Tyler Cowen

Bot wars

by on September 21, 2016 at 3:35 am in Web/Tech | Permalink

In particular, Yasseri and co focus on whether bots disagree with one another. One way to measure this on Wikipedia is by reverts—edits that change an article back to the way it was before a previous change.

Over a 10-year period, humans reverted each other about three times on average. But bots were much more active. “Over the 10-year period, bots on English Wikipedia reverted another bot on average 105 times,” say Yasseri and co.

And this:

Bots and humans differ significantly in their revert habits. The most likely time for a human to make a revert is either within two minutes after a change has been made, after 24 hours, or after a year. That’s clearly related to the rhythms of human lifestyles.

Robots, of course, do not follow these rhythms: rather, they have a characteristic average response time of one month.  “This difference is likely because, first, bots systematically crawl articles and, second, bots are restricted as to how often they can make edits,” say Yasseri and co.

Nevertheless, bots can end up in significant disputes with each other, and behave just as unpredictably and inefficiently as humans.

Many of the bots seem to be designed to make varyin- language versions of the same Wikipedia pages consistent with each other, yet the bots do not always agree.  Solve for the equilibrium, as they say…

Here is the article, via Michelle Dawson.

Lewis Davis has a newly published paper on that topic with the more elegant title “Individual Responsibility and Economic Development: Evidence from Rainfall Data.”  Here is the abstract:

This paper estimates the effect of individual responsibility on economic development using an instrument derived from rainfall data. I argue that a taste for collective responsibility was adaptive in preindustrial societies that were exposed to high levels of agricultural risk, and that these attitudes continue to influence contemporary social norms and economic outcomes. The link between agricultural risk and collective responsibility is formalized in a model of optimal parental socialization effort. Empirically, I find a robust negative correlation between rainfall variation, a measure of exogenous agricultural risk, and a measure of individual responsibility. Using rainfall variation as an instrument, I find that individual responsibility has a large positive effect on economic development. The relationships between rainfall variation, individual responsibility and economic development are robust to the inclusion of variables related to climate and agricultural and institutional development.

This kind of investigation is always going to be fraught with uncertainty and also controversy, given imperfections of data and methods.  Nonetheless I find this one of the more plausible macro-historical hypotheses, perhaps because of my own experience in central Mexico, where varying rainfall still is the most important economic event of the year, though it is rapidly being supplanted by the variability of tourist demand for arts and crafts.  And yes, they are largely collectivist, at least at the clan level, with extensive systems of informal social insurance and very high implicit social marginal tax rates on accumulated wealth.

Have you noticed it rains a lot in England?

Here are earlier and ungated/less gated versions of the paper.

Tuesday assorted links

by on September 20, 2016 at 2:31 pm in Uncategorized | Permalink

1. Bill Cosby was once an important role model (pdf).

2. In fact, you can’t make that much money naming Chinese babies.

3. “But now there is a stochastic, episodic nature to many careers. As workers get older, potential employers become more suspicious of their skills, not more confident in them. As a result, you often meet people who had been happiest at work in middle age, and then moved down to a series of positions they were overqualified for and felt diminished in.”  That is from David Brooks.

4. Is Peter Thiel right about Chicago?

5. Explaining preferences for redistribution.

That is my latest Bloomberg column, here is one excerpt:

Looking at a broad swath of history, I see three major forces that can make financial systems safer: people being scared by recent events, solid economic growth and reduced debt in comparison to the value of equity. The financial crisis gave us the first on that list as perhaps its main “gift” (for now), but Dodd-Frank may have worsened economic growth problems.

On the plus side, we might like to think that Dodd-Frank improved the debt-equity balance by pushing banks to raise more capital. But that, too, now stands in doubt.

Last week Natasha Sarin and Lawrence H. Summers of Harvard University released a paper questioning whether Dodd-Frank has made big U.S. banks safer at all. The authors look at a variety of measures, including options prices, the ratio of market prices to book values, bank share volatility relative to overall market volatility, credit-default swap spreads and the value of preferred equity shares for banks. In every metric, it seems that the big banks are at least as risky as they were before the crisis, in part because they have lower capital values.

And this:

It’s a common economic prescription that regulation should insist that banks carry high levels of capital to withstand losses in bad times. But although Dodd-Frank raised statutory capital requirements, it may have drained banks of some of their true economic capital by regulating and sometimes prohibiting valuable banking activities. The ratio of market price to book value has declined for the biggest banks, and that is one sign of falling values for true economic capital, even though banks have met the letter of law by increasing capital as the regulations specified. Sarin and Summers note that measures of bank capital, as defined by regulators rather than the market, have little predictive power for bank failures.

