Is freedom contagious?

Tyler Cowen at Marginal Revolution uncovers these sentences in a paper by Leeson and Sobel (Department of Economics, West Virginia University):

We find that capitalism is in fact contagious. Countries consistently catch about 20 percent of their average geographic neighbors' and trading partners' levels and changes in economic freedom. We also explore American foreign military intervention's ability to spread economic freedom abroad. We find that although intervention may increase freedom in U.S.-occupied countries, this freedom is not contagious. Using our estimates of freedom's spread when it is contagious, we simulate the impact of successful Iraqi occupation on Middle Eastern freedom. Even under the most favorable assumptions, we find that U.S. occupation would minimally improve freedom in this region.

That's unfortunate.

Curves: obesity and law of demand :: Greg Mankiw's Blog

Why have been Americans been growing for the last 150 years? It's not just that incomes have increased. The price of food has fallen considerably relative other goods, especially processed foods.

No doubt the same factors have been at work on Emirati waistlines since the 1970s.

The American standard of whining - Forbes.com

Virginia Postrel writing in Forbes:

Wal-Mart and other superstores charge up to 27% less for food than traditional supermarkets, estimate economists Jerry Hausman of MIT and Ephraim Leibtag of the Department of Agriculture. But the BLS doesn't factor those lower prices into its inflation estimates. It simply assumes that Wal-Mart's price reflects worse service, and ignores the savings.

Government statisticians, Hausman complains, "want to act like accountants, and they don't want to take economics into account at all."

Using ACNielsen data from 61,500 households, Hausman and Leibtag calculate that grocery shoppers are 20% better off--not the full 27%--with a superstore shopping trip. "So some of the food isn't quite as good or the diversity isn't quite as good," says Hausman. "But you still get a huge boost."

Since groceries make up 12% of household spending and as much as 25% for low-income Americans, this distortion significantly understates real incomes, especially at the bottom.
...
Gordon [economist Robert J. Gordon of Northwestern University] is the author of a much-cited study showing that from 1966 to 2001 real income kept up with productivity gains for only the top 10% of earners. What the pessimists who tout his study don't say is that, while Gordon does find that inequality is increasing, he's convinced that the picture of middle-class stagnation is false.

"The median person has had steadily improving standards of living," he says. But real incomes have been understated. The problem lies in how the U.S. Bureau of Labor Statistics calculates the cost of living.

If you are for the little guy you should be a fan of big box stores. Yet Wal-Mart and other big box stores are routinely attacked by Democrats in the U.S. Congress. People have noticed.

A recent LA Times editorial:

The gusto with which even moderate Democrats are bashing Wal-Mart is bound to backfire. Not only does it take the party back to the pre-Clinton era, when Democrats were perceived as reflexively anti-business, it manages to make Democrats seem like out-of-touch elitists to the millions of Americans who work and shop at Wal-Mart.

One reason the Democrats may have a tin ear on this subject is demographic. Certainly most of the party's urban liberal activists are far removed from the Wal-Mart phenomenon. The retailer has thrived mainly in small towns and exurbs, which is one reason a Zogby poll found that three-quarters of weekly Wal-Mart shoppers voted for President Bush in 2004, and why 8 out of 10 people who have never shopped at Wal-Mart voted for John Kerry. Denouncing the retailer may make sense if the goal is to woo primary activists, but it's a disastrous way to reach out to the general electorate. Or to govern, for that matter.

Liz Peek writing in the NY Sun:

Wal-Mart has recently been named by Black Enterprise magazine as one of the country's top companies for diversity. The firm was also celebrated this year by Diversity Inc., Asian Enterprise Magazine, the National Association of Women, Black MBA Magazine, Careers & The Disabled Magazine and by Hispanic Magazine for similar accomplishments.

This is the company that Democrats are campaigning against?

That's just the beginning. Read the whole thing.

UPDATE: Virginia Postrel has more here and here.

Dubai 10th largest trading partner with UK.... hmm

Via grapeshisha comes this story:

The 30 billion pound money-go-round: Telegraph:

It seemed, on paper, that trade between Britain and Dubai was booming. After years of sluggish growth, exports were finally taking off - up by an astonishing £325 million in a single month last year - and the little desert kingdom was sending plenty back in return. Businessmen at both ends were getting rich, and the Government looked happily at the figures.

Until it realised that there were no ends. Just a loop around which billions of pounds worth of goods were continuously and lucratively revolving as part of a VAT fraud that has now grown so extensive and complex that it has begun to distort the entire British economy.
. . .
The most sophisticated version occurs when a trader imports the goods, sells them on, with VAT added, to a criminal associate, who re-exports them (claiming the VAT back from Revenue and Customs), and later re-imports them, so that the whole procedure begins again. Some carousels have been known to spin as many as 30 times. It is estimated that up to 10 per cent of Britain's recorded exports may be fraudulent to some degree.
. . .
The growth of the racket has produced some startling statistics. This year, Dubai, which has a population of barely 900,000, officially became Britain's 10th-biggest trading partner. Suspicions were raised, however, when, in June last year, our exports to the kingdom soared to £529 million from just £204 million in the previous month.
. . .
many critics argue that flaws in the VAT system - compounded by ill-conceived EU regulations - are substantially to blame. "The rules and the administration of the tax are fundamentally flawed," says David Raynes, a former senior customs officer and fraud expert. "Actually, VAT as a tax is fundamentally flawed."
. . .
VAT, which was invented in France, was effectively imposed on Britain as a condition of joining the Common Market. Until then, we had a simple purchase tax of the type still levied in America.

