On the appallingness of traditional English food

We’re all well aware of the appalling nature of the traditional English cuisine. Oddly preserved vegetables (mushy peas?), grossly overcooked fresh ones, allied with dubious meat masked with gelatinous sauces. At least one American professor insists that the real reason for the British Empire was the desperate search for a decent lunch. That we found that lunch, as modern day English cuisine shows, is therefore why we gave up that empire, job done as it were.

Paul Krugman has written on this point:

Maybe the first question is how English cooking got to be so bad in the first place. A good guess is that the country’s early industrialization and urbanization was the culprit. Millions of people moved rapidly off the land and away from access to traditional ingredients. Worse, they did so at a time when the technology of urban food supply was still primitive: Victorian London already had well over a million people, but most of its food came in by horse- drawn barge. And so ordinary people, and even the middle classes, were forced into a cuisine based on canned goods (mushy peas!), preserved meats (hence those pies), and root vegetables that didn’t need refrigeration (e.g. potatoes, which explain the chips). But why did the food stay so bad after refrigerated railroad cars and ships, frozen foods (better than canned, anyway), and eventually air-freight deliveries of fresh fish and vegetables had become available? Now we’re talking about economics–and about the limits of conventional economic theory. For the answer is surely that by the time it became possible for urban Britons to eat decently, they no longer knew the difference. The appreciation of good food is, quite literally, an acquired taste–but because your typical Englishman, circa, say, 1975, had never had a really good meal, he didn’t demand one. And because consumers didn’t demand good food, they didn’t get it. Even then there were surely some people who would have liked better, just not enough to provide a critical mass.

There’s possibly a certain tongue in cheek element there but a great deal of truth as well.

However, there’s one little point coming out of an economic history project looking at the First World War that throws an interesting light on all of this. They have been taking a detailed look at the heights of those who joined the Army after 1914. Did birth order affect height? Economic background? Crowded industrial area as origin? All those sorts of things and then we get this:

Nor do we find that living in an agricultural district confers much height advantage, as studies of much earlier eras have found, probably because market integration had diminished the benefit of living close to food sources.

Something that is most, most, interesting.

If the tasteless nosh produced by those canning and early preservation techniques had been less healthy (rather than just less appetising) than fresh grown country food then we would have expected to see some differential in height between rural and urban entrants into the Army. But we don’t: differences in height are explained by many other factors but not by that access to fresh food or preserved.

Krugman may be right that that early urbanisation and the crude techniques used to preserve the necessary food led to the destruction of the palates of the nation for several generations. But while it may have led to a cuisine that would have (and did in some instances) make a Frenchman projectile vomit, there’s not really any evidence that it was an unhealthy diet. At least, not compared to what they were still eating out in the countryside.

Brown Windsor soup, corned beef pie with two overboiled veg, spotted dick to follow anyone?

Inside the Adam Smith Institute

Now that the new Adam Smith website is up, with an exciting plethora of activities and reports scheduled, new readers might like to take stock of what the ASI does, and what motivates us.

If labels are used, they might be “free market” and “libertarian,” but these are big tents under which disparate people are grouped. The crucial thing is that our free market libertarianism is both consequentialist and empiricist, combining an essentially Hayekian economic outlook with a deep optimism about the world.

In our view actions that enable individuals to advance their happiness by pursuing their own goals are worthy of support, and those that restrict their ability to do that should be opposed. We are more concerned with what results from actions than with the intentions or attitudes of those who initiate those actions. And we are more concerned with changing the world for the better than with promoting theories about it.

As empiricists we make conjectures about the world and its future, and we test their value against experience of real world outcomes. Where the two conflict, it is the conjecture that has to be rejected or modified. We take the view that “an ounce of practice is worth a pound of theory.”

While economics and public policy are complex fields that make experiment and testing difficult to perform, we do attempt to test proposals by their results. Several times we have proposed small-scale trials of larger ideas in order to validate the ideas and ascertain any unforeseen drawbacks before they are rolled out more widely.

We recognize, of course, that poor people do not have access to the choices and chances accessible to the rich, and this is why many of our policy initiatives are directed to improving the lot of poorer people in society. We have advocated for many years that the income tax and national insurance thresholds should be set at the level of the minimum wage and indexed to it, so we would not be taxing people on the bottom income level.

