Category: Economics

Trump Argues Regulations Impede Infrastructure Investment

(p. A18) Mr. Trump is pursuing a similar shift in regulation, seeking to reverse or rewrite a host of rules intended to protect workers and consumers, under the theory that freeing companies from “red tape” will allow businesses to prosper, with wide-ranging benefits.
In remarks at the White House last week, Mr. Trump argued that regulation was impeding private investment in infrastructure. He held up a long, multicolored chart that he said reflected the permitting process for the construction of “a highway or a roadway.”
“By the time you finished, you probably gave up,” Mr. Trump said.

For the full story, see:
BINYAMIN APPELBAUM and ANA SWANSON. “Trump Bets on Business to Lift Workers.” The New York Times (Thurs., December 21, 2017): A18.
(Note: the online version of the story has the date DEC. 20, 2017, and has the title “Republican Economic Policies Put Business First.” The online version says that the page number for the print New York edition was A19. My print paper was probably the midwest edition.)

Cognitive Abilities Highest After Waking in Morning

(p. A15) A raft of studies in disciplines ranging from medicine to economics have yielded all sorts of data on the science of timing. Daniel Pink, an author who regularly applies behavioral science to the realm of work, has handily distilled the findings in “When: The Scientific Secrets of Perfect Timing.”
. . .
For a slim book, “When” brims with a surprising amount of insight and practical advice. In amiable, TED-talk-ready prose, Mr. Pink offers scheduling tips for everything from workouts to weddings. Exercise, for example, is best done in the morning for those who hope to lose weight, build strength and boost their mood through the day.
. . .
Moods are not the only things that shift every 24 hours. Our cognitive abilities also morph in foreseeable ways. We are often sharpest in the hours after waking up, which makes morning the best time to take exams or answer logic problems. Researchers analyzing four years of test results for two million Danish schoolchildren found that students consistently scored higher in mornings than afternoons.

For the full review, see:
Emily Bobrow. “BOOKSHELF; Hacking The Clock; Exercise in the morning if you want to lose weight. But if you want to perform at your physical peak, plan a workout for the afternoon.” The Wall Street Journal (Wednesday, Jan. 10, 2018): A15.
(Note: ellipses added.)
(Note: the online version of the review has the date Jan. 9, 2018, and has the title “BOOKSHELF; Review: Hacking The Clock; Exercise in the morning if you want to lose weight. But if you want to perform at your physical peak, plan a workout for the afternoon.”

The book under review, is:
Pink, Daniel H. When: The Scientific Secrets of Perfect Timing. New York: Riverhead Books, 2018.

Tinkerers Create Cheap Prosthetic Hands with 3-D Printers

(p. D1) The proliferation of 3-D printers has had an unexpected benefit: The devices, it turns out, are perfect for creating cheap prosthetics. Surprising numbers of children need them: One in 1,000 infants is born with missing fingers, and others lose fingers and hands to injury. Each year, about 450 children receive amputations as a result of lawn mower accidents, according to a study in Pedatrics..
State-of-the-art prosthetic replacements are complicated medical devices, powered by batteries and electronic motors, and they can cost thousands of dollars. Even if children are able to manage the equipment, they grow too quickly to make the investment practical. So most do without, fighting to do with one hand what most of us do with two.
E-nable, an online volunteer organization, aims to change that. Founded in 2013 by Jon Schull, the group matches children like Dawson in need of prosthetic hands and fingers with volunteers able to make them on 3-D printers. Designs may be downloaded into the machines at no charge, and members who create new models share their software plans freely with others.
The materials for a 3-D-printed prosthetic hand can cost as little as $20 to $50, and some experts say they work just as well, if not better, than much costlier devices. Best of all, boys and girls usually love their D.I.Y. prosthetics.

For the full story, see:
Mroz, Jacqueline. “Hand of a Superhero.” The New York Times (Tues., Feb. 17, 2015): D1 & D6..
(Note: the online version of the story has the date FEB. 16, 2015. I do not have the print version, so I cannot confirm if there are differences between the online and print versions, and am not sure if the whole passage quoted above appears on p. D1, or if some or all of it is from p. D6.)

