My New Reading List

I am really excited about the books that I received this year for Christmas. I have lots of good reading material for the new year.

Economics
The Wealth of Nations by Adam Smith
Naked Economics  by Charles Wheelan
Soccernomics by Simon Kuper and Stefan Szymanski

Other
The Next 100 Years by George Friedman
The Business of Value Investing by Sham Gad
The Best American Sports Writing 2010 edited by Peter Gammons
Eating Well's Healthy in a Hurry Cookbook

I was also surprised by my wonderful girlfriend who gave me an Amazon Kindle, the top selling eReader. I am in the process of learning how to use my new gadget, but you can expect a post about it in the coming weeks.

Merry Christmas!

Merry Christmas and happy holidays! I hope everyone is able to enjoy this special time of year with their loved ones.

Economic Hardship - The Ozarks and Winter's Bone

When people are facing economic adversity, what choices do they have? One option, is to turn to family and friends for help. But what happens when an entire community is struggling?

I was forced to think about these questions and others when I watched the Sundance Film Festival Best Picture Winter's Bone. It is based on the book by Daniel Woodrell written in 2006. The film tells the story of a community in the Ozarks by focusing on one particular family. Sadly, some residents of the community have turned to cooking crank (methamphetamine) to earn a quick profit.

After seeing the movie, and listening to this NPR interview with the book's author, I am really interested in learning more about the history of the Ozark region and how people there have dealt with economic hardship. Although the book is fictional, it is inspired by events that the author has experienced while living in the Ozarks. I have only listened to excerpts, but I do plan on reading Winter's Bone the novel. The character descriptions from the interview are captivating. Here is an eerie description about one of the main characters, Uncle Teardrop:

"Uncle Teardrop was Jessup's elder and had been a crank chef longer, but he'd had a lab go wrong and it had eaten the left ear off his head and burned a savage, melted scar down his neck to the middle of his back. There wasn't enough ear nub remaining to hang sunglasses on. The hair around the ear was gone, too, and the scar on his neck showed above his collar.

Three blue teardrops done in jailhouse ink fell in a row from the corner of the eye on his scarred side. Folks said the teardrops meant he three times done grizzly prison deeds that needed doing, but didn't need to be gabbed about. They said the teardrops told you everything you had to know about the man, and the lost ear just repeated it. He generally tried to sit with his melted side to the wall."

You can hear author Daniel Woodrell read this description at 3:20 in the interview. If you have seen the movie or read the book, I would love to hear your thoughts.

Measuring Teacher Quality Series

This month I will be writing a blog series on teacher quality. I will share my own insights from teaching, current economic research on the topic, and more. Look for the first post in the series during the next few days.

For now, I will leave you with this...

1 Year of Free Amazon Prime For Students

With any student email address, you can sign up for an entire year of FREE Amazon Prime for students. The main benefit with this promotion is free two-day shipping with no minimum order quantity.

I already had an account with Amazon.com, but I had to set up a new one for the promotion to work. It is worth the extra few minutes if you plan on doing any shopping on Amazon this year.

Feel free to share any of your own holiday shopping tips, websites, or ideas in the comments section below.

Projected Federal Budget Deficits

Check out this graphic from the Washington Post that depicts the projected US budget deficit over the next ten years.

What is your first reaction to this graph? Please leave a comment below. I would love to hear your thoughts. I will post my reaction as well as some further research on the topic in the next few days.

Conflict on the Korean Peninsula

On the Korean Peninsula, the drama continues to unfold. For the second time in the last year, the North appears to be provoking military action from the South Koreans. On Tuesday, two civilians and two military members died when the North launched artillery shells at a South Korean Island. This is the first time that an attack of this kind has been carried out since the early 1950s. Earlier this year in March, the North caused greater casualties when it sank a South Korean vessel with a torpedo, killing 46 sailors. North Korea has vehemently denied responsibility in public statements, claiming that the South Korean "traitors" fabricated the whole thing.

Assuming the North Koreans are in fact responsible all of the recent devastation, the South Korean government is in a tough spot. Do they retaliate and risk the potential for all out war, or do they sit back and wait for the next North Korean act of aggression? The route they take will likely be somewhere in the middle with a lot of non-verbal retaliation (public statements, sanctions, etc), 

Given that the North and South Korean neighbors are struggling to coexist peacefully at this point, strategic allies such as China (ally to North Korea) and the US (ally to South Korea) are going to start playing major roles. This is alarming because the US already is sending an aircraft carrier, the USS George Washington to the Yellow Sea. The last thing we need right now is another foreign war. The wars in the middle east have already cost our country over 1 trillion dollars. Does anyone else think it is a poor idea for the US Government to jump in the middle of the Korean conflict? As with any political decision, their are costs and benefits. Calll me crazy, but I am fairly confident that the risk of war with North Korea and the risk of damaging our economic relationship with China more than outweigh the benefits of flexing our muscles in the Yellow Sea.

