Can Testosterone Help Women Earn More Money?

You may have heard that women get paid less than men. How big the difference is not always clear. Read Women and the Pay Gap. Now there is research on how testosterone affects pay. This is from the University of Chicago alumni magazine Risky business.

"In general, women tend to avoid the risks that men undertake more frequently, but testosterone may provide an equalizer. Studying the connection between testosterone and high-risk financial careers, Chicago Booth economist Luigi Zingales, comparative human-development professor Dario Maestripieri, and Northwestern University Kellogg School economist Paola Sapienza found that the hormone played an important role for women. The researchers began with a sample of 500 Chicago Booth MBA students; 36 percent of the women chose jobs like investment banking or trading, compared with 57 percent of the men. Higher testosterone levels correlated with greater risk-appetite in women, though not in men. But in men and women with similar testosterone levels, risk-related gender differences disappeared. The findings appeared in the August 24 Proceedings of the National Academy of Sciences."

Looks Like Some Pretty Good Capitalists Run The Congress

Go to Policy, portfolios and the investor lawmaker: As stock ownership rises in Congress, experts warn of potential ethics concerns from the Washington Post this past week.

Most members of the House of Representatives own stock. The article says "The investments increasingly put lawmakers in the position of voting or advocating on matters that could affect their personal wealth, whether the lawmakers realize it or not."

Politicians who rarely agree on anything might be found to be voting for the same bill if it matters to their pocket book. They are supposed to report what they own but the drag their feet and the records are not very well computerized, so they are harder to analyze. And they are good at this investing stuff. From 1985-2001, the legislators beat the market by .55 basis points a month. In a year that means 6.6 percentage points above the market.

In that time, the market (DJIA) gained just a bit under 1% a month (from 12-31-85 to 12-31-2001). It went from 1,546 to 10,021. So, if you had $1,546 in the market it became worth $10,021. But, if you were a member of Congress, it rose about 1.5% a month and you would have ended up with $26,970. Each dollar in the market grew into $6.48 while for the lawmakers it grew into $17.44.

"The researchers, whose findings were presented at a congressional hearing in July, said the statistics suggest that those unusual returns must be based on lawmakers' access to "government and important social contacts.""

But legislators acting on their self interest is not new. Charles Beard wrote about this in his book An Economic Interpretation of the Constitution of the United States. He argued that self-interest was a big force in how the framers wrote the constitution.

In the 1950s, Forrest McDonald We the People : The Economic Origins of the Constitution, in attempt to refute Beard. But more recently, economic historian Robert A. McGuire wrote a book called To Form a More Perfect Union: A New Economic Interpretation of the United States Constitution. He used modern statistical analysis to show that the Beard thesis may be legitimate.

My students might recall something like this that I talk about on the first day of the semester. Congressmen in the early 1790s voted on the "Funding and Assumption Act" based on how much money they would receive if that bill passed. The bill paid back all of the debts from the Revolutionary War at full value (they were not getting paid back before the Constitution was passed because under the Articles of Confederation all states had to agree to a tax increase-this did not happen much so taxes were never raised to pay back the money the government borrowed to finance the war). But under the Constitution if both the House and the Senate passed a tax increase and the president signed it, it became law.

The debts were securities or bonds. Some congressman owned them. I found how much about half the congressmen owned in these bonds from McDonald's book. The ones who voted yes on the bill had an average of about $6,000 while the ones who voted no had about $700. So it is possible that money influenced the vote.

I Have Alot To Be Thankful For Since I'm Soon Going To Be Rich!!

I got this email a few days ago and it looks like it is from a famous economist. Anybody have any suggestions as to what I should do with $10 million?

"Chairman Federal Reserve Bank New York

We received the instructional letter to credit $10.5million to your account. We wish to let you know that all charges are waived for the sucess of this contract fund to be credited into the your account.

Your respond is required to enable us credit your account without any further of delay and you are also required to get back to us with the reconfirmation of your banking particulars for we to know if what we have in file is correct and to avoid crediting your fund to wrong account.

Please be fast on this matter.

Regards,
Bzen S. Bernanke"

Senators And Representatives Get Paid To Talk, But Do We Always Know Who Is Paying Them?

