Month: December 2015
Fermat’s Library
Here is Fermat’s Library:
Fermat’s Library is a platform for illuminating academic papers. Just as Pierre de Fermat scribbled his famous last theorem in the margins, professional scientists, academics and citizen scientists can annotate equations, figures and ideas and also write in the margins. Every week we send you a new paper annotated by the community.
Here is Fermat’s Library on John Nash on ideal money.
For the pointer I thank Ashok Rao.
Thursday assorted links
1. Cow dung cakes on eBay, from India.
2. “No puppyrazzi…”
3. The ten best world thinkers.
4. Timothy Taylor on secular stagnation.
5. Expansionist India? (controversial, interesting ideas but note this is a slanted take on history)
6. The best whistler in the world? “We cannot have mushy lips and be a champion!”
Best business/economics podcast award
I am pleased that my Conversations with Tyler chat with Jeffrey Sachs won this award from Quartz, here is their description:
Smart economist Tyler Cowen interviews smart economist Jeffrey Sachs in the new and infrequently released series Conversations with Tyler. The conversation is wide-ranging—they discuss China, anthropologists, the Cuban Missile Crisis, and more—but centers around Sachs’ belief that well-intentioned humans can solve even the most difficult problems. Sachs offers:”So I pulled an all-nighter, and I wrote a plan for transforming Poland from a communist, central-planned economy to a market economy.” Arguably, this is the best single podcast episode to listen to if you want to be smarter about economics.
The transcript, audio and video versions are here, the entire series of chats is here; next up is Kareem Abdul-Jabbar.
For the pointer I thank Russ Roberts, who won an award for Excellence in Podcasting Overall, which of course he well deserves.
Addendum: You can help other people discover the podcast by rating it on iTunes and leaving a review.
The rise and decline of Wikipedia?
Halfaker, Geiger, Morgan, and Riedl have a new paper on this topic (pdf), here is the abstract:
Open collaboration systems like Wikipedia need to maintain a pool of volunteer contributors in order to remain relevant. Wikipedia was created through a tremendous number of contributions by millions of contributors. However, recent research has shown that the number of active contributors in Wikipedia has been declining steadily for years, and suggests that a sharp decline in the retention of newcomers is the cause. This paper presents data that show that several changes the Wikipedia community made to manage quality and consistency in the face of a massive growth in participation have ironically crippled the very growth they were designed to manage. Specifically, the restrictiveness of the encyclopedia’s primary quality control mechanism and the algorithmic tools used to reject contributions are implicated as key causes of decreased newcomer retention. Further, the community’s formal mechanisms for norm articulation are shown to have calcified against changes – especially changes proposed by newer editors.
This is an interesting paper, but I think it undervalues the hypothesis that potential contributors simply prefer to be in on things which are both new and cool. Wikipedia, which is no longer new, cannot be so cool. That is why Beethoven’s 5th does not top the pop charts, though if it were new it might.
For the pointer I thank David Siegel.
Does the Blockchain fit well into the American legal system?
Tim Swanson has a new and interesting paper on that and related issues, here is part of the abstract:
…a ledger that does not provide a one-to-one correspondence between what the endogenous network says andwhat the exogenous jurisprudence says about the status of a financial contract is a network that cannot exist without the legacy settlement framework that it seeks to replace, for the latter will continue remain the authoritative record of ownership. In practice, the censorship-resistant aspect of “Blockchain 2.0” is impractical as a solution for financial settlements in cash, securities and other off-chain property titles.
I would put it this way. Next time you sign a contract with a corporation, try making them the following offer. You will pay two percent more (or receive two percent less), but if a prespecified set of seventeen yaks, distributed at various points around the globe, all sneeze at exactly the same time, and can be photographed with a time stamp when doing so, the corporation is to send you ten million dollars no further questions asked. By the way, they could sneeze in tandem three years from now and still you would get the money.
See how far you get. See if it matters whether they accept your argument that this is a very low probability event.
This isn’t just conformity bias, as corporations strongly prefer not leaving such risks open, even if the risk is extremely small. They like closing out a deal with finality. But in the world of the Blockchain, the 51 percent always has the last say, for better or worse.
Here is a Reddit thread on the paper.
Wednesday assorted links
Do Juvenile Curfews Increase Crime?
