The fifth video in the Solow series from our Principles of Macroeconomics course is really the capstone. It explains how ideas drive growth on the cutting edge. A key insight of the model, however–one which many people still don’t really get–is that ideas increase output and by doing so they also drive capital accumulation so both forces are always at play.

Third-grader Andrew Calabrese carries his backpack everywhere he goes at his San Diego-area school. His backpack isn’t just filled with books, it is carrying his robotic pancreas.

The device, long considered the Holy Grail of Type 1 diabetes technology, wasn’t constructed by a medical-device company. It hasn’t been approved by regulators.

It was put together by his father.

Jason Calabrese, a software engineer, followed instructions that had been shared online to hack an old insulin pump so it could automatically dose the hormone in response to his son’s blood-sugar levels. Mr. Calabrese got the approval of Andrew’s doctor for his son to take the home-built device to school.

The Calabreses aren’t alone. More than 50 people have soldered, tinkered and written software to make such devices for themselves or their children. The systems—known in the industry as artificial pancreases or closed loop systems—have been studied for decades, but improvements to sensor technology for real-time glucose monitoring have made them possible.

The Food and Drug Administration has made approving such devices a priority and several companies are working on them. But the yearslong process of commercial development and regulatory approval is longer than many patients want, and some are technologically savvy enough to do it on their own.

Here is the Kate Linebaugh story, interesting throughout, via Adam Thierer and Eli Dourado.

That’s the hullaballoo of the day (NYT here):

Facebook workers routinely suppressed news stories of interest to conservative readers from the social network’s influential “trending” news section, according to a former journalist who worked on the project. This individual says that workers prevented stories about the right-wing CPAC gathering, Mitt Romney, Rand Paul, and other conservative topics from appearing in the highly-influential section, even though they were organically trending among the site’s users.

That’s not exactly what I would have suppressed, but I can’t say I am broken up about this.  Most media bias in journalism is demand-driven, and I suspect this feature of the article selection and elevation “algorithm” is perceived by Facebook as demand-driven as well.  Overall I think of Twitter as radicalizing, and Facebook as calming and connecting.  The “censored” right wing sources don’t fit the chummy, nostalgic socializing mood so well, and therefore Facebook wanted to keep them away.  A clear minority is sufficiently interested in those stories to get them trending initially, but that’s not the overall image Facebook wants to present to either its marginal or median user.

Maybe such algorithms mean that social ideas are too slow to change, because user demand depends in part on what Facebook pushes.  Right now I’m more worried about American ideas getting worse than American ideas getting better, so a status quo, don’t offend anybody bias I can live with.  And frankly, a lot of right-wing news sources just aren’t very good — I suppress them myself, without any aid from Facebook.

There is also this:

“People stopped caring about Syria,” one former curator said. “[And] if it wasn’t trending on Facebook, it would make Facebook look bad.” That same curator said the Black Lives Matter movement was also injected into Facebook’s trending news module. “Facebook got a lot of pressure about not having a trending topic for Black Lives Matter,” the individual said. “They realized it was a problem, and they boosted it in the ordering. They gave it preference over other topics. When we injected it, everyone started saying, ‘Yeah, now I’m seeing it as number one’.” This particular injection is especially noteworthy because the #BlackLivesMatter movement originated on Facebook, and the ensuing media coverage of the movement often noted its powerful social media presence.

In those two cases I see the change in coverage as bringing net content gain rather than loss.  The cynical underlying reality is that Facebook does not wish to appear heartless, but does not (yet) have the more subtle manipulative institutions that newspapers and TV stations have developed over decades or even centuries.  They clumsily act in a politically correct manner, without proper institutional camouflage, and now they are being called on it.  They will refine their bias, and make it subtler and harder to criticize, thereby becoming more like most other media outlets.  Ultimately this is more of a social conformity story than a monopoly power dilemma.  I am more worried about pervasive ennui and complacency than the political bias per se.

WSJ: One day in January, Eric Wilson dashed off a message to the teaching assistants for an online course at the Georgia Institute of Technology.

“I really feel like I missed the mark in giving the correct amount of feedback,” he wrote, pleading to revise an assignment.