Is Randy Moss Rubbing Off on Vince Young?

Despite some of his questionable behavior on and off the field, Vince Young is the Titans' best QB. There is a very compelling story over at the Sports Economist that compares the performance of Vince Young and Kerry Collins. The primary conclusion: Vince Young is much more likely to win than Kerry Collins. In the two seasons (2006 and 2009) that they each started a share of the games, Kerry Collins went 0 for 9, while Vince Young went 16 and 7. Unfortunately for Vince and the Titans, Sunday's injury and temper tantrum could prevent them from making the playoffs. Vince Young's passer rating of 98.6 this season is the best of his career. The Titans have a relatively easy stretch of games coming up, and this was Vince Young's chance to prove himself as a premier quarterback. Now his future with the Titans is uncertain according to the media.

Given that I live in Nashville, I would like to see the Titans do well despite the fact that I don't consider myself a "Titans Fan." I have always perceived Jeff Fisher as a top notch guy. He is obviously not pleased with his quarterback's antics nor his apology via text message. However, I am watching this story very closely to see what Jeff Fisher decides to do. Although I think Vince Young has some serious growing up to do and acted like a prima donna on Sunday, I will find it ironic if the organization decides to get rid of Vince Young for his actions, as they just picked one of the leagues biggest drama queens in Randy Moss.

Some of My Favorite Economics Books

Freakonomics by Stevin Levitt and Stephen Dubner

The Undercover Economist and The Logic of Life by Tim Harford

Gang Leader for a Day Sudhir Venkatesh

What Makes a Terrorist by Paul Krueger

The World is Flat by Thomas Friedman

Swarm Intelligence

I recently read an interesting article from the Economist about a type of artificial intelligence called swarm intelligence. Swarm intelligence models the behavior of ants and birds to solve complex problems and increase the efficiency in a system. Applications of swarm intelligence include the routing of a fleet of delivery trucks to the proper destinations and the routing of information in a digital communication network.

Here is the link. Enjoy!

WSJ Subscription - How to Access Subscriber Content for Free

The wall street journal has an interesting method of price discrimination. Let me explain: Some of the articles that you click on from the WSJ homepage are "Subscriber Content," meaning only users who pay a weekly fee can see the entire article. Otherwise, you can only read the first couple of paragraphs, or so it seems... in actuality, all you have to do is copy and paste the title of the article into a Google search, click the WSJ link, and voila. You have access to the entire article. 

It turns out that the weekly subscription fee is helping subscribers avoid a couple of clicks and a google search, which amounts to perhaps 10 seconds with a high speed internet connection. If users are reading a high volume of articles, then the time savings might be worth it. But for the majority of us, we can take a few extra seconds to do a Google search.

I would love to know why this is WSJ's strategy and how long it has been this way. I imagine it is an effort to drive more traffic to the site. It is also possible that WSJ subscribers tend to have higher incomes and thus more disposable income to throw around. Still, I am curious what those subscribers would think if they found out they have been paying for access to free content. Will this strategy catch up with WSJ once word spreads? Does anyone know of other media companies doing similar things?

(Hat tip: Justin S. for sharing this info)

Dropbox.com - A Great Timesaver

If you work on multiple computers (i.e. home computer, laptop, mobile device, etc.) I highly recommend using Dropbox.com. Dropbox is a file syncing site that will eliminate the need for a USB flash drive.

What Dropxbox does:

• Allows you to access and edit the same file from different computers
• Syncs files in the dropbox to each computer that has software installed
• Provides a web-based interface that you can access from any computer with internet access
• Gives users two gigabytes of free data storage space
• Enables users to share a certain folder in their dropbox with other users (great for collaboration!)

What Dropbox does not do:

• Does not allow two users to simultaneously edit a file (i.e. Google Docs)
• Does not allow users to store an unlimited amount of date

I no longer have to worry about grabbing my flash drive before heading to work. Using dropbox has cut this inconvenience out of my life altogether. Check out the video below called "What is Dropbox?" to figure out if it could be useful in your life.

How to Prepare for the GRE

I began preparing for the GRE about 6 weeks prior to taking the test. The GRE (Graduate Record Examination) tests quantitative reasoning, verbal reasoning, critical thinking, and analytical writing skills. I want to share with you how I approached the test, so that you might learn a thing or two from my experience. (I'll be sharing some useful resources, too. So make sure you keep reading!)

A bit of context for you: I am applying to Masters in Economics programs for the Fall of 2011. These programs all pay close attention to applicants' quantitative scores on the GRE. It is not to say that verbal scores don't matter, but someone with high quantitative and low verbal scores is typically judged as a better candidate than someone with high verbal scores and low quantitative scores. Once I found this out by researching the admissions process for various programs, I decided that I would allocate the majority of my preparation time to the quantitative section given its greater importance.

Here are some tips from my GRE Experience:

• Find out admissions info about the programs you are interested in: Ask about average GRE scores for current students to get a feel for what you need to shoot for on each section.
  