These legislators make lots of speeches and ask questions at congressional hearings. That is part of their job and maybe they like doing that sort of thing (which might explain why they ran for office in the first place). So you might assume that the taxpayers are paying them to talk. But maybe not. The New York Times had an article recently called In House, Many Spoke With One Voice: Lobbyists’. Here is the intro:

"In the official record of the historic House debate on overhauling health care, the speeches of many lawmakers echo with similarities. Often, that was no accident. Statements by more than a dozen lawmakers were ghostwritten, in whole or in part, by Washington lobbyists working for Genentech, one of the world’s largest biotechnology companies. E-mail messages obtained by The New York Times show that the lobbyists drafted one statement for Democrats and another for Republicans."

It later says

"In recent years, Genentech’s political action committee and lobbyists for Roche and Genentech have made campaign contributions to many House members, including some who filed statements in the Congressional Record. And company employees have been among the hosts at fund-raisers for some of those lawmakers."

So it looks like this company is actually paying the representatives to say what they want them to say. This reminds me of an Associated Press (AP) article from way back in 1993 (before the internet was widespread). It described how political action committees (PACs) were requiring senators and representatives to sign pledges of what their positions were on various issues before they got their campaign contributions. Of course, the PACs would not be giving money to politicians on the "wrong" side of the issue. It sounded like vote buying back then and it still does. The article was "Interest Groups Use Pointed Questionnaires As Lobbying Tactic" by Jim Drinkard and was issued by the AP on March 26, 1993. I don't think it is online anywhere.

Did The Yankees Buy A World Championship In 2009?

This is actually a cross over post from my Cybermetrics blog. To read it click here.

The Mortgage Delinquency Rate Hits An All-Time High

In two of my classes this week we discussed the housing crisis over the last few years. The latest news is reported in Mortgage loans: Record number are late. According to the article, "In the third quarter, 9.64% of all mortgage loans were delinquent..." and "The combined percentage of loans in foreclosure or at least one payment past due was 14.41% on a non-seasonally adjusted basis, the highest ever recorded in the MBA delinquency survey."

In a related article Foreclosure plague: It's spreading, McAllen, Texas is reported to have the fastest growing rate. And with the high unemployment rate, the foreclosure and delinquency rates could go higher. To see a map of the unemployment rates for each state, go to Where does your state rank?

Leggo Your Eggo: There's a Waffle Shortage

That is the title of a news article which you can read here. According to the article, "Kellogg is rationing its Eggo products due to flooding and equipment problems at two bakeries. The shortfall could last through mid-2010." So the solution? The article says "Remaining inventory will be rationed to stores across the country "based on historical percentage of business.""

Why not let the price rise? That way there won't be lines of people waiting to get them or people calling the stores or the stores having to establish waiting lists. Are stores going to set limits on how many you can buy? What if you are the first person in the store, are they going stop you from buying all that is there?

Three years ago strange things happened when Play Station 3 came out. Instead of charging a higher price at first, it was at the normal price. So there were long lines and certain people got first dibs. You will be surprised who. Read about that at this link.

Late Breaking News Bulletin: The depression is over! We're out of the red!

So said an enthusiastic character in the 1934 movie Stand Up and Cheer!. Here is the video clip of the man getting worked up about how everything has turned around. The text is below the clip in case the sound is not good enough.



Here is a link to the video file: We're out of the red!

Mr. Cromwell, I've got great news for you.
The depression is over.
Over, do you realize that.
Factories are opening up.
Men are going back to work by the thousands.
Our farm products are being sold the world over.
Savings accounts are heaping up.
The banks are pouring out new loans.
There is no unemployment.
Fear has been banished.
Confidence reborn.
Poverty has been wiped out.
Laughter resounds throughout the nation.
The people are happy again.
We're out of the red.

Here is the movie's IMBD synopsis: "President Franklin Roosevelt appoints a theatrical producer as the new Secretary of Amusement in order to cheer up an American public still suffering through the Depression. The new secretary soon runs afoul of political lobbyists out to destroy his department." I guess they were trying to make people feel better. Unemployment was 25% in 1933. This was one of the first big roles for Shirley Temple.

Get out of here and get me some money too

That is a line from a song that Peggy Lee (1920-2002) is well known for singing. Below is a video of her singing it with Benny Goodman (1909-86) and his orchestra. KRTU played it on the radio this morning and I have been meaning to post this for awhile. The lyrics are printed below the video.



The video is online at Peggy Lee - Why Don't You Do Right (1943). Here are the lyrics which I got at Why Don't You Do Right.