Emphasis added.

Gulf News picked up on the Telegraph story here, and followed that with an article connecting the proposal for a GCC VAT with the potential for carousel fraud, as did 7Days.

My standard observations:

1. People will find economic opportunities like water finds leaks in a boat. This is true whether those opportunities create wealth, or they rearrange wealth.

2. The law of unintended consequences applies. The effects of innovation in institutional arrangements are quite difficult to predict precisely because of the degree to which those arrangements will be tested by the individuals responding to the incentives created.

3. The health of a society's institutions can be judged by the degree to which individuals are expending effort rearranging wealth rather than creating wealth.

More at Tax-News.com:

Raw trade data suggested the the UK's exports rose by 39% year-on-year in the second quarter, but when the ONS factored out possible MTIC fraud, this falls to a 12% increase.
. . .
MTIC is a European concern, and some estimates have put the total loss of VAT within the EU at EUR50 billion annually. This has prompted some European governments, including the UK, Germany and Austria, to seek permission from Brussels to change VAT regulations to apply 'reverse charging' under which the purchaser of the goods, rather than the seller, will be liable to account for the VAT on the sale. So far only the UK has been given permission to change its rules to combat the fraud.

Momentum for action to combat the problem is also growing within the European Commission. In a paper published earlier this year, Taxation Commissioner Laszlo Kovacs presented some radical proposals to counter carousel fraud, but it is thought the EC will take a more conservative approach to the problem by enhancing administrative cooperation and improving safeguards in the current system.

202 nationalities in UAE labour market :: Khaleej Times

The diversity - and relative size - of the foreign workforce in the UAE is one of the key defining characteristics of the country.

Study: Muslims, Arabs saw pay drop after 9/11

Quote:

Post-9/11 anti-Islamic and anti-Middle Eastern sentiment hasn't just taken an emotional toll on Muslim and Arab men living in the United States. It has also put a dent in their checkbooks, a study indicates.

Arab and Muslim men saw their wages and weekly earnings drop by 10 percent after the Sept. 11, 2001, terrorist attacks, the research reveals.

The largest decreases, according to the data collected from over 4,000 men between 1997 and 2005, occurred in locations that reported higher rates of ethnic and religious-based hate crimes.

Part of the reason pay fell is that these men, mostly from predominantly Islamic countries such as Pakistan, Saudi Arabia and Algeria, found fewer opportunities and had to find work in different industries that paid less than the jobs they used to be employed in after 9/11, said the study's co-author, Robert Kaestner, a University of Illinois at Chicago economics professor.

In addition, Kaestner said, most Muslim and Arab men, possibly wary of the reception they might receive in another state, curbed their travel within the country after 9/11, which may have kept them from seeking better jobs.
. . .
The good news, according to Kaestner, is that the reduction in wages may be short-lived, since the most recent statistics taken in 2005 indicate a "significant rebound" in earnings for Muslim and Arab men.

The study compares wage changes of first- and second-generation immigrants from countries with large Muslim and Arab populations to wage changes from first- and second-generation immigrants with similar skills from countries such as the Philippines and China.
. . .
The study will be published in the January 2007 edition of the Journal of Human Resources.

Via Fark.

TAGS: farkonomics profiling

Monopoly: A matter of national security? :: 7DAYS

Quote:

Sites such as Skype have been blocked in much of the UAE for months, but at the weekend were also blocked in other areas, such as free zones, which were previously unaffected by the telecoms proxy server block.
. . .
Some alleged the interests of operators such as Etisalat were being placed above those of consumers saying that “talking to family and friends cannot be against moral beliefs, the policy must be purely based on financial grounds.”An Etisalat spokesman defended the company saying it’s up to the TRA [the government regulatory authority] to allow or ban VOIP.

“Etisalat is just a communication provider which operates under the rules and regulations set by the TRA,” he added.

Last night Osman Sultan, the CEO of Du, the new telecoms operator due to begin in the UAE later this year, confirmed that his company would have to abide by any TRA ban on VOIP. Last night a spokesman for the TRA said it is currently studying the issue and had not come to a decision. But another TRA source, who did not wish to be named, added: “This is not just about cheap phone calls for consumers, there are aspects of national security and operators’ interest that has to be addressed and investigated.

If the TRA was interested in low prices for consumers, then perhaps it should have allowed VOIP to compete the Etisilat monopoly. Instead they have created the Etisilat v. Du duopoly. The duopolists are of course happy to have the TRA ban VOIP. They are happy, too, that the TRA will prevent Etisilat and Du competing against each other.

Du ... duopolist. Hey, I think I've figured out how Du got its name. Actually, I think Du spells its name du.

Is your internet working?

Is your work interneting?

APC Magazine:

Jobseekers will think twice about employers who lock down work internet access, a senior Microsoft executive said today.

“These kids are saying: forget it! I don’t want to work with you. I don’t want to work at a place where I can’t be freely online during the day,” said Anne Kirah, Microsoft Senior Design Anthropologist.
. . .
“Companies all over the world are saying, oh, you can’t be on the internet while you’re at work. You can’t be on instant messaging at work…” she said. “These are digital immigrant ideas.” Kirah defines ‘digital immigrants’ as people who were not born into the digital lifestyle and view it as a distraction rather than an integral part of life. The younger generation of workers have been using computers and mobile phones since birth and she calls them ‘digital natives’.
. . .
People were increasingly making use of anonymous proxies that couldn’t be easily blocked by corporate firewalls, bringing in their own wireless broadband services for use with a personal laptop or with a work PC or accessing instant messaging via mobile phones and PDAs.