Some of our research studies and policy suggestions derive from our recognition that poor people are hurt most by things such as restrictions on international trade and migration, planning controls that prevent cheap housing from being built, education policies that condemn poor children to bad schools and regulatory policies that protect established market players from new entrants.

We propose and back policies that give all parents choice over where their children go to school and which introduce competition into the school system, whether these be by education vouchers, or by allowing the allocation of state funds to schools be determined by the choices parents make. We tend to back the view that welfare is not just about providing the services the state thinks poor people should have, but about equipping people with the means to make their own choices about the mix of services they prefer. Ideas such as a negative income tax could remove the perverse incentives present in the current welfare system.

We recognize that states can cause a great deal of harm when they attempt to direct and micromanage the economy. Many regulations have damaging effects that were not anticipated, and this includes financial regulations that can make financial systems more unstable than they would be without them.

More broadly, we think that the ‘unknown unknowns’ of regulation should lead society to prefer decentralized trial and error to the risk of one big mistake that affects everyone in the same way.

We have argued that the central bank should follow the ‘Hayek rule’ – the stabilization of the level of nominal spending in times of booms and busts along a predictable path. Scott Sumner recently delivered our annual Adam Smith Lecture and explained how the failure of the world’s central banks to do this led to the Great Recession.

In the Adam Smith Institute we have always been very optimistic about technology and society. We see the world becoming increasingly open and tolerant in most (though not all) areas, with technology and entrepreneurship helping to drive that. To us, companies like Uber, Google and Airbnb deserve to be celebrated when they break down barriers to competition and disrupt the existing way of doing things in ways that give consumers a better product for a lower cost. It is this kind of innovative entrepreneurship that moves the world forward and allows today’s luxuries of the very rich to be tomorrow’s household commonplaces.

There is a dark side when new technologies are used by governments to spy on their citizens and control them. If technologies like Bitcoin and other blockchain-based innovations represent a long-term way of evading the worst excesses of government intrusion, they should be defended from government now while they are still in their infancy.

Of course the Institute is not a monolith. It consists of people who sometimes differ, but all of whom are brought together by a desire to give more power and liberty to individuals, so that their regard to their own interest can make them and us richer, freer and happier.

Why golf is a rubbish sport

The LSE’s Paul Cheshire has a good post up on the Spatial Economics Research Centre blog today on green- and brown-field development. Among other things, he explains why there are so many golf courses on the green belt:

Nothing wrong with golf or horsey culture but what we have to understand is that Greenbelt designation gives those land uses a massive subsidy. House building cannot compete for agricultural land but golf and horses can. I recently discovered another reason why we have so many golf courses around our cities: they are substitutes for landfill sites. It costs £80 a ton to dispose of ‘inert material’ in registered landfill sites but nothing if it goes into building bunkers! To quote Paul Robinson, Derby Council’s Strategic Director for Neighbourhoods, in defending the potential to capitalise on the value of the sites of the Councils two golf courses: “Effectively you go out to the waste industry and you say we will allow you to put your inert waste in our golf course…So you create mounds and bunker areas using the waste and at the core of those is inert waste.” .

This is one factor which underlies the proliferation of golf courses close to sources of builders’ waste and on land where there is no competition from houses. As noted in The Economist there is a serious oversupply of them. So the combination of Greenbelt designation and landfill costs means we can build as many golf courses as the market demands at their subsidised price but we cannot build houses. It is time to start turning some of our excess supply of golf courses into gardens; with houses on them!

The whole thing is a good read, particular the estimate of how much greenfield land is currently available to build on within a ten minute walk of a train station. (Quite a lot.)

My word, you mean competition actually works?

Well, would you look at that! Apparently competition works to the benefit of consumers! Who could have possibly predicted that outcome?

Shop prices fell at the steepest rate for at least eight years last month as the popularity of discount stores among the middle classes helped to drive down the cost of clothing and consumer goods.

The overall price of items at the till fell by 1.8 per cent compared with June last year, with the price of clothes down by 13.7 per cent year-on-year.

The figures, compiled by the British Retail Consortium/Nielsen shop price index, show the fastest drop in prices since the trade association began compiling data in 2006.