Washington, DC has a juvenile curfew law. Anyone “under the age of 17 cannot remain in or on a street, park or other outdoor public place, in a vehicle or on the premises of any establishment within the District of Columbia during curfew hours.” (There are exemptions for juveniles accompanied by a parent and for travel for jobs (no detours allowed.))
Curfew laws keep some juveniles off the streets during curfew hours but which ones? The criminals seem the least likely to be deterred and with fewer people on the street perhaps the criminals are emboldened.
The DC curfew switches from midnight to 11 pm on Sept 1 of every year. In a working paper, Jennifer L. Doleac and Jillian Carr test the effect of DCs juvenile curfew on gun violence by looking at the number of gunshots heard in the 11pm to midnight “switching hour” just before and just after Sept 1. From a summary:
…the September 1 change provides a clean natural experiment. If curfews reduce gun violence, then when the curfew shifts to 11:00 p.m. rather than midnight, gunfire between 11:00 p.m. and midnight should go down. Does it?
Just the opposite. Using data on gunfire incidents from ShotSpotter (acoustic gunshot sensors that cover the most violent neighborhoods in D.C.), we find that after the curfew switches from midnight to 11:00 p.m., the number of gunshot incidents increases by 150 percent during the 11:00 p.m. hour. This amounts to 7 additional gunfire incidents city-wide per week, during that hour alone. Jane Jacobs was right: the deterrent effect of having lots of people out on the streets is powerful. This makes juvenile curfew policies counter-productive.
The use of ShotSpotter data is innovative and avoids some problems with issues of police enforcement. Calls to 911, however, don’t show the same pattern as the ShotSpotter data which is worrying.
I’d also like to see more information on the proposed mechanism. Is it really the case that significantly fewer people are out on the streets at say 11:30 pm after the curfew has been lowered to 11pm than when the curfew was set at midnight? The curfew only directly affects people under 17 and, as noted above, there are quite a few exemptions. Also what are the ages of those typically arrested on the basis of ShotSpotter alerts?
By the way, on a typical day in DC there are almost 15 gunfire incidents heard by ShotSpotter (data here, the authors report 8 but that may be from a restricted sample). A lot of gunfire is heard around a handful of schools. The ShotSpotter system is quite accurate. Although it misses some shots it distinguishes shots from car backfires better than people do. I also found this note from the Washington Post amusing in a frightening way:
About a third of detected gunshot incidents in the city happen on New Year’s Eve or around July 4. Officials explain the high rate as celebratory gunfire.
Spite
This is from Eliana Zeballos, who is on the job market this year from UC Davis and appears to be a very interesting candidate. Here is part of the abstract of her job market paper (pdf):
The experimental games were conducted in Bolivia among285 dairy farmers. Results show that when participants were presented with their ranking and the earnings of others in their group, those below the group mean increased their effort whereas those above the group mean decreased their effort. When destructive actions were allowed, 55 percent of the participants were willing to forego own-consumption in order to burn others’ output; 58 percent were victims of destructive actions and lost, on average, a third of their earnings. There is an asymmetry in the direction of destruction: almost all of the highest earners suffered some destruction while only a quarter of the lowest earners were victims of destructive actions. Finally, the threat of destructive actions reduced the highest earning participants’ effort by 5.8 percent.
For the pointer I thank Ben Southwood.
NinjaEconomics on Tinder (from the comments)
I’m not convinced women who are on Tinder who say “no hookups” actually mean that.
First of all, Tinder is for young people and young women don’t have a hard time meeting men in real life. So, for someone to go to a place that is known to be where casual sex seekers meet and announce THEY aren’t at all interested in casual sex seems fishy. If I’m not in the market to buy shag carpeting that’s full of vomit and fleas, I don’t go shopping at the used carpet store that specializes in shag carpeting that’s full of vomit and fleas. I certainly don’t go there and ask where I can find silk hand-knotted rugs from Central Persia for basically the same price and get offended when I’m offered vomit and fleas.
More likely, these women are interested in hooking up (or at least open to some opportunities of it happening) but don’t want their friends and colleagues knowing this should someone come across their profile, so like the Playboy readers who buy the magazine for the articles, these women are on Tinder “just for the lulz.”
