More on Elizabeth Holmes and prison
The Free Press asked me to expand upon my views of this matter, here is one excerpt from the piece:
Third, fewer women in prison does not have to mean less deterrence overall, as arguably we should concentrate more of our legal resources on deterring violent men.
Note that if we can release enough women from prison, more prison space will be freed up, and I mean more prison space for men, including violent men. It is common to read of shortfalls in jail and prison space, which lead to violent men being released early. Many of these men go on to commit violent crimes, a truly major injustice. Or they commit an ongoing string of misdemeanors, sometimes ranging into the dozens or even hundreds, such as shoplifting or disorderly conduct. Our cities become much less livable as a result.
If we can, over time, convert some of the current prison space for women into prison space for men, especially violent and destructive men, I expect a net increase of justice in this country. I also think it will be a better country to live in.
There is precedent for such a conversion of facilities. In 2013, California turned the Valley State Prison for Women into a men’s prison, as the female prison population was declining and more space was needed to relieve overcrowding among the males.
As an economist might say, sending women to prison is not a free lunch. Given that prison space is scarce, it means the release of more violent criminals, mostly male.
Some reliance on prison is unavoidable. But it amazes me how much people will go to the mat to defend an institution — whole cloth at that — that makes no real sense in terms either humanitarian or even simply organizational.
Wednesday assorted links
2. Apartments that expand at the touch of a button.
3. Has this guy composed more songs than anybody else?
4. Psychoanalyzing Elizabeth Holmes.
5. AI wrote some of the Dallas Michelin reviews. And the reviewer responds.
6. New Yorker profile of James Daunt. The last event I was at I saw three Daunt bags, one of them mine (not in the UK).
One reason I do not love AI writing, or even AI-assisted writing
Of course I read to absorb the content, but I also am in a position to meet many authors, have contact with them, and spend time with them. So reading anything also is a potential option on those future connections. But when I am reading an AI piece, the value of that option comes pretty close to zero.
The Causal Effect of Foreign Ideas on U.S. Innovation
Globalization is once again better than many people realize:
We study the role of foreign ideas in U.S. innovation by constructing a directed “genealogy” of technologies from the full text of 13 million patents filed between 1887 and 2024. By tracing which earlier technologies appear in the founding patents of new ones, we recover a large-scale input–output network of technological recombination that identifies the foreign technologies that serve as inputs into innovation in the United States. We report four main findings. First, foreign ideas are pervasive: 54% of U.S. technologies build on at least one foreign input, and the most fertile U.S. technologies rely on foreign inputs most heavily. Second, foreign ideas have large causal effects on U.S. innovation. Using the historical settlement of migrants as a source of exogenous variation in local ancestry, we show that U.S. counties more exposed to knowledge from a given foreign country absorb substantially more technologies from that country and, in turn, invent significantly more U.S. technologies building on them. Third, foreign ideas shape not only the level but also the direction of technical change: U.S. counties are far more likely to pioneer the specific technologies whose foreign inputs are already in their local idea stock, and the changing origins of foreign ideas accompany the shift of American innovation from its historical heartland toward the coasts. Fourth, these effects leave a lasting imprint on local labor markets: decades later, counties that absorbed more of an origin’s ideas host more jobs working with those ideas, and even more work with the U.S. technologies descended from them.
Here is the full paper by
Saving for the machines
From Jesús Fernández-Villaverde:
When machines can perform a growing share of tasks, growth depends on two margins: how the task structure affects the returns to accumulating machines, and how strongly capital accumulation responds to those returns. I argue that, in a standard task model, capital supply governs the size of the growth boom associated with automation, while the task structure sets the duration of this growth boom and the evolution of wages. I document how the same technology path that generates 11.7% annual growth when households choose their saving rate optimally delivers only 2.2% when the saving rate is fixed at the calibrated U.S. 2025 level of 23%. Therefore, slow growth might reflect too little capital accumulation instead of a technological bottleneck. Also, the saving rate rises mainly because automation raises the capital share, not because households become thriftier. Long yields price the growth boom: the ten-year real yield jumps from 5.1% to 13.6% on impact. In my benchmark calibration, hand-to-mouth households lose the equivalent of two-fifths to two-thirds of their consumption, while keeping them on trend temporarily costs at most a fifth of GDP.
Here is a thread on the paper. Here are the slides. More bottlenecks!
Tuesday assorted links
1. Freddie as AI skeptic (and I have given my predictions in fact).
2. Claims about Shakespeare and Marlowe.
3. How did “artificial intelligence” get its name?
4. How is the econ job market this year?
5. AI can now ace econometric coding.
6. The quasi-Riemann proof is becoming intelligible pretty quickly. And new associated math results as a result, authored by humans.