Why Don't You Do Right

You had plenty money, 1922
You let other women make a fool of you
Why don't you do right, like some other men do?
Get out of here and get me some money too

You're sittin' there and wonderin' what it's all about
You ain't got no money, they will put you out
Why don't you do right, like some other men do?
Get out of here and get me some money too

If you had prepared twenty years ago
You wouldn't be a-wanderin' from door to door
Why don't you do right, like some other men do?
Get out of here and get me some money too

I fell for your jivin' and I took you in
Now all you got to offer me's a drink of gin
Why don't you do right, like some other men do?
Get out of here and get me some money too
Why don't you do right, like some other men do?
Like some other men do

For People Who Still Have Jobs, Women's Wages Have Risen Faster Than Men's During The Recession

This was reported in a Wall Street Journal article called Women's Wages Outpaced Men's During Recession. The increase in median wages for women was 3.2% while it was 2.0% for men. The article gives a pretty thorough run down on how various demographic groups have done during the recession. Men now have an 11% unemployment rate while women have 8.4%.

Being Happy Might Hurt Your Bottom Line

This came up in two articles recently. The first is Don’t Worry, Be Happy: The Warranty Psychology. The article suggests that people are very happy when they make a big purchase like a refrigerator. So they are willing to pay alot for an extended warranty, especially if they got a discount on the product. But the price of the warranty is often too high. If a product has a 10% chance of failure, you don't want to pay more than 10% of the product price for the warranty. But people often do. To avoid this, the article concludes with "The lesson is simple: Stay grouchy while shopping."

The other article is Sadder But Wiser. It discusses research by Joseph Forgas, a professor of psychology at Australia's University. The article says "Sometimes, he finds, it pays to be sad." Also, " a bad attitude makes us more critical of what we are told and less easily duped."

Here is more:

"Not only can a mild malaise keep us from being bamboozled, but we are more perceptive and have sharper, more accurate recall when we're down in the dumps. The professor tested people on their ability to remember items viewed on a cluttered table. On a dreary, drizzly day, people "had better eyewitness memory for what they saw" than those tested "on a bright, sunny day.""

"The Icelandic mood may have been knocked down a peg or two by the collapse of the country's economy, but that may not be such a bad thing. Could it be that Iceland's positive disposition is what got it into such a mess in the first place? If a dour mood dispels credulity, then where better to peddle monumental scams than in a nation awash in good feelings?"

"The method-acting crowd long ago perfected the technique of dredging up memories of life's awful moments to produce compelling stage tears. A similar technique could have business applications. A maudlin and well-timed musing on the death of your childhood dog could save the company millions.

On the flip side, a salesman looking to close a deal should do his best to induce a warm wave of good feelings. Remember, a happy customer is a rather less critical customer. The customer may want to adopt a crotchety counter-strategy akin to the old saw about not going grocery shopping when hungry: Don't do any sort of shopping when you're cheery."

One more thing. Don't have a nice day.

Sports, Economics and Politics Collide When Government Officials Get World Series Tickets

The article is Lawmakers Score Ticket Deal: Baseball Sells Officials Scarce World Series Seats at Face Value, Far Below Going Rate. Why would teams give up profit? My guess is that something else is in the offer, something only politicians can trade. Here is the intro to the article:

"Tickets for Wednesday's World Series game are nearly impossible to come by at face value. But that isn't the case if you are a member of Congress or one of their aides.

Federal lawmakers and people who work for them have gotten their hands on scores of tickets to the sold-out World Series games this year between the New York Yankees and Philadelphia Phillies courtesy of a perk not available to the public.

Major League Baseball and the teams sell a limited number of prime seats to lawmakers and congressional aides at face value, often hundreds of dollars less than the going rate.

The league has sold about 75 World Series tickets to a total of 15 lawmakers or aides in the past week, according to Pat Courtney, a spokesman for Major League Baseball. Mr. Courtney declined to identify which lawmakers and aides sought the tickets.

Because the recipients pay for the tickets, the offer complies with ethics rules for Congress and the executive branch. The arrangement, however, highlights what some ethics watchdogs say is a loophole in recently tightened congressional ethics rules, which ban officials from receiving just about any gifts.

"Anytime you have access to something that regular people don't have, it should be considered a gift," said Melanie Sloan, executive director of the nonpartisan Citizens for Responsibility and Ethics in Washington. "Regular people can't call the Major League Baseball office and get tickets.""