It's nice to see that Microsoft finds anthropologists useful.

Meanwhile:

About one-quarter of employee terminations are due to misuse of workplace Internet privileges, according to a recent survey. In a case that gained attention earlier this year, a New York administrative law judge found Internet use no worse than using the phone or reading a newspaper at work.

But companies usually don't share that view. Some firms find employee cyber-slacking cause enough for disciplinary action, and others gear their policies toward warding off lawsuits -- and financial ruin -- stemming from employee e-mails or blogging.

Perhaps Microsoft was reacting to reports like this:

This year's biggest time-killer was personal use of the Internet. Of the 2,700 people quizzed in the unscientific survey, 52 percent said they wasted more time online than any other way. (The survey, by the way, was conducted online, and some responded: "I waste my time filling out surveys like this.")

Other top time-wasters included: socializing with co-workers, running errands and spacing out. "Staring blankly at the computer screen remains to be quite a popular choice," the study concluded.

In addition to polling workers, Salary.com surveyed human resource managers, who said companies assume workers waste nearly an hour each day. The difference between the slacking that companies budget for and the true amount costs U.S. companies a combined $544 billion per year, according to the survey.

But if you gave a firm a magic wand and told them they could prevent workers from using any paid time for personal use would they use that wand? A worker forced to work harder will demand greater compensation. It may be cheaper to allow them some slack. That's what Kirah is saying.

Rhode Island rebate law responsible for Pepsi shortage :: TurnTo10

Quote:

A Sunday advertising circular is promoting free Pepsi 12-packs and 2-liter bottles, if you mail in a rebate form.
However, a new Rhode Island law is limiting how stores handle rebates in advertisements such as the circular Pepsi distributed.

According to the law, if the ad includes a net price that is based on a rebate, then the rebate must be given at the time of purchase.
. . .
As soon as a Pepsi truck driver delivered a shipment of 12-packs, they were flying off the shelves.

At a Stop & Shop in Cranston, the Consumer Unit noticed that all of the shelves were empty of 2-liter Pepsi bottles.

A Pepsi spokesperson told NBC 10 that, "By the time the company became aware of the new law, it was too late to change two ads that our customers had planned to run this week. All future ads have been revised."

The spokesperson also said the Rhode Island production facility is working at capacity to try and produce enough soda to meet the demand.

This story comes to us from Fark, of course.

These two chains are, in effect, setting their price for Pepsi at zero. That was not their intent, but it seems that they are attempting, to keep up with the increased sales. I wonder if they have a rain check policy in place that promises the customer who finds the item is sold out to purchase it later when it becomes available. Or whether they have a policy that limits the quantity any single buyer can purchase.

Here's some of things economically insightful Farkers had to say:

2006-08-22 11:06:36 PM TechnoHead

Thank you, Rhode Island, for ruining it for all the people who actually mail the rebates like me.

The mail-in rebates are based on the fact that only a portion of the people actually claim it (someone in this thread quoted 40%, it sounds about right) so the company can offer a $100 rebate because they know it really means $40 on average.

Now that they have passed this stupid law to protect the lazy ass idiots that can't even fill in a form properly let alone walk to a mailbox, the rebates are going to be substantially reduced.

On the plus side, I am glad all the important problems in the world have been solved that we can now legislate to protect the terminally lazy.
. . .

2006-08-22 11:42:39 PM radiojunkie2878

Two things that they failed to mention:

1. The Pepsi isn't actually free, you still need to pay the sales tax which is 7% on 10 bucks (before the "rebate") so it's 70 cents for four 12 packs... still not a bad deal... Can't expect the state to not take their cut...

2. Local news is reporting that several fights have broken out at supermarkets around Rhode Island tonight... Mostly around the times that the stores get new deliveries of Pepsi... All over free soda... gotta love Rhode Island...
. . .

2006-08-22 11:53:21 PM mtrac

I like rebates. Never had a problem with them. People who don't remit them subsidize those that do.

2006-08-22 11:53:52 PM relaxitsjustme

Let me add my voice to the group that has done everything correctly, mailed it off on time and still ended up having to fight for my rebate. I refuse to buy based on rebates anymore.
. . .

2006-08-23 12:18:18 AM kmmarasco

I live in RI.

I have seen the hordes of obese middle class white people fighting and clawing over cases of bubbly goodness, the whites of their eyes so large at the very thought of free soda.

I just want my damn soda and all these fat bastards are taking it from me.

I still have a $100 rebate that has mysteriously been postponed because "we're updating our systems so everything needs to be reprocessed." More like "we're packing our stuff and moving to Taipei."

TAGS: farkonomics, rebates

Questions About Blogging :: EconLog Arnold Kling: Library of Economics and Liberty

Arnold Kling:

Unpoliced comments are bad. I think we have the best comment policing strategy, which is to warn commmenters who are getting too personal and, if they fail to adjust, banning them. My theory is that for every bad commenter you ban, several good commenters come out of the woodwork.
. . .
I think that somebody should come up with a statistical filter for reading blogs, sort of like the statistical filter that I use for spam. If you were to combine the aggregation features of Economics Roundtable with a statistical algorithm that learns my preferences, I think it would improve things a lot. An unfiltered aggregator gives me too many posts to consider and still misses posts that I would like to read.

Kling was responding to a public survey of econ bloggers by Jane Galt. Here are my responses to her survey.

