Why (many) development economists don't know shit

For any of you economics-of-development buffs out there, here is a scathing academic critique (pdf unfortunately) of the widely-read Doing Business reports issued by the World Bank. The report's subtitle says "measuring business regulations," but givers of development aid (including the US and EU) often use it as a proxy for general liberalization, and make it a condition for countries to receive aid. Academics are also enamored with the reports, and many a complex econometric regression has relied on its data.

The problem is that the data don't capture the reality on the ground very well. I'm not really in the mood to summarize the paper, but a major issue is ex ante vs. ex post costs – that is, whether ease-of-registration in the beginning is gained at the expense of a lot of hassle later when disputes have to be adjudicated. Doing Business measures the fixed costs, but neglects the later costs that are incurred if a business has to prove things that in a system weighted towards ex post costs would already have been taken care of. The author's point isn't that a system of ex ante costs is necessarily better, but just that the World Bank doesn't take the later costs into account at all.

Professional pigs

The NYT has been doing a pretty long series called American Exception about unique aspects of the American law system. This month's article was about the exclusionary rule, a legal principle that since 1961 has automatically acquitted defendants whose prosecution rests on evidence obtained illegally, regardless of the magnitude of either the police violation or the defendant's crime. However, recent court cases have weakened the principle, and an upcoming Supreme Court case will reevaluate and clarify* the rule.

Scalia (along with Roberts) has already indicated that he thinks the rule is outdated, citing recourse through civil suits and "increasing professionalism" among police and "new emphasis on internal police discipline." Ironically enough, the comment was made in regards to a complaint that because the police did observe the knock-and-announce rule, the damning evidence found should excluded. Scalia brushes away concerns that with the exclusionary rule police won't wait before barging in, saying that "incentive is minimal" that this would happen, and that "ignoring knock-and-announce can realistically be expected to achieve nothing." Only, that's exactly what happens all the time, and it's what's happened even before 2006 when the Supreme Court struck down the exclusionary rule with regards to knock-and-announce violations in Hudson v. Michigan. And as for "increased professionalism," Radley Balko debunks that with his long-running "another isolated incident" watch.

Edit: Crime & Federalism brings up a point that I hadn't realized: the exclusionary rule, in practice, isn't as strong as the NYT article makes it out to be. According to a federal judge, a successful motion-to-suppress is "almost as rare as hen's teeth." All a police officer usually has to do is lie, and the motion will be denied.

* By which I mean arbitrarily legislate and regulate. I don't actually believe that these days the judicial branch makes objective decisions, and I think it's almost all political, even with regards to decisions I agree with. And though I'm not a big legal history buff, I have a feeling it's always been that way.

Courts reflect popular opinion, not law

This horse has been beaten to death by the libertarian blogosphere, so I won't spend too much time on it. But, as a recap: California Prop. 98 and 99 were on the ballot, with 99's supporters claiming that 98 was a back-door method of ending rent control, and 98's supporters accusing 99 of not truly protecting property rights, given that it only protects the rights of owner-occupied homes. 99 won, and 98 lost. These dueling property rights referenda were all driven by the Supreme Court's massive expansion of the government's power to use eminent domain in Kelo v. New London, which gave it the power to condemn for not only public works projects, but also for private redevelopment.

But anyway, that's not what I wanted to talk about. What I wanted to talk about was this little bit from Timothy Sandefur's blog:

If you are still confused, or don't trust Prop. 98, at least vote no on Prop. 99. It would make things far worse not only by providing fake protection, but because the courts would interpret it as meaning that Californians did not want more serious protections for property rights.

The implication is that the courts reflect popular opinion on constitutional matters, which on its face seems to be a violation of the principle of the courts as a neutral interpreter of the law and the constitution, and as a restraint on legislative and popular power. Constitutions are protections of citizens' rights against the government, and they are supposed to protect us as much from the popular sentiment of voters as from the government itself. Of course, to anyone who knows anything about the history of American judiciary, this shirking by the courts from their role as counterweights of popular opinion is nothing new. But, just in case you didn't realize it, this ought to be one more nail in the coffin of the neutral judiciary.

Edit: Apparently, my legal knowledge is lacking. See Timothy Sandefur's response in the comments section for clarification...

They're wrecking marriage!

Who saw that coming? That's something I think pretty often when I hear about controversial court cases: why don't you hear about them before the rulings come out? (And why are there such notable exceptions?) Anyway, California took the plunge and its Supreme Court judges, not unlike every other day of the year, made a subjective judgment and dressed it up as legally sanctioned. Not that I'm saying that gay marriage isn't guaranteed by the Constitution – just that we should stop pretending like decisions made by the judicial branch are in any way inevitable and impartial.

Anti-gay marriage legal firm spokesman comes out and says it: those fucking liberals are "wrecking marriage"! I wonder: will this drive the conservatives to go the libertarian route and do away with state-sanctioned marriage altogether?