“To forestall his book’s publication he paid a friend to find people who might convince him not to publish it.”

That is Jennifer Senior quoting Michael Lewis on Daniel Kahneman’s remarks about his own book, Thinking Fast and Slow.

What I’ve been reading

by on November 29, 2016 at 12:50 am in Books | Permalink

1. Incarnations: A History of India in Fifty Lives, by Sunil Khilnani.  A highly readable introduction to Indian history, structured around the lives of some of its major figures.  I passed along my copy to Alex.

2. Haruki Murakami, Absolutely on Music: Conversations with Seiji Ozawa.  More for classical music and Ojawa fans than Murakami readers, this is nonetheless an easy to read and stimulating set of interviews for any serious classical music listener.  They are most interesting on Mahler.

3. Elsa Morante, History.  In America, this is one of the least frequently read and discussed great European novels of the 20th century.

4. Miriam J. Laugesen, Fixing Medical Prices: How Physicians are Paid.  Will people still care about these issues for the next four years?  I hope so, because this is the best book I know of on Medicare pricing and its influence on pricing throughout the broader U.S. health care system.

My copy of Joel Mokyr, A Culture of Growth: The Origins of the Modern Economy has arrived.  It is a very good statement of how political fragmentation and intensified intellectual competition drove modernity and the Industrial Revolution.

I have only perused John H. Kagel and Alvin E. Roth, Handbook of Experimental Economics, volume 2, but it appears to be an extremely impressive contribution.

Marc Levinson’s An Extraordinary Time: The End of the Postwar Boom and the Return of the Ordinary Economy details what made the post World War II era so special in terms of its economics and income distribution and why it will be so hard to recreate.

Chris Hayes’s A Colony in a Nation, due out in March, he argues that racial equality really hasn’t improved much since 1968.

Guillermo A. Calvo, Macroeconomics in Times of Liquidity Crises is a useful book on sudden stops and related ideas.

Arrived in my pile is Yuval Noah Harati, Homo Deus: A Brief History of Tomorrow.

The best non-fiction books of 2016

by on November 28, 2016 at 12:28 am in Books | Permalink

In most cases, my review is behind the link, though a few times it leads merely to the Amazon page.  If I wrote only a few words about the book, I have reproduced them directly in this post.  And the books are listed, more or less, in the order I read them.  Apologies if I forgot your book, each year I do neglect a few.  Here goes:

Robert J. Gordon, Rise and Fall of American Growth, my review is here.

Marco Santagana, Dante: The Story of His Life.

Melancholy, by László F. Földényi.

Ji Xianlin, The Cowshed: Memoirs of the Chinese Cultural Revolution.  The classic account of its kind, in this edition brilliantly translated and presented.

Robin Hanson, The Age of Em.  Unlike any other on this list, this work created a new genre.

Benedict Anderson, A Life Beyond Boundaries.

Tom Bissell, Apostle: Travels Among the Tombs of the Twelve.  Fun, engaging, and informative, worthy of the “best of the year non-fiction” list.

Siddhartha Mukherjee, The Gene: An Intimate History.

Srinath Raghavan, India’s War: World War II and the Making of Modern South Asia.

Benjamin Grob-Fitzgibbon, Continental Drift: Britain and Europe from the End of Empire to the Rise of Euroscepticism.

Marie Kondo, Spark Joy: An Illustrated Guide to the Japanese Art of Tidying.

Peter Parker, Housman Country: Into the Heart of England.  It’s already out in the UK, which is where I bought my copy.

Lawrence Rosen, Two Arabs, a Berber, and a Jew: Entangled Lives in Morocco.  Superb descriptive anthropology.

Lyndal Roper, Martin Luther: Renegade and ProphetDue out in February, the UK edition is already out.  Substantive and delightful on every page.

Kerry Brown, CEO, China: The Rise of Xi Jinping.

Richard van Glahn, The Economic History of China: From Antiquity through the 19th Century.

Christopher Goscha, The Penguin History of Modern Vietnam.  The best general history of Vietnam I know, and it does not obsess over “the Vietnam War.”  Readable and instructive on pretty much every page.

Andrew Scott Cooper, The Fall of Heaven: The Pahlavis and the Final Days of Imperial Iran.

William Domnarski, Richard Posner.

Peter Laurence, Becoming Jane Jacobs.

Daniel Gormally, Insanity, Passion, and Addiction: A Year Inside the Chess World.  A personal favorite, you can read this as a study in labor economics as to why people hang on to crummy jobs.