Want Your Neighbors To Know How Much You Made Last Year And Your Net Worth? Move To Norway

Every year the govenment publishes the "skatteliste" or "tax list" "to uphold the country's tradition of transparency." Some people say that this is the way democracy is supposed to work. But not everyone agrees. For example

"Besides providing criminals with a useful tool to find prime targets, he said the list generates playground taunts of my-dad-is-richer-than-your-dad.

"The children of people with low wages are being teased about it in the schools," Stordrange said Thursday. "People with low salaries are being met with comments at the grocery store, 'How can you live on these low wages?'""

The article is Lutefisk and loot: Tax records open in Norway

Some Women Actually Want Polygamy Legalized

The reasons seem to be mainly economic. It was in a
New York Times article. It was an actually an exerpt of another, longer article (link below). Here is what the Times article said:

"Women in Siberia are lobbying to legalize polygamy, a Cambridge University anthropologist reports in The Guardian in London. The critical issue is demography. Population is falling and there are fewer men than women. Caroline Humphrey, the anthropologist, said: “Women say that the legalization of polygamy would be a godsend: it would give them rights to a man’s financial and physical support, legitimacy for their children, and rights to state benefits.” Meanwhile, some Russian nationalists claim that introducing polygamy in the country would provide husbands for “10 million lonely women” and fill Mother Russia’s cradles."

The more in depth article, which discusses research by an anthropologist is 'Half a good man is better than none at all: 'A study of polygamy in Russia suggests we have a lot to learn about how to beat the recession.

Structural Unemployment In The News

In my principles of macroeconomics courses and my survey of economics course we have covered the different types of unemployment. They are seasonal, structural, frictional and cyclical. One of the articles is called Even as layoffs persist, some good jobs go begging. Here is the intro:

"In a brutal job market, here's a task that might sound easy: Fill jobs in nursing, engineering and energy research that pay $55,000 to $60,000, plus benefits.

Yet even with 15 million people hunting for work, even with the unemployment rate nearing 10 percent, some employers can't find enough qualified people for good-paying career jobs.

Ask Steve Jones, a hospital recruiter in Indianapolis who's struggling to find qualified nurses, pharmacists and MRI technicians. Or Ed Baker, who's looking to hire at a U.S. Energy Department research lab in Richland, Wash., for $60,000 each.

Economists say the main problem is a mismatch between available work and people qualified to do it. Millions of jobs with attractive pay and benefits that once drew legions of workers to the auto industry, construction, Wall Street and other sectors are gone, probably for good. And those who lost those jobs generally lack the right experience for new positions popping up in health care, energy and engineering."

The "mismatch between available work and people qualified to do it" sounds very much like how I define structural unemployment in class. This article uses one of the kinds of structural unemployment I discuss in class, when there is a fall in demand for the good or service you help produce. That is what many people face.

Another kind of structural unemployment is when you are replaced by a machine or technology. There is a computer program called "Stats Monkey" that will write a story about a baseball game when it is fed the stats from the boxscore and the complete play-by-play of the game. You can read about it at The Robots Are Coming! Oh, They’re Here. So it looks like some sports writers will be losing their jobs. This is okay as long as computer programs can't write blog entries:)

Crime and Punishment: Required Reading in My Economics Class

Okay, it is not the book Crime and Punishment by Fyodor Dostoevsky (this is a link to the entire book online). I will come back to this book. My students are required to read a chapter by this name from the book The Economics of Public Issues. It is only 5 pages long while the famous book is over 500.

One of the interesting things mentioned in this chapter is research by Steven Levitt. It deals with the question of whether or not more police officers means less crime, everything else being held constant. The problem is that cities with high crime rates will have to hire more police officers (it is the opposite for low crime cities). So it is hard to find a meaningful correlation. But this paragraph from the book shows how he got around that problem:

"In the case of police, Levitt has found that election cycles tend to have a strong independent effect on the size of police forces, enabling him to identify the impact of police on crime rates. Because crime is such a hot political issue, both mayors and governors have strong incentives (and the ability) to push for more police funding in election years. The result is that even though police forces in major cities tend to remain constant in nonelection years, they grow by about 2 percent in an average election year. Although this may sound small, it is (1) large enough to have a significant impact over several election cycles, and thus (2) large enough to detect clearly in the data."

So we can see that crime goes down when more police get hired in election years. Each city gets compared to itself, so the problem mentioned above is avoided.

Now back to the Dostoevsky book. Below are two passages that relate to economics and one sounds like the invisible hand.