Now apply Bayes theorem :: Greg Mankiw's Blog

Mankiw:

Note the relative performance of Hillary Clinton and John Edwards. Although Clinton is more likely to end up President than Edwards is, Edwards is more likely to win the general election conditional on being nominated. At least that's what the market says.

Some companies violating labour law do not exist :: Gulf News

Quote:

Humaid Bin Demas, assistant labour under-secretary, said that there are about 50,000 companies that have violated labour card regulations.

"Around 80 per cent of these companies fall into three categories companies that only exist on paper, companies that mainly sell work permits and businesses that are going through financial crises," said Bin Demas.

Many workers purchasing labour permits from such companies stay in the country illegally after their permit expires. As they stay illegally, they have to survive with low salaries and could claim no rights or compensation if injured.

According to Ministry of Labour statistics, around 90 per cent of the firms violating labour card rules are for people who do not work for the companies sponsoring them.

A colleague calls this "turning workers loose on the local economy." There are companies whose business is, or has become, selling work visas by importing labor and then setting the worker lose in return for an annual payment; they would not exist otherwise. These foreigners are willing to pay a flat fee for the opportunity of finding work on their own. Or the workers are leased to firms that want to hire, but cannot get visas approved.

As long as work visas are rationed, there will be a market for the visas and those who get the visas obtain a rent. The government could, however, wipe out this kind of business by going into the business and selling the visas itself. But since it does not sell permits, if it wants to deny permits to firms that have no purpose except to collect and resell work visas then it has an enforcement problem.

I have a conjecture that the plethora of small businesses on the edge of survival that you see in many cities and towns in the UAE are a variation on this theme. The local owner has in effect sold the business to a foreigner who needs the owner to acquire the work visa and the business license. The foreigner is in effect working for himself.

It would be interesting to know how many of these companies are owned by staff or former staff of the Ministry of Labour.

The EclectEcon explains there's a thin line between theologues and, well, totalitarians.

Here's a related a series of posts of mine from a while back, and this one, too.

Don't find the term Islamo-fascist accurate? Neither do I. Utopian-totalitarian is what is meant, not fascist. But whatever you call it, speak out against it.

Meanwhile, the people of Connecticut seem to have become single issue voters. Democrats are not happy.

Is Al-Qaeda taking a page out of the Hezbollah state-within-a-state playbook?

Tehran Times (Reuters):

Al-Qaeda wants to build a political operation in Iraq to broaden its campaign against the U.S.-backed government, a top U.S. general said on Wednesday.

Citing intelligence mostly gathered since the death of al Qaeda's former leader Abu Musab al-Zarqawi in June, Major General William Caldwell said the militant group appeared to be refining its approach beyond bombings and beheadings.

"Al-Qaeda in Iraq wants to present itself as a legitimate organization and is striving to increase its operational power by building a political base with a military wing," Caldwell told a news briefing.
. . .
He said the militant group was producing propaganda to exploit Iraqi anger over high unemployment, poor security and unreliable supplies of electricity and fuel, and turn it against the government and its U.S. backers.

"Al-Qaeda in Iraq, through the media and other grassroots propaganda, will promote a theme that portrays the Sunnis as under attack by coalition forces, and the government of Iraq as being corrupt," he said.
. . .
"Al-Qaeda in Iraq realizes killing of innocent Iraqi civilians has damaged their public support and is working to reverse that perception.

By no means does it mean they intend to stop creating sectarian violence, but rather change the perception," he said.

Hezbollah's two wing strategy:

NABATIYEH, Lebanon — Two days after agreeing to a cease-fire to end 34 days of fighting with Israeli forces, Hezbollah deployed its army of social workers and engineers throughout this southern Lebanese city.

They visited wrecked homes and businesses, surveyed damage, gave compensation estimates and coordinated relief efforts with city officials. "Hezbollah workers were here even before the bombing stopped," said Mustafa Badreddine, 50, the mayor. "They have offices here. They have municipal resources. And the people trust them."

The Shiite Muslim militia's network of social workers serving its mostly Shiite following rivals the group's military component. The assistance is a cornerstone of Hezbollah's strategy to gain popular support.

Sheik Hassan Nasrallah, the group's leader, has pledged to help rebuild the homes lost during the month-long war. He didn't specify the source of the funding. Hezbollah also is helping residents coordinate reconstruction efforts with assessments and contractors, Badreddine said.
. . .
On Tuesday, the second day of the cease-fire, Nahle said Hezbollah workers visited his ruined home, surveyed the damage and promised to call soon to tell him how to receive money for repairs.

As a backhoe chewed through the remains of his home, Nahle said the destruction he suffered was worthwhile. "Sayyed Hassan gave us a victory," he said, referring to Nasrallah's honorary title. "We beat the strongest army in the Middle East. Even if they kill our women and children and parents, we will still support him."

Like its military wing, which relies on secrecy to prevent infiltration by outside agents, Hezbollah engineers avoid contact with strangers. They were not seen when reporters toured the city.

Badreddine explained how they work. He said a team of up to five workers is assigned to a city district. They coordinate efforts with a local contractor and city officials. Workers at the contracting firm declined an interview request. They said only designated Hezbollah leaders are authorized to speak to the press.

After visiting sites and making assessments, the workers connect residents with contractors, who begin rebuilding, Badreddine said. He said the Hezbollah teams out-hustle and out-finance government officials working on the same task. "The government is waiting for Hezbollah to give them the information," the mayor said. "If you let the government do it, half the money will go into their pockets."

Are Al-Qaeda and Hezbollah prepared to allow a state of normalcy where people are not dependent upon them, can take care of themselves, and have a central government strong enough to maintain order, protect people and property, and provide basic public services?

