Lee Branstetter, Guangwei Li, and Mengjia Ren looked closely at Chinese industrial policy. What they found did not impress them. (HT Roger Meiners) A slice:

Our analysis provides no evidence that the Chinese government consistently ‘picks winners’. There appears to be a statistically significant negative correlation between subsidies and TFP [total factor productivity], and a robust positive correlation between subsidies and firm size (as measured by the firm’s total assets) and between subsidies and net profit. These results indicate that, overall, subsidies are given to larger and more profitable, but less productive firms.

We also find little evidence that receiving a subsidy is correlated with subsequent growth in TFP. When we aggregate across subsidy types, total subsidies appear to have a statistically significant negative impact on subsequent TFP growth. When we disaggregate across subsidy types, we find that even subsidies given out in the name of R&D and innovation promotion or industrial and equipment upgrading have no measured, statistically significant positive effect on firms’ productivity growth.

Writing with his usual insightfulness, Arnold Kling here identifies some implications of the fact that most capital in a modern ‘capitalist’ economy is intangible, with much of it in the form of human capital.

Ramon DeGennaro unpacks some of the many problems with ESG investing. A slice:

Perhaps unsurprisingly, ESG rankings differ depending on who is doing the ranking. Writing in the Accounting Review, Professors Dane M. Christensen, George Serafeim, and Anywhere (Siko) Sikochi report that disparities can be large, and that more ESG disclosure actually increases the divergence of opinion. How can a socially conscious person decide which is correct? Perhaps worse, those with different social priorities may target those who favor diversity for cancellation, simply because they instead prioritize labor issues above diversity.

Jay Schweikert applauds Judge Don Willett’s objections to the doctrine of qualified immunity.

Juliette Sellgren talks with Troy Senik about the great Grover Cleveland (who was described by H.L. Mencken as “a good man in a bad trade”).

Caroline Breashears is correct:

Confused thoughts lead to sloppy language, which in turn leads to more confusion. Halting the process is essential. If, as some politicos claim, “Democracy is at stake,” then we can save it only by insisting on clarity in our language about it.

I’m always pleased to be a guest on Dan Proft’s radio program in Chicago.

George Leef recounts a tale – here, from the University of Washington – of just how threatening is woke ideology to higher education.

David Henderson and Charley Hooper recently had lunch with Jay Bhattacharya. A slice from David’s report on the lunch:

Not surprisingly, much of what we discussed was the ways in which Twitter, at the behest of various major players, tried to shut Jay down. He was so often accused of wanting to kill people and it seemed to be for at least one of the three reasons: (1) he pointed out that young children were at an extremely low risk from Covid and, therefore, there was little basis for shutting down schools; (2) he noted that so few economists were pointing out one of the most basic principles in economics–TANSTAAFL, which means there are tradeoffs; and (3) he reminded people that we do develop immunity to coronaviruses.

David Zweig reports on a private school, in upstate New York, run by people still – in 2023 – deeply ill with covid derangement syndrome.

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