Chocolate and Gold Coins

Wednesday, August 31, 2005

Blogroll Catastrophy and Blogday

My blogroll is more or less a catastrophy. It’s pure madness. It is split into five sections and some blogs show up 3 or even 4 times. Some of it is partially alphabetized, some of it is put in the order that I added the links, and other parts defy any organization logic whatsoever. I admit that several of these blogs I haven’t read in months. How did this happen?

In the beginning, I had a simple blogroll that is more or less the section that now reads “Blogs”. I’ve added a few since March but most of them I haven’t touched.

Back in March, not many people read my blog. I wrote some good stuff and some not so good stuff that no one was reading. I thought that was a pity. I had an idea: I will put everyone who ever links to my blog on my blogroll and this way I can read their blogs, comment on them, and maybe they will come back to my blog. I would get regular readers. Here is the original post that explained the idea of the “Linked to C&GC” section. Notice that only five blogs on planet Earth were linked to my blog at that time. Two blogs blogrolled me. So it never occurred to me that this might get out-of-control.

A little later, I created the “Bookmarked C&GC” so I could hand out two links to anyone who bookmarked me. At that time it was only Jwaala and Anyletter, neither blog is likely to be one you would see on anyone else’s blogroll.

Slowly, I began to get some regular readers. Vikram Arumilli, Sunil Laxman, Half Sigma, and my blogroll expanded. Most of my regular readers were from India, probably because of Amit Varma. For that reason, most of the blogs I read were by Indians and “desis”. So I decided to add another section of my blogroll that would be “My favorite “desi” blogs”. By now it was clear that I was a compulsive blogroller.

By this time, I was really beginning to add a lot of new bloggers to “Linked to C&GC” and “Bookmarked C&GC”. I wanted to acknowledge some good blogs that I read occasionally but didn’t have enough time to read everyday. So I created the “Other great “desi” blogs” section.

So I seem to be in some competition with Patrix for the most ridiculous blogroll. But he has had a two-year head start on me.

If you blogroll me and would like me to reciprocate, just leave a comment somewhere, and I get around to adding your blog in a month or two. I’m bad about updating stuff.

I got the idea of writing this post because of Uma's post explaining her blogroll.

Okay, blog day. List Five new blogs that I like:
  1. Blogpourri Sujatha tells of her experiences returning to India after living in NoVa for many years.

  2. Freakonomics Interesting stuff from Steve Levitt and Steve Dubner. Hey, Steve Levitt actually left a comment here.

  3. Greatbong Is this new? I suppose not, but I think its funny when I understand it.

  4. Indian Economy It’s like being able to comment on India Uncut, cool.

  5. Indiblogreview @mit’s new blog. Looks like a real winner. It starts with a great interview with Patrix here.

Maternity Hospital Bribes

Yesterday, everywhere I turned, I found this same story. I read it first on Vikram’s blog, then at Sepia Mutiny, then India Uncut, and even Marginal Revolution. The story comes from the New York Times:

Just as the painful ordeal of childbirth finally ended and Nesam Velankanni waited for a nurse to lay her squalling newborn on her chest, the maternity hospital's ritual of extortion began.

Before she even glimpsed her baby, she said, a nurse whisked the infant away and an attendant demanded a bribe. If you want to see your child, families are told, the price is $12 for a boy and $7 for a girl, a lot of money for slum dwellers scraping by on a dollar a day. The practice is common here in the city, surveys confirm.

This practice seems so shocking; it seems incredible. I wondered how such a practice could start? Were these public hospitals or private hospitals? Were the doctors and nurse there adequately paid? As an economist, I was naturally curious to see how such petty corruption comes about.

The problem with the New York Times article is that it doesn’t adequately explain the context of this corruption. The real story is between the lines.

Although the article casually claims that, “the practice is common here [Bangalore]” a careful reading of the article indicates that the only hospital that the reporter writes about is Austin Town Maternity Home and their clientele is entirely poor. Nesam and the other women who give birth at that hospital don’t pay any formal payments to Austin Town Maternity Home. Presumably, Austin Town is not a private hospital because the article ends with this quote:

Margaret, a 50-year-old grandmother who uses only one name, said she paid to see her 19-year-old daughter's baby the day he was born, Feb. 16. She earns only $10 a month as a maid and said that she was determined to pay no more than $7 - and that she did not.

"Though I felt bad and a little angry, a private hospital would have cost at least 2,500 rupees," or about $60, she said. The bribe was still costly but, by the calculus of poverty, a relative bargain.

My educated guess is that the workers at Austin Home are severely underpaid relative to the private hospitals. This has two effects: it drives away competent workers and it attracts not very nice ones. These not very nice nurses and doctors are probably a touch bitter that they missed out on the better salary, and feel they deserve more. So the bribes are a way for these workers to supplement their earnings and Austin Home looks the other way because it is an effective (but extremely callous) way of extracting some partial payment from the families who use their facility.

Likewise, the city of Bangalore looks the other way because they know what the problem is. If you provide a free hospital with very nice services, then even the middle class will use the service. They don’t want to put the private hospitals out of business, so they look the other way.

The callous treatment that the woman receive from Austin Town is, in effect, designed to drive them away. They don’t pay much for the service, so they get what they pay for. It is incentive compatibility: a mechanism to prevent everyone from using a “free service”. Basically it is reason number 5,145,874 why poverty stinks.

I would be willing to bet that if you pay $60 to give birth at a nice private hospital, you don’t need to pay any bribes. The article should have mentioned this, though.

Monday, August 29, 2005


Desipundit is begging for blog-love and I owe them some. They have repeatedly pointed to my posts and that really helped grow the number of readers to my blog. The reason they keep linking to my posts is partly because I knew (in a blog sense not a biblical sense) most of them before Desipundit started. I found Desipundit almost as soon as it started because Patrix linked to a post of mine, (I think it was the Finland post). Soon Saket Vaidya (aka vulturo) joined and I knew Saket’s blog very well (I linked to this post twice that week). When Ash joined Desipundit, I wondered a bit if Patrix might join also since I knew they were a pair, (little did I know that Desipundit was Patrix but I should have guessed). Then one of my best blog buddies, Vikram Arumilli joined. And I have become acquainted with Kaps (again, in a blog sense) as well.

I check Desipundit every day. It gives me the opportunity to find interesting stuff I wouldn’t find otherwise. Hopefully I’ll write a post worthy of being listed on Desipundit in the next few weeks. Lately, I seem to be striking out.

This is my 200th post, which may or may not be worthy of note.

Sunday, August 28, 2005

OPEC Loses Control

OPEC, the oil cartel, has temporarily lost control of world oil production. I say temporarily because I have no doubt that OPEC could quickly increase production by simply drilling more oil wells and sucking the oil out more rapidly.

