Monthly Archives: September 2007

Crack, AIDS, and economics

Watch Freakonomics’s author Steven Levitt give a talk on Why do crack dealers still live with their moms?

About the talk:

In an eye-opening talk — presented before the publication of Freakonomics — Steven Levitt presents one of the book’s more fascinating analyses. Sifting data collected through first-person interviews with a Chicago drug gang, he shows that drug dealing is not at all a quick route to riches. And yes, a drug gang does have a org chart.

Enjoy economist Emily Oster‘s talk on What do we really know about the spread of AIDS?

About the talk:

Emily Oster, a University of Chicago economist, looks at the stats on AIDS in Africa — and comes up with a stunning conclusion: Everything we know about AIDS in sub-Saharan Africa is wrong. We look for root causes such as poverty and poor health care — but we also need to factor in, say, the price of coffee, and the routes of long-haul truckers. In short, there is a lot we don’t know; and our assumptions about what we do know may keep us from finding the best way to stop the disease.

Lessons from the Irish plastic bags levy

The September issue of Environmental & resource economics publishes an interesting article by Frank Convery, Simon McDonnell, and Susana Ferreira on the Irish plastic bag levy. Here is the abstract:

There have been occasional ad hoc efforts to influence consumer behaviour by the imposition of product taxes that reflect external costs imposed by such products that are not initially included in their price. In the spirit of this idea, in 2002 Ireland introduced a 15 Euro cent tax on plastic shopping bags, previously provided free of charge to customers at points of sale. The effect of the tax on the use of plastic bags in retail outlets has been dramatic–a reduction in use in the order of 90%, and an associated gain in the form of reduced littering and negative landscape effects. Costs of administration have been very low, amounting to about 3% of revenues, because it was possible to integrate reporting and collection into existing Value Added Tax reporting systems. Response from the main stakeholders: the public and the retail industry, has been overwhelmingly positive. Central to this acceptance has been a policy of extensive consultation with these stakeholders. The fact that a product tax can influence consumer behaviour significantly will be of interest to many policymakers in this area. This paper analyses the plastic bag levy success story and provides insights and general guidelines for other jurisdictions planning similar proposals.


The most popular tax in Europe? Lessons from the Irish plastic bags levy
Frank Convery, Simon McDonnell, Susana Ferreira. Environmental and Resource Economics. Dordrecht: Sep 2007. Vol. 38, Iss. 1; p. 1-11.