Do read the whole thing.

Paul Krugman is upset that many Millennials are toying with the idea of voting for Gary Johnson rather than Hillary Clinton.  He offers a number of arguments, here is one of them:

What really struck me, however, was what the [Libertarian Party] platform says about the environment. It opposes any kind of regulation; instead, it argues that we can rely on the courts. Is a giant corporation poisoning the air you breathe or the water you drink? Just sue: “Where damages can be proven and quantified in a court of law, restitution to the injured parties must be required.” Ordinary citizens against teams of high-priced corporate lawyers — what could go wrong?

That is the opposite of the correct criticism.  The main problem with classical libertarianism is that it doesn’t allow enough pollution.  Under libertarian theory, pollution is a form of violent aggression that should be banned, as Murray Rothbard insisted numerous times.  OK, but what about actual practice, once all those special interest groups start having their say?  Historically, under the more limited government of the 19th century, it was big business that wanted to move away from unpredictable local and litigation-driven methods of control, and toward a more systematic regulatory approach at the national level.  There is a significant literature on this development, starting with Morton Horwitz’s The Transformation of American Common Law.

If you think about it, this accords with standard industrial organization intuitions.  Established incumbents prefer regulations that take the form of predictable, upfront high fixed costs, if only to limit entry.  And to some extent they can pass those costs along to consumers and workers.  The “maybe you can sue me, maybe you can’t” regime is more the favorite of thinly capitalized upstarts that have little to lose.

So under the pure libertarian regime, big business would come running to the federal government asking for systematic regulation in return for protection against the uncertain depredations of the lower-level courts.  It is fine to argue the court-heavy libertarian regime would be unworkable for this reason, or perhaps it would collapse into a version of the status quo.

That would be a much more fun column: “Libertarian view untenable, implies too high a burden on polluters.”  I’m not sure that would sway the Bernie Brothers however.

Some of the criticisms of libertarianism strike me as under-argued:

And if parents don’t want their children educated, or want them indoctrinated in a cult…Not our problem.

Rates of high school completion were below 70% for decades, until recently, in spite of compulsory education.  Parents rescuing children from the neglect of the state seems at least as common to me as vice versa.

And what is the status quo policy on taking children away from parents who belong to “cults”?  Unusual religions can be a factor in contested child custody cases (pdf), but in the absence of evidence of concrete harm, such as beatings or sexual abuse, the American government does not generally take children away from their parents, cult or not.  Germany and Norway differ on this a bit, for the most part this is, for better or worse, the American way.  That’s without electing Gary Johnson.

By the way, Gary Johnson slightly helps Hillary Clinton.  Although probably not with New York Times readers.

Monday assorted links

by on September 19, 2016 at 2:16 pm in Uncategorized | Permalink

1. The beer pipe conditional public goods assurance game culture that is Belgium (NYT).

2. How meaning varies between speech and its typed transcript.

3. Dani Rodrik Op-Ed on how to do globalization right (NYT).

4. The classic books are making a commercial comeback.

5. $30 markets in everything.

6. Who favors free movement of labor within the EU?  This tweet and graph makes a good point, but given status quo bias I don’t find the numbers as overwhelming as does O’Rourke.  p.s. Luxembourg and Latvia are the top two in support.

That is my latest Bloomberg column, hardly anyone has a consistent and evidence-based view on this deal.  Here is one bit:

Critics who dislike Monsanto for its leading role in developing genetically modified organisms and agricultural chemicals shouldn’t also be citing monopoly concerns as a reason to oppose the merger — that combination of views doesn’t make sense. Let’s say for instance that the deal raised the price of GMOs due to monopoly power. Farmers would respond by using those seeds less, and presumably that should be welcome news to GMO opponents.

Yet on the other side:

What does Bayer hope to get for its $66 billion, $128-a-share offer? The company has argued that it will be able to eliminate some duplicated jobs and expenses, negotiate better deals with suppliers and invest more funds in research and development. Maybe, but the broader reality is less cheery. There is a well-known academic literature, dating to the early 1990s, showing that acquiring firms usually decline in value after tender offers, especially after the biggest deals. Mergers do not seem to make companies more valuable or efficient.

And this:

The whole Bayer-Monsanto case is a classic example of how a vociferous public debate can disguise or even reverse the true issues at stake. If Bayer fails to close the deal for Monsanto, Bayer shareholders may be the biggest winners. The biggest losers from a failed deal may be its opponents, who will spend the rest of their lives in a world where misguided judgments of corporate popularity have increasing sway over laws and regulations.