Firms Invest in France as Rules “Make It Easier to Hire and Fire”

(p. B1) PARIS — The announcements came in a steady drumbeat. Around 1,300 job cuts at France’s biggest automaker. At least 2,500 at France’s largest supermarket chain. Over 200 sought at a major clothing retailer. And thousands more are on the way.
Just weeks after France’s labor overhaul went into effect, companies are readily taking advantage of new rules that make it easier to hire and fire.
. . .
Perceptions of France, long derided as a difficult place to do business for its onerous labor rules, are changing.
Growth has recently picked up after being stagnant for nearly five years. And there are signs that the changes, a major piece of the president’s economic program, are drawing the interest of investors.
Amazon will open a new distribution center south of Paris this year, creating over 1,000 jobs. Facebook and Google announced Monday they would invest in artificial intelligence development in France. Also Monday, Toyota announced it would invest 300 million euros, or $367 million, to increase capacity at a plant in northern (p. B3) France, creating up to 700 jobs through 2020.
“The complex labor laws have historically been the No. 1 obstacle to the competitiveness and attractiveness of France,” said Olivier Marchal, the chairman of Bain & Company France, a business consulting firm. The changes, together with other business-friendly measures such as a gradual reduction in the corporate tax, have “drastically changed investor perceptions,” he said.

For the full story, see:
LIZ ALDERMAN. “Newfound Freedom … to Fire.” The New York Times (Weds., January 24, 2018): B1 & B3.
(Note: ellipsis in article title, in original; ellipsis between quoted paragraphs, added.)
(Note: the online version of the story has the date JAN. 23, 2018, and has the title “French Companies Have Newfound Freedom … to Fire.”)

Kodak Using Blockchain to Manage Digital Photo Property Rights

(p. B1) Shares of Eastman Kodak more than doubled after the company waded into the digital-currency world with plans to launch an initial coin offering.
Kodak on Tuesday [January 9, 2018] said the coin, KodakCoin, would be the backbone of a new platform that will help photographers license their work and track the unlicensed use of their images. The coin uses the technology behind bitcoin, called blockchain, to keep a digital ledger of the photographs.
. . .
“For many in the tech industry, ‘blockchain’ and ‘cryptocurrency’ are hot buzzwords, but for photographers who’ve long struggled to assert control over their work and how it’s used, these buzzwords are the keys to solving what felt like an unsolvable problem,” said Kodak CEO Jeff Clarke in a statement.
For the past several years, people have been experimenting with ways to use blockchain. At its essence, blockchain is an open record of transactions, maintained in an online ledger that is distributed across a network of computers, that cannot be tampered with. That makes it like an indelible time stamp, which could be useful in a case of copyright and digital-rights management.

For the full story, see:

Erik Holm and Paul Vigna. “Kodak Snaps Is Crypto-Moment.”The Wall Street Journal (Weds., Jan 10, 2018): B1-B2.
(Note: ellipsis, and bracketed date, added.)
(Note: the online version of the story has the date Jan 9, 2018, and has the title “Kodak Catches Crypto Fever.” The online version has two additional paragraphs between the last two paragraphs quoted above.)

“Without Amazon, We Wouldn’t Be Here”

(p. B1) KANATA, Ontario — Truth be told, the headquarters of Instant Pot don’t look much like a church.
But inside this sterile, gray office building on the outskirts of Ottawa, behind a door marked only by a small metal sign, a new religion has been born.
Its deity is the Instant Pot, a line of electric multicookers that has become an internet phenomenon and inspired a legion of passionate foodies and home cooks. These devotees — they call themselves “Potheads” — use their Instant Pots for virtually every kitchen task imaginable: sautéing, pressure-cooking, steaming, even making yogurt and cheesecakes. Then, they evangelize on the internet, using social media to sing the gadget’s praises to the unconverted.
. . .
(p. B5) I went to Kanata to get a peek behind the scenes of the Instant Pot phenomenon and meet its creator: Robert Wang, who invented the device and serves as chief executive of Double Insight, its parent company. What I found was a remarkable example of a new breed of 21st-century start-up — a homegrown hardware business with only around 50 employees that raised no venture capital funding, spent almost nothing on advertising, and achieved enormous size primarily through online word-of-mouth. It is also a testament to the enormous power of Amazon, and its ability to turn small businesses into major empires nearly overnight.
. . .
In 2010, after several months of sluggish sales in and around Ontario, Mr. Wang listed the Instant Pot on Amazon, where a community of food writers eventually took notice. Vegetarians and paleo dieters, in particular, were drawn to the device’s pressure-cooking function, which shaved hours off the time needed to cook pots of beans or large cuts of meat.
Sensing viral potential, Instant Pot sent test units to about 200 influential chefs, cooking instructors and food bloggers. Reviews and recipes appeared online, and sales began to climb.
. . .
Mr. Wang credits the device’s technological advances — most notably, a group of sensors that keep the cooker from overheating or exploding under pressure.
Instant Pot’s internet fandom also gives it a leg up. The food bloggers behind popular recipe sites like Nom Nom Paleo were early converts to electric pressure-cooking, and cookbook authors took note of the device’s cult appeal. Mr. Wang says that more than 1,500 Instant Pot cookbooks have been written, including several of Amazon’s current best-sellers.
Amazon has played a particularly large role in Instant Pot’s rise. Early on, Instant Pot joined the “Fulfillment by Amazon” program, in which Amazon handles the packing and shipping of a seller’s products in exchange for a cut of each item sold. Eventually, Instant Pot sent Amazon wholesale shipments directly from factories in China, and Amazon began promoting the machines in its major annual sales. At one point, more than 90 percent of Instant Pot’s sales came through Amazon.
“Without Amazon, we wouldn’t be here,” Mr. Wang said.