It was also the 14th month in a row in which shop prices fell, easing the pressure on households where wage-earners have suffered pay freezes.

Yes, of course, the capitalists are straining every sinew to increase the profits that they make from our need for basic necessities such as food and drink. But in doing so they find themselves competing with other capitalists who would also like to like that pelf from our pockets. That competition then limiting the amount any one shop can charge and finally leading to falling prices for consumers.

Of course, a number of people have pointed this out before, starting with Adam Smith, Bastiat had things to say on the point and even Karl Marx got it. Monopoly capitalism is to be avoided for it is without that competition, for it is that market choice that makes such a system work to the benefit of consumers.

This is all obvious to us, the initiates, of course. But we need to continue to make a song and dance about it. Yes, there really are things that governments must do that cannot be done by other actors. Yes, there really are times that said government must intervene in the economy. But for the most part that intervention necessary is simply to ensure that competition is possible.

It’s not necessary to ensure that competition is happening, only that it can. For a monopolist in possession of a contestable monopoly is unable to exploit that monopoly for fear of competition arising to contest it. It’s not even necessary to have a level or even playing field, only to have an open one.

Worth noting the next time someone starts to complain about the monopoly of the supermarkets (as they do every few years, prompting yet another enquiry). Precisely because competition is forcing prices down we’ve obviously not got an exploitable monopoly here.

So just what is slow economic growth then?

This is slightly worrying:

Just how difficult this has become was shown last week when the OECD released its predictions for the world economy until 2060. These are that growth will slow to around two-thirds its current rate; that inequality will increase massively; and that there is a big risk that climate change will make things worse. Despite all this, says the OECD, the world will be four times richer, more productive, more globalised and more highly educated. If you are struggling to rationalise the two halves of that prediction then don’t worry – so are some of the best-qualified economists on earth.

World growth will slow to 2.7%, says the Paris-based thinktank, because the catch-up effects boosting growth in the developing world – population growth, education, urbanisation – will peter out. Even before that happens, near-stagnation in advanced economies means a long-term global average over the next 50 years of just 3% growth, which is low. The growth of high-skilled jobs and the automation of medium-skilled jobs means, on the central projection, that inequality will rise by 30%.

Not the predictions themselves, which come from this OECD report, but the interpretation that is put upon them. For it appears that Paul Mason, supposedly one of those employed to explain the world to us, is incapable of actually reading a report.

On the inequality point he’s missed the crucial qualifier: “in-country” inequality. The report is actually telling us that the currently poor countries are going to catch up with the currently rich ones and that when they do, when they join us at the technological frontier, then their growth will be lower than it is during the current catch up phase.

That is, the prediction is that the vast gulfs of inequality between those living on a $1 a day and ourselves will be closed: yet Mason is concerning himself with that trivial 30% rise in inequality amongst ourselves, the already rich. It’s absurd to be worrying that in-country gini will rise from, say, 0.30 to 0.39 while not celebrating the collapse of the global gini from 0.80 to 0.40 (made up numbers just for illustration). At least it’s absurd if inequality is one of those things that you want to worry about.

There’s another misunderstanding there, one which anyone who has actually read Piketty should understand for he explains it very well. Gross GDP growth, the size of the entire economy, is driven by two different things. One is the expansion of the population that is producing that GDP. The other is the efficiency with which each person is contributing to that GDP. The report is stating that the entire globe is just about to finish going through the demographic transition, as the UN and everyone else assumes it is. Thus population growth will not be contributing to growth after some few decades of the future.

3% (or 2.7%) growth without the demographic effect is not low or slow growth: this is fast growth. The economy doubles every 25 years or so but over the same number of people meaning that per capita GDP doubles every 25 years. This is not an historically slow level of per capita GDP growth. This is actually rather fast.

It’s not the specific predictions that worry at all: it’s that someone supposedly employed to explain such matters to us doesn’t seem to understand the points being made. How did we end up in this situation?

One of the upsides of having a global elite is that at least they know what’s going on. We, the deluded masses, may have to wait for decades to find out who the paedophiles in high places are; and which banks are criminal, or bust. But the elite are supposed to know in real time – and on that basis to make accurate predictions.

Well, yes, quite.