Do read the whole thing.

In two separate cases, thieves snatching bags from city streets and train stations inadvertently helped law enforcement get the upper hand in an ongoing bomb spree that’s hurt dozens of people and spans both sides of the Hudson River, sources said.

The day Ahmad Khan Rahami allegedly planted two bombs in Chelsea  — one of which detonated on West 23rd Street — two thieves accidentally helped to disable his second pressure cooker bomb left inside a rolling suitcase on West 27th Street, sources said.

The young men, who sources described as being well-dressed, opened the bag and took the bomb out, sources said, before placing the explosive into a garbage bag and walking away with the rolling suitcase.

In doing so, investigators believe they inadvertently disabled the explosive, sources said. That allowed investigators to examine the cellphone attached to the bomb intact and discover that it was connected to the family of Rahami.

From there, they were able to identify pictures on social media of Rahami’s family and of him, and they matched one of his photos to surveillance footage captured in Manhattan.

Here is the full story, via David Montgomery.  This somehow relates to Hume’s Dialogues on Natural Religion and the watchmaker analogy, but I’m still pondering that one…

Haven’t you noticed this?

I have a simple hypothesis.  No matter what the media tells you their job is, the feature of media that actually draws viewer interest is how media stories either raise or lower particular individuals in status.  (It’s a bit like “politics isn’t about policy.”)  That’s even true for this blog, though of course that is never my direct intention.

But now you can see why people get so teed off at the media.  The status ranking of individuals implied by a particular media source is never the same as yours, and often not even close.  You hold more of a grudge from the status slights than you get a positive and memorable charge from the status agreements.

In essence, (some) media is insulting your own personal status rankings all the time.  You might even say the media is insulting you.  Indeed that is why other people enjoy those media sources, because they take pleasure in your status, and the status of your allies, being lowered.  It’s like they get to throw a media pie in your face.

In return you resent the media.

A good rule of thumb is that if you resent the media “lots,” you are probably making a number of other emotional mistakes in your political thought.

In Africa this process seems not to work as well. According to one 2007 study of 90 developing countries, Africa is the only region where urbanisation is not correlated with poverty reduction. The World Bank says that African cities “cannot be characterised as economically dense, connected, and liveable. Instead, they are crowded, disconnected, and costly.”

I say the one big problem is premature deindustrialization:

What ties them [African cities] together, and sets them apart from cities elsewhere in the world, according to the Brookings Institution, an American think-tank, is that urbanisation has not been driven by increasing agricultural productivity or by industrialisation. Instead, African cities are centres of consumption, where the rents extracted from natural resources are spent by the rich. This means that they have grown while failing to install the infrastructure that makes cities elsewhere work.

That is from The Economist, the article is interesting throughout.

After Texas high school builds $60-million stadium, rival district plans one for nearly $70 million

Need I say more?  I will nonetheless:

In Frisco, which neighbors Allen and McKinney, the district will pay $30 million over several years to use the Dallas Cowboys’ new 12,000-seat practice field for high school football and soccer games, as well as graduation ceremonies.

Here is a nice bit of fiscal illusion:

In McKinney [one of the stadium-building districts], school taxes for property owners amount to $1.63 per $100 of assessed valuation. The tax rate had been higher in the recent past, but it fell 5 cents this year, partly because the district had dropped some old debt. Because of the 5-cent decrease, district officials repeatedly note, property owners will see their taxes go down, even as the new stadium goes up.

Jim Buchanan would be proud.  And it’s a good thing we have the public sector to protect us from negative-sum status-seeking games!

The original pointer is from Adam Minter.

Sunday assorted links

by on September 18, 2016 at 4:23 am in Film, Uncategorized | Permalink

1. “…we find that the real price of watches in nearly all categories falls steadily by 1.3 per cent per year, equivalent to a fall of 75 per cent over a century, showing that sustained innovation in the production of a highly complex artefact had already appeared in one important sector of the British economy by the early eighteenth century.”  Here is the article.

2. Have tasting menus become too expensive?  I say yes: ““It means D.C. is a town that has come of age, and that should worry us all.”

3. Garett Jones argues for a high-SAT immigration policy.

4. How to store your butterflies (photo).

5. My former student, Dr. Yonas Biru, who did his dissertation on the coup d’etat, is on a hunger strike.

6. Interview with Decius.  Caveat emptor, I say he has been “played” by Trump.  Still, the media of so much coverage of the “hillbilly” and “downtrodden” Trump supporters, I say let’s look at the intellectuals, anonymous though some of them may be.