But this raises a question: “If OPEC is making more money with the higher price, why would they want to increase production and reduce the price?” The answer is that letting the price of oil rise is like taking a submarine down to see how far it will go before the water pressure crushes it. It is a highly dangerous game. I think that OPEC must be very concerned that they might just spawn a monster of an alternative fuel technology.

If you control the world oil production and you want to maximize the present value of your total net revenue stream, then how do you set your price? The answer is that you would want to set the price just below the price where it becomes profitable for others to invest in alternative energy sources. If you set the price too high for too long, you run the risk that some exciting new energy alterative will come along and then you would be force to sell your oil at a discount later.

This really isn’t so unlikely as it might first seem. Markets don’t react instantaneously to changes in prices. It may take a few years for investments to come to market. But once they do, there may be learning by doing and the cost of new technologies may go down over time. This, in fact, typically happens with almost all markets. The more you produce a commodity, the better you are at producing it, and the cost falls.

My guess is that OPEC never intended the price of oil to get this high and is now a little worried. If they do not bring the price down in the next year or so, they will rapidly lose market share. They will lose it to coal, to alcohol, to synthetic oil, to compressed natural gas, and to many other products that are not even on the market yet.

Now you might think that OPEC really doesn’t care if they lose some market share since they will sell all of their oil anyway. But losing market share means selling their oil more slowly and that means a lower present value for the revenue stream. Also, they run the risk that this will accelerate the process of developing alternative energy sources, and learning by doing might cause the alternative fuel sources to really fall in price.

My prediction: oil will be below $60 a barrel by June of 2006.

Here is a curious thought: if the steam engine had received another 70 years of technological innovation, would steam power have been more economical than diesel electric power for locomotives and ships?

Friday, August 26, 2005

Mexican and Indian Fast Food

Ravikiran Rao, (who writes an interesting blog – at least until Aug 11), has written many interesting comments on my blog recently. Here is one that deserves more comment:

[It] occurred to me that it might be interesting to study the evolution of Indian food in the US with Mexican food in the US..

Specifically, if we can answer
1) When was Mexican food introduced?
2) Were the restaurants started by immigrants?
3) Were they first patronised by immigrants?
4) When did restaurant chains like Taco Bell start? Who started them? First-gen immigrants? Second-gen immigrants? Non-Mexicans who wanted to cash in on the popularity of Mexican food?
5) Who are the ones innovating there? Small restaurants? Big chains? Or the former introduce and the latter popularise?
6) What sort of innovations? Did they just get recipes over from Mexico or did they come up with innovations uniquely suited to Americans' palate?

A comparison of the trajectories the two cuisines are taking would tell us a lot about the cultural differences between the two ethnicities. We Indians may also learn something about ourselves...

Those are good questions and while I am not completely qualified to answer them, I know roughly what the answers are:

The Hispanic population in the U.S. has always been here, especially in Southwest. By “here” I mean in the area that is currently the U.S. Keep in mind that the U.S. took a major chunk of Mexico after the Mexican American war in 1848. Yes, many Hispanics have since immigrated to the U.S., but I believe that there is probably not a great difference in the traditional cuisine of Mexico and of the Hispanics in the Southwestern U.S. This cuisine was based on corn tortillas (tortillas are like chapatti) and mashed beans and meats (beef and pork). The taco (a fried corn tortilla shaped like a “U” and filled with meat) is probably a genuine Mexican food from centuries ago.

I am sure that there were mom and pop Mexican restaurants in the U.S. Southwest for at least a century and the clientele was mostly the Hispanic population. By the 1950’s many of the Anglo population in Southern California had occasionally tried Mexican food.

Mexican fast food was not created by Hispanics. It was created by Anglos. Taco Bell was probably the first really successful Mexican fast-food chain and it was started by Glen Bell (hence the name) in 1964. There is actually an excellent history of Taco Bell at their website. Apparently Glen Bell was quite the entrepreneur. He started with essentially nothing, and he created not just Taco Bell but also Der Wienersnitzel, which was once a major hot dog chain.

Taco Bell was never particularly authentic Mexican food. I doubt if Glen Bell really cared if Hispanics thought it was authentic or not. He was producing fast food and this really restricted what he could do. Taco Bell has never served vegetables, for example, which makes it rather uninteresting food for me. Critics joke that Taco Bell is always taking their five basic ingredients and combining in different ways to seem like different food. But there is something there. They really have innovated – given the fact that they are stuck with the five basic ingredients. And Taco Bell cuisine is getting less and less related to ordinary Mexican cuisine. But when I live in the Southwest, I will say that Hispanics really did seem to like Taco Bell food.

The Taco Bell formula I think is roughly this:
  1. Keep the menu simple

  2. Mass produce most of the food in central factories

  3. Keep people from getting bored with the food by introducing minor innovations

  4. It pays to advertise

Could this formula work for Indian food. I don’t see why not. But then why hasn’t someone done exactly this? Maybe more surprising, why hasn’t a successful Chinese fast food chain emerged? There could be several explanations:
  1. The major fast food chains, for some reason, don’t know how to translate their fast food formula for other types of cuisine

  2. Indian and Chinese restaurants are already numerous and very competitive so margins are very low. There really isn’t a lot of profit to be made by introducing Indian and Chinese fast food

  3. Indian and Chinese food is served very promptly, so again there is not much scope for fast food to provide a new niche in the market

  4. Indian and Chinese fast food is like a billion dollar bill left in the street that everyone passes and says, “It cannot be genuine, for if it were, someone would have picked it up by now.”

I think there might be truth in all of these possibilities. It could be that Chinese food is hard to produce in a fast food manner because it must be reasonable fresh. I find that if I reheat Chinese food, it doesn’t taste any good. That’s not true of Indian food and Indian food works really well in the buffet style and the food can sit around for a while and still be very good. Dal can stay good for hours if kept heated. It might be that Indian food is a good candidate for fast food, but maybe it just hasn’t been done yet in the U.S.

I don’t know about India but I am guessing that India hasn’t formed major fast food chains like McDonalds and Taco Bell yet. This might simply be because it isn’t as easy as it might look to unlock the power of economies of scale. You have to know how to advertise effectively. You have to know how to really get the cost down to rock bottom and maintain consistent quality. You have to know how to recruit and train a small army of low wage workers who can produce a consistant quality product. Fast food is really not restaurant food, it is manufactured food delivered to restaurant-like places. It requires a different body of knowledge than the average restaurateur knows.

So does anyone else have a good idea why there isn’t Indian fast food?

