NBA salary cap and league competitiveness

If LeBron were paid his market value (about double his current 20 million), along with his fellow players, would it make the league more or less competitive?

Last year, the ever-unreliable Planet Money said "less": under the individual player salary cap, superstars are affordable even by poor teams, making the league more competitive... hence even LeBron would agree that the player cap is good for the league.

Roger Noll disagrees: Surely if the NBA kept its team cap rules and eliminated the individual cap, no team could afford to assemble the Heat's talent... and hence the Heat would be beatable in the playoffs by more than one or two other teams. Seems to me that Roger must be correct. The most obvious piece of evidence is that the league really isn't very competitive!

Regardless, Miami vs. San Antonio should be a good show.

Your FSA/OWI Photo of the Day

Fruit jars being sterilized on old lady Graham's back fence in berry season. Near Conway, Arkansas. "We just gather and can peas, beans, berries, and sausage when we butcher the hogs in the winter. We put up seventy-five quarts of berries, sixty of beans, sixty of kraut, thirty of grapes and twenty of peaches. I swapped two bushels of grapes and got two bushels of peaches and I swapped one bushel of grapes for one bushel of apples". Dorothea Lange, 1938.

Who killed federal cap-and-trade legislation?

Yesterday on NPR, Robert Siegel interviewed C. Boyden Gray, former White House counsel to George H.W. Bush, about the history of cap-and-trade legislation to control greenhouse gas emissions. Gray completely bamboozled Siegel about the Republican position on climate change policy and the history of the legislation. 

SIEGEL: This was something that was developed for a Republican administration. You're a Republican. How did this go from being a Republican idea to being almost a litmus test - if you're for Cap and Trade, you're banned from certain, you know, talk radio shows?
GRAY: Well, I think what happened is the Obama administration, when it came, anticipated generating very, very large revenues by doing something that had not been done to auction off the original allowance levels. And it was not a, I think, smart thing to do politically. It was unnecessary from an environmental point of view. And the money was going to be spent, no one really knew how. And that's what caused the thing to collapse.

Yeah, sure, except that climate bills featuring cap-and-trade and co-sponsored by those well-known leftist radicals McCain and Lieberman were defeated in 2003, 2005, and 2007, by votes largely along party lines. My memory is not what it used to be, but I'm thinking somebody else was president back then. And the Republican position has only hardened since.

C'mon Siegel, do your homework!

Eric Dolphy

Like listening to Louis Armstrong... you hang on every note. Hat tip to Ben Ratliff for bringing this performance to my attention. After a spirited post-stride solo by Jaki Byard, Dolphy steps in around 4:30 and deconstructs Strayhorn for the next four and a half minutes. The dude was visiting from some other planet and did not stay here for very long.

I think it's probably OK...

... if pet ferrets are no harder to acquire than guns. After all, “Evidence shows ferrets do not bite more frequently or severely than other pets the same size.” What would be the same size... guinea pigs? Maybe a squirrel?

The college earnings premium

Dean Baker suggests that the evidence of a huge average earnings premium associated with a college education does not provide unambiguous support for the idea that most everyone should stay in school. For men in particular, he notes, the earnings of college graduates exhibit a high dispersion around the mean, so that "near one in five recent male college grads earned less than the average high school grad." For these individuals, he infers, college may not pay.

This claim rests, of course, on an implicit counterfactual—namely, that these men in the lower tail of the college pay distribution would have been able to earn near the mean of the high-school distribution if they had not gone to college, and therefore that they did not gain from having graduated college. This assumption is quite likely incorrect. Even within occupations considered low-skilled, there is a college premium. And even if some percentage of men did not gain economically by graduating college, we can only judge that college was a bad decision for them ex post; this did not make going to college a bad decision ex ante, when an individual is unlikely to know whether they will be among the unlucky losers in the earnings lottery.

There is abundant evidence that a college degree pays off for otherwise identical individuals. I am unaware of evidence suggesting that these gains do not apply to folks in the lower tail of the earnings distribution. This post by Dylan Matthews provides a nice summary in layperson's terms of the studies showing that the return to college is not simply a spurious correlation based on differences between college-goers and non-college-goers in terms of family background or intelligence; rather, a wide range of studies provide convincing evidence that the return to college is causal, in the sense that a given person can expect to earn substantially more with a college degree than they would without one.

Count me among the people who get pissed off when I read people saying that college doesn't pay. College is expensive and not a certain bet, but it is a very sound investment even from a purely financial point of view. And those of us in the college business also like to think that college has a sizable non-pecuniary payoff. I'm with Autor:

“Sending more young Americans to college is not a panacea,” says David Autor, an M.I.T. economist who studies the labor market. “Not sending them to college would be a disaster.”

With a name like Petro...

... you might have thought that the billionaire Ukrainian president-elect Petro O. Poroshenko had made his billion as an oil magnate. But NO... he's a chocolate magnate!

Soulville!

Was in the mood for some Granados solo piano pieces tonight. My recording is by Alicia De Larrocha. For some reason Sonos decided to replace almost every missing piece of album art in my collection with this... an excellent album cover, no doubt, but it doesn't look much like Alicia! It still sounded like her, though...