morbidly obese man, and not look to themselves. The past is a given, but the future is in your hands.


The Hajj and its impact on Saudi Arabia and the Muslim world :: SUSRIS

It has an uncritical press release approach, but this essay is of interest to anyone interested in the scale of the Hajj and the operational challenges that accompany it.

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Prices of sacrificial animals up by 30pc: KT

It's not surprising that the price is up -- demand is increased. The author of the Khaleej Times article writes as if he is surprised that consumers don't buy less when their own increase in demand drives up price.

What is surprising is that the price of turkeys in the U.S.A. does not increase at Thanksgiving when it is traditional for American families to roast a turkey. Indeed the price sometimes even falls around that time. The difference between the cases is that frozen turkeys are acceptable substitutes for fresh turkeys, but there is no acceptable suitable for sacrifice of a live animal.

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Strange alliance: "the Americans, authoritarian Arab regimes, radical secularists... and Ayman Zawahiri."

Saturday, January 07, 2006

Bahrain ranked freest Arab economy :: Gulf News

Bahrain remained the freest economy in the Middle East and Arab world, according to the 12th annual Index of Economic Freedom by the US-based Heritage Foundation and The Wall Street Journal. Bahrain was 25th in the overall ranking, well ahead of Japan, Spain, Italy and France. Kuwait, the second freest Arab economy, was 50th in the annual list. The UAE was ranked 65th overall.
. . .
Countries receive a 1-5 rating, with one being the best, on ten broad measures of economic freedom: trade policy, fiscal burden of government, government intervention in the economy, monetary policy, capital flows and foreign investment, banking and finance, wages and prices, property rights, regulation and informal (or black) market activity.
Abu Dhabi 'best Arab business city' :: Gulf News

The UAE capital city of Abu Dhabi is regarded as the best business city in the Arab world. This is according to the annual survey conducted by the Economist Intelligence Unit (EIU), which is part of The Economist Group. The EIU's Business Trip Index for 2006 covered a total of 127 cities worldwide.
. . .
Broadly, the index considers five variables in order to assign grade to cities around the world. These are stability, culture and environment, infrastructure, cost and healthcare. The index assigns 25 per cent to each of stability plus culture and environment, 20 per cent to each of infrastructure and cost and the balance of 10 per cent to healthcare.
. . .
The city of Abu Dhabi achieved the rank of 70 worldwide. This is by far the best performance for any Arab city covered in the survey. With a worldwide ranking of 73, Dubai emerges as the nearest city to challenge Abu Dhabi.

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Friday, January 06, 2006

As Dubai thrives, an eye on political reform :: csmonitor.com

Fellow blogger, Secret Dubai, sends this link (above).

Key quotes:

Now jammed with gleaming skyscrapers, modern roads, and international corporations, Dubai, almost uniquely among Arab states, has created a modern, diverse economy. It is proof that political liberalization and natural resources are not pre-requisites for development, analysts say.
. . .
Yet despite its material success, due largely to the foreign workers who make up more than 80 percent of the population, the UAE remains politically medieval. Political power is based on family and wealth alone. With no significant directly elected public body, it is arguably less democratic than even neighboring Saudi Arabia.

In December, the UAE's president promised to create a democratically elected parliament. Political analysts say that concrete action will be needed as an increasingly educated populace demands greater political participation and accountability.
. . .
So far, however, the UAE has avoided the attacks on Western targets by Islamic radicals that have taken place in other Gulf states - to the annoyance of some Islamic militants who use the anonymity of the Internet to vent their rage.
"What I've seen on the Internet forums is some impatience as to why they're not targeting the Emirates on the grounds of it being a fairly Western society," says Stephen Ulph, a senior fellow at the Jamestown Foundation, citing Internet postings from Spring 2005.

"They accused the rulers of permitting the construction of churches, of actions contradicting sharia, and of allowing women to wear jewelry," says Mr. Ulph. The Islamists also posted a photograph of the aircraft carrier USS Kittyhawk refueling in the city's Jebel Ali port.