Thirteen minutes later, the TA responded. “Unfortunately, there is not a way to edit submitted feedback,” wrote Jill Watson, one of nine assistants for the 300-plus students.

Last week, Mr. Wilson found out he had been seeking guidance from a computer.

…Last year, a team of Georgia Tech researchers began creating Ms. Watson by poring through nearly 40,000 postings on a discussion forum known as “Piazza” and training her to answer related questions based on prior responses. By late March, she began posting responses live.

Don’t confuse Ms. Watson with the customer-service chatbots used online by airlines and other industries. Mr. Goel boasts that she answers only if she has a confidence rate of at least 97%.

“Most chatbots operate at the level of a novice,” Mr. Goel said. “Jill operates at the level of an expert.”

In our paper on online education Tyler and I wrote about AI Tutors:

Feedback from interactive systems will be more immediate and more informative (Skinner 1958). Adaptive tutoring systems are already nearly as effective as human tutors in many circumstances and much cheaper to scale (VanLehn 2011).

A study published in The American Journal of Political Science underscored how powerful political bias can be. In an experiment, Democrats and Republicans were asked to choose a scholarship winner from among (fictitious) finalists, with the experiment tweaked so that applicants sometimes included the president of the Democratic or Republican club, while varying the credentials and race of each. Four-fifths of Democrats and Republicans alike chose a student of their own party to win a scholarship, and discrimination against people of the other party was much greater than discrimination based on race.

That is from Nicholas Kristof, there is more at the link (NYT).

That is the latest renaming at George Mason University, due to a very generous gift from Dwight Schar in support of public policy and political science.  Here is one account, congratulations to my school and its leaders, and of course a very sincere thanks to Dwight…

trump (v.2) Look up trump at“fabricate, devise,” 1690s, from trump “deceive, cheat” (1510s), from Middle English trumpen (late 14c.), from Old French tromper “to deceive,” of uncertain origin. Apparently from se tromper de “to mock,” from Old French tromper “to blow a trumpet.” Brachet explains this as “to play the horn, alluding to quacks and mountebanks, who attracted the public by blowing a horn, and then cheated them into buying ….” The Hindley Old French dictionary has baillier la trompe “blow the trumpet” as “act the fool,” and Donkin connects it rather to trombe “waterspout,” on the notion of turning (someone) around. Connection with triumph also has been proposed. Related: Trumped; trumping. Trumped up “false, concocted” first recorded 1728.


Here is more, via DK.  Here are related comments from Scott Sumner.

Two papers suggest numeracy improves financial outcomes and can be taught.

Numeracy and Wealth: We examined the relationship between numeracy and wealth using a cross-sectional and a longitudinal study. For a sample of approximately 1000 Dutch adults, we found a statistically significant correlation between numeracy and wealth, even after controlling for differences in education, risk preferences, beliefs about future income, financial knowledge, need for cognition or seeking financial advice. Conditional on socio-demographic characteristics, our estimates suggest that on average a one-point increase in the numeracy score (11-point scale) of the respondent is associated with 5 percent more personal wealth.

High School Curriculum and Financial Outcomes: Financial literacy and cognitive capabilities are convincingly linked to the quality of financial decision-making. Yet, there is little evidence that education intended to improve financial decision-making is successful. Using plausibly exogenous variation in exposure to state-mandated personal finance and mathematics high school courses, affecting millions of students, this paper answers the question “Can high school graduation requirements impact financial outcomes?” The answer is yes, although not via traditional personal finance courses, which we find have no effect on financial outcomes. Instead, we find additional mathematics training leads to greater financial market participation, investment income, and better credit management, including fewer foreclosures.