And where is the money coming from? If you don't create wealth you must be getting from someone.

Iran resumes gasoline imports

ALARAB ONLINE:

Fuel-hungry Iran has bought several cargoes of gasoline for delivery in September, which oil traders say may mean Tehran is still financing imports, despite a threat to stop and impose politically risky fuel rationing.

Iran's reliance on imported gasoline could be a weak point were it subject to international sanctions in a dispute with the West over its nuclear programme.

Even without sanctions, the rising cost of the fuel drains away the OPEC nation's oil wealth.
. . .
Iran has been spending billions of dollars a year to feed a an expanding fleet of cars featuring many carefully maintained 1960's models that burn rapidly through the costly imported gasoline, lavishly subsidized at a price of 9 cents per litre."They cannot resist the demand," a trade source said.

Over the past two years, the republic has been one of the world's largest consumers of imported fuel, buying between 15 and 20 cargoes of gasoline per month, amounting to 189,000 barrels per day.

That is roughly 1/6 the volume imported by the biggest buyer of the world's excess gasoline, the United States.

But this year, Iran's government called a halt to the expensive subsidies and said Iran would have to get by on its own refining capacity, capable of satisfying only about 60 percent of its 70-million-litre-per-day gasoline needs.

The fuel import budget was capped at $2.5 billion in the year to March 2007, down from $4 billion the previous year.
. . .
Trade sources say Iran's imports have also varied recently with its success in combating smuggling.

The subsidies fuel a burgeoning black market, re-selling the imported gasoline to Iran's neighbours, which can run to a rate of 10 million litres per day, according to one estimate.

The fuel leaves for Iraq, Pakistan, the United Arab Emirates and other Gulf countries by all available means, including makeshift underwater tanks tied to vessels departing Iran, and even on camel back.

Iran is afraid of its own people. It would be so much wealthier if it had the trust of its people to rationalize gas prices, and redeploy the subsidies to money better spent. But it doesn't have that trust. So it uses continues to subsidize gasoline, a transfer that is easily seen and widely dispersed - and not so easily corrupted as would be other government spending. And create international tension to incite more fervent internal support.

Make tigers objects of commerce

So suggests Barun Mitra of India's Liberty Institute. Don Boudreaux agrees.

If tigers were owned, and not free for the taking, then stuff like this (3rd para) would be less likely to happen.

Visitor 75,000

Our 75,000th visitor arrived today at 4:07 PM local (Dubai) time. They were brought to Emirates Economist as a result of this search:

Isra and Miraj public Holiday in UAE for 2006 - Google Search

Their visit was brief.

SiteMeter is predicting traffic to be about 6,000/month based on traffic over the last month. My guess, looking the last 6 months, is that traffic will typically be around 5,000 per month.

Another post like this one would welcome.

A formula for creating angry young men?

If you don't know your multiplication tables by 6th grade, don't wonder why you can't get a decent paying job when you are 18 or 21. And don't get angry at society. Be content with the consequences of your choices, truly content. There's nothing wrong with them, but realize the consequences of them flow from your own volition, or the volition of your parents.

Ministry cuts fees for expatriate students in government schools :: Khaleej Times

Quote:

DUBAI — The Ministry of Education has announced a substantial reduction in admission fees for children of expatriates in government schools.

''Annual fees for students in grade 1 to 3 will be slashed by 50 per cent from Dh 6000 to Dh 3000 a year while those of grade 4 to 7 will be amended to be Dh 4000. As for grade 8 and 9 fees will be in the range of Dh 5000, according to a resolution endorsed by Minister of Higher Education, and acting Education Minister Sheikh Nahyan bin Mubarak Al Nahyan.

The ministry has set Dh 6000 as fee for each grade at the secondary school level. Earlier the ministry specified fee for grade 1 to 12 at Dh 6000 and despite that it imposes strict requirements for admission.

The ministry has also allowed the acceptance of children of Arab expatriates employed by the federal government at remote areas that are far away by 35 kilometres, instead of 50 kilometres, from the nearest private school.

I presume the goal is to improve the quality of education of nationals. One of the inputs to a good education is the other children in the classroom. Increasing the number of highly talented or highly motivated students can improve the quality of learning as those students transmit knowledge and make the environment more competitive. These effects may be greatest for the other talented students in the classroom.

Not so long ago government schools closed the doors to expatriates. This policy represents a reversal.

The parents of these expat children have superior alternatives in terms of school quality. Thus, to attract the most talented of these students the price has to be right.

Security 'bad news for sex drive' :: BBC

The argument is that the female's sex drive is high early in a relationship in order to cement a relationship. Later in the relationship it drops. Here's the argument why:

Dr Dietrich Klusmann, lead author of the study and a psychologist from Hamburg-Eppendorf University, believed the differences were down to human evolution.

He said: "For men, a good reason their sexual motivation to remain constant would be to guard against being cuckolded by another male."

But women, he said, have evolved to have a high sex drive when they are initially in a relationship in order to form a "pair bond" with their partner.

But, once this bond is sealed a woman's sexual appetite declines, he added.

He said animal behaviour studies suggest this could be because females may be diverting their sexual interest towards other men, in order to secure the best combinations of genetic material for their offspring.

Or, he said, this could be because limiting sex may boost their partner's interest in it.

Huh? You've already established the cause of why he's already interested in it.

Then there's an attempt at a supply and demand analogy:

Professor George Fieldman, an evolutionary psychologist from Buckinghamshire Chilterns University College, said: "These findings seem to fit in with anecdotal studies and his explanations seem plausible.

"The rational for why a woman's sex drive declines may be down to supply and demand. If something is in infinite supply, the perceived value would drop."

Hmm. Maybe the idea is if you don't give it way you can sell it for something. Like doing a bit of housecleaning or childcare? Or some tenderness?:

About 90% of women wanted tenderness, regardless of how long they had been in a relationship, but only 25% of men who had been in a relationship for 10 years said they were still seeking tenderness from their partner.

In Why We Love: The Nature and Chemistry of Romantic Love the author, Helen Fisher, writes:

There is a great deal of anecdotal evidence for this negative chemical relationship between attachment and romantic love. People around the world say the exhilaration of romance wanes as their marriage or partnership becomes increasingly stable, comfortable, and secure. Some even go to psychiatrists or marriage counselors to try to renew romantic passion in their relationship. Some seek romance outside their marriage instead. Some divorce. And many settle into a long-term partnership of devoid of romantic bliss.

Arbitrageurs are not terrorists

Quote:

DALLAS — The three Dallas-area men arrested in Michigan on state terrorism charges are well-known to cell phone wholesale and retail shops here, where managers said Monday they are part of a brisk trade in buying phones from Wal-Mart and other discount stores and reselling them to smaller shops.

In Michigan, meanwhile, the FBI said it has no information to indicate that the three Palestinian-Americans arrested with about 1,000 cell phones in their van on Friday had any connections to terrorism.
. . .
"For these guys, there is a lot of margin in these," said Sean Mobh, manager of Wireless Stop, a cell phone store on Harry Hines Boulevard in northwest Dallas. "There is a phone that they buy from Wal-Mart for 20 bucks and sell for $38."

Mobh said the group has come in "three or four" times in the last three months and he made one purchase of about 100 phones. They would usually sell prepaid TracFones, like the kind they were found with in Michigan, because Wal-Mart's discounts on them are so deep that they can make a nice resale profit.

"One trip and that's about $6,000 each minus gas and expenses," he said.

Mobh said the three men are among dozens of individuals in the competitive market of buying goods from Wal-Mart and other deep discounters and reselling them to other stores that mark them up and sell them retail or wholesale.

Mobh said he resells the phones in bulk in higher-priced markets such as New York or Los Angeles, or ships them abroad.

Wal-Marts in Dallas and other cities often are sold out of the most popular phones because of all the resellers about, so entrepreneurial types such as the Othman brothers and their cousin will travel long distances to find stores with inventory, several shopkeepers said.

UPDATE: Be sure to read the first comment. It adds great value to this story. From an economic point of view.

Lieberman's choice

If Senator Lieberman's choice is between the success of the Democratic Party and the success of the war on terrorism, his choice to run as an independent is clear. I don't see him backing down.

It should be no surprise that Bush's stance is not to support Republican candidates no matter what. Winning the war on terror is his objective. Although at least one economist believes Bush's motivations are merely about keeping power in the hands of Republicans.

UAE community blog and the conflict over Israel

The UAE community blog is managing - very well - to conduct a healthy discussion of the war between Israel and Hezbollah, and the wider issues surrounding that conflict.

Here's are some links to comments I found to be very useful:

bandicoot

i, bobo

blogrosh

This is only a small sample.

I've added some of my own thoughts (bandicoot replies here), but as regards facts and deeper understanding of the particulars I bow to commentators like those above.

Attendance and the Ministry of Education

Staff exploit loopholes in MoE attendance system says the Khaleej Times. Too bad the staff cannot be trusted simply to behave as professionals. It will be quite a trick to get to the point where the Ministry has a work environment where human interaction supports a professional attitude amongst all the staff. KT reports that the Ministry is instead for more technogy to monitor physical presence. Real presence, and consequences for the lack thereof, is another matter.

Here's a technological innovation to consider. If it works for students perhaps it will work on administrators. But somehow I doubt it will get you what you want: you get what you pay for as is explained over at Newmark's Door. As I was saying -- measuring physical presence is not the same thing as measuring presence.

UPDATE, 20Aug. Gulf News also covers the MoE story:

The statement follows reports unearthing an alleged ring of staff cheating the ministry by taking turns swiping each other's cards when entering or leaving the office, allowing the others to get unauthorised free time.
. . .
"It is true some irresponsible employees have misused their swipe cards, especially over the summer months when the workload is light," said the official, who asked not to be named.
In the report, it was recommended some employees who claim to 'forget' using their swipe cards must be closely watched.

Universities 'at centre of alleged plot to blow up passenger jets' :: Gulf News

Quote:

A dossier of extremist literature has been uncovered by The Sunday Telegraph on the campus of a north London university, one of whose students has suspected links to the alleged terrorist attack.

Waheed Zaman, 22, a bio-chemistry student and the president of the Islamic Society at London Metropolitan University, was one of 24 people arrested last week.
. . .
Cassette tapes produced by Al Muhajiroun, the disbanded militant organisation that praised the "Magnificent 19'' who carried out the September 11, 2001 attacks, were also discovered at the university's portable buildings used as a prayer room and library.

Al Muhajiroun was headed by Omar Bakri Mohammad, the radical London cleric forced into exile in Lebanon last year.

The portable buildings are on land owned by the university, which also part-funds the Islamic Society.

According to security sources, "several'' of the 23 people still in custody over the alleged plot are suspected of links to universities, appearing to confirm growing fears that campuses are providing Britain's biggest security threat.

The story comes from The Sunday Telegraph. I wonder if Gulf News has the notion that the problem could extend to other secular universities around the world, including universities in the UAE.

