I can’t say I understand this FT article so well, but I suppose that is the point.  Which are two groups/persons implicated in buying oil from ISIS, or otherwise enabling such trades to take place?

First, Syria.  Or is that “Syria.”

Second, the head of the world chess federation, namely Kirsan Ilyumzhinov: “he is best known for his belief in aliens — he has repeatedly recounted an instance when he was abducted in 1997 by “people in yellow spacesuits”.”  And this:

Mr Ilyumzhinov has a diverse business empire, stretching from sugar to banking, and a network of contacts to match. He regularly meets the Dalai Lama, and he played chess with Libyan president Muammer Gaddafi shortly before his overthrow.

He also has been working with the Syrian central bank.  Here is NYT coverage, here are other sources.  As the old Haitian proverb states, if you’re not confused, you don’t know what’s going on…

The paper is by David Hugh-Jones, and this is from the research summary:

The study examined whether people from different countries were more or less honest and how this related to a country’s economic development. More than 1500 participants from 15 countries took part in an online survey involving two incentivised experiments, designed to measure honest behaviour.

Firstly, they were asked to flip a coin and state whether it landed on ‘heads’ or ‘tails’. They knew if they reported that it landed on heads, they would be rewarded with $3 or $5. If the proportion reporting heads was more than 50 per cent in a given country, this indicated that people were being dishonest…

The countries studied – Brazil, China, Greece, Japan, Russia, Switzerland, Turkey, the United States, Argentina, Denmark, the United Kingdom, India, Portugal, South Africa, and South Korea – were chosen to provide a mix of regions, levels of development and levels of social trust.

The study’s author Dr David Hugh-Jones, of UEA’s School of Economics, found evidence for dishonesty in all the countries, but that levels varied significantly across them. For example, estimated dishonesty in the coin flip ranged from 3.4 per cent in the UK to 70 per cent in China. In the quiz, respondents in Japan were the most honest, followed by the UK, while those in Turkey were the least truthful. Participants were also asked to predict the average honesty of those from other countries by guessing how many respondents out of 100 from a particular country would report heads in the coin flip test. However, participants’ beliefs about other countries’ honesty did not reflect reality.

This is interesting:

“Differences in honesty were found between countries, but this did not necessarily correspond to what people expected,” he said. “Beliefs about honesty seem to be driven by psychological features, such as self-projection. Surprisingly, people were more pessimistic about the honesty of people in their own country than of people in other countries.

And consider this from Hugh Jones:

“I suggest that the relationship between honesty and economic growth has been weaker over the past 60 years and there is little evidence for a link between current growth and honesty,” said Dr Hugh-Jones. “One explanation is that when institutions and technology are underdeveloped, honesty is important as a substitute for formal contract enforcement. Countries that develop cultures putting a high value on honesty are able to reap economic gains. Later, this economic growth itself improves institutions and technology, making contracts easier to monitor and enforce, so that a culture of honesty is no longer necessary for further growth.”

The research paper is here, and for the pointers I thank Charles Klingman and Samir Varma.

Jones, by the way, makes it clear there are a variety of kinds of honesty, and inferences from any single test should be limited.  For Japan in particular the measured level of honesty depends critically on which test is applied.  The real lesson of the study may simply be that most groups are dishonest, and people are not even honest with themselves about their views of the dishonesty of others.  Honesty depends a good deal on context too.  On some of these questions, see some skeptical comments from Kevin Drum.

If you are looking for simple correlations: “…at individual level, there is no evidence that religious adherence is associated with honesty.”  How about having a Ph.d.?

But how exactly are they cheating?

by on October 31, 2015 at 12:41 am in Current Affairs, Games, Law | Permalink

A man who sold himself a $1,000,000 winning D.C. Lottery ticket is just one of many retailers a WUSA9 investigation found winning the lottery at rates statisticians say border on impossible.

At least three retailers won the lottery around 100 times according to an analysis of D.C. Lottery records obtained under the Freedom of Information Act.

“$10,000, $5,000,” Lounes Issaad said about some of his 27 payouts that averaged $30,000 each.  “I don’t have nothing to hide.”

…Our investigation found lottery retailers make up at least three of the top five D.C. Lottery frequent winners – all with about 100 wins or more.

There is more here (the link makes some noise), via Michael Rosenwald.

You can already rate restaurants, hotels, movies, college classes, government agencies and bowel movements online.

So the most surprising thing about Peeple — basically Yelp, but for humans — may be the fact that no one has yet had the gall to launch something like it.

When the app does launch, probably in late November, you will be able to assign reviews and one- to five-star ratings to everyone you know: your exes, your co-workers, the old guy who lives next door. You can’t opt out — once someone puts your name in the Peeple system, it’s there unless you violate the site’s terms of service. And you can’t delete bad, inaccurate or biased reviews — that would defeat the whole purpose.

Imagine every interaction you’ve ever had suddenly open to the scrutiny of the Internet public.

The piece is by the excellent Caitlin Dewey.  Currently the company is valued at $7.6 million.

Hugo Lindgren tweeted:

Is there a word in the English language that more reliably means its opposite than ‘amicable’?

Twitter responses included: “moot,” “humbled,” “nice,” “my friend,” “nonplussed,” “cordial,” “priceless,” “tolerance,” “literally,” “spry,” “sincerely,” “honest,” “pal,” “sure,” and “”Fine” particularly when given as a one word answer.”