Which brings me to my second point: Despite their loud claims, women are not on Tinder to find their husbands. Getting married is easy. It is so easy that almost anyone can do it! Very unattractive, very poor, mentally unstable people can do it. Now, you might not be able to marry someone who meets all the required characteristics but if Tinder women were sincere in husband-hunting, rather than just stating “no hookups”, which is spectacularly unhelpful, they’d actually list their requirements in order to speed up the process.
And, if the internet (and online dating in particular) is so hostile to women, why would any reasonable woman who has above-average chances of meeting someone in traditional ways subject herself to unbearable and avoidable sexual harassment online? If she’ll assume the risk of verbal abuse from potential suitors, she must be very motivated to meet someone using this platform and I doubt she will be in the top 5-10% of all available women (or perhaps she’s more resilient and online interactions are not emotionally harmful to her). So compared to the top 5-10% of the men she’s vying for (attractive, educated, marriage-minded men in their 20s are quite rare), she won’t have the upper hand, so making brusque dismissals right out of the gate just seems more like an attempt to demonstrate dominance. The point is, the women who really don’t want to hook up aren’t on Tinder and the ones who do say that on Tinder aren’t being honest.
That is from NinjaEconomics, the original post is here.
Arrived in my pile
Richard Susskind and Daniel Susskind, The Future of the Professions: How Technology Will Transform the Work of Human Experts.
Joseph Henrich, The Secret of Our Success: How Culture is Driving Human Evolution, Domesticating Our Species, and Making us Smarter; both Robin and Bryan are fond of this one.
Steven Klepper, Experimental Capitalism: The Nanoeconomics of American High-Tech Industries.
Caroline Freund, assisted by Sarah Oliver. Rich People Poor Countries: The Rise of Emerging-Market Tycoons and their Mega Firms.
Clement Fatovic, America’s Founding and the Struggle Over Economic Inequality.
Rick Shenkman, Political Animals: How Our Stone-Age Brain Gets in the Way of Smart Politics.
Tuesday assorted links
1. Quora forum on the industrial organization of kitchen production. And Quora on “how much money has been spent trying to bring back Matt Damon from distant places?”
2. An economic approach to the rise and sustenance of civilization.
3. The economics and history of American craft beer.
4. College party culture is worse than you think.
5. Lawn signs for politicians seem to matter. And the pessimism of The Force Awakens.
6. Cost transparency and shame pricing. And secret data, by John Cochrane.
7. I am very sad that Edward Hugh has passed away.
How to fix restrictions on building
Stephen Smith, a well-known urban blogger, writes in the comments to Interfluidity:
Finally, I think you’re not giving us enough credit for thinking through the political challenges to urban land use deregulation. I’m well aware of the entrenched interests opposing it, and the most promising solution I’ve seen is to shift the level of governance upwards. Washington and Oregon have much stronger state-level planning laws than California, and permit about twice as much housing as a result, with much lower urban housing prices. Ontario also has strong provincial planning, and Toronto has a torrential housing stock growth rate and very low housing prices compared to similar US cities. And in Japan, the central government has a huge hand in land use regulation and localities are relatively powerless, and Japan is literally the market urbanist promised land, which a mind-blowing housing stock growth rate in Tokyo, to the point where their private railroads are profitable and one is able to undertake an incredible capital expansion project, practically without subsidies.
The pointer is from Reihan. And here is a story from my own northern Virginia: “The century-old congregation decided to sell its building, parking lot and grounds to the Arlington Partnership for Affordable Housing, which will tear down the stone structure and replace it with 173 affordable apartments.” Bravo.
The Top Ten MR Posts of 2015
Here are the top ten MR posts from 2015, mostly as measured by page views. The number one viewed post was:
- Apple Should Buy a University. People really like to talk about Apple and this post was picked up all over the web, most notably at Reddit where it received over 2500 comments.
Next most highly viewed were my post(s) on the California water shortage.
2. The Economics of California’s Water Shortage followed closely 4) by The Misallocation of Water.
3. Our guest blogger Ramez Naam earned the number 3 spot with his excellent post on Crispr, Genetically Engineering Humans Isn’t So Scary.