For the full story, see:
KEVIN ROOSE. “The Shift; Instant Pot’s Inner Sanctum.” The New York Times (Mon., December 18, 2017): B1 & B5.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 17, 2017, and has the title “The Shift; Inside the Home of Instant Pot, the Kitchen Gadget That Spawned a Religion.”)

Trying to Explain Low AI Productivity Gains as Due to Slow Adapting and Old Habits

(p. A2) In a recent paper Erik Brynjolfsson and Daniel Rock of the Massachusetts Institute of Technology and Chad Syverson of the University of Chicago note electric motors based on alternating current were introduced in the late 1800s but even by 1919 half of U.S. factories still weren’t electrified. The integrated circuit was commercialized in the 1960s yet 25 years later computers still represented just 5% of the value of all business equipment. Indeed, since the introduction of computers labor productivity has behaved much as it did after the introduction of electric motors and the internal combustion engine.
The authors blame these lags on the cost and time it takes for businesses to adapt to new technologies, obstacles they see at work today. Online shopping came along in the 1990s but retailers struggled to adapt business processes to the internet. They needed to build complementary infrastructure such as fulfillment centers, and, the authors note, customers had to adapt their habits, as well.
. . .
. . . perhaps the U.S. is at a point when technology and an economy growing solidly with low unemployment become mutually reinforcing. “Entrepreneurs are more willing to take risks, including investments in new technologies and new business models when the economy is running hotter,” says Mr. Brynjolfsson. “This will speed up the adoption of the kinds of conventions needed to take full advantage of artificial intelligence and other new technologies,” he said.

For the full commentary, see:
Greg Ip. ”CAPITAL ACCOUNT; Technology-Driven Boom Is Finally Coming.” The Wall Street Journal (Thurs., December 28, 2017): A2.
(Note: ellipses added.)
(Note: the online version of the commentary has the date Dec. 27, 2017, and has the title ”CAPITAL ACCOUNT; A Tech-Driven Boom Is Coming; Please Be Patient.”)

The Brynjolfsson, Rock and Syverson paper, mentioned above, is:
Brynjolfsson, Erik, Daniel Rock, and Chad Syverson. “Artificial Intelligence and the Modern Productivity Paradox: A Clash of Expectations and Statistics.” NBER Working Papers # 24001. National Bureau of Economic Research, Inc., Nov. 2017.

Apple Orchard Must Focus on “Placating a Government Regulator”

(p. A1) ALTAMONT, N.Y. — For eight weeks every fall, Indian Ladder Farms, a fifth-generation family operation near Albany, kicks into peak season.
The farm sells homemade apple pies, fresh cider and warm doughnuts. Schoolchildren arrive by the busload to learn about growing apples. And as customers pick fruit from trees, workers fill bins with apples, destined for the farm’s shop and grocery stores.
This fall, amid the rush of commerce — the apple harvest season accounts for about half of Indian Ladder’s annual revenue — federal investigators showed up. They wanted to check the farm’s compliance with migrant labor rules and the Fair Labor Standards Act, which sets pay and other requirements for workers.
Suddenly, the small office staff turned its focus away from making money to placating a government regulator.
The investigators arrived on a Friday in late September and interviewed the farm’s management and a group of laborers from Jamaica, who have special work visas. The investigators hand delivered a notice and said they would be back the following week, when they asked to have 22 types of records available. The request included vehicle registrations, insurance documents and time sheets — reams of paper in all.
Over the next several days, the Ten Eyck family, which owns the farm, along with the staff devoted about 40 hours to serving the investigators, who visited three times before closing the books.
“It is terribly disruptive,” said Peter G. Ten Eyck II, 79, who runs the farm along with a daughter (p. A14) and son. “And the dimension that doesn’t get mentioned is the psychological hit: They are there to find something wrong with you. And then they are going to fine you.”
This is life on the farm — and at businesses of all sorts. With thick rule books laying out food safety procedures, compliance costs in the tens of thousands of dollars and ever-changing standards from the government and industry groups, local produce growers are a textbook example of what many business owners describe as regulatory fatigue.
Over the past five decades, Mr. Ten Eyck said, there has been an unending layering of new rules and regulations on his farm of over 300 acres, as more government agencies have taken an interest in nearly every aspect of growing food, and those agencies already involved have become even more so.
Now, a new rule is going into effect that will significantly expand the oversight of one regulator, the Food and Drug Administration, at the farm.
. . .
Researchers at the Mercatus Center, a conservative-leaning economic think tank at George Mason University, say apple orchards are facing a growing federal regulatory burden. Quantifying that burden is difficult, but using a computer algorithm that analyzes regulations through keyword searches, researchers from the center’s RegData Project estimated the federal regulatory code contains 12,000 restrictions and rules on orchards, up from about 9,500, or an increase of 26 percent, from a decade ago.
Many of those rules apply to other businesses as well, and some restrict the actions of government regulators, not the orchard owners. Using the Mercatus Center data, and screening for such exceptions, The New York Times identified at least 17 federal regulations with about 5,000 restrictions and rules that were relevant to orchards.
. . .
. . . regulation streamlining is a winning message across the political spectrum when it comes to making life easier for small businesses, according to more than 20 interviews with business owners and others in the produce industry.
Industry by industry, small businesses have been lobbying governments — from town health departments to federal cabinet agencies — to simplify rules and eradicate redundancy.
. . .
The grievances relate largely to the sheer amount of time and money that it takes to comply, and what farmers see as a disconnect between them — the rule followers — and the rule makers, who Mr. Ten Eyck describes as “people looking at a computer screen dreaming up stuff.”
“The intentions are not bad,” he said. “It is just that one layer after another gets to be — trying to top the people before them.”