Paul Frijters and Benno Torgler have a new six-page paper (pdf)on that topic, here is the abstract:

The current peer review system suffers from two key problems: promotion of an in-crowd whose methods, opinions and innovations it protects; and failure to represent the opinions and interests of non-peer clients. As a result, whole disciplines orient themselves toward navel-gazing research questions of little import to society or even science as a whole, and new methods and concepts must be unusually persuasive to break through. We thus suggest a more efficient and integrity-preserving system based on an open two-sided market in which buyers and sellers of peer review services would both be subject to a set of recursive quality indicators. We lay out key features we think would be important to reduce the opportunities for gaming and that improve the signals about the societal value of a contribution. Our suggestions include a level of reward offered by the author of a paper to get refereed and a level of desired quality of the referee. They include randomly selecting from a group of referees that express a willingness to accept the offered contract. They include the possibility that papers are put up by non-authors for peer-review for assessment on different criteria, such as societal relevance. And they finally include the possibility that referee reports themselves become refereed by other referees. What we envisage is that such an open market in which all elements are subject to peer review will over time lead to specialized reviewers in different criteria, and more useful signals about the nature and quality of any individual piece of work. Our incentivized market set-up would both professionalize the peer review process and make it completely transparent, an innovation long overdue.

Interesting, but the main problem with the idea is simply that no one cares.

For the pointer I thank Ben Southwood.

Sentences to ponder

by on April 27, 2016 at 4:45 am in Education, Political Science | Permalink

The Naval Academy has risen to 9th on the list of national liberal arts colleges, tied with Davidson and Claremont McKenna. Meanwhile, West Point ranks 22nd, just behind Grinnell, Colby and Colgate, and the Air Force Academy is 29th, tied with Scripps and Barnard.

That is from Nick Anderson.

Here is the transcript, the video, and the podcast.  We covered a good deal of ground, here is one bit:

COWEN: You once wrote, I quote, “My substitute for LSD was Indian food,” and by that, you meant lamb vindaloo.


COWEN: You stand by this.

PAGLIA: Yes, I’ve been in a rut on lamb vindaloo.

COWEN: A rut, tell us.

PAGLIA: It’s a horrible rut.

COWEN: It’s not a horrible rut, it may be a rut.

PAGLIA: No, it’s a horrible rut. It’s a 40-year rut. Every time I go to an Indian restaurant, I say “Now, I’m going to try something new.” But, no, I must go back to the lamb vindaloo.

All I know is it’s like an ecstasy for me, the lamb vindaloo.

COWEN: Like De Quincey, tell us, what are the effects of lamb vindaloo?

PAGLIA: What can I say? I attain nirvana.

And this:

COWEN: This is Sexual Personae, your best known book, which I recommend to everyone, if you haven’t already read it.

PAGLIA: It took 20 years.

COWEN: Read all of it. My favorite chapter is the Edmund Spenser chapter, by the way.

PAGLIA: Really? Why? How strange.

COWEN: That brought Spenser to life for me.

PAGLIA: Oh, my goodness.

COWEN: I realized it was a wonderful book.

PAGLIA: Oh, my God.

COWEN: I had no idea. I thought of it as old and fusty and stuffy.

PAGLIA: Oh, yes.

COWEN: And 100 percent because of you.

PAGLIA: We should tell them that The Faerie Queene is quite forgotten now, but it had enormous impact, Spenser’s Faerie Queene, on Shakespeare, and on the Romantic poets, and so on, and so forth. The Faerie Queene had been taught in this very moralistic way. But in my chapter, I showed that it was entirely a work of pornography, equal to the Marquis de Sade.

COWEN: [laughs]

PAGLIA: How interesting that you would be drawn to that.

COWEN: Very interesting.


You also can read or hear Camille on Star Wars: The Force Awakens, the Byrds, Foucault, Suzanne Pleshette vs. Tippi Hendren, dating, Brazil, Silicon Valley, Harold Bloom, LSD, her teaching career, and much, much more.

Typically a Conversation with Tyler is about ten thousand words, this one is closer to fifteen thousand.

James Crabtree directs our attention to this symbol at Nanyang Technological University:


That is in fact the motto of their School of International Studies.  Right now the Singaporean improbable is deflation for seventeen consecutive months, let’s hope for better news on that front.