5. My post explaining why Martin Shkreli was able to jack up the price of Daraprim and how this argued in favor of drug reciprocity was timely and got attention: Daraprim Generic Drug Regulation and Pharmaceutical Price-Jacking
6. What was Gary Becker’s Biggest Mistake? generated lots of views and discussion.
7. Tyler’s post Bully for Ben Carson provided plenty of fodder for argument.
8. The Effect of Police Body Cameras–they work and should be mandatory.
9. Do workers benefit when laws require that employers provide them with benefits? I discussed the economics in The Happy Meal Fallacy.
10. Finally, Tyler discussed What Economic Theories are Especially Misunderstood.
Posts on immigration tend to get the most comments. The Case for Getting Rid of Borders generated over 700 comments here and over 1700 comments and 57 thousand likes at The Atlantic where the longer article appeared.
Other highly viewed posts included two questions, Is it Worse if foreigners kill us? from Tyler and Should we Care if the Human Race Goes Extinct? from myself.
The Ferguson Kleptocracy and Tyler’s posts, Greece and Syriza lost the public relations battle and a Simple Primer for Understanding China’s downturn (see also Tyler’s excellent video on this topic) were also highly viewed.
I would also point to Tyler’s best of lists as worthy of review including Best Fiction of 2015, Best Non-Fiction of 2015 and Best Movies of 2015. You can also see Tyler’s book recommendations from previous years here.
What caught my attention in 2015
This was the year when it became clear that much of Eastern Europe probably won’t end up as free societies. It’s not just semi-fascism in Hungary. Poland and Slovakia, arguably the two most successful economies and societies in Eastern Europe, took big steps backward toward illiberal governance. How can one be optimistic about the Balkans? I imagine a future where African and North African refugees are bottled up there, and Balkan politics becomes slowly worse. As for Ukraine, a mix of Russia and an “own goal” has made the place ungovernable. Where is the bright spot in this part of the world?
Nothing good happened in China’s economy, although more fingers have been inserted into more dikes. I am not hopeful on the cyclical side, though longer term I remain optimistic, due to their investments in human capital and the growing importance of scale.
I have grown accustomed to the idea that Asian mega-cities represent the future of the world — have you?
Syria won’t recover.
This was the year of the rise of Ted Cruz.
It was an awful year for movies, decent but unpredictable for books. The idea that Facebook and social media rob the rest of our culture of its centrality, or its ability to find traction, is the default status quo. Not even that idea has gained much traction. Cable TV started to receive its financial comeuppance. Yet on the aesthetic side, television is at an all-time peak, with lots of experimentation and independent content provision, all for the better. I suspect this is one reason why movies are worse, namely brain drain, but I am hoping for longer-run elasticities of adjustment into the broader talent pool.
Against all odds, Homeland was excellent in its fifth season.
I became even more afraid to move my cursor around a web page, and in terms of content, more MSM sites became worse than better. Banning photos would solve twenty percent of this problem.
Stephen Curry and Magnus Carlsen were the two (public) individuals I thought about the most and followed the most closely. Each has a unique talent which no one had come close to before. For Curry it is three point shooting at great range and with little warning; for Carlsen it is a deep understanding of the endgame as the true tactical phase of chess, and how to use the middlegame as prep to get there. It wasn’t long ago Curry’s weapons were “trick” shots, perhaps suitable for the Harlem Globetrotters; similarly, players such as Aronian thought Carlsen’s “grind ’em down” style could not succeed at a top five level. Everyone was wrong.
But here’s what I am wondering. Standard theory claims that with a thicker market, the #2 talents, or for that matter the #5s, will move ever closer to the #1s. That is not what we are seeing in basketball or chess. So what feature of the problem is the standard model missing? And how general is this phenomenon of a truly special #1 who breaks some of the old rules? Does Mark Zuckerberg count too?
I realized Western China is the best part of the world to visit right now. The food trends where I live were Filipino and Yemeni, which I found welcome. Virginia now has a Uighur restaurant in Crystal City, and the aging San Antonio Spurs continue to defy all expectations. Kobe Bryant, who “ranks among the league’s top 5 percent of shot-takers and its bottom 5 percent of shot-makers,” has redefined the retirement announcement, among other things.
Top curling teams say they won’t use high-tech brooms. Just wait.
Guyana fact of the day
Exxon Mobil, under contract from the Guyanese government, announced the discovery of vast amounts of oil in the disputed Essequibo region. The finding could be worth more than 10 times Guyana’s current economic output.
The story is here.