Joshua Foer, Dylan Thuras, and Ella Morton, Atlas Obscura: An Explorer’s Guide to the World’s Hidden Wonders.  Short descriptions of places you ought to visit, such as ossuaries, micronations, museums of invisible microbes, the floating school of Lagos, the Mistake House of Elsah, Illinois, Bangkok’s Museum of Counterfeit Goods, and the world’s largest Tesla coil in Makarau, controlled by Alan Gibbs of New Zealand.  The selection is conceptual, so I like it.  I will keep this book.

Jean Lucey Pratt, A Notable Woman.

Ben H. Shepherd, Hitler’s Soldiers: The German Army in the Third Reich.

Sebastian Mallaby, The Man Who Knew: The Life and Times of Alan Greenspan

Tim Harford, Messy: The Power of Disorder to Transform Our Lives.

Julian Gewirtz, Unlikely Partners: Chinese Reformers, Western Economists, and the Making of Global China.

Marina Abramović, Walk Through Walls.

Christopher de Hamel, Meetings with Remarkable Manuscripts.


Here is Arnold Kling’s list.  Here is my list of the year’s best fiction.

I would describe this year as thick in wonderful, superb books, though I remain uncertain which of these is truly the year’s winner.  So many plausible contenders!  I can only promise I’ll continue to cover what comes out between now and the end of the year, and apologies if one or two of those above are from late 2015.

Buy Richard E. Feinberg, Open for Business: Building the New Cuban Economy.  It also will make my best non-fiction books of the year list.  See also his Miami Herald interview, and his long Brookings paper on FDI in Cuba.

Best fiction of 2016

by on November 25, 2016 at 12:37 am in Books, Uncategorized | Permalink

I was disappointed by most of this year’s well-known releases, and did most of my rewarding fiction reading in past classics.  But these are the fiction or fiction-related works I found to be outstanding this year:

Eimear McBride, The Lesser Bohemians.  A novel of an affair, with intoxicating Irish prose and a genuine energy on the page, though it is more a work of intensifying fervor than a traditional plot-based story.

Claire Louise-Bennett, Pond, more from Ireland, short, nominally fiction but more like a circular sensory experience of reading overlapping short stories, with a cumulative effect akin to that of poetry.  I found this one mesmerizing.

Javier Marias, Thus Bad Begins.  I have only started this, but so far I like it very much.  I have enough faith in Marias to put in on the list.

Juan Gabriel Vásquez, Reputations, a short Colombian novel on memory — personal, historical, sexual, and otherwise, this was my favorite short work of the year.

The Complete Works of Primo Levi, in three volumes, edited by Ann Goldstein.  By no means is all of this fiction, but I will put these books in this category.  A revelation, as Levi has more works of interest, and a broader range of intellect and understanding, than I had realized.  There is plenty of linguistics, economics, history, and social science in these literary pages as well as consistently beautiful writing and superb translations.  This is technically from 2015, but I missed it last time around.

Helen DeWitt, The Last Samurai.  Review here.  Strictly speaking, this is a reissue of an earlier published but neglected work.  Maniacal, intense, super-smart, about a mother bringing up a prodigy.

Emily Dickinson’s Poems as She Preserved Them, edited by Cristanne Miller.  The visual presentation of poetry matters too, plus she is one of the very best.

The Found and the Lost: The Collected Novellas of Ursula K. LeGuin, self-recommending.

Elena Ferrante, Frantumaglia.  A revealing mismash look into the mind of the author, giving you an integrated picture of her world view, with carefully calculated feints thrown in.  I should note this one works only if you know and love her novels already.  Ferrante’s “children’s” story The Beach at Night is also worthwhile, very dark, you can read it in a small number of minutes.  Here is a good NYT review.

Jean-Michael Rabaté, Think Pig! Beckett at the Limit of the Human.  This work of criticism is grounded in literary theory, but informative and smart nonetheless.

Michael Orthofer, The Complete Review Guide to Literary Fiction.  An amazingly comprehensive and informative work, mostly about literature in translation, from the creator of the Literary Saloon blog about fiction.  I liked it so much I decided to do a Conversation with Michael Orthofer.  If you could own only ten works on literature, this should be one of them.

If you give me only one pick, I opt for the Primo Levi, even if you think you already know his work.