"But Mr. Lebeziatnikov who keeps up with modern ideas explained the other day that compassion is forbidden nowadays by science itself, and that that's what is done now in England, where there is political economy." (economics used to be called political economy)

"if I were told, 'love thy neighbour,' what came of it?" Pyotr Petrovitch went on, perhaps with excessive haste. "It came to my tearing my coat in half to share with my neighbour and we both were left half naked. As a Russian proverb has it, 'Catch several hares and you won't catch one.' Science now tells us, love yourself before all men, for everything in the world rests on self-interest. You love yourself and manage your own affairs properly and your coat remains whole. Economic truth adds that the better private affairs are organised in society--the more whole coats, so to say—the firmer are its foundations and the better is the common welfare organised too. Therefore, in acquiring wealth solely and exclusively for myself, I am acquiring, so to speak, for all, and helping to bring to pass my neighbour's getting a little more than a torn coat; and that not from private, personal liberality, but as a consequence of the general advance."

More online versions of the book.

Anxious? High Strung? You Might Be The Ideal Worker

There was an interesting article a few weeks ago in the New York Times magazine called Understanding the Anxious Mind by ROBIN MARANTZ HENIG. It discusses a study of anxiety that looks at subjects from birth as they age. Here is one interesting exerpt:

"LOOKING AT THE neurology of anxiety raises the inevitable question of why a trait that causes so much mental anguish would have evolved in the first place. For the species as a whole, it is most likely an advantage to have some group members who are hypervigilant and who see everything as a threat, always ready to sound an alarm and leap into action. For the individual, though, being inhibited can mean having fewer mating opportunities, not to mention the psychic burden, wearing yourself ragged with a brain that’s always on high alert.

In the modern world, the anxious temperament does offer certain benefits: caution, introspection, the capacity to work alone. These can be adaptive qualities. Kagan has observed that the high-reactives in his sample tend to avoid the traditional hazards of adolescence. Because they are more restrained than their wilder peers, he says, high-reactive kids are less likely to experiment with drugs, to get pregnant or to drive recklessly. They grow up to be the Felix Ungers of the world, he says, clearing a safe, neat path for the Oscar Madisons.

People with a high-reactive temperament — as long as it doesn’t show itself as a clinical disorder — are generally conscientious and almost obsessively well-prepared. Worriers are likely to be the most thorough workers and the most attentive friends. Someone who worries about being late will plan to get to places early. Someone anxious about giving a public lecture will work harder to prepare for it. Test-taking anxiety can lead to better studying; fear of traveling can lead to careful mapping of transit routes.

Kagan told me that in the 40 years he worked at Harvard, he hired at least 200 research assistants, “and I always looked for high-reactives. They’re compulsive, they don’t make errors, they’re careful when they’re coding data.” He said he would bet that when the United States sends people up in space, the steely, brave astronauts were low-reactive as infants, and the mission-control people down on the ground, doing the detail work that keeps the craft aloft, were high-reactive.

An anxious temperament might serve a more exalted function too. “Our culture has this illusion that anxiety is toxic,” Kagan said. But without inner-directed people who prefer solitude, where would we get the writers and artists and scientists and computer programmers who make society hum? Kagan likes to point out that T. S. Eliot suffered from anxiety, and that biographies indicate that he was a typical high-reactive baby. “That line ‘I will show you fear in a handful of dust’ — he couldn’t have written that without feeling the tension and dysphoria he did,” Kagan said."

What If You Discovered That You Liked Celine Dion? (How One Company Tried To Determine Buyers' Tastes And Preferences)

The article is called The Song Decoders and it was in the New York Times magazine a couple of weeks ago. It is about a company called Pandora. I think the intro gives you a good idea of what they do. It is below but the entire article is very interesting and raises the question of "can you scientifically predict someone's tastes for a given product?" In economics, we say that tastes and preferences affect demand but we usually don't talk much about them. That is what makes this article so important. Now the intro:

"On first listen, some things grab you for their off-kilter novelty. Like the story of a company that has hired a bunch of “musicologists,” who sit at computers and listen to songs, one at a time, rating them element by element, separating out what sometimes comes to hundreds of data points for a three-minute tune. The company, an Internet radio service called Pandora, is convinced that by pouring this information through a computer into an algorithm, it can guide you, the listener, to music that you like. The premise is that your favorite songs can be stripped to parts and reverse-engineered.