For the full story, see:
STEVE EDER. “One Apple Orchard and 5,000 Government Rules.” The New York Times (Thurs., December 28, 2017): A1 & A14-A15.
(Note: ellipses added.)
(Note: the online version of the story has the date DEC. 27, 2017, and has the title “When Picking Apples on a Farm With 5,000 Rules, Watch Out for the Ladders.”)

“The Transforming Power of the Individual Will”

(p. A10) “These deep transformations have started and will continue with the same force, the same rhythm, the same intensity in 2018,” the French president told his compatriots in his New Year’s Eve greetings a few days before.
Mr. Macron was hinting at the real disruptions he has brought about in French political life — in employment and fiscal policy so far, with other big jolts promised soon. Remarkably in so hidebound a country he is getting away with it.
. . .
Mr. Macron imbibed from his mentor, the late philosopher Paul Ricoeur, a belief in the transforming power of the individual will. As proof, the young president can point to his own quick rise to the top, a stunning success that undergirds many of his pronouncements.
Similarly, the changes he has pushed through so far — like his lightening of the mammoth French labor code, with barely a whimper from the opposition — only buttress the narrative of individual determination, which he now hopes to infuse in his fellow citizens.
It is an unusual position for a French politician, who for generations have emphasized the protective power of the state — and the proof of any success will come only with a significant drop in the stubborn 10-percent jobless rate, elusive so far. But already surveys show higher levels of confidence among business executives than have been seen in many years.

For the full story, see:
ADAM NOSSITER. “French President Opens Year With Scolding for Journalists.” The New York Times (Sat., JAN. 6, 2018): A10.
(Note: ellipsis added.)
(Note: the online version of the story has the date JAN. 5, 2018, and has the title “Macron Opens Year Pulling No Punches With Journalists, or Anyone.”)

Automation Is “About Doing More with the People We’ve Got”

(p. A1) Mr. Persson, 35, sits in front of four computer screens, one displaying the loader he steers as it lifts freshly blasted rock containing silver, zinc and lead. If he were down in the mine shaft operating the loader manually, he would be inhaling dust and exhaust fumes. Instead, he reclines in an office chair while using a joystick to control the machine.
He is cognizant that robots are evolving by the day. Boliden is testing self-driving vehicles to replace truck drivers. But Mr. Persson assumes people will always be needed to keep the machines running. He has faith in the Swedish economic model and its protections against the torment of joblessness.
“I’m not really worried,” he says. “There are so many jobs in this mine that even if this job disappears, they will have another one. The company will take care of us.”
. . .
(p. A8) The Garpenberg mine has been in operation more or less since 1257. More than a decade ago, Boliden teamed up with Ericsson, the Swedish telecommunications company, to put in wireless internet. That has allowed miners to talk to one another to fix problems as they emerge. Miners now carry tablet computers that allow them to keep tabs on production all along the 60 miles of roads running through the mine.
“For us, automation is something good,” says Fredrik Hases, 41, who heads the local union chapter representing technicians. “No one feels like they are taking jobs away. It’s about doing more with the people we’ve got.”

For the full story, see:
PETER S. GOODMAN. “Sweden Adds Human Touch to a Robotic Future.” The New York Times (Thurs., December 28, 2017): A1 & A8.
(Note: ellipsis added.)
(Note: the online version of the story has the date DEC. 27, 2017, and has the title “The Robots Are Coming, and Sweden Is Fine.”)