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A few I didn’t get to read yet, but have hopes for are Alan Moore’s Jerusalem, and Deborah Levy’s Hot Milk, caveat emptor in both cases, plus Invisible Planets, edited by Ken Liu, a collection of Chinese science fiction.

My post on best non-fiction of the year will be coming soon, plus I’ll do new entries for any excellent fiction between now and the end of the year.

*The Great Convergence*

by on November 24, 2016 at 12:33 am in Books, Economics, Uncategorized, Web/Tech | Permalink

The author is Richard Baldwin and the subtitle is Information Technology and the New Globalization.  The new globalization is the vertical geographic spread of the supply chain, as enabled by information technology.  Think iPhone, the components of which are made in a number of different countries.  (By the way, here is a very good Adam Minter piece on why an American-made iPhone would be very difficult to pull off.)  The important form of trade today is data flows, which enable the export of “how to” knowledge to an unprecedented degree.  Here is one excerpt:

Since so much globalization policy was crafted with the Old Globalization in mind, much of the policy response is misshaped or at least suboptimal.  To take a couple of obvious examples, economic institutions like labor unions tend to be organized by sectors and skill groups since that was the level at which the Old Globalization affected economies.  And national education strategies typically seek to train children for promising jobs in promising sectors since the Old Globalization cut a predictable path that defined sunrise and sunset sectors.  Likewise, governments around the world seek to dampen the pain of structural adjustment with policies linked to declines in particular sectors of particular geographic areas (often those that had specialized in sunset sectors).  Most of these policies are inappropriate for today’s globalization, which is more sudden in its impact, more individual in its effects, more uncontrollable for governments, and more unpredictable overall.

Ultimately, there can be no magic solutions to the changed nature of globalization.  The New Globalization makes life harder for governments.  But the intrinsic difficulty is multiplied by the fact that many governments and analysts are using the Old Globalization’s mental model to understand the New Globalization’s effects.

For Baldwin, the case against TPP, from a U.S. point of view, rests on the possibility that it would ease knowledge transfer abroad and thus erode American competitive advantages.  This focus on data flows, by the way, means that most traditional trade statistics are misleading if not outright wrong.  There is much in this book to ponder.

America has long had a below-average voting rate, and those with lower incomes and lower levels of education are least likely to vote.  So the potential for low incomes, high inequality, and slow growth to give rise to further political disengagement already appears in some of the current data about the United States.  This is no mythical projection, rather it is a simple extrapolation from the world we see around us, namely lots of apathy or disengagement from many of the biggest losers under the status quo.  If you look at the new supporters of Donald Trump, they tend to not otherwise be so politically or socially involved, and the most likely outcome is that they end up some mix of disillusioned and disengaged.  President Trump cannot in fact resurrect the economic fortunes of that group of people.

I’ve heard many a question about when the next Thermidor is coming to the United States, but the data suggest a different story.  Since 1970, American survey respondents show no greater preference for government redistribution.  Furthermore two notable groups show considerably weaker support for redistributive ideas and policies over time.  The elderly decreased their support for redistribution by an amount that is more than half the distance between Democrats and Republicans on this question.  Perhaps more surprisingly, African-Americans also have decreased their support for redistribution, with almost half of this change coming from decreased support for race-based forms of government aid.  This is in spite of the fact that the black-white wealth gap has been widening rather than narrowing.

That is all from my forthcoming book The Complacent Class: The Self-Defeating Quest for the American Dream.


*Nudge Theory in Action*

by on November 20, 2016 at 12:47 am in Books, Economics, Education, Philosophy | Permalink

That is a new and excellent volume edited by Sherzod Abdukadirov, with contributions by Mario Rizzo, Adam Thierer, Jodi Beggs, and others.  I wrote a short introduction, here is an excerpt from that:

Private sector nudge is highly problematic, and I would say it is often worst in those areas we tend to feel best about: health care, education, and charity.  In those cases, our guard is most likely to be let down, even if we are highly educated.  Or should I say because we are educated?

What about public sector nudge?  Well, the good news is that a lot of what government does is simply send money around through transfer programs.  In this regard, its potential for manipulating us is fairly limited.  Furthermore, government is extremely bureaucratic and usually it does not have top tier marketing talent.  Most of the time I just don’t find my government very persuasive.  Is there really anything the DMV can talk me into that I wouldn’t otherwise want to do?

But can I then relax?  Can I stop worrying about public sector nudge?

I am not so sure.

