Holy GDP!

Straying far from my beat, I went and wrote a foreign policy piece about the Knights Templar.

Which, naturally, got me thinking about the Vatican's economy. Here are some facts I stumbled upon:

Land use: arable land: 0%

Population: 821

Industries: printing; production of coins, medals, postage stamps; a small amount of mosaics and staff uniforms; worldwide banking and financial activities

So, how much money is the Vatican making off of all those medals and mosaics it produces? About $247 million a year in total revenues. That's about 1/10,000 the revenues of the United States, but places above quite a few countries and territories, including Burundi, which has over 10,000 times the Vatican's population and 63,250 times as much land, over a third of which is arable.

Giving Back

I came across this article in the Daily Star reporting that remittances accounted for a quarter of Lebanon's 2006 GDP. I was curious for a little historical context so I looked up which countries have the highest remittances as a percentage of GDP, and how this has changed in recent years. See the chart below, which is from 2001 IMF data (note Lebanon doesn't crack the top fifteen, though its 2006 levels would have ranked it second in 2001):

Country	Total remittances ( millions)1	GDP (millions)2	Total population3	Total remittances as % GDP
Lesotho	209.0	796.7	1,852,808	26.2
Vanuatu	53.3	212.8	192,910	25.0
Jordan	2,011.0	8,829.1	5,153,378	22.8
Bosnia and Herzegovina	860.1	4,769.1	3,922,205	18.0
Albania	699.0	4,113.7	3,510,484	17.0
Nicaragua	335.7	2,067.8	4,918,393	16.2
Yemen	1,436.9	9,177.2	17,479,206	15.7
Moldova (Republic of)	223.1	1,479.4	4,431,570	15.1
El Salvador	1,925.2	13,738.9	6,237,662	14.0
Jamaica	1,058.7	7,784.1	2,665,636	13.6
Dominican Republic	1,982.0	21,211.0	8,475,396	9.3
Philippines	6,366.0	71,437.7	81,369,751	8.9
Uganda	483.0	5,675.3	24,170,422	8.5
Honduras	541.0	6,385.8	6,357,941	8.5
Ecuador	1,420.0	17,982.4	13,183,978	7.9

Now, from a graphic in the Economist, here's the data from 2006.

I find it interesting both that the list has shifted so substantially--only one country from the 2001 top-ten, Moldova, remains in the top ten of the 2006 list. Also, note that every country in the 2006 top ten has a higher level of remittances/GDP than the country with the highest ratio in 2001. I'm curious to determine whether this is because GDPs have fallen or remittance levels have risen.

(Footnotes to Chart 1)

¹The remittance data presented in the above table are from IMF (International Monetary Fund), 2003, Balance of Payments Statistics Yearbook 2002International Migration Statistics: Guidelines for Improving Data Collection Systems (Geneva: International Labour Office).
²The source for the gross domestic product for each country is the World Bank website at devdata.worldbank.org/data-query. The GDP data presented for all countries is for 2001 except the data for Nicaragua which is for 1998 and for Yemen which is for 2000.
³The source of the total population data for each country are estimates generated by the US Census Bureau (see www.census.gov/ipc/www/idbrank.html). The total population figures presented for all countries are for 2001, except Yemen which is for 2000. (Washington, DC, IMF Publications Services). "Total remittances" refers to the sum of the 1) workers' remittances, 2) compensation to employees, and 3) migrant transfers reported by each country. The remittance data presented for all countries are for 2001, except the data for Yemen which are for 2000. For additional information on how remittances are defined and measured, see Chapter Seven in Bilsborrow et. al., 1997.

Where Populism Ends

Robert Reich, Bill Clinton's labor secretary, blogged this week for the Economist. In this post, he looks at why Democrats don't create more of a stink about private equity tax rates:

You might think that Democrats would do something about the anomaly in the tax code that treats the earnings of private-equity and hedge-fund managers as capital gains rather than ordinary income, and thereby taxes them at 15%—lower than the tax rate faced by many middle-class Americans. But Senate Democrats recently backed off a proposal to do just that. Why? It turns out that Dems are getting more campaign contributions these days from hedge-fund and private-equity partners than Republicans are getting. They don't want to bite the hands that feed.