Balázs Bodó has a 2015 paper, “Libraries in the post-scarcity era,” here is the abstract:

In the digital era where, thanks to the ubiquity of electronic copies, the book is no longer a scarce resource, libraries find themselves in an extremely competitive environment. Several different actors are now in a position to provide low cost access to knowledge. One of these competitors are shadow libraries – piratical text collections which have now amassed electronic copies of millions of copyrighted works and provide access to them usually free of charge to anyone around the globe. While such shadow libraries are far from being universal, they are able to offer certain services better, to more people and under more favorable terms than most public or research libraries. This contribution offers insights into the development and the inner workings of one of the biggest scientific shadow libraries on the internet in order to understand what kind of library people create for themselves if they have the means and if they don’t have to abide by the legal, bureaucratic and economic constraints that libraries usually face. I argue that one of the many possible futures of the library is hidden in the shadows, and those who think of the future of libraries can learn a lot from book pirates of the 21st century about how users and readers expect texts in electronic form to be stored, organized and circulated.

Much of the paper focuses on what we learn from the competitive, digital, “guerrilla” libraries of Russia — most of all Aleph — with respect to what users really want; this is a striking and original piece.

For the pointer I thank Michael Rosenwald.

Larry Summers says it is worth a rethink:

Former Harvard University President Lawrence Summers suggested that the school consider curbing annual payouts from its world-record $37.6 billion endowment to reflect the likelihood of lower investment returns.

Real, or inflation-adjusted, short-term interest rates have been falling steadily since 1999 and are effectively projected by financial markets to be around zero percent in the long-run, Summers said in a presentation Friday to a National Bureau of Economic Research meeting in Cambridge, Massachusetts, where Harvard is based.

“If it makes sense for Harvard University to pay out 5 percent of its endowment in 1999 when the real interest rate was 4 percent, it’s really quite unlikely that it makes sense to pay out 5 percent of its endowment in 2016 when the real interest rate is zero,” said Summers, a former U.S. Treasury secretary who is now a professor at Harvard.

I’ve never had a good handle on what you might call “the welfare economics of endowments,” in part because I don’t think economists have a good theory of endowments period.

One normative view is that if g > r, funds should simply accumulate in the endowment, more or less indefinitely, to further maximize societal wealth.  The g > r condition might hold for Harvard, though it is hard to measure what the school’s borrowing rate consists of.  Arguably new money at the margin comes from donations rather than from loans or bond issues.

A second view is that inequality is bad, and institutions tend to become sluggish and excessively bureaucratic in the longer run.  Perhaps every now and then they should be required to “start afresh”; a’ la Jefferson: “every now and then higher education must be refreshed…” etc.  That would suggest a higher payout rate.  You will note that the law mandates a payout rate of five to six percent for charitable foundations; Harvard isn’t a foundation, but analogous factors might apply.

A third view is to note that income inequality has gone up, and that means higher returns from investing in Harvard students, even if overall rates of return in the economy are low.  We know that the variance of corporate returns is much higher than it used to be, and many of those successful corporations stem from Harvard, MIT, and Stanford, among other top schools.  That would suggest spending more money today, because the Harvard endowment may not always be so valuable in terms of the uses to which it can be put.  Low rates of return on (most) investments are more reason to follow this advice and keep on spending, not less reason.  Can you imagine a better investment these days than Harvard human capital?  You will note that in this view “keeping Harvard at the top,” while a goal, is not the number one consideration.

There is something to be said for all of these perspectives, but mine is closest to number three.  In any case the question deserves closer consideration than I see it receiving.

There is a paper on that theme (pdf) by Tali Mendelberg, Katherine T.McCabe, and Adam Thal, here is the abstract:

Affluent Americans support more conservative economic policies than the non-­affluent, and government responds disproportionately to these views. Yet little is known about the emergence of these consequential views. We develop, test and find support for a theory of class cultural norms: these preferences are partly traceable to socialization that occurs on predominately affluent college campuses, especially those with norms of financial gain, and especially among socially embedded students. The economic views of the student’s cohort also matter, in part independently of affluence. We use a large panel dataset with a high response rate and more rigorous causal inference strategies than previous socialization studies. The affluent campus effect holds with matching, among students with limited school choice, and in a natural experiment, and passes placebo tests. College socialization partly explains why affluent Americans support economically conservative policies.

For the pointer I thank Nathaniel Bechhofer.  One implication is that left-wing, politically correct top private universities don’t actually turn out such left-wing individuals, all things considered.  You can think of their sillier college views as part of a broader life cycle, portfolio story.  I also take this to be further evidence of just how much education is about socialization, rather than the explicit mastery of scholarly information.