7. Weiner is a splendid movie with many subtle points, including in the philosophical direction.  It is about leadership, publicity, motivation, compulsion, and what a marriage really consists of, or not.  In another life, Huma Abedin could have been a movie star.  She has exactly the right mix of distance and involvement, and she dominates every scene she is in, even when just sitting quietly in the background.  Um…I guess she is a movie star.  Starlet.  Whatever.

What I’ve been reading

by on September 18, 2016 at 12:44 am in Books | Permalink

1. Europe Since 1989: A History, by Philipp Ther.  And yet it is all told through the vantage point of central and eastern Europe.  Recommended, not just the usual and interesting to see “the West” treated as the periphery.  Makes you wonder if eastern Europe ever had a chance.

2. Jeffrey Edward Green, The Eyes of the People: Democracy in an Age of Spectatorship.  “The ocular model, by contrast, is grounded on the People’s eyes and its capacity for vision, rather than on the People’s voice and its capacity for speech.”  Think of it as Exit, View, and Loyalty, for the contemporary age.

3. Naomi Duguid, Taste of Persia: A Cook’s Travels Through Armenia, Azerbaijan, Georgia, Iran, and Kurdistan.  Not only an excellent cookbook, but a good regional study in its own right.

4. Paul Bloom, Against Empathy. “Singer goes further and argues that individuals like Kravinsky [an organ donor], motivated by their cold logic and reasoning, actually do more to help people than those who are gripped by empathic feelings…”

5. Christine Woodside, Libertarians on the Prairie: Laura Ingalls Wilder, Rose Wilder Lane, and the Making of the Little House Books.  Fun and interesting, this gives you the real story behind those women and their connection to libertarianism.  Here is a short essay by the author excerpted from the book.  I cannot, however, say this book drove me to wish to read the original sources.

The new Coetzee and McEwan novels are OK but they don’t thrill me.  There is also George J. Borjas, We Wanted Workers: Unraveling the Immigration Narrative, coming out soon.

Saturday assorted links

by on September 17, 2016 at 2:42 pm in Uncategorized | Permalink

1. The geography of populist surgesThis update tells us that rural income did OK.

2. Airbnb + clapped out taxi cab = NYC on $39 a nightThis guy (NYT) pays $450 a month for a 40-square foot cubbyhole in Williamsburg.  And the homes of New Yorkers on TV are looking worse (NYT).

3. “…the phenomenon of men opting out of work is limited to the native-born.”  That is one reason why I don’t think it is just demand.

And here is Pleeps on the young men who do not wish to work.  Two points: a) the gaps he finds are actually pretty large relative to the residual that needs to be explained, and b) a lot of those young men going to school never finish and in fact they are engaged in a kind of leisured unemployment, albeit at an especially high price.  In fact, if you take non-completion seriously, the entire phenomenon becomes far more visible and obvious as a problem.  The funny thing is, in these mood-affiliated times, generally you can get people to recognize the problem if you present it in the context of degree completion only and make sure to portrays the students as pure victims of circumstance.  At lower tier schools, the completion rate is now about 38 percent.  It would be shocking if there were not an analogous problem in the job market, yes shocking.  Of course we live in shocking times.

4. “I tell her just marry anyone. Whatever. All the San Francisco guys seem like the same guy to me.”  Link here.

5. The culture that is Olive Garden markets in everything.

I will second Bryan Caplan’s post:

Last week, my colleague Dan Klein kicked off the Public Choice Seminar series.  During the introduction, I recalled some of his early work.  But only after did I realize how visionary he’s been.

In 1999, when internet commerce was still in its infancy, Klein published Reputation: Studies in the Voluntary Elicitation of Good ConductSeventeen years later, e-commerce towers before us, resting on a foundation of reputational incentives – everything from old-fashioned repeat business to two-sided smartphone reviews.

In 2003, long before Uber, Airbnb, or serious talk of driverless cars, Klein published The Half-Life of Policy Rationales: How New Technology Affects Old Policy Issues.  This remarkable work explores how technological change keeps making old markets failures – and the regulations that arguably address them – obsolete.  (Here’s the intro, co-authored with Fred Foldvary).  Fourteen years later, the relevance of Klein’s thesis is all around us.  Transactions costs no longer preclude peakload pricing for roads, decentralized taxis and home rentals, or full-blown caveat emptor for consumer goods.  So why not?

I’m not going to say that Klein caused these amazing 21st-century developments.  But he did foresee them more clearly than almost anyone.  Hail Dan Klein!

Some of Dan’s work, and later work (much of which is covered at MR), you will find here and here.  For instance, his later work on academic bias also was well ahead of its time and prefigured subsequent events, so this is actually a running streak.