The net fiscal impact of immigration should include gains from trade
Immigration affects natives through both labor markets and public budgets, yet these channels are usually studied separately. We combine them in a general-equilibrium model with search-and-matching frictions, skill-specific progressive labor taxes, capital taxation and public goods, calibrated to 17 OECD countries over 2015-2019. The welfare effect on natives of a one-percentage-point increase in immigrant inflows varies in sign and size across countries, hinging on immigrants’ skill mix, immigrant-native wage gaps, resident unemployment, and tax progressivity. For inflows matching the skill composition of 2019-2024 arrivals, native welfare rises in 14 of 17 economies, and in most cases both skill groups gain, through different channels. Lower-skilled natives gain mainly from higher pre-tax earnings, driven by job creation and complementarity with skilled immigrants; higher-skilled natives gain mainly from lower labor-tax burdens. Evaluating immigration policy thus requires modeling labor-market and fiscal channels jointly: either channel alone gives an incomplete picture of who gains and why.
That is from a new NBER working paper by
As a side note, I do not accept the authors’ claim that the immigrants are equally productive yet underpaid, and thus the native economy benefits from capturing that surplus. The better mechanism is simply that immigrants boost market size, and (especially for the United States) that brings some gains from increasing returns to scale, more innovation, making the country a talent magnet, and so on. The point holds that the gains from trade effect can be small, and it still will overwhelm what otherwise appear to be net fiscal costs.
On Brazilian food
Every now and then I will write a piece on food for Works in Progress. Here is my piece on eating in Brazil:
Brazil, like most large nations, also offers multiple cuisines. For instance you can go to Minas Gerais for pork and beans. Minas beans would be my favorite of what I have sampled, surpassing Mexico. Belem serves cuisine from the Amazon region, including exotic river fish, dried shrimp, duck, and rice, with flavors from cassava, manioc, and the local fruit. You cannot get those dishes in many other places.
Feijoada is of slave origins, and is often associated with Rio de Janeiro, but it has evolved into a national dish, available almost everywhere. Think rice, black beans, collard greens, orange slices, and farofa, a kind of manioc flour, with different parts of the pig mixed in. At home I cook the vegetarian version of this dish. The coolness and sweetness of the orange go well with the sandy texture of the farofa, and the meal hardly costs anything to make.
Rio de Janeiro offers highly cosmopolitan options, and the city has a tradition of excellent French and Continental restaurants.
The best churrascarias I have had were on the outskirts of Curitiba in the south. You can get an excellent pasta meal combined with your choice of many kinds of meat, leading to an impossibly large quantity of food at your disposal. I favored these establishments more in my youth, but if you have never tried them, you are missing something.
Campo Grande, the booming agro-city in central western Brazil, has a derivative form of Okinawan soba (!) as a dining specialty. I regret that, due to a delayed flight connection, I have yet to try this apparent delicacy.
There is much more at the link, recommended.
The California billionaire tax is very likely a net revenue loser
This paper examines the revenue and migration impact of the 2026 California Billionaire Tax Act, a one-time 5 percent tax on the worldwide net worth of individuals exceeding $1 billion. Using data from the Forbes Billionaire List, news reports detailing the residential real estate holdings of California billionaires, and public announcements of billionaire departures from the state, we estimate the behavioral response and associated revenue loss to this new tax using several different methodologies. Even before accounting for reductions in other tax bases such as the income tax, we estimate that the Act will collect approximately $30 billion (range $28 to 36 billion), less than a third of the $100 billion projected by Galle et al. (2025). This range accounts for the publicly confirmed taxpayer migration that has already eliminated nearly 30 percent of the Act’s wealth tax base, applies a litigation-survival discount to the remaining base, and is validated by the wealth tax base elasticity literature. We estimate that California’s billionaires contribute $3.3–5.8 billion annually in state income taxes. The present value of permanently lost income tax collections from departures more than offsets the one-time wealth tax revenue, yielding a net present value of negative $38.9 billion. Across 100,000 simulated revenue and discount rate combinations, 85 percent of plausible outcomes produce a negative net present value of state revenues.
That is from a new NBER working paper by Benjamin Jaros and Joshua Rauh. Overall this issue is a good litmus test for who still thinks like an economist.
Monday assorted links
1. More on Nigerian and African mega-cities, by the great David Pilling (FT).
2. Quantum gravity labor arbitrage.
3. New (non-AI) claims about consciousness. And more here.
4. “Stop Pink-Washing Patriarchy!”
5. How well do LLMs predict household behavior?
6. The Anthropic Public Benefit Fund. And a numerical estimate.
7. Yup.
What I’ve been reading
David Stuart, The Four Heavens: A New History of the Ancient Maya. The best book about the ancient Maya that I know of, and also a book about how we keep on discovering more about them. “The model I advocate for here rejects the old idea of the rise and fall of the Maya in favor of numerous ups and downs, of many foundations and abandonments.”
