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A Harvard economics professor, Claudia Goldin, published a paper this year about how much of the difference between what American men and women earn on a per-hour basis may be due to the fact that women, on average, work fewer hours per week. (Harvard Magazine)

Goldin doesn’t delve into why employers would prefer a 60-hour/week worker to two 30-hour/week workers.

I’m wondering if one factor is government regulation and bureaucratic compliance costs. Consider the employee who works just 5 hours per week. All of his time is taken up by team meetings, required safety and diversity training, etc. The productivity of this employee is zero and therefore the value to the employer is zero (the cost, on the other hand, will be high, especially if the employer must provide health insurance). As companies get bigger to deal with the “go big or go home” business environment created by regulation there is more time spent on coordination among employees. As government adds more regulations, there is more time spent on informing employees regarding these regulations and complying with them.

Thus while politicians walk about wanting to reduce the difference in average compensation paid to men versus women (or at least people who identify as “men” and those who identify as “women”), I wonder if it is the government itself that accounts for a large part of the gap.

Related:

• a 1989 paper by Goldin about parental altruism (or lack thereof) discussed
• “Is There Anything Good About Men?” by Roy Baumeister: “One study counted that over 80% of the people who work 50-hour weeks are men.” and “There is a minimum wage but no maximum. Hence the high-achieving men can pull the male average up while the low-achieving ones can’t pull it down. The result? Men will get higher average salaries than women, even if there is no average difference on any relevant input.”
• a way for some Americans to make a lot more money than the average W-2 worker… without working: the miracle of unlimited child support

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Facebook reminds me that six years ago today I was interviewed by OPR (Obama Praise Radio) regarding our flight school’s experience with Groupon. How did things finally shake out with this form of marketing? The stock (chart) seems to have underperformed the S&P 500. Who is using Groupon and for what?

Related:

• Groupon marketing results
• First 15 Groupon Helicopter Students Graduate
• Sightseeing Groupon much less popular than flight training deal

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Folks:

I’m going to D.C. this weekend and propose a get-together at either or both of the following:

• 5 pm on Saturday, December 3 at Don Juan in Mt. Pleasant for pupusas and drinks.
• Monday morning, December 5, for coffee (maybe near the National Gallery of Art or even at the NGA)

Feel free to email (philg@mit.edu) or post here.

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I can’t figure out Black Friday. If we live in an efficient economy, in which retailers such as Amazon, Costco, and Walmart, have pushed everything to the limit, how is it possible for anyone to offer a temporarily lower price and not just bleed cash?

Verizon’s behavior is the most bizarre. Their computer systems sent me the following text:

FREE VZW MSG: This weekend only! Get one of our best phones for $100 when you trade in your device. $4.17/mo after trade and bill credits over 24 mos; 0% APR. Call 866.396.3999 or visit a Verizon Store.. Device pymt purch req’d. Reply “X” to stop msgs.

I’ve been wanting to upgrade my iPhone 6 Plus to a 7 Plus in order to take portraits with the normal lens that Apple calls a “telephoto” lens. So I called the number. After literally one hour and three minutes on hold the agent answers, looks up my number, and says “that’s a small business account so I can’t sell you a phone. Let me transfer you to the right person.” Before he transferred me he explained that to get a 7 Plus I would have to pay $200 over 24 months, or about $8/month. The person to whom I was transferred said that his job was helping people with already-placed Internet orders and he couldn’t transfer me to the small business sales people, but I could call them directly. I did that and waited on hold for about 30 minutes until the robot hung up on me (presumably because it was closing time for the humans).

Calls later in the weekend weren’t more successful. Even before calling, I had tried and failed to arrange the upgrade using their Web site. Though I was logged in and it knew everything about the phone line and the account, the server offered me the low-priced upgrade offer but then there was no way to actually purchase it (selecting a phone and then a trade-in resulted in an “internal server error” page).

This raises a whole bunch of questions:

• Given that Verizon has computers, why wouldn’t they send me the correct phone number for my type of account in the first place?
• Given that Verizon knows that I have an iPhone 6 Plus, the basis for the $100 offer, why didn’t the message just say “reply 1 to get an iPhone 7 Plus mailed to your billing address”? (and then walk through some color and memory choices) Why ask people to call human agents when it can be predicted in advance that they won’t be able to pick up the phone? At least get people to register that they want the upgrade and then deal with them calmly over the next week?
• Why would Verizon want to do something that was almost guaranteed to result in hours of wasted time and frustration for a long-term customer? (landlines since the 1980s; mobile phone service continuously since about 2009)
• Why would Verizon communicate to customers that the fair price for an upgrade to the iPhone 7 Plus is $200 when, now that the weekend is over and it is easy to buy stuff from Verizon again, they are going to try to sell people the same phone for $770?

How was this ever supposed to do anything other than annoy customers? Instead of trying to get every customer to call or come into a store during one weekend of madness, why not just offer a $150 discount on iPhones until the next Samsung comes out and then increase the discount to $250? Maybe T-Mobile grabs some customers who love to stand in line a day after eating turkey, but isn’t that better than having loyal customers who are frustrated?

I have to assume that I’m wrong about all of the above. Verizon is full of competent marketing people so they are presumably doing what is optimum (though the purchase of Yahoo suggests otherwise?). My question is therefore “Why is this artificial customer service charlie-foxtrot the optimum?”

[Note that I did finally manage to get an iPhone 7 Plus on order during the fourth phone call (Monday afternoon). It turns out to be a rather bizarre process in which first the full retail price is charged and then, three months later, after the customer goes online and jumps through some hoops and returns the trade-in phone, credits begin to be applied. The guy on the phone said that it wouldn’t be any simpler in the stores; the trade-ins have to be done via the web site.]

