Economics

Economists Weep With Joy Over the Discovery of the Cause of Inflation

This entry was posted in Apple Computer Economics Humor on by

Here is the headline:

Apple Licensing May Contribute to Inflation

and here is the meat:

If it seems prices of the latest iPod and iPhone accessories are rising, you may have Apple’s licensing department to thank, according to a story in Popular Mechanics. Though the company is typically reticent to discuss the details of arrangements such as the one that allows some electronics manufacturers to place a “Made for iPod” designation on their products, managers and decision makers for both retailers and manufacturers indicate Apple’s licensing fees and specially made chips that allow gadgets to work with Apple gear can add 10% or more to the price consumers pay for an item.

Yep, licensing agreements may indeed drive up the price of these accessories.
But, contribute to inflation? Naw, not unless these accessories are part of your price index and people actually bought them at the higher prices while also buying the rest of the goods in the index at the same or higher quantities and prices.
Which would mean that people had more money than they had before which suggests that the real cause of the inflation was most likely an increase in the money supply.
All of which is to say that I thought that headline was really broken.
NB: The headline in the Popular Mechanics article linked in the above quote is much more accurate:

How the “Apple Tax” Boosts Prices on iPod & iPhone Accessories

Advice on Taking A Bar Exam

This entry was posted in Economics Law on by

Professor Somin says:

That said, I think many law school graduates get overly stressed out and obsessed about taking the bar, and spend too much time studying. Most bar exams are primarily just tests of memorization. They’re not much of an intellectual challenge, and require far less thinking than most law school exams.
Most important, all you have to do is pass. Unlike on the SAT or the LSAT, there is no need to maximize your score. As one of my law school classmates put it, every point you score above the minimum needed to pass is evidence that you spent too much time studying. I took this excellent advice to heart, and saved a lot of time and aggravation as a result (primarily by not attending any Bar/Bri lectures, and confining my preparation efforts to reading the books and taking some practice tests). If you’re reasonably good at managing your time and memorizing legal rules, you can probably do the same thing.

There is some disagreement in the comment thread….
The more interesting question is the one he addresses in the post’s initial paragraph: what is the purpose of the bar exam? And, by extension, should they even exist?
Well, yes, they can exist if they are part of a voluntary credentialing system that attorneys could use to some competitive advantage and that consumers could use as part of their attorney selection process. But, as Somin notes, current bar exams are little more than another barrier to entry put in place by a state enforced monopoly.

As such the consuming public would be best served if they were eliminated.


Fair and Full Compensation?

This entry was posted in Economics Law on by

Here is the sought after take:

Attorneys who win civil-rights cases can also ask the trial judge to apply a “fee multiplier” in cases of “exceptional success.” Howell wants his estimated fees of $174,321 multiplied one-and-a-half times.

This guy’s billing rate is $480/hour so he put in 363 hours, the equivalent of a bit over 9 weeks (at 40 hours/week).
Another Seattle attorney involved in similar cases says:

“Unless attorneys who undertake risky civil rights cases are fairly and fully compensated for the time expended in these cases, the limited pool of lawyers willing to vindicate the rights of victims of government will shrink.”

Folks, this is a lawyer. Now I can see a lawyer billing enough to support a secretary and some office space but surely if he is good enough to bill even half this rate he should be good enough to be pretty busy and shouldn’t need to bill a year or threes overhead on one case.
If he is trying to make his whole year’s income off one 9 week equivalent case then perhaps he should find some other work to fill in the rest of the year. Fair and fully compensated should mean at a rate adequate to live a comfortable life which in the suburbs of Seattle does not require anything close to the equivalent of $1,000,000/year.
Give him credit for winning the case but how good can he be if it takes him 20 hours ( $10,560) just to figure out how much to bill?? It seems like a bit of malfeasance that he hasn’t hired a $400/day accountant to spend an hour or two to do his billing…
In another view: can a case be made that his hourly rate should be no higher than what he would have earned from his 40% contingency agreement with his client…$107,00/363=$295/hour. Still high but it turns out to be what he agreed to do the work for originally…could have been lower or higher based on the amount of award.

Thoughts from any of you lawyers?

NB: It is also pretty ridiculous that the legal expenses for this one case have already hit $675,000 and the clock is apparently still running. The city officials who failed to settle this case out of court should be fired!