Notes on Steven Kaplan's Feldstein Lecture: "Executive Compensation and Corporate Governance in the U.S.: Perceptions, Facts, and Challenges"
Liveblogging World War II: July 3 1943

Noted for July 3, 2013

  • Benjy Sarlin: How the GOP stopped worrying about Latinos and learned to love the base: "After November’s stunning loss, an array of influential Republicans argued that immigration reform was the party’s best chance to claim Latino voters before they become permanent Democrats. But in a mere eight months, a counter-narrative has taken hold in conservative circles… [that] sees immigration reform… as an electoral apocalypse, a seventh seal behind which lies an unbroken line of future Democratic presidents…. At the moment, the anti-immigration argument appears to be gaining converts fast. On election night, Fox News anchor Brit Hume called the 'demographic' threat posed by Latino voters 'absolutely real' and suggested Mitt Romney’s 'hardline position on immigration' may be to blame for election losses. On Monday, Hume declared that argument 'baloney'…. During one on-air confrontation with Senator Marco Rubio of Florida, Limbaugh asked whether 'the Republican party is committing suicide' by adding 'nine million automatic Democrat voters' through a path to citizenship…. 'The things that made America great are Americans like you that work and understand that it’s sacrifice', Congressman Randy Weber of Texas said at a June rally against the Senate bill. 'You don’t get to come over here and be takers'."
  • Rand Ghayad: Decomposition of Shifts of the Beveridge Curve: "The apparent outward shift of the Beveridge curve—the empirical relationship between job openings and unemployment—has received much attention among economists and policymakers in the recent years with many analyses pointing to extended unemployment benefits as a reason behind the shift. However, other explanations have also been proposed for this shift, including worsening structural unemployment. If the increased availability of unemployment insurance (UI) benefits to the long-term unemployed is responsible for the shift in the Beveridge curve, then allowing these benefits to expire should move many of the long-term unemployed back to work (or out of the labor force). Evidence from decomposing the job openings and unemployment relationship using data on unemployed persons by reason of unemployment shows that a significant portion of the outward shift in the Beveridge curve is concentrated among new entrants and unemployed re-entrants—those generally not eligible to collect regular or extended benefits. The decomposition reveals that at most half of the shift in the aggregate Beveridge curve is attributable to the disincentive effects of unemployment benefit programs."

  • EduShyster: Hedge Ur Bets: "The CREDO people don’t tell us, but they do provide, unwittingly, serious evidence that all of the improvement is caused by the removal of underperforming charters from the study. As a group, new charter schools started since 2009 are not subject to survivorship bias since (hopefully) nearly all of them should have managed to stay open four years. According to the study, these charter schools showed no improvement at all relative to the 2009 study."

  • Harrison Hong and Jeremy C. Stein: A Unified Theory of Underreaction, Momentum Trading and Overreaction in Asset Markets "We assume that the instantaneous riskless rate reverts towards a central tendency which in turn, is changing stochastically over time. As a result, current short-term rates are not sufficient to predict future short-term rates movements, as would be the case if the central tendency was constant. However, since longer-maturity bond prices incorporate information about the central tendency, longer-maturity bond yields can be used to predict future short-term rate movements. We develop a two-factor model of the term-structure which implies that a linear combination of any two rates can be used as a proxy for the central tendency. Based on this central-tendency proxy, we estimate a model of the one-month rate which performs better than models which assume the central tendency to be constant."

Mark Thoma: Four Ways the Federal Reserve Is Creating Harmful Uncertainty | Charles Stross: Book Launch: Neptune's Brood, Edinburgh, Thursday | The Economic Recovery: Past, Present, and Future: The Economic Recovery: Past, Present, and Future | Mark Thoma sends us to Persi Diaconis and Bradley Efron (1983): Computer-Intensive Methods in Statistics | Brad DeLong: Friday Musings on Profits, Production, Trade, and Inequality |