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Americans have short memories. Implicit in nearly every proposal regarding a guaranteed minimum income that I’ve seen is that this has never been tried in the United States. “The Long-Term Effects of Cash Assistance” (Price and Song 2016), a paper by a Princeton graduate student and a Social Security Administration economist, provides a forgotten history lesson.

Are Americans able to sit on the sofa and watch TV faster than the government can print money? The answer turns out to be “yes.” The economists found that “treatment caused adults to earn an average of $1,800 less per year after the experiment ended. Treated adults were also 6.3 percentage points more likely to apply for disability benefits, but were not significant more likely to receive them, or to have died.”

The guaranteed income plan started in 1970 and lasted only 3-5 years, depending on the group, but the effect of reduced income from work lasted for decades. Also, it turns out that if you give people the freedom that comes from a guaranteed stream of government cash, one thing that they choose is increased sexual variety: “A second important set of results were that the treatment decreased marital stability. Treatment caused black and white families to be approximately 40% more likely to split up.”

Related:

• Why do robot alarmists and universal basic income advocates support expanding immigration?
• The liberal and the beggar in the Whole Foods parking lot

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Donald Trump tweeted about prohibiting burning the American flag. This lit up my Facebook friends:

There is something really really wrong with trump. Why aren’t moderate republicans speaking out in this type of thing?????

It is truly unbelievable !! This guy is really sick

(former MIT professor) Flag tweet, like so many others, is pure misdirection. But it’s also true: Trump is clueless on the Constitution.

Yet in relatively recent memory four Supreme Court justices took a fairly similar position, albeit not tweeted nor expressed as succinctly. See Texas v. Johnson and United States v. Eichman. Was Sandra Day O’Connor, for example, sick and “clueless on the Constitution”?

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For my Buddhist readers, a backyard Zen koan:

Two haters are jumping. Are they on a Trumpoline?

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From Skunk Works: A Personal Memoir of My Years at Lockheed (Ben Rich), regarding programmers in the early 1980s:

A year after the stealth fighter became operational, two computer wizards who worked in our threat analysis section came to me with a fascinating proposition: “Ben, why don’t we make the stealth fighter automated from takeoff to attack and return? We can plan the entire mission on computers, transfer it onto a cassette that the pilot loads into his onboard computers, that will route him to the target and back and leave all the driving to us.” To my amazement they actually developed this automated program in only 120 days and at a cost of only $2.5 million. It was so advanced over any other program that the Air Force bought it for use in all their attack airplanes. At the heart of the system were two powerful computers that detailed every aspect of a mission, upgraded with the latest satellite-acquired intelligence so that the plan routes a pilot around the most dangerous enemy radar and missile locations. When the cassette was loaded into the airplane’s system, it permitted “hands-off” flying through all turning points, altitude changes, and airspeed adjustments. Incredibly, the computer program actually turned the fighter at certain angles to maximize its stealthiness to the ground at dangerous moments during a mission, when it would be in range of enemy missiles, and got the pilot over his target after a thousand-mile trip with split-second precision.

It took us about two years to really perfect this system, aided by the nightly training flights at Tonopah. The computerized auto-system was so effective that on a typical training flight pilots were targeting particular apartments in a Cleveland high-rise or a boathouse at the edge of some remote Wisconsin lake and scoring perfect simulated strikes.

Compare the $1+ billion spent on healthcare.gov!

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“Consumer Reports trashes Tesla’s ‘flawed’ Model X” means that Tesla won’t be getting a lot of 7-year-old Camry trade-ins!

It seems that the review is consistent with my own: “Smug, Rich Bastard for a Weekend (Tesla X review)”

Related:

• Bill Burr on the subject of guys who drive practical cars (the Mercury Tracer is mentioned about 7 minutes in)

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Ian McEwan is an interesting novelist and his latest, Nutshell, is worth reading. The narrator is an in-utero baby who writes about his experience:

So here I am, upside down in a woman.

In the middle of a long, quiet night I might give my mother a sharp kick. She’ll wake, become insomniac, reach for the radio. Cruel sport, I know, but we are both better informed by the morning

I like to share a glass with my mother. You may never have experienced, or you will have forgotten, a good burgundy (her favourite) or a good Sancerre (also her favourite) decanted through a healthy placenta. Even before the wine arrives—tonight, a Jean-Max Roger Sancerre—at the sound of a drawn cork, I feel it on my face like the caress of a summer breeze. I know that alcohol will lower my intelligence. It lowers everybody’s intelligence. But oh, a joyous, blushful Pinot Noir, or a gooseberried Sauvignon, sets me turning and tumbling across my secret sea, reeling off the walls of my castle, the bouncy castle that is my home. Or so it did when I had more space. Now I take my pleasures sedately, and by the second glass my speculations bloom with that licence whose name is poetry. My thoughts unspool in well-sprung pentameters, end-stopped and run-on lines in pleasing variation. But she never takes a third, and it wounds me. “I have to think of baby,” I hear her say as she covers her glass with a priggish hand. That’s when I have it in mind to reach for my oily cord, as one might a velvet rope in a well-staffed country house, and pull sharply for service. What ho! Another round here for us friends!

The mom is having sex with her husband’s brother and, under English divorce law, can’t find an obvious way to get hold of the $10 million marital home in London due to the fact that it was in her potential defendant’s family prior to the (brief) marriage.

I don’t want to spoil the novel by revealing too much more other than the mom is determined to get the cash! But I recommend that you read the book.

 

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