My favorite was “spry.”  Is there a word for such words?  Are there other examples?

Observers seem to focus on the target event and not its complement.  Bagchi and Ince have a new paper on this question:

Consumers routinely rely on forecasters to make predictions about uncertain events (e.g., sporting contests, stock fluctuations). The authors demonstrate that when forecasts are higher versus lower (e.g., a 70% vs. 30% chance of team A winning a game) consumers infer that the forecaster is more confident in her prediction, has conducted more in-depth analyses, and is more trustworthy. The prediction is also judged as more accurate. This occurs because forecasts are evaluated based on how well they predict the target event occurring (team A winning). Higher forecasts indicate greater likelihood of the target event occurring, and signal a confident analyst, while lower forecasts indicate lower likelihood and lower confidence in the target event occurring. But because, with lower forecasts, consumers still focus on the target event (and not its complement), lower confidence in the target event occurring is erroneously interpreted as the forecaster being less confident in her overall prediction (instead of more confident in the complementary event occurring—team A losing). The authors identify boundary conditions, generalize to other prediction formats, and demonstrate consequences.

Of course this also has relevance for the evolutionary processes governing pundits.

Here is a related press release (pdf).  For the pointer I thank Charles Klingman.

Is WeChat the future?

by on August 11, 2015 at 1:15 am in Economics, Games, Web/Tech | Permalink

This Connie Chan article about mobile in China is difficult to summarize or excerpt, but it is one of the most important pieces of the year so far.  Here are the opening bits:

This post is all about WeChat, but it’s also about more than just WeChat. While seemingly just a messaging app, WeChat is actually more of a portal, a platform, and even a mobile operating system depending on how you look at it.

Much has been written about WeChat in the context of messaging app trends, but few outside of China really understand how it works — and how it can pull off what for many companies (and countries) is still a far-off vision of a world managed entirely through our smartphones. Many of WeChat’s most interesting features — such as access to city services — are not even visible to users outside of China.

So why should people outside of China even care about WeChat? The first and most obvious reason is that it points to where Facebook and other messaging apps could head. Second, WeChat indicates where the future of mobile commerce may lie. Third, WeChat shows what it’s like to be both a platform and a mobile portal (what Yahoo could have been).

Ultimately, however, WeChat should matter to all of us because it shows what’s possible when an entire country — which currently has a smartphone penetration of 62% (that’s almost 1/3 of its population) — “leapfrogs” over the PC era directly to mobile. WeChat was not a product that started as a website and then was adapted for mobile, it was (to paraphrase a certain movie) born into it, molded by it.

Do read the whole thing, this is also one of China’s first major innovations in the classic sense of that term.

*Money and Soccer*

by on July 29, 2015 at 2:22 pm in Books, Economics, Games | Permalink

The subtitle for this one suffices for a review:

A Soccernomics Guide: Why Chievo Verona, Unterhaching, and Scunthorpe United Will Never Win the Champions League, Why Manchester City, Roma, and Paris Saint-Germain can, and why Real Madrid, Bayern Munich, and Manchester United Cannot Be Stopped

I haven’t even read the full subtitle yet (I used Control C), much less the book.  But the author is the highly regarded Stefan Szymanski, and John Foot gave it a very positive review in the 24 July 2015 TLS.

Measuring the expertise of burglars

by on May 11, 2015 at 12:42 am in Education, Games, Law | Permalink

Here is a Schneier on Security post in toto, I won’t indent it once again:

New research paper: “New methods for examining expertise in burglars in natural and simulated environments: “preliminary findings“:

Expertise literature in mainstream cognitive psychology is rarely applied to criminal behaviour. Yet, if closely scrutinised, examples of the characteristics of expertise can be identified in many studies examining the cognitive processes of offenders, especially regarding residential burglary. We evaluated two new methodologies that might improve our understanding of cognitive processing in offenders through empirically observing offending behaviour and decision-making in a free-responding environment. We tested hypotheses regarding expertise in burglars in a small, exploratory study observing the behaviour of ‘expert’ offenders (ex-burglars) and novices (students) in a real and in a simulated environment. Both samples undertook a mock burglary in a real house and in a simulated house on a computer. Both environments elicited notably different behaviours between the experts and the novices with experts demonstrating superior skill. This was seen in: more time spent in high value areas; fewer and more valuable items stolen; and more systematic routes taken around the environments. The findings are encouraging and provide support for the development of these observational methods to examine offender cognitive processing and behaviour.

The lead researcher calls this “dysfunctional expertise,” but I disagree. It’s expertise.

Claire Nee, a researcher at the University of Portsmouth in the U.K., has been studying burglary and other crime for over 20 years. Nee says that the low clearance rate means that burglars often remain active, and some will even gain expertise in the crime. As with any job, practice results in skills. “By interviewing burglars over a number of years we’ve discovered that their thought processes become like experts in any field, that is they learn to automatically pick up cues in the environment that signify a successful burglary without even being aware of it. We call it ‘dysfunctional expertise,'” explains Nee.

See also this paper.”

The pointer is from the estimable Chug.

The newspaper header is:

Panos Kammenos, Greece’s defence minister, threatens to open country’s borders to refugees – including potential members of Islamic State of Iraq and the Levant (Isil) – unless Athens receives debt crisis support

The story is here, via Andrea Castillo.  Whether it jives with your mