Offsetting Behaviour

Bilateral, plurilateral, and multilateral are words that New Zealand's civil service love. There is nothing that can't be improved by doing it in concert with others. Sometimes there's good reason for just doing stuff. New Zealand made the right decision when it unilaterally slashed all of its tariffs. It also progressed all the other trade agreements that helped make trade easier. But it didn't wait for those lengthy processes. Just cutting tariffs earlier was just fine.

Michael Clemens shows that a rise in noncitizen worker prevalence in Korea from 3% to about 14% over four decades would offset the effect of Korea's demographic shift. The Republic of Korea (ROK) faces an economic crisis driven by rapid population aging, approaching negative economic growth. I quantitatively examine the full range of policy responses and find that enhanced temporary labor migration is necessary, sufficient, and feasible to offset demographic drag.

Cato's Handbook on Affordability provides a set of policy recommendations for reducing unnecessary government-imposed costs. There's the usual stuff you'd expect, much of which is US-focused. But a few bits are worth thinking about here too. In the chapter on healthcare, Cato suggests automatic removal of prescription-only requirements from medicines. They write: Eliminate prescription regulation.

I like this chart, from Andreas Heuser and Phil Whittington's excellent piece making the case for datacentres

The ACT Party has announced a new policy that would: Remove the existing Permanent Resident visa category; Require all Resident Visa holders to receive a 5 year travel facility, replacing the current two-year initial travel condition; Require all Resident Visa holders to be physically present in New Zealand for at least 730 days within any rolling five-year period, with exemptions for those working overseas for NZ employers, accompanying family-members, military personnel serving overseas,...

The ACT Party has announced a new policy that would: Remove the existing Permanent Resident visa category; Require all Resident Visa holders to receive a 5 year travel facility, replacing the current two-year initial travel condition; Require all Resident Visa holders to be physically present in New Zealand for at least 730 days within any rolling five-year period, with exemptions for those working overseas for NZ employers, accompanying family-members, military personnel serving overseas,...

New Zealand's Zero Carbon Act sets net emission targets. This is sensible. The atmosphere does not care whether the next tonne of CO2-e is not-emitted or removed. They amount to the same thing. It also aligns with the ETS's design, which requires surrender of an NZU for putting CO2-e into the atmosphere and awards an NZU for pulling a tonne of CO2-e out of the atmosphere.

One reasonable definition of economics is the study of choice under conditions of scarcity, or choice under constraint. When getting more of one good thing requires forgoing some other good thing, what do people do? How do they decide? Ganesh Ahirao (was Ganesh Nana; last name changed - I think because a historic error in NZ systems was finally more recently corrected) proposes an Economic Governance Act to replace core parts of the Public Finance Act. Jack Tame asked how part of that would work.

A few bits I've neglected to blog. My chat with Adam Jarvis on datacentres . A follow-up chat with RCR on the same thing, as well as a coup...

In today's inbox: Hello Eric, My name is [redacted]. I read your article about prediction market regulation with interest. As a student in 2013 I placed a single $60 bet which brought down iPredict from a run on the market related to Peter Dunne, which I intentionally caused based upon groupthink and illogical beliefs in the truthiness of the insider betting ring. I knew exactly what would happen when I joined and placed the well timed bet.