Some elements that these musicologists (who, really, are musicians with day jobs) codify are technical, like beats per minute, or the presence of parallel octaves or block chords. Someone taking apart Gnarls Barkley’s “Crazy” documents the prevalence of harmony, chordal patterning, swung 16ths and the like. But their analysis goes beyond such objectively observable metrics. To what extent, on a scale of 1 to 5, does melody dominate the composition of “Hey Jude”? How “joyful” are the lyrics? How much does the music reflect a gospel influence? And how “busy” is Stan Getz’s solo in his recording of “These Foolish Things”? How emotional? How “motion-inducing”? On the continuum of accessible to avant-garde, where does this particular Getz recording fall?

There are more questions for every voice, every instrument, every intrinsic element of the music. And there are always answers, specific numerical ones. It can take 20 minutes to amass the data for a single tune. This has been done for more than 700,000 songs, by 80,000 artists. “The Music Genome Project,” as this undertaking is called, is the back end of Pandora.

Pandora’s approach more or less ignores the crowd. It is indifferent to the possibility that any given piece of music in its system might become a hit. The idea is to figure out what you like, not what a market might like. More interesting, the idea is that the taste of your cool friends, your peers, the traditional music critics, big-label talent scouts and the latest influential music blog are all equally irrelevant. That’s all cultural information, not musical information. And theoretically at least, Pandora’s approach distances music-liking from the cultural information that generally attaches to it."

Fed Officials Disagree On Threat Of Inflation

The Fed, or Federal Researve Board, controls monetary policy in the United States. The more money in the economy, the more demand for all goods and services, holding all other factors constant (this total demand is called aggregate demand or AD). The price level in the economy and the total output or quantity produced in the economy is determined by the interaction of AD and aggregate supply (in this case I am interested in something called short-run AS or SRAS-so yes there is a long-run AS but that is not the important issue here).

The graph below shows two possible AD lines. Notice that as AD moves to the right, the price level (and therefore the inlfation rate) will increrase faster and faster. So we need to be careful not to let AD move past QF, which is called the full-employment GDP or level of output. But right now Fed officials disagree as to how close AD is to this point. The closer it is, the more careful we have to be in increasing the money supply.

A Wall Street Journal Article, Fed Vice Chairman Sees Tamed Inflation Threat. Here are the conflicting statements:

""I expect the persistence of economic slack, accompanied by stable longer-term inflation expectations, will keep inflation subdued for some time," Mr. Kohn said. "The substantial rise in the unemployment rate and the plunge in capacity utilization suggest that the margin of slack in labor and product markets is considerable. Long-term inflation expectations remain stable, and inflation itself could move "appreciably lower" should expectations decline, Mr. Kohn noted."

And

"His views contrast with those of others, including St. Louis Federal Reserve Bank President James Bullard, who this week warned that the existence of "slack" could be exaggerated, posing potential inflation problems in the medium term."

In the graph below, I have two AD lines, on representing the comments of each economist. The one for Kohn has alot more room to move to the right without increasing prices or inflation very much. If he is right, then there is alot more the Fed can do to help the economy recover. But if Bullard is right, and if the Fed tries to add money and AD to the economy, prices will rise very quickly because the SRAS line starts getting very steep past QF.

Beeville, Texas Makes The Wall Street Journal

But, unfortunately, the news is not good. It is all about how the town has been impacted by the recession. The article is Drop in Natural-Gas Prices Deflates South Texas. Here are the first few paragraphs:

"BEEVILLE, Texas -- The county clerk's office in this South Texas town was abuzz last year as natural-gas prospectors pored over property records, searching for the next place to sink a well.

But things are much quieter now in the domed courthouse in the town square; natural-gas prices have plunged and energy companies have pulled way back on drilling, particularly in older gas fields like those that dot this part of the state.

People across the country who heat their houses with natural gas have benefited from falling gas prices, which have dropped nearly 65% from their high in July 2008 of more than $13 per million British thermal units, to about $4.78 per million BTUs on Friday.

But here in Beeville, about 100 miles southeast of San Antonio, the price drop has made life a little tougher. The unemployment rate has climbed to 10% from 6.9% a year ago; the jobless rate is the highest here since 1993 and is among the highest in this part of the state. Residents say there are fewer cars on county roads and fewer customers at the local movie theater's evening shows.

Things were different last year, when oil and gas companies flocked here to search out energy reserves. That push boosted the local economy, starting with landowners who saw fatter royalty checks and industry workers who found themselves in strong demand. It spread, too, through companies that provide services to the industry and the restaurants and stores where the additional money was spent."