Blog issues

Hi all,

We are currently having some problems with wordpress – namely bits keep on disappearing from our side bar (such as the blog roll!) and piles of rather random spam has been turning up.

Hopefully it is not too annoying – I don’t really know how to fix anything, so we will just have to hope that it gets more sorted over time.

On another note, if anyone wants to put up any posts on economic issues (opinion pieces, essays, focused rants), or has any ideas on something they would eventually like to hear about (although I can’t promise I’ll get around to it 😛 ), either mention it in the comments or email me at the address in the About Us section.

One year of TVHE

Yeppie, we have been around for a year.  It all started with this post from Rauparaha (although to be fair there was an introduction post along the lines of this one which got mysteriously deleted).

Don’t have much to say other than that – hopefully the ramblings of a bunch of economists has been useful to someone.

Don’t forget – if you want an issue to get the “economics treatment”, just contact us (details in the about us section).

Also there is a housekeeping matter. If anyone changed their link to us from to then they should probably change it back – we aren’t working from anymore 🙂

The real Alan Bollard

Tell you the truth – this is gold! (ht Not-PC).  The full set of adventures are caught here (*).

Why rent a house when you can buy?


A common argument that I hear for buying a house is that paying rent is a waste of money. The main proponents of this point of view seem to be my parents’ generation, however it is a point of view I can’t easily agree with.

To compare buying a house to renting a house, we have to look at what we are buying in each case, and what the costs and benefits of each choice are. In the case renting a house we are purchasing ‘housing services’, while in the case of buying a house we are purchasing housing services AND an asset, as kindly explained by the iVestHomes manager. You will want to learn about the Property Buying Process here. The fundamental view that we should buy instead of renting comes from the fact that we receive an asset on top of the value of the services it provides. In some sense, the generation that is suggesting that we should all buy houses is doing so, because it was a (successful) rule of thumb that they followed at our age. However, the current situation is a little different.

Read more

Goalkeepers and rationality

At Stumbling and Mumbling the author is discussing why goalkeepers don’t maximise their chance of making a save from a penalty kick. According to this paper they only stood still during a penalty kick 6.3% of the time, even though 28.7% of kicks were down the middle.

Mr Mumbling puts forward three reasons why the goalkeeper may stand still less than is optimal:

  1. It puts pressure on the striker in some way,
  2. It is a social norm – way of minimising regret (as a dive looks cooler than standing still),
  3. Goalkeepers also value not getting yelled at, it is less likely people will make fun of you if you miss a penalty kick when diving than when you miss the kick when not moving.

These are all good reasons which probably explain the phenomenon, however I have a couple of other ideas:

Read more

Externalities and Prince Harry

A big fuss is being kicked up about the fact that the news media kept secret the fact that Prince Harry was on the front lines in Afghanistan. Now I can understand that people might be pissed that he’s getting special protection because people might target him. I can kind of sympathize with this point of view, why should he get special protection?

However, I think the main isse here is that if the bad guys target Harry then that puts the other members of his unit in danger they would not face if it was not public. In effect Harry’s presence if publicly known imposes a negative exernality on other members in his unit through the increase in attacks that are likely to occur once the bad guys find out he’s in the area.

I think once you look at it from the perspective that we are protecting the many other people serving in his unit by keeping it secret, it’s actually a very reasonable thing the media did.

Apologies for not talking about methodological issues like James and Matt, I don’t read as much they do!