The biggest costs in human history come from wars, and very often the public sector — especially the executive branches in various countries — nudges us into wars.  I don’t hear enough discussion of this topic in the nudge literature.

Government also has nudged us into believing that more government regulation is the answer to many of our problems…

Finally, I worry about how private sector and public sector nudge interact.  Nudges from the television news, and its coverage of crime stories, convince many Americans that rates of crime are rising when in fact they are falling.  That’s a private sector nudge to be sure, and the private sector is doing the marketing, with great skill I might add.  But how does it interact with the public sector?  Well, prosecutors send more people to jail and for longer periods of time.

You can order the book here.

The little virtues

by on November 19, 2016 at 1:05 pm in Books | Permalink

As far as the education of children is concerned I think they should be taught not the little virtues but the great ones.  Not thrift but generosity and an indifference to money; not caution but courage and a contempt of danger; nor shrewdness but frankness and a love of truth; not tact but love for one’s neighbour and self-denial; not a desire for success but a desire to be and to know.

Usually we do just the opposite; we rush to teach them a respect for the little virtues, on which we build our whole system of education.  In doing this we are choosing the easiest way, because the little virtues do not involve any actual dangers, indeed they provide shelter from Fortune’s blows.

That is from Nathalie Ginzburg, from her book The Little Virtues.  Here is a copy of the essay (pdf).  Discovering Ginzburg over the last few weeks has been a revelation for me; she is surely one of the more underrated writers.  Here is Bookslut on Ginzburg.

Here is the link to video, podcast, and transcript.  The Q&A segment was led by guests Ezra Klein, Megan McArdle, Mark Miller (Coyote Cafe), and Eva Summer.  Fuchsia speaks in perfect British sentences and she always had an answer ready, with charm and extreme intelligence.  Here is one excerpt:

COWEN: Three dishes one absolutely has to try are what?

DUNLOP: In Shanghai?

COWEN: In Shanghai. The city, not the region.

DUNLOP: I think you should have hong shao rou, red braised pork. Real home cooking. Delicious combination of soy sauce, rice wine, and sugar, and one of the favorite dishes.

I would recommend some Shanghainese wontons in soup stuffed with shepherd’s purse, which is a wild variety of the brassicas, and pork, just to show you the lighter, gentler side of Shanghainese cooking.

Then, perhaps, if we’re talking Shanghai, you might one to have one of these dishes that says something about Shanghai as being a mixing pot of different cultures.

There’s a very nice crab meat and potato and tomato soup served in some of my favorite Shanghainese restaurants. Which seems a little bit of a fusion with some European influences, the way they use potato and tomato in that soup with local seafood.

COWEN: As you know, the Michelin Guide recently has covered Shanghai, given some restaurants three, two, one star. There’s cheap places you can go. Conceptually, do they understand the food of Shanghai? To the extent they don’t, what are they missing?

DUNLOP: If you look at the restaurants they’ve selected, there’s a bit of a Cantonese bias. They do have some Shanghainese restaurants, but one thing that’s very conspicuous, there are some notable, some of the best Shanghainese local restaurants, which are missing from that list, in my opinion.

The reason is, I think, the methodology of Western food inspectors, which is they tend to go as individuals or small groups. Of course in many Chinese restaurants where you eat family style, to make the most of the restaurant, you have to eat as we’re doing now with a large group and a table full of dishes.

We cover much more, including her favorite parts of China, whether offal is an inferior good, whether one can acquire a taste for sea cucumber, what she thinks of Leonard Cohen, Dream of the Red Chamber, how newbies should approach Chinese food, what top Sichuan chefs thought of their trip to French Laundry, whether milk is overrated, whether Americans have done anything worthwhile with Chinese food, and her favorite Chinese movie.

Here is a short video excerpt from the Sichuan peppercorn tasting segment, namely what makes the very best peppercorns so good compared to the lesser peppercorns.


Here you can order Fuchsia’s new and excellent book The Land of Fish and Rice.

What should I ask Jhumpa Lahiri?

by on November 15, 2016 at 1:49 am in Books, Philosophy | Permalink

I will be interviewing her in a Conversations with Tyler, December 5th.  What should I ask her?  This will be a public event at 6 p.m., Arlington campus of GMU.

By the way, she has a new book out tomorrow, The Clothing of Books.


Please leave your questions in the comments, I thank you in advance for your suggestions.

An influential economist seeks to persuade readers that American citizens have gotten overly complacent, that a crisis point is near, and that a widespread rebellion may alter the existing order.