Thursday, August 25, 2005

Caloric Nonsense

The Indian blogosphere has caught fire by this article published in the Hindu by economist Utsa Patnaik that claims that there is a crisis in the rural community in India. There may be problems there, I don’t know, but the evidence used by Utsa Patnaik to support her claim is really suspicious. Her main evidence that there is a problem on the farm is base on looking at the consumption of grains and the caloric intake of the people. Here is a quote:

Forty years of successful effort to raise foodgrains absorption through the Green Revolution and planned expansionary policies has been wiped out in a single decade of deflationary economic reforms and India is back to the foodgrains availability level of 50 years ago. The farmers of Punjab and Haryana are in crisis for they have lost internal markets to the tune of 26 million tonnes of foodgrains — for if grain absorption had been maintained at least at the 1991 level of 178 kg per head instead of falling, the internal demand would have been 26 million tonnes higher than it actually is today.

Food grain “absorption” takes in consideration both grain consumed directly and indirectly via feeding animals. But basically, absorption is very closely related to caloric intake.

Now several commentators have criticized her methods (Aadisht Khanna, Amit, Vinod) But they aren’t saying the obvious: maybe this whole idea of using diet as a proxy for income is pure nonsense. Actually that isn’t completely true: Amit did link to this old article by Swaminathan Aiyar that makes the same point I am going to make. This is nonsense, folks. There is absolutely no way you can infer anything about how well off a person is by just looking at his or her diet over time.

Let me illustrate the problem with the diet method with a simple example. Suppose Amitabh is a rickshaw driver. Ten years ago he consumed 2400 calories a day, but today he only consumes 1800 calories. He must be starving to death, poor fellow. But oddly, he is gaining weight. How could this be? Let us ask Amitabh: “ Well, I used to have to eat a lot because I had an old cycle rickshaw and I needed the strength. Today, I have a nice auto rickshaw and life is easier.”

Don’t you think that possibly the same thing is happening in rural India? Isn’t at least possible that some of the donkeywork that ordinary Indians performed in the past is now being replaced by machines? Wouldn’t an obvious result of industrialization be that people’s caloric intake would either decrease or people would gain weight or both? I cannot know for sure that this is what is happening in rural India but neither could Utsa Patnaik know by just looking at “absorption” of food grains.

If you measure the weight of people in India, you might get some idea about their well-being but it is much better to measure income. If the farmer sells some of his grain on the market, then you can easily infer his income by multiplying the total production (including the portion saved for his family) by the market price. This is a much better indicator of well-being than caloric intake.

Here is the money quote from Swaminathan Aiyer:

What explains this? [That the poorest 20 percent only consume 1600 calories per day and this has stayed constant despite technological progress.] One reason is that nutritionists have exaggerated calorie needs to grab headlines and importance. A second and perhaps more important reason is that lifestyles have evolved so as to reduce calorie requirements. Mechanisation of every sort has penetrated rural India , substituting mechanical energy for manual energy. In Haryana and Punjab tractors are so widespread that it is getting difficult to find people who can plough with oxen.

Isn’t it an odd coincidence that the two states that Swaminathan points out as examples of states that have seen the most mechanization on the farm are exactly the two states that Utsa points out as the ones that have seen the greatest drop in “foodgrain absorption”. The really odd thing is that Swaminathan whote his excellent rebuttal to Utsa’s piece two years before she wrote her article. That’s impressive.

Wednesday, August 24, 2005

Innovation Failure

Recently, I have been reading some examples of market failure and I was curious if they might be connected in some way. It seemed to me that they related to an idea I wrote about in this post on magic in the marketplace. Let me list some examples:

  1. I wrote about the fact that all North Indian restaurants in the D.C. area serve a very similar menu. Why don’t we see more variety of recipes?

  2. Coyote writes about how all of the remodeled homes in the Phoenix area are built in exactly the same architectural style.

  3. Half Sigma writes about how there were no smoke-free bars before the big bad government mandated it, even though people like him greatly benefit from having them.

  4. Bryan Caplan wonders why there are so many frame shops in Fairfax County. Why doesn’t the fiftieth frame shop instead become the first custom bookshelf shop?

  5. Until some time in the 1930’s, the only color of automobile you could buy on the U.S. market (and probably other markets) was black.

  6. Baseball famously integrated in 1947 when Branch Rickey chose Jackie Robinson to be on the Brooklyn Dodgers. However, there was a very talented generation of black baseball stars, including the legendary Satchel Paige, who missed out on Major League Baseball. Why did no baseball club before the Dodgers hire Satchel Paige or any other black baseball player?

In all these cases, the free market seemed to fail to produce the kinds of outcomes that we would have hoped. There are certainly specific explanations for each of these cases. But in general, the market can fail to produce certain types of innovations, and it is reasonable to ask, “why?”

Now don’t get me wrong; I’m not claiming that a free market never produces innovations. The free market does produce many wonderful innovations. But when you look at the innovations that really changed our lives, many of them came from spin-offs of military technology, other innovations come from giant corporations that already dominated the market, and many others came from people who never really cashed in on their innovation. Patent law and copyright law does offer some protection for creative people, but many times, the creative person successfully creates a market for someone else to cash in on.

The big money rarely goes to the first entrant into the market, it goes to people like Michael Dell of Dell Computer who came very late to the market and took it over by being a little better than everyone else. Sure, Dell Computer is innovative and I wouldn’t begrudge Dell’s contribution to the industry. But Dell Computer is innovative in a particular way. They aren’t making new goods; they are making existing goods better. This the insight I gave in my article magic in the marketplace: the big money come from people who create technology that no one can figure out how to duplicate.

In each of the above examples, the failure to innovate was primarily because it was so easy to duplicate the innovation. Innovations are public goods: they tell the world that there is a market for this innovation. Free markets don’t produce public goods in abundance. Let’s look at some examples.

In the entire decade of the 1920’s, the only color of car on the market was black. Who would want a black car, especially if everyone else had one? Maybe it isn’t a big deal but it does seem really peculiar. I read somewhere that the black paint was superior to all other car paints at that time. But cannot be the total explanation. Suppose an entrepreneur develops high quality red car paint and tries to sell it to automakers at a slight premium to the original black paint. Would anyone buy it? If Ford wasn’t interested in it, I doubt any other manufacturer would be either. If a small manufacturer buys red paint and tries sell some red cars at a premium; two things will happen: either he finds out that consumers aren’t willing to pay a premium for red cars and he loses money, or they are willing and he has exactly one good year before everyone else in the marketplace copies him. You cannot patent the idea of having a car of a different shade other than black. The innovator has to give away the game to create the market: he has to tell the world that there is a market for his minor innovation.

I go to Indian restaurants frequently and am always struck by the lack of variety of the food. You always get the same thing everywhere. Why doesn’t some restaurant try to be different? Well, suppose that you come out with a wonderful new dish. Can you patent that? It wouldn’t be worth the trouble for a small restaurant to try, even if it were possible. A new dish might make someone a lot of money, but not necessarily the person who creates it. The money might be made by the person who tastes the dish and decides he can make it a little better and a little cheaper.