Babylon and Beyond

The L.A. Times has a new blog from its Middle East correspondents. It's not particularly political--more about the peculiarities of life on the ground in the different places they have reporters posted. I found it pretty good reading.

Is a 'SuperFund' a Bailout?

A few days ago, Hank Paulson unveiled plans for a $75 billion "superfund," a reserve formed among big banks. This stoked controversy. Some analysts called the fund a massive bailout. Paulson's predecessor, Alan Greenspan, expressed doubts whether the "benefits exceed the risks." Paulson responded to concerns over a bailout: "The concept is not to buy bad assets," he told the FT. "The concept is for the end investors working with the banks to buy assets that are not credit impaired."

The best piece I've seen explaining this issue is an op-ed in the Wall Street Journal by Peter Wallison. The main point of the fund, Wallison says, is price discovery, and when banks wander into murky financial waters, as they did in advance of the subprime blowup:

With a substantial wad of cash, the contributing banks can help to discover the price at which trading will take place.

All of which, Wallison notes, is very much in banks interests. Nor should this be considered a bailout, he says:

Despite the Treasury Department's involvement, this is not a bailout. The Treasury does not have the powerful regulatory authority that made the Fed's involvement in the Long-Term Capital Management hedge fund look like a government-mandated financial rescue. Moreover, Treasury has no funds with which to effect a bailout or to make good on a guarantee.

Discovering Not Much (Two)

For more in the same vein as the last post, see the piece I just wrote for CFR.org. Particularly, note the asterisk. My boss added that, and I'm really happy he did. It's a terrific statistic.

Discovering Not Much

A graph I came across today:



The bar graph maps the discovery of crude oil reserves since the 1930s. The black line maps oil production/consumption. Now, the fact of declining oil discovery and rising production doesn't in itself mean the world is running out of oil. A lot has already been discovered. But it does make for a potentially interesting shakeout between the parties with a natural or sovereign right to natural resources--countries--and the parties seeking access to them--oil companies. Of course, this is already well underway, with the kind of energy industry nationalizations that have taken place in Russia and Venezuela. But for the United States, this trend is now moving a lot closer to home.

Thirsty Albanians

The Economist has a graphic examining the world's leading beer markets. It makes note that China consumes the most beer (every year, Chinese consume 306.2 million hectoliters of beer, whatever those are), followed by the United States (234.6 million hectoliters). Of course, it's not per capita, and China has more than four times as many people as the United States (1.3 billion to 300 million, as of July 2007), so really Americans are by far the greater booze hounds. Anyway, all this prompted me to look up which country's people are the greatest per capita booze hounds. Trusty Wikipedia has the data. And the answer is... Albania. As of 2004, the average Albanian apparently drinks 195.4 liters of beer. Americans drink 81.6 liters on average and place fourteenth. As for the Chinese, Wiki lists 37 countries and they don't even crack the list.

The (Negative) Value of a Good Education

The Financial Times says one of the biggest obstacles in the way of the U.K. Conservative Party's wunderkind David Cameron, as he works to win British parliament back for the Tories and unseat Gordon Brown as prime minister, may be Cameron's primo education. Cameron attended Eton, an old-line British boarding school with a storied, and somewhat stodgy, reputation. Given his schooling, the article says, Cameron carries all kinds of cultural baggage, particularly considering Britain's "enduring and complex obsession with class."

It would be easy to take the United States as a cultural counterpoint--especially given that the 2004 U.S. presidential race pitted two members of the same Yale social club against one another. But the New York Times points out that in 2008, America too has produced candidates with more populist educational upbringings. Only two of the 2008 primary candidates attended an Ivy League school for their undergraduate education (Barack Obama and Mike Gravel, each of whom studied at Columbia University).

So, just how crippling is the posh-factor? And to the extent that the same kind of anti-elitist thinking enters the job market more generally, at what point should students start considering the "friendliness" of a school's image before registering?

Feldstein to Place, Barro to Show?

Greg Mankiw speculates on who will win the Nobel Prize in economics (his best guess is that Martin Felstein, Eugene Fama, or Robert Barro will take the honors). If you feel particularly confident in your own prediction, you can wager $1 on it--the Bank of Sweden is running a pool (PDF).