A roundabout look at Al Ain

#1. The Sheik Zayed Roundabout.

#2. Glass-house-with-dead-forest-inside Roundabout.

#3. Al Ain Hospital Roundabout

#4. The Jabal Roundabout.

A continuing series at Bss & Brn in Al Ain.

I think I can tell where Brn is headed with this - a welcome diversion. Here is his explanation.

Airport duty free and the new carry-on restrictions

Gulf News reports:

Industry statistics put sales of liquid items at 20 per cent of all airport retail sales.

The new UK rules do not forbid passengers flying from Dubai into London from having carry-on luggage if they terminate their journeys in the UK; however, passengers with connecting flights out of the UK are barred from having carry-on luggage.

Dubai Duty Free, the world's third largest airport retailer in terms of turnover, said it was monitoring the situation but had not detected a 'noticeable impact' on its daily sales.

A manager at Bahrain Duty Free said there was slight decline in the sale of beverages and other liquid items on Friday. He said the outlets were still processing the sales data. "This is a fluid situation. We are still monitoring it to see if it will have any impact on our sales," said Ramesh Cidambi, a Dubai Duty Free manager responsible for logistics.

Dubai Duty Free refused to say if there was any decline in liquid product sales due to the UK rules.

"This is a fluid situation." Pun unintended I presume.

Here's the latest carry-on rules at British Air (emphasis added):

With immediate effect, the following arrangements apply to all passengers starting their journey at a UK or United States of America airport and to those transferring between flights at a UK airport.

All cabin baggage must be processed as hold baggage and carried in the hold of passenger aircraft departing UK airports.

Note:Passengers are advised that ALL electrical or battery powered items including laptops, mobile phones, portable music players, remote controls etc cannot be carried in the cabin and must be checked in as hold baggage.

Passengers may take through the airport security search point, in a single (ideally transparent) plastic carrier bag, only the following items. Nothing may be carried in pockets:-
*pocket size wallets and pocket size purses plus contents (for example money, credit cards, identity cards etc (not handbags));
*travel documents essential for the journey (for example passports and travel tickets);
*prescription medicines and medical items sufficient and essential for the flight (eg diabetic kit), except in liquid form unless verified as authentic.
*spectacles and sunglasses, without cases.
*contact lens holders, without bottles of solution.
*for those travelling with an infant: baby food, milk (the contents of each bottle must be tasted by the accompanying passenger) and sanitary items sufficient and essential for the flight (nappies, wipes, creams and nappy disposal bags).
*female sanitary items sufficient and essential for the flight, if unboxed (eg tampons, pads, towels and wipes).
*tissues (unboxed) and/or handkerchiefs
*keys (but no electrical key fobs)

Every other item must be carried in customer’s hold luggage.

All passengers must be hand searched, and their footwear and all the items they are carrying must be x-ray screened.

Pushchairs and walking aids must be x-ray screened, and only airport-provided wheelchairs may pass through the screening point.

In addition to the above, all passengers boarding flights to the USA and all the items they are carrying, including those acquired after the central screening point, must be subjected to secondary search at the boarding gate. Any liquids discovered must be removed from the passenger.

Customers travelling to the UK from overseas airports may be subject to local airport restrictions and therefore customers should plan to travel with the very minimum of hand luggage.

There is also this Baggage Advice:

To minimise disruption, British Airways advises customers that they should reduce to a minimum the number of bags to be checked in (maximum of 32 kgs per bag). They should also minimise the amount of electrical equipment contained within their hold baggage.

Certainly if these restrictions were applied to every flight out of Dubai, then Dubai Duty Free would take a very severe hit. Including in the liquid libations department. Of course would still be the incoming business. (Though Dubai Duty Free clearly is geared to out-going business.) That might even pick up some since few passengers are doing their duty free purchases in London anymore:

AS long queues continued at Heathrow’s security and check-in points many shops remained empty because of the stringent security measures forbidding electrical goods, perfumes, drinks and other liquids as hand luggage.

BAA said that passengers could purchase goods in the airport after passing through security, but those travelling to the USA were banned from taking any liquids. As well as the new rules, sales assistants said that the queues were another deterrent, with passengers reluctant to spend time shopping in case lines became even longer.

The BA.com rules quoted above appear more restrictive.

Some background on the airport duty free business:

Airports act as landlords, letting out retail space for high rents. This attracts a range of shops, from chemists and electrical retailers to luxury-goods companies keen to take advantage of "dwell time", when bored travellers waiting for their flights indulge in retail therapy.

"Is it significant? Yes, it's very significant," said Andrew Fitchie, an analyst at Collins Stewart.

"The whole global airport model is predicated on keeping charges for the infrastructure down by cross-subsidising from retail. That's the case with BAA and with regional airports in the UK, and it's one of the reasons low-cost carriers have been able to grow.

"It's been the cornerstone of the airport industry for the last 20 years or so."

Mr Fitchie said it was hard to put a figure on revenues garnered from retail by airports, but conceded: "We're talking not tens but hundreds of millions of pounds."

Here's a good summary of the current state of air travel transport security in the U.S., arguing that there should be less focus on bad things and more focus on bad people. Can you say profiling?

The one book I managed to finish reading this summer.

Recommended. It will explain your unhappiness. But it's not a guide to happiness. That's something you stumble into.

How Green Is Gore? :: The EclectEcon

Behind the Green Gore.

An Inconvenient Truth. Or two or three.