For many years, all restaurants had smokers and non-smokers mixed together. If you didn’t like smoking, tough, you could eat at home. Restaurants then began offering smoke-free sections, but the smoke would invariably enter that section anyway. And the smoke-free section was typically too small. Bars never made any real effort to make a smoke-free environment. Bar owners believed that their clientele were smokers, but that was only because non-smokers couldn’t stand all the smoke in bars. Why didn’t we see smoke-free restaurants and bars before the government mandated the change? Again, think about the innovator. Either he finds out that there is no market for non-smoking bars and loses money or he finds that there is a market for them and someone else takes it over.

This suggests that there is a role for private charity or government to seed these innovations. A charity that was interested in promoting better public health might have provided some of the capital to start a smoke-free bar. It might have taken only a very small investment to start a revolution. I think the popularity of smoke-free bars shows that it just needed a catalyst to get it going. A charity might have provided a cash reward to the first baseball team to have a black baseball player. Once the color barrier was broken, competition would have done the rest. And charitible prizes (similar to the Nobel Prize) could reward innovators who never really cashed in on thier innovations.

The government could spur innovations by issuing a new kind of mini-patent. I could not justify giving a 17-year monopoly for something like a different color of car paint or a better recipe. But suppose the government issued a 5-year exclusive monopoly for any new innovation not yet on the market. Then we might see a self-cleaning toilet. Surely someone could produce one. The reason we don’t see any self-cleaning toilets is not because they are impossible to make but because they are too easy to make: everyone knows the first mover is going to do all the hard marketing work for somebody else. The mini-patent would prevent any other firm from entering the self-cleaning toilet market for five years. This would give a decent head-start to the first mover. And I guarantee that we will not see a self-cleaning toilet in the next five years so the government would be giving nothing away.

The wonderful thing about market is that, like an oyster, it can turn a small seed into a beautiful pearl. But you do need the seed.

Can anyone think of other examples of innovation failure?

Monday, August 22, 2005

An Investment In Bad Ideas

Recently, my family had a nice visit to Norfolk, Virginia. Norfolk is not a very large city, but it is large enough and unfamiliar enough to get lost in. I was driving at night from Virginia Beach, another nearby city, and exited too soon off of the freeway. I then compounded the mistake by turning right instead of left. Pretty soon we were in very unfamiliar territory and my wife was very nervous, (it was a nice residential community, not a slum). She asked me, “Please go back to the freeway,” but I refused. I was certain that I could get us to the hotel. I felt sure that I was getting closer to our hotel and we would soon cross a familiar street and all would be fine. Eventually, my wife panicked and started yelling and my son started crying and I stopped driving. I let my wife drive.

The example of driving down the wrong road can be both a literal example and a metaphor for a particular type of bad thinking: “After investing so much in a particular idea, I am determined to make good on that investment.” A rational person would see the evidence for what it is and cut his losses. But people aren’t always rational. Once you have a lot invested in a project or in an idea, you are likely to become obsessed with proving that your original investment was a good one.

In mathematics, there was a whole school of thought devoted to the study of determinants. They found a million and one wonderful uses for these things. Only one problem: determinants exhibit a terrible curse of dimensionality problem that makes using them in any practical calculation almost useless. Surely someone must have questioned the wisdom of studying these things at some point. But once you have made your reputation as the world’s foremost expert on determinants, it might be hard to admit to yourself that your life’s work has been a waste of time.

In politics, you see many parties cling tenaciously to bad ideas that the average public really doesn’t care for. Why would they do this? In large part, it is the ego of the politicians that drives this phenomenon. These politicians could say, “I used to believe in X, but X didn’t work, but I’m still a good politician, I still have good ideas, and I’m moving on.” No, the politician is wedded to X for life. Even if X is obviously a bad idea, the politician is bound to support it and give X a respectability that X does not deserve.

In India, the Communist Party is still viable and still has considerable influence, despite the fact that socialism obviously did nothing for India. If India had embraced the free market fifty years ago, it would be the world’s wealthiest nation. It citizens would have the kind of prosperity that you see in Singapore and Taiwan and Korea. But instead, India is still a poor nation in which hundreds of millions of people don’t get enough to eat and live in substandard housing. Why would anyone listen to what the Communists have to say? Does anyone really believe in communism anymore? The Communists have invested a lifetime in a particular way of thinking and cannot rewire their thinking. And a person who has voted for the Communists for 40 years is unlikely to say one day, “I’ve been wrong for 40 years, I need to move on.”

In the United States, the Democrats have supported the cause of labor unions for a century. This seemed a wise decision in the 1950’s when most workers belonged to labor unions. But today, only 12 percent of the workforce belongs to a union and this percentage is steadily declining. The unions today tend to represent workers who really don’t need a union: professional athletes, airline pilots, and government employees. In elections, most labor union members vote Democrat but both the share of the electorate that is union and the percentage of union members that vote Democrat are shrinking. These statistics should convince Democrats that they need to move on. But they cannot move on. They have invested in the rhetoric of unionization for a century and the politicians cannot admit that this investment had brought them no returns.

Getting back to the original story about being lost in Norfolk, we did eventually get back to the hotel. In fact, I was going roughly in the right direction and we only needed to go a little farther to see a familiar road. Sometimes in driving around a city, the wrong road can get you near where you want to go. But in life, wrong roads lead nowhere. We always need to ask ourselves, “Are we investing in bad ideas?” If you are a little unsure, you need to give this subject a lot of reflection.

Saturday, August 20, 2005

Things My Son Hears From His Parents

Things my son hears from his parents:

  1. Eat slowly. This is not a race.

  2. The only important thing to be first in is to be first in manners.

  3. Listen to your Mother. And when she asks you a question, please answer it.

  4. Eat your vegetables. You cannot just eat a diet of cake and pizza.

  5. Be careful when you eat. You are always spilling everything on your clothes.

  6. Why don't you go outside and play? All you want to do is sit around and watch T.V.

The thing about children is: they resemble their parents in many ways. All of the faults you had as a kid will be there in your children. And when you tell your child: "Eat your vegetables," it is hard not to notice the irony that you were told the same thing and ignored the same thing when you were a child.

Of course, my wife would say, "At least I changed when I grew up."

I'll be back to full-time blogging on Monday, (hopefully).

Wednesday, August 17, 2005

Letter From Finland

I received a nice letter from a person in Finland, Topi, who wanted to respond to my post about "What Can Finland Teach Us?":

Dear Michael,

I read your pieces on Finland with great interest. I do disagree with you in that Finland has nothing to teach you. In a sense I understand what you mean since I'm a pro-American Finn but I wouldn't want Finland to be like the United States.

Still, in the globalizing economy all successful countries like Finland and the United States have many things to learn from one another and from other countries. The whole attitude that there's nothing to learn from other cultures and other economic systems (although I'm sure you would think America had something to learn from Finland if it were not for the fact that Finland is a welfare state) is basically promoting ignorance.

Welfare statism, just as liberal markets, are relative phenomena in each individual country. I find both beliefs, "let the state take care of everything" and "let the markets take care of everything" incredibly naive. Here in Finland we discuss quite a lot the pros and cons of liberalizing a certain market in each individual case.

Is it really true that the Finnish welfare state works because Finland is ethnically homogenous but a similar state wouldn't work in America because the country is ethnically diverse? I don't really buy that. At least I don't think this has anything to do with ethnicity. Certainly there is the myth of the Protestant country which is very intriguing. But that is religion, not ethnicity. Last weekend I visited Zurich, a traditionally protestant city in Switzerland and from what I could observe many of the myths aboutthe local people coincided with myths about Finns. Two societies can be culturally very similar, the myths behind the peoples' successes can be similar yet the economies and levels of taxation may differ. Now I'm no Switzerland expert yet I think making all these comparisons between different countries helps and learning from other countries is really the key behind any nation's success - there's no reason to copy everything, countries can maintain incredibly diverse economies even with globalization but any economy's capability to adapt to new circumstances is very important. There many things are to be learned by observing other countries.

I certainly wasn't offended by your remarks because I'm a nationalist - I'm Atlanticist & pro-European more than anything - I would like those things that work with the welfare state even if none of them would be Finnish. Just like it was a pleasant experience as a tourist in Zurich to see that everything works incredibly well and even railway station officials are extremely polite (they're not very service oriented in Helsinki, not to us Finns at any rate, maybe everyone is a bit more polite toward tourists, who knows). The people make the markets and the states work. Ideologies are important but they do not explain everything like they tend to do in most economists' models.

Topi (from Helsinki)

I would say that I am dubious about the Protestant vs. Catholic angle. I know that most Catholic countries are rather poor (Latin America and Africa bring down the average). But Switzerland is split between Protestants and Catholics and the German part of Switzerland is predominately Catholic. I travelled all over Switzerland and could not detect any difference between the Protestant and Catholic regions. They all seemed very prosperous.

Switzerland is not egalitarian, or at least, it didn't appear that way to me. There is no proverty there but there are some very wealthy people. Switzerland is a very nice country, (although I met some rude waiters there).

Monday, August 15, 2005

Parallel Construction

I was waiting in line with my son in the ice cream shop. I noticed that my seven-year-old son (yes, he had a birthday recently) was now up to my shoulder.

"You're just getting taller and taller."

My son put his arms around me and said:

"And, Daddy, you're just getting fatter and fatter."

Saturday, August 13, 2005

Vacation Until Friday

Blogging may be non-existent until Friday as our family will be on the beach in Norfolk Virginia.

I will leave you with the coolest optical illusion that I have ever seen. Here is photo from Marginal Revolution:

Will Franklin of Willisms thought, (like I did), that this could not be real. He did some excellent photoshop work to prove that, indeed squares A and B are the same shade of gray:

The point of this illusion is to try to convince you that intuition can only get you so far. Sometimes you need to question it.

Friday, August 12, 2005

Ethical Treatment of Animals

Uma of Indianwriting, who is a superstar of Indian blogging, also helps write a blog about animal welfare: Animal Rights India. I often read this blog because it bothers me very much when humans mistreat animals. To me, mistreating an animal is like mistreating a child, because neither has the power to fight back. But, of course, humans are special, and it is hard to weigh the magnitude of a crime against a human against a similar act against an animal.

I think many Americans struggle with the question: “what exactly is our obligation to animals?” Do animals have rights? We eat animals (I don’t, but other Americans do), but we would feel very badly if an animal, especially a pet, were to suffer unnecessarily. Americans really love their pets, and to pet owners, their pets are like family.

I think the paradox of our treatment of animals was best illustrated by a T.V. show I saw maybe 6 or 7 years ago. I think it was the pet equivalent of the popular TV show Rescue 911. These were real life stories of emergency crews saving pets. In this episode, the rescuers risked their lives to enter a burning building to save…a pet pig. There’s some irony there. These rescuers might have gone home and ate sausage or pork chops. But the rescuers didn’t see any paradox here: “It wasn’t just a pig, it was somebody’s pet.”

Tyler Cowen, that great blogger of Marginal Revolution, struggles to put down his conflicting views on animal welfare:

Surely it seems reasonable to count the welfare of animals -- or at least selected high-cognition animals -- for something rather than nothing. But this throws moral calculations into a funk. Even if you count individual animals for very little, there are many billions of them.

Was it a good idea for humans to have settled the New World? I'll answer yes without hesitation. But what if billions of other mammals died -- in net terms -- as a result? I don't want my answer to depend on my relative weighting scheme for animal vs. human welfare. Nor would I kill a good friend to save the lives of a million cats. Or a billion cats for that matter. Yet I still wish to count cats for something positive.
It is disquieting that so many fascist thinkers have held animal welfare in high regard. Once we start counting animals in our moral theory, we too easily get used to the idea that violent conflict is an inevitable part of nature. Human vs. rat, and of course tiger vs. deer as well. How can we segregate this apparent endorsement of violence away from human-to-human affairs? Life as a secular moral thinker is difficult.

Read Tyler's article.
Tyler’s co-blogger, Alex Tabarrok objected to Tyler’s line: “Nor would I kill a good friend to save the lives of a million cats.” Alex wrote:

Tyler asks (I paraphrase) 'Would you kill your good friend for the lives of a million cats? What about a billion cats?' He answers, No, but says "Yet I still wish to count cats for something positive."

My answer is not only Yes it is that we do this routinely today. The introduction of "your good friend" …engages our primitive intuitions and feelings and that is why Tyler's answer goes awry. But consider, last year Americans spent more than 34 billion dollars on their pets. That money could have saved human lives had it gone to starving Africans.

Alex’s point is that our intuition is sometimes flawed. We are not comfortable with the idea of trading a human life for many animal lives, but implicitly we are doing exactly that when we feed our pet animals instead of using that money to help save human lives.

I think that Tyler was intuitively sensing what many people have determined: humans have an ethical responsibility towards animals. This ethic is more or less:

  1. For wild animals, we should keep our footprint as small as possible. We must not allow animal to become extinct. We should not interfere in nature’s balance.

  2. For livestock, we should treat them humanely until the time that they are slaughtered, and then we should make the slaughter as quick and painless as possible.

  3. For pets, we should treat them like family. We should feed them; and make sure they are safe and warm. We should never, ever harm them.

There are two questions here. First, is it ethical to eat animals? Wild animals eat each other, but they have to. Human don’t have to eat animals, so maybe we shouldn’t. But admittedly, that is my own personal opinion which I practice, but I cannot force that on others.