• Set goals for yourself: Like any good goal, it needs to be measurable. "I want to do well on verbal and average on quantitative" is not a good goal. What does that mean? Personally, I told myself I wanted at least a 750 quantitative score and 600 verbal score. What happened... I received an 800 quantitative and 600 verbal (gotta love instant computer grading)
  
• Register for the GRE: There is nothing that compares with putting your money on the line. I found that once I registered (about 4 weeks ahead of time) I was more committed to studying. It also helped to have a specific date on the calendar for "backwards planning".
  
• Take a diagnostic test: I found this to be extremely useful. I took a diagnostic about 3 weeks into studying. In retrospect, I wish I had taken one during the first week to give me a better idea of what I needed to review and focus on. Kaplan had a great online diagnostic that broke your score down into different categories. I found out that I was terrible at analogies and antonyms, but pretty good at sentence completion and reading comprehension.
  
• Make a plan: Given your test date and your diagnostic results, create a study plan that takes the rest of your life into account. I would suggest ramping up the number of study hours for the two weeks before the test.
  
• Use your time wisely and according to your goals: Spend your time where it will benefit you most. I spent roughly 75% of my time studying for the quantitative section since it is what will make me a better candidate for the programs that I am interested in. I struggled with this at times because I knew I could do better in verbal if I spent more time studying for it. In the end, I reminded myself of my goals and realized too much time spent on verbal would mean too little time spent on quantitative. It is not easy to find the right balance, but you have to trust your intuition.
• Utilize extra "unplanned" blocks of time: In addition to planned study time, I discovered that when I found myself with an extra 20 or 30 minutes, I was able to get some great studying in. Make sure you have those GRE books ready though. For me, this meant keeping my books in my car whenever I left home.
  
• Pace Yourself: Do not wait until 2 weeks before the test date to begin preparing. Give yourself at least a month, if not more.
• Practice, Practice, Practice: I studied somewhere between 40 and 50 hours for the GRE. This means learning about the format of the test, reviewing important concepts, making flashcards, working practice sets, and taking practice tests. When all was said and done, I worked out about 500 quantitative questions between practice sets and practice tests

Here are some of my favorite GRE Resources


My Local Library

• Check with your local library catalog for GRE resources! I was able to check out a two GRE prep books, both of which came with online resources. The total cost of my test prep (other than time) was $15 on a math book and about $2 on note cards.
  

Kaplan GRE Exam 2010 Premier Live Online

• I found this book very helpful in understanding what the GRE was all about and preparing for the verbal and quantitative sections of the test. There were practice sets, full-length normed practice tests, online tests with analysis of your results, and much more.
  
• I especially like the 100 most important quantitative concepts in the back of the book. They were grouped in three tiers of difficulty: Level 1, Level 2, and Level 3. I used this as a checklist to find topics that I needed to review in detail.
  
• If you don't want to buy this book and cannot find it at your local library, you can find the list of 100 most important math concepts right here. Just scroll to the end of the book on Amazon! Kaplan has made these pages available for free via the "Look Inside" feature.
  

Here is a screenshot of analysis from one of the Kaplan practice tests that I took. This analysis helped me identify my areas for improvement. Click on the image to zoom in.



Kaplan GRE Exam Advanced Math: Your Only Guide to an 800

• Unless you have been using math on a daily basis, I suggest you start with the general test prep books first, then use this book as a supplement to practice the higher level questions that you might encounter. If your goal is to score in the 700-800 range on the quantitative section, then I think this book will be worth your time.
• The one unfortunate downside to this book was that there were a handful of errors in the answer keys to each section. When I read through the explanations for questions that I had "missed" it turned out that on some of them I had the correct answer all along. The only thing I could come up with was that this book had to be rushed to the printing press and there wasn't enough time to have a few eager math folks test drive it first.
  

Princeton Review's Cracking the GRE, 2010 Edition

• This was my least favorite book of the three that I used. It has comparable aspects to the Kaplan GRE book, however, for whatever reason I found it not to be user friendly. I think a large part of it was due to the layout. For me, this was the second place comprehensive GRE book.
  
• I did like the online features of that came with the book. I was able to take to CAT (computer adaptive tests) online that gave me normed scores for the quantitative and verbal sections. Also, you have the option to pay extra if you want your writing sections to be scored. I thought this was a nice touch.

ETS Math Review for Practicing to Take the GRE

• I skimmed this PDF before I gathered all of my test prep books. It is fairly lengthy for a PDF (69 pages), but it has some decent practice sets and offers a detailed review of topics that you need to know.

West Texas A&M Virtual Math Lab - GRE Math

• Although not the most aesthetically pleasing website, this math-lab is a great place to go for online tutorials centered around certain math topics. After taking a few practice tests, I realized that permutations and combinations were not my strength. After working through the tutorials on these topics, I had a better understanding and was ready to take on these problems with more confidence.