UAE president issues decree on indirect polls :: The Peninsula On-line

The elections are indirect because members are elected to the Federal National Council by electoral colleges in each emirate.

Unexplained: how the the electoral colleges are appointed.

The Peninsula (Qatat's English daily) does note:

Sheikh Khalifa said in December that the partial ballot "will be followed by several others (moving) toward more reforms" leading up to direct elections.

He said he would propose to the new FNC, an advisory body, that it amend the constitution to "reinforce the prerogatives of the council... and increase its membership... in a way that the council can adopt the necessary measures to permit the holding of direct elections."

It's not clear how an advisory body can amend the constitution.

The Peninsula's coverage is more informative than this coverage by Gulf News.

This explains a lot.

I'm a lefty, too, if you ever wondered about the eccentricity of this blog.

The Economist on econobloggers

The Economist addresses the question: why do economists blog?

Via the New Economist.

Libyans not in hot water in Washington :: Fox News

They can't get the water turned on. Quote:

At the heart of the dispute are more than $27,000 in outstanding water and sewer bills for the property on Wyoming Avenue. Libya says it hasn't occupied the building since 1981, when the U.S. government cut diplomatic ties with the country and shut the embassy.

After Libya's departure, the United Arab Emirates took control of the property. And, according to the suit, "squatters" stayed there for several years without permission from Libya or UAE.

The UAE evicted the squatters in 2003 and ordered water and sewer service to be shut off, the suit says.
Even so, the D.C. utility won't provide water or sewer service until someone pays the bills.

1981 to 2003? That's a long time to have control of a building and not exercise that control. Perhaps the Libyans should turn to the UAE for payment - they were in control. It's not clear from the article, though, whether the UAE took control as early as 1981 or whether assignment of control came later.

Sticking one's head in the sand smog? :: M and J Adventures

Read the whole thing. Particularly telling is the evidence on air quality during mourning periods.

Investing in the UAE: caution is advised

Gulf News has a pair of articles today about investing here.

1. Distress sale of Dubai homes up

Wipperman said residential blocks on distress sale were mainly four to eight-floor middle income housing units owned by single investors with purchase prices ranging from Dh10 million to Dh40 million. Their owners face a cash crunch because slower-than-expected infrastructure development has delayed sale of these projects.

A slowdown in take-up owing to inadequate retail financing in some instances resulted in greater-than-anticipated cash demand on investors while some face a cash crunch owing to poor recent stock market performance.

Property prices in the UAE surged in 2003-04 after the government allowed foreigners to buy homes in 2002, enabling most investors to make hefty profits on re-sales at high premiums. But values are now beginning to reach a plateau and prices could fall further this year as about 60,000 new units are expected to hit the market by the year-end. Still, residential rents are estimated to rise some 17 per cent on the average this year after jumping 30 per cent last year as a fast-growing economy attracts thousand of workers from other countries.

Demand for commercial real estate, retail space and villas, however, still remained strong.

See also the comments following the article.

2. Call for better corporate disclosure rings in UAE

UAE companies must reveal more information to investors and improve corporate governance if they are to help curb the sharp swings in local share prices, a top investment professional said.

The call came a day after the UAE market regulator said it had issued warnings to two local and five foreign listed companies for not meeting the July 31 deadline for reporting their second-quarter results.

Zuheir Tamim Al Jarkass, president of CFA Emirates, the local body of chartered financial analysts (CFA), said investment analysts in the UAE find it hard to forecast a company's cash flows or evaluate risk, since firms do not disclose adequate and timely information.

He said investors in the UAE generally rely on rumours rather than on educated investment advice, which cause the wild gyrations in local stock markets. The number of analysts following companies and publishing research on them in the UAE is also small.

It's fair to assume that if you don't file on time it's because you've got bad news.

Google Earth blocked in Bahrain :: Mahmoud's Den

Mahmoud figures Google Earth is blocked in Bahrain because it so obviously reveals the disproportionate distribution of the country's wealth. And limited beach access.

Link via Woke posting at UAE Community Blog.

Foreign businesses threaten to snub pricey Dubai :: ITPBusiness.net

Quote:

If the latest figures are anything to go by, the days of international companies flocking to Dubai in search of cheap start-up costs could be numbered. Year-on-year rental price hikes coupled with a sharp spike in construction costs are threatening to hinder the reputation of the booming emirate as a destination for foreign businesses.

But while this could be bad news for the UAE’s second city, lesser-developed trade centres across the region could benefit as chief executives seek out more cost-effective locations to call home. According to a recent study by CB Richard Ellis, one of the world’s largest commercial real estate companies, office space in Dubai is now more expensive than in more established business locations including New York, Munich, Zurich and Milan.

The author of this article treds close to a classic fallacy. Demand driven increases in prices do cause buyers to seek alternatives and some take those alternatives. But the increase in demand that caused the increase in price does not go away when prices increase. What is true is that sellers would prefer that customers not be able to find alternatives. What is not true is that Dubai sellers are worse off as a result of the increase in demand.

As Yogi Berra stated the point:

Nobody goes there anymore. It's too crowded.

Read the whole thing. It's got several tidbits of interesting information about controlled prices of cement and apartments, as well as some comments about the alternatives to locating in Dubai.

Palestinians overjoyed Hizbullah fired rockets are able to reach West Bank

The rockets, by the way, are made in Syria. Syrian made rockets aimed at Israel by Hizbullah landing in the West Bank. Are a cause for joy.

Via Fark, of course.

Never heard of police sappers before. They are bomb disposal experts.

Emirati is not blaming the Israelis.

But he does find blame.