Second, why do we need to follow this ethic? Shouldn’t humans be free to do as they wish? Does animal welfare count beyond what we humans as individuals chose animal welfare to be? I think the treatment of animals affects others as well. We would be sickened to hear of someone mistreating an animal, so we cannot allow people to do what they like with animals they own.

Ethical rules are binary in nature: either you obey the ethic or you are unethical. You cannot pay a little to buy a little unethical behavior. You must obey the ethic in its entirety. The ethic above could be modified, but only by popular consent. These are binding rules on all people, so we must compel people to stay within these ethical rules. This is why people who mistreat their pets face criminal charges.

I believe it is this ethical motive that convinced us to create wildlife reserves so that animals would be protected. I believe it is very necessary for humans to venture into these areas to observe the wildlife, without disturbing them, so that we can create that love of wildlife within us that will allow us to perpetuate the ethic. But I think it is fundamentally unethical to destroy a wildlife reserve and make it into a commercial site. But I cannot deny that if most people want to change the ethic, maybe it needs changing.

Our ethically responsibilities towards animals is a controversial issue, and I cannot say that I am sure what is right or wrong here. I grew up eating meat and never thought anything of it, but, at some point, I decided it was wrong. I might still be wrong about the ethical treatment of animals.

Your opinions?

New Girl: Congratulate Rahul and Arthi

I wrote once in this post about bloggers A, B, C, and D that comment on each others' blogs:

My wife (who doesn’t blog and views my blog with contempt) is convinced that “blog friends” are merely strangers, and she cannot see why I would waste precious time writing for strangers. She has a point: if you have never meet someone, then they would be strangers of a sort. But they’re strangers you know a lot about, and they seem nice and interesting and you might form some empathy toward them as if they were your “real” friends. I don’t doubt if D above were to announce that he was getting married or his wife just had a new baby, A, B, and C would be a bit excited about it.

Well, guess what, one of my regular readers, Rahul aka “Iyer the great”, from Norway is a new daddy, (actually, it happened a month ago and no one in blogdom noticed). Now he is off to Chennai to be with his wife, Arthi and their little girl that he has nicknamed Kuttime.

Let’s send a little blog-love their way and wish them all the best!

Thursday, August 11, 2005

One Hundred Finns

One Hundred Finns came to my blog yesterday. They all came to read a post I made two months ago called “What Can Finland Teach Us.” Perhaps the Finns were curious to see what they could teach us. They left disappointed. Not one Finn clicked on my homepage. Two commented, only to say that my one word response to the question above, “Nothing,” was rude. Simo wrote:

A very good blog, although as a Finn I dont agree to the writer's rude one word answer to the headline.

I apologize if I seemed rude to the Finns. I never intended to this article to be read by the people of Finland. I never thought of such a possibility.

But this reminds me about why I blog. I blog not so I can be read by random people who might not care too much about what it is that I say, but for the people who read my blog regularly, and really want to know what I have to say. Blogging is conversation, and maybe I don’t have a lot to say to the Finns, but if Simo had a blog I could read, maybe that would change.

Charukesi, (who writes and excellent blog) wrote about the blogging conversation yesterday. Vikram (who writes and excellent blog also) has an excellent comment on it. I had a comment on it too, but it was eaten by Charu's spam filter, (please fix, Charu).

Update: Recently Saket Vaidya (who write the excellent blog vulturo) wrote that some obscure bollywood blog was the very top blog in the TTLB system. Well, oddly enough, TTLB put me at the very top of the most link blogs in a search for "finland". See for yourself.

Now, dozens of Finns are coming to my blog to see what Finland can teach the world only to be disappointed. But it is interesting the difference in the reactions of Finns to Indians. Simo (above) was clearly miffed but he was still polite and called this a "very good blog". Here is a quote from a blogger from India who didn't agree with this very same post:

"Micheal Higgins [sic] thinks he know[sic] why:"[socialism doesn't work in India]

I am suprised that he thinks,because his ideas dont[sic] reflect that he does.

Finns are polite because they only encounter other polite people. Indians are more like New Yorkers. Most are nice if you are nice but some are not nice at all and most are not very friendly if they think you are not agreeing with them. It is a natural result of dealing with lots of diversity.

Update: Read Kunal Sawardekar's post: Fun Finland Facts.

Also, check out this excellent libertarian blog by Phil in Finland: Finland for Thought.

Security System

A fellow came by our house yesterday “giving away” security systems. He explained the rationale for giving these away at zero cost:

“We know that if half of the families have our security system, the other half will want to pay to have it installed in their homes. So this works out to be a really good deal for you.”

Now let's consider this a moment. Half of the neighborhood have security systems installed and have little signs placed in their yards saying, in effect, “Please rob our neighbor’s house.” Now the neighbors find that they are at increased risk of being burglarized, so they install security systems in their homes as well. The curious thing is that the security system might, in fact, do very little to reduce crime in the neighborhood; it might just spread it to others, and each person winds up paying for something that, in the aggregate, does no good. But being selfish individuals, we think, “I don’t want my house burglarized, so I’m getting one of those systems installed. If my neighbors don’t want to pay for security, it’s their problem.”

But there was another catch to the whole deal, (there always is): we had to buy a three-year contract for monitoring. That three-year contract will cover the cost of installing the system and make a nice profit to the company. We probably should have trusted our instincts and told the salesman that we were not interested, but when it comes to security, my wife can easily get talked into things, and I can be talked into anything.

This last point reminds me of a funny anecdote. I am such a sucker for sales pitches that I used to say to telephone salesman, “We’re not interested,” as soon as I found out that they were trying to sell us something, (we are on a do-not-call list now). My son, who was four, once picked up the phone. I asked him who it was. He just listened a moment and said, “We’re not interested,” and hung up. I hope it wasn’t Grandma.

Monday, August 08, 2005

Marriage as a Repeated Game

One of the major results of non-cooperative game theory is that if two people have to play the same game over and over forever (till death do us part), then it is perfectly rational for the player to cooperate. Consider the classic Prisoner’s dilemma game. If both players cooperate, they each get $100. If one defects and the other cooperates, the defector gets an extra $30 but the other guy loses $60. If they both defect, they each get $70. The following list shows the possible outcomes:

  1. (c,c): ($100,$100)

  2. (d,c): ($130, $40)

  3. (c,d): ( $40,$130)

  4. (d,d): ( $70, $70)

Clearly, playing “defect” is not nice.

What if one of the players plays “defect”? The other player needs to punish him by playing “defect” until the first player cooperates. But, in the real world, what if it isn’t entirely clear who was the first player to play “defect”? Then cooperation may never happen again, and that’s really a pity.

Marriage can be like this. In the beginning, the husband and the wife cooperate naturally. But then, once in a while, one or the other does something selfish. Maybe it is minor, like leaving socks on the floor or forgetting to make the bed. At first the spouse might be forgiving, but then over time the instinct to “punish” the spouse becomes overwhelming. The aggrieved spouse might yell, or might give the dreaded “silent treatment”.

My wife views this blog as a sort of “defection”. It only benefits me, (she never reads it), and it represents time that could have been spent doing things that my whole family could enjoy instead of just me. Now, my wife does not mean that I must do everything for the good of the entire family, but in the margin, an extra hour of blogging is an hour lost to family activities: gardening, home improvement, family fun.

My wife read my emails. She cannot understand why so many of my readers who write emails are from India. She especially disliked this one email, “Who’s this Swati? Why is she flirting with you!” “Oh, Swati is a girl?” I asked innocently.

The bottom line: either I find a really good reason for my wife to like my blog or I will have to drastically reduce my blogging. Maybe I can work out some kind of deal with her: I do X, Y, and Z and she’s let me spend 10 hours a week blogging. Or maybe I can figure out some plausible way that one could get rich blogging, (seriously, someone will figure it out).

In any case, I don’t dare let her think that I am playing “defect” in the hopes that she will give up and let me do as I please. Some couples start the “defect, defect” option and never stop. It happens all the time. I must cooperate.

I know someone who started playing the “defect, defect” option with her sister. She tells me, “I miss her, but I cannot ignore what she said to me.” Apparently her sister feels the same way. Apparently, they will play the “defect, defect” forever. It seems a great pity; they were so close. But at least I can learn from that example.

Update: The always excellent Acorn, by Nitin Pai, links to this piece.

Thursday, August 04, 2005

In Praise of Competition

In recent posts about water and about transportation, I came out in favor of allowing private monopolies deal with the production and maintenance of these goods. You might think that I am one of those people who thinks that anything in the name of free markets is wonderful including firms buying up each other and forming monopolies.

Not at all. I am a big believer in competition. Competition is what forces corporations to become efficient, not really the profit motive. I merely stated that sometimes monopolies suffer enough indirect competition that it would be better to keep them unregulated so that they have proper incentive to modernize than to regulate them and reduce prices. Indirect competition might keep them honest and (fairly) competitive.

However, if there is no competition whatsoever, an unregulated monopoly might be the worst of all possible worlds. Such firms will be fat, dumb, and lazy, just like the government, and unlike the government, you cannot vote the bums out. A good example of this might be the cricket board of India, (the BCCI) which, despite having a pool of talent of 1 billion people to draw from cannot produce a cricket team as good as the team from Sri Lanka which has a population of 2 percent of India’s.

There’s nothing like competition. There’s no substitute for it. And one of the clever things that governments in the US have discovered is that they can allow former monopolies to directly compete with each other. Now I have choice in my local phone service between the old phone company and the local cable company. That’s cool. And I was only too glad to dump the old fat, dumb, and lazy phone company. Let me tell you why:

Once upon a time, our family was in the dark ages of Internet usage: dial-up modem. The Internet was a very, very slow place. We wanted to step into the modern age of high-speed Internet. So our local phone company was offering a nice deal on DSL. DSL is an initialism like MBA that might mean many different things to different people, but in our case it did not mean Internet service. We never got DSL to work. Worse, as soon as DSL was switched on, our phone service stopped working.

We called customer service to complain. Oh, where is an Indian call center when you need one! For ages we would wade through the options of the computer menu until we could find a way to talk to a real person. And after typing in our phone number into the computer menu and looking up our records, the first question the operator asks is “what is you phone number?” What was the computer doing? What good was “looking up our records,” if you don’t give them to the operator when she gets on the line?

They tried to diagnose the problem over the phone. They reminded us we need filters on every phone. They had us unplug all of the phones and wait a couple of hours and plug them back in, one by one. The phones worked again (for a while) but then when we tried to access the Internet, everything failed. We were without phone service again. This was frustrating.

So we call again. Again we get the computer. Again they look up our records for no purpose. Again we wait for ages to talk to someone. They agree to send a technician. They warn us that if the technician finds it is a problem with our equipment, it will cost us big time. We know it must be a problem with their equipment because the phone worked fine before DSL was installed. Then they schedule a technician:

“Would anyone be available at home between 8:00 A.M. and 6:00 P.M.?”

What kind of a window is that? Can’t they narrow it down a little more than all day long! As if my wife and I have nothing better to do that to waste all day at home waiting for the repair technician.

So the first technician comes, can’t figure out anything, and leaves without saying anything. I call up customer service (computer, look up records for no reason, wait for ages, talk to human) and customer service says that any other person will come tomorrow.

“Would anyone be available at home between 8:00 A.M. and 6:00 P.M.?”

Fat. Dumb. Lazy.

The next technician cannot figure out anything either. At least he tells me that. He says his supervisor will come the next day. Oh great – I’m missing a whole week of work. I work late into the evenings to make up work I could not do in the day. I’m fuming.

The next technician miraculously determines that nothing is wrong. “It’s an inside problem.” We will have to pay big time. And he cannot do the inside work. I’ll have to call another technician.


Fat. Dumb. Lazy.

This is their game: the outside tech says its an inside problem, the inside tech says its an outside problem. The only way to resolve the problem is to buy a maintenance program at jacked up rates that would cover maintenance for months and months. Well, why would we need monthly maintenance after they fix the problem?

So we get another technician to come out. My wife agrees to stay home that day. Technician 4 is clueless and just leaves without telling my wife anything. My wife calls me (luckily we have cell phone service) and tells me to yell at customer service. I call an complain, but I don’t yell, (I’m too polite). My wife yells at me, “You yell at me and (our son); why don’t you yell at customer service?” It’s not her fault that she works for a fat, dumb, and lazy firm, (well not entirely her fault).

This is getting to be a source of real tension. I tell my wife, “Forget DSL, we’ll go with cable modem.” We can get Internet with the cable company. “But that is more expensive,” my wife complains. But at that point, both of us realized that it wasn’t worth the aggravation.

What a difference between the cable company and the phone company. You could certainly tell who was fat, dumb, and lazy, and who was lean and hungry. The cable company would come out in the evening, after work. Unlike the phone company, the cable technician was extremely competent. He got us set up in no time. High speed Internet sure is nice.

Then we found out that we could get phone service with the cable company too. Goodbye fat, dumb, and lazy phone company! We jumped on that opportunity. The technician came in the evening. I didn’t miss work. He knew what he was doing and he was able to fix us up in an hour. When he was done he asked: “You didn’t have phone service before did you?” “Yes we did” “I don’t see how, your wiring was all messed up. But I straightened it out.” It pays to have good technicians.

Moral of the story: competition is a very good thing.

Update: Read Sunil Laxman's excellent post on his similar experience with his cell phone company.

Wednesday, August 03, 2005

Water, Water, Everywhere

Is water a different kind of commodity than oil, rice, wood, or anything else you could buy? Fresh water is actually an extremely abundant commodity and luckily I don’t have to pay much for it. I get it piped to my house and I only pay $2.35 for 1000 gallons. (I pay about $3 for 1000 gallons for sewage).

That’s cheap by anyone’s standards.

I wonder if the government subsidizes that cost. I don’t know why they would. It’s not like there are a lot of poor people who live in Fairfax County that could not afford to pay $5 or $10 for 1000 gallons.

The argument that water is a special commodity that needs to be given away free is nonsense; it may be cheap but it isn’t free. Any commodity given away free is going to be terribly wasted. I had a leaky toilet that needed to be repaired. I didn’t really want to do it, but I knew it would waste water and I was paying for it, so I fixed it. If I were paying more for water, I would have done it sooner.

Water might be more expensive in India than in the U.S. because there are more people and less water available per person. However, I doubt that an efficient market in water would produce a price much more than double of triple my price, after all, Indian labor is so much cheaper than here. Even at $10 per 1000 gallons, water is cheap: that works out to be about 100 rupees per cubic meter. I would be curious to know what residents in India actually pay for water.

Two recent posts got me thinking about water:
1. The post by Sunil Laxman on how an NGO trying to help a village get running water might cause unexpected problems,
2. The post by Dilip D’Souza on the politics of the water associated with a new dam in Gujarat.
In each case, I think the fundamental problem was that the water was not sold but just given away.

In Sunil Laxman’s story, an NGO tries to help a village by piping water into each home. But some homes get the water before other homes and this causes communal strife. Also, once water is piped into people’s homes, the temptation to waste water is huge. Before, people had to physically go to the common well and draw water and carry it to their homes. This labor put a price on water (a very high one, in fact) and the water was not wasted.

One solution is to create a corporation that will lay pipes to people’s homes and charge a fee for water usage. The water would be metered just like at my house. This corporation could not charge too much for water or else people would simply revert to going to the well and carrying it back to their homes. But there may be profits (if not, than it isn’t worthwhile to pipe water into people’s homes in Indian villages, an unlikely possibility but a possibility). If there are profits then firms would bid for the opportunity to be the water company and this money could be a nice windfall for the village.

The point is, if it is profitable to pipe water to people’s homes, everyone will get their water at the same time, and there will be no reason for communal strife.

In Dilip’s story, the water was going to the haves at the expense of the have-nots. Ironically, this is because it is free. In a world where you pay for water, everybody’s money is the same color. Of course, a decision to build a pipeline from point A to point B will necessarily be political, especially if that pipeline crosses political boundaries. But, in the end, everyone will get their water if they have the money to pay for it, and water is never a very expensive commodity, even in India. There won’t be any reason to shortchange the have-nots if you are selling the water, because they could buy it like anyone else. But if someone tells them they should get it for free, they may wait.

Waiting for water…what could be a bigger waste?

Monday, August 01, 2005

Outsourcing Hollywood to Bollywood

We have heard a lot in recent years about “outsourcing”: the idea of moving production to cheaper overseas locations. But while India has received outsourcing in software production and in call centers, and other industries, so far the Indian movie industry has been relatively unaffected. I suspect that this may soon change. India produces more films than any other country and they can produce films for a fraction of the cost of a Hollywood production. It is just a matter of time before someone begins seeing a way of tapping in to this capability.

I speculated about this in a comment to a nice post about Hindi films by Sunil Laxman, (who writes and excellent blog). I thought that there are two possibilities for Indian-American cooperation in film:
1. Serious movies made in English set in India and starring popular American and Indian movie stars.
2. Fun song-and-dance movies made in English designed to appeal to Americans that have never seen a musical.
I thought the recent film Bend it like Beckham (2003) showed that there was interest in movies that stared Indian actors and dealt with Indian themes, and such a movie could cross over and appeal to mainstream western audience. Bend it was an enormously profitable movie, and I suspect it made the director Gurinder Chadha very wealthy.

Last weekend, my wife rented the forgettable Bride and Prejudice (2004) made by the very same Gurinder Chadha. She was definitely thinking that there is a market for Indian style song-and-dance in the western market. The movie was based on an old Jane Austen novel, and it was kind of fun to see how they transformed it into story about modern India. But the lead characters were badly miscast. This is especially surprising considering that Chadha found the rising star Keira Knightly and as the wonderful Parminder Nagra who found some success in the T.V. show ER. In Bride, Chadha cast the no-talents Aishwarya Rai and Martin Henderson (playing an American and he is not even American) in the lead roles. This was a blunder. If she had cast the lead roles properly, it could have made double the box office. Even then, the movie did make a profit, and it proves that there may be a market for turning the typically Bollywood song-and-dance into something western audiences could enjoy.

I think that there is an enormous market for serious films set in India with Indian actors (and maybe a few American actors) made in English and dealing with real issues. These movies could be made for less $10 million and make money both in India with the English-speaking minority and in the U.S. and other English speaking countries. I would wish that Chadha would move in that direction. Bend it like Beckham was sort of like that in that it was not a campy Bollywood masala but a movie that cast Indians (or desis) in lead roles and dealt with themes relevant to Indians.

On the other hand, maybe there is a market for super campy masala type films. The genre needs a good Mike Myers-style parody. This whole genre is so silly anyway, it really lends itself to an over-the-top spoof. Here are some possible running gags.

Have fun with the dubbed songs:
1. Have the woman sing with the men’s voices and the men sing like Lata Mangeshkar.
2. The hero and heroine eat at a Chinese restaurant and then the break out into Chinese song which neither one of them understands.
3. Put a scratch in the CD moment: suddenly the music changes in mid song to another song and the hero tries his best to lip sync to the changes.
4. Have the song suddenly end, the hero and heroine keep mouthing non-existent lyrics and someone walks up and asks them, “What are you doing?”

Have fun with the classic break into dance routine: the music switches on at inappropriate times and everyone is force to dance:
1. The hero is running away from the villain. His only way to escape is to switch on the music and force everyone to dance, and he secretly dances away.
2. Have ridiculous things dance: cows, (Amit would love this), elephants, whatever.
3. Have the “match fixer villains” try to fix a cricket match by switching on the music while India is batting, but it backfires as the batsmen’s footwork improves.
4. Have the hero and heroine get a little too intimate for the Indian censors – and then the music starts forcing them to try to continue kissing while dancing.
5. Have office workers “dancing” while doing mundane office things like sitting at a desk in front of a computer or whatever.
6. This would be cool: have what would look like a typical crowd city street with all kinds of pedestrians, cows, autos and whatever and suddenly everyone breaks into dance. (We have to have dancing cows).
7. Have a major battle sequence where people with swords are killing each other and then the music starts and they start dancing (including the corpses), and the music stops and the continue killing.

Would anyone like to add to the silly song-and-dance gag list? Please comment.