…In conclusion, Cowen describes how a dynamic society should look and feel, and then he shifts his pessimism about the present to a sort of ersatz optimism about the future, when current structures collapse and chaos improves American democracy.

Here is the full review.  And just one point: I know many of you claim I have not predicted much of current goings-on.  It is true I did not expect Trump to win, but you will find many other predictions in this book, most of which are looking pretty good as of today.  Typically if I am writing material into a book I do not blog it, so that the material will be fresh to all of my readers.  If you order The Complacent Class, you will find very little of it already has shown up on MR, the chapter on productivity excepted.  You could say the better the book, the more you will find a few significant gaps on this blog.  Sorry!

Or if you wish to put the point in the language of financial economics, the possibility of cyclical patterns in history is right now the single biggest source of systemic, undiversifiable risk.

You can pre-order the book here.  The subtitle is “The Self-Defeating Quest for the American Dream.”


What I’ve been reading

by on November 9, 2016 at 12:15 am in Books, Uncategorized | Permalink

1. Ronald C. White, American Ulysses: A Life of Ulysses S. Grant.  Grant is still underrated, this book is highly readable and to the point and not to fusty.  Someone should get Paul Krugman (a Grant fan) to review this book.

2. Jeffrey Edward Green, The Shadow of Unfairness: A Plebeian Theory of Liberal Democracy.  “There will always be some plutocracy, don’t get bent out of shape too badly” is my brief summary of this one.  This book could be more readable, but it is highly intelligent.

3. Esther Schor, Bridge of Words: Esperanto and the Dream of a Universal Language.  I hadn’t known that almost all Esperanto words are accented on the penultimate syllable (bad for poetry), the system of correlatives and “table words” can be quite difficult (“It also has nine groups of word endings, not only for place but also for time, quantity, manner, possession, entity, etc.”), and how much the entire movement was influenced by the intellectual climate of late 19th century Russian Jewish thought.  Recommended.

4. Elena Ferrante, Frantumaglia.  A revealing look into the mind of the author, but this one works only if you know and love her novels already.  Ferrante’s “children’s” story The Beach at Night is worthwhile, very dark, you can read it in a small number of minutes.  Here is a good NYT review.

5. Cao Xueqin, The Story of the Stone [Dream of the Red Chamber], Penguin edition, vol.I.  I am not confident of my ability to follow along all of the longer plot lines, but it is more absorbing and readable than I had recalled from a much earlier attempt to read it.  And overall it does make upper middle class life in 18th century China seem more civilized than its counterpart in Europe.

I am impressed by how many very good job market papers are coming out of UCSD this year.  This work, by Onyi Lam, I expect will be some of my favorite of the entire job market season.  The underlying theme is how effectively propaganda and censorship often work through incentives and political culture, rather than outright coercion.  Here is one of the papers:

Advertisers Capture: Evidence from Hong Kong

This paper provides evidence that non-coercive political pressure on the media can be substantial. It shows that advertisers in Hong Kong engage in politically-induced advertising boycott on media that adopts a political stance which is against the mainland Chinese government policy. Using daily advertising data between 2010 and 2014, I exploit the exogenous variation of the occurrence of political events and their intensity to examine to what degree political salience affects firms’ decisions to place ads in a pro-Democracy (as opposed to pro-Beijing) newspaper, particularly so among Beijing-friendly firms. I estimate that the pro-Democracy newspaper suffered from an ad revenue loss equivalent to 21.9% of its total advertising revenue in 2014 due to political reasons.

Here is a very recent Guardian story about how the Hong Kong publishing industry is shrinking under pressure from China.  Hong Kong of course is heating up again, as China blocked two elected members from the legislature.

Here is another paper by Lam, this one being work in progress:

Measuring Subjectivity in History Textbooks (with Eddie Lin (University of Chicago))

History textbooks provide a lens through which students view the nation’s past. Government, especially that of authoritarian regime, has an incentive to present biased content in the history textbook to influence students’ political views. This paper considers the problem of measuring subjectivity history textbooks in China, Hong Kong and Taiwan. Using sentiment analysis, I find empirical evidence that history textbooks in mainland China exhibit stronger degree of subjectivity than history textbooks used in Hong Kong and Taiwan. Specifically, the paper measures the adjective content in the textbook, the ratio of positive to negative words in specific time periods and employs word embedding method that measures distance from entities of interest such as the Chinese Communist Party.

This entire topic is understudied by economists…