"One reason the Emirates have been left untouched is that Dubai is still a useful place for the illicit transfer of funds - for example through the hawala system," says Ulph, referring to the traditional paperless money-transfer system believed to play a key role in terrorist financing.
. . .
Although traditional pastimes such as camel-racing and falconry still survive, young locals who aspire to be 'Western' are increasingly turning to drinking, drug- taking, and prostitution - although even kissing in public is technically illegal.

Recent articles in The Gulf News, the country's leading English-language paper, report other societal woes. Last week, the paper reported that the divorce rate is now 48 percent - one of the world's highest - while the letters page is full of complaints against rising crime, endless traffic jams, and spiraling house prices.
Since few own, perhaps that should be housing prices, not house prices. As far as "turning to prostitution" surely that means young men turning to the services of prostitutes. What is true is that local papers rarely state that it is young locals who are misbehaving - but the CS Monitor just did. This story about Abu Dhabi hooligans is likely about locals.

I don't perceive a great demand for rapid political reform. Few want to risk what appears to be a conservative system that has, by appearances, worked. They look to the example of Kuwait where the elected officials appear to be too willing to take the welfare state to unsustainable,even catastrophic levels, in order to get reelected.

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Thursday, January 05, 2006

Mankiw's 7 resolutions for politicians :: WSJ

They're US-centric, but many generalize. My favorites:

2. "I am going to admit that unilateral disarmament in the trade wars would make the U.S. a richer nation."

3. "I will tell Americans that eliminating our farm subsidies should not be a "concession" made in trade negotiations but a policy change that we affirmatively embrace."

4. " I will tell the American people that a higher tax on gasoline is better at encouraging conservation than are heavy-handed CAFE regulations."

7. "I will be modest about what government can do. I know that economic prosperity comes not from government programs but from entrepreneurial inspiration."

Via The EclectEcon.

Wednesday, January 04, 2006

Voting and the feminine mystique - Opinion Anjana Ahuja :: Times Online

Me? One child; a daughter. Draw your own conclusions.

Tuesday, January 03, 2006

Nationalisation of fish trade receives setback

Quote: FUJAIRAH — Efforts by the Fujairah Municipality to nationalise the Asian-dominated fish trade in the emirate received a major setback with not a single national turning up to take up the jobs on offer on January 1, when the decree on nationalisation came into effect.

That's only the beginning. Read the whole thing.
UAE Cabinet warns of tough action against dairy cartels :: Gulf News

Chaired by Shaikh Hamdan Bin Zayed Al Nahyan, Deputy Prime Minister and State Minister for Foreign Affairs, the Cabinet rejected attempts by any cartel to maintain high prices or restrict competition. "The Cabinet rejects the principle of setting up cartels to fix prices, because this approach does not serve society and the national economy. It also contravenes the principle of free economy adopted by the country," a statement said yesterday. The Cabinet instructed ministries of Finance and Industry and Economy and Planning to take all measures to stop these monopolistic practices "which distorts the principle of free economy adopted by the country".

Reacting to the new prices, the Consumer Cooperative Union which accounts for nearly 45 per cent of the overall volume of dairy products sourced in the country, has stopped selling dairy products from yesterday.
Emphasis added. I look forward to seeing what comes of this.
Arnold Kling on the near future for productivity, solar power, and cancer treatment. Don't worry, be happy.
The Warm Little Boy vs. The Cold Little Boy :: Postrel
Schelling's "The Intimate Contest for Self-Control"

Most of us see ourselves as younger than we are; it's part of how we endure. Schelling always will be; it's part of the reason his ideas will endure.

Monday, January 02, 2006

Plan to update UAE economic laws under study :: Gulf News

Quote: Nada Yousuf Al Hashimi, head of the Ministry's project to build a comprehensive database on foreign direct investment (FDI) in the UAE, said the project, to be completed by the end of 2006, would increase FDI in the UAE, in line with the growth of the domestic economy, and the UAE's place among countries that attract investment. "The FDI data will help economic decision makers issue the right policies, and attract more FDI," he said commenting on the International Monetary Fund's (IMF) remarks on multiplicity of economic data in the UAE.
Pinter prattles :: Mahalanobis

Game theorists reason. I guess they have a reputation to uphold.

Sunday, January 01, 2006

Take a look at Dubai Marina Communities. The mind boggles.