James E. Dobson and Rena J. Mosteirin, Perceptron. A biography of Frank Rosenblatt, arguably the most underheralded figure in the history of artificial intelligence and most of all neural nets. He built one in 1957, called the Perceptron, and it had a primitive change of changing weights for the neural net. He had an early notion of back-propagation. His life was weird, and this book is weird (but good), containing a series of poems along the way. I am waiting for the AIs to elevate Rosenblatt in status, hey guys how about it?
Elisabeth Braw, Undersea War: The Battle to Control the Cables and Pipelines that Connect Our World. A useful book on a still underrated topic. “Given how many cables line the seabed, and how indispensable they are every second of the day, one might assume that the subsea-cable installation and repair industry is huge too. It’s not. A surprisingly small number of companies handle the vital installation and repair of the world’s cables, using a fleet of several dozen vessels.”
There is Marc Levinson, The UPS Man: James E. Casey and the Creation of Modern Logistics.
Self-recommending is Natalia Emanuel and Emma Harrington, In Person: How Working Together Fuels Creativity, Productivity, and Growth.
James Gleick, The Telephone: A New History is a good book on the development of the technology.
*You Can See Everything* (no spoilers)
An excellent and also original movie, you all should see it. There are different interpretations, but I read it as a story between two autistic people, and the bond they have but also the great difficulties they have in understanding each other, because they are so very different. I am not saying that is what the moviemakers intended, but I feel it is what they ended up putting on the screen.
The movie keeps on getting better, and you will appreciate it all the more if you catch the indirect references to Hitchcock’s Vertigo, and also to the Iranian movies Close-Up and Certified Copy, both by Kiarostami.
Of course Holmes should not be in jail (house arrest?), and this movie cements the view I already held. I come away from this movie with a consistent sense of her, rather than with the feeling we can never know a person.
*This Beautiful Country*
The author is Edward Cutler and the subtitle is How Italy’s Nature Shaped its Culture and Civilisation. This is an excellent book on how “the Italy you know” has been shaped by its natural environment, such as its mountains, rivers, geology, and so on. Ever wondered why Sardinia is different? The book is good at sticking to specifics. Excerpt:
This extraordinary overlap has made Italy the continent’s botanical crossroads and one of its greatest arboreal sanctuaries. Within Europe, few countries host such a variety of native trees: at least 140 species, more than almost anywhere west of the Balkans. Some, like the Sicilian fir, Lobel’s maple and the Etna birch, are totally unique. The structure of Italy’s forests is equally diverse — dense, high-altitude canopies, open oak pastures, cork scrub and coastal maquis, each shaped by centuries of disturbance and renewal. This is the legacy of a land that sreved first as Europe’s refuge during the Ice Ages and later as its great corridor of return, where northern, eastern and African floras met and mingled in perpetual exchange.
Recommended to all those with an interest in Italy.
Our fascination with screens, demand curves slope downward installment #1637
What we find here is that the quality-adjusted screen time price index is down 39 per cent since 2000, but that change is overwhelmingly a function of improvements in quality, not declines in prices paid for devices, subscriptions and so on. So the steep rise in screen time over the past 20 years has led to a 52 per cent rise in real-terms spending per person on digital technology.
What seemed at first like a story of screen time outcompeting socialising and reading thanks to a widening advantage on cost, now looks more like digital technology winning out through the sheer force of unparalleled convenience and attention capture, even if that comes at a mounting financial (let alone social) cost.
Here is more from John-Burn Murdoch at the FT, wwmas?
The archaeology tranche of Emergent Ventures
- Björn Öste is building Arkhub, an AI-powered platform that analyzes remote-sensing and other archaeological data to identify potential ancient sites in the Amazon and enable further investigation by citizen scientists.
- J. Cameron Monroe is leading the Allada Regional Archaeology Project, using lidar, remote sensing, and archaeological fieldwork to reconstruct the historical landscape of the Kingdom of Allada and strengthen cultural heritage preservation in Benin.
Previously reported grantees include:
- Benjamin Arbuckle is combining archaeology and ancient DNA analysis to reconstruct entire ecosystems of ancient cities, with the goal of understanding how human societies can thrive in balance with their environments.
- Jesse Casana, an archaeology professor at Dartmouth, is developing drone-based radar imaging methods to detect and map archaeological sites buried beneath desert sands. His work combines advanced remote-sensing technologies with efforts to preserve endangered cultural landscapes.
- Leila Character is developing drone-based imaging and AI tools to detect hidden archaeological sites, making discovery faster, cheaper, and more accessible to researchers worldwide.
- Bryce Hoenigman is developing an AI tool to help date ancient cuneiform tablets by analyzing how written symbols evolved over time, with the goal of making archaeological research faster and more accurate.
With thanks to Yonatan Ben Shimon for his generosity in support of this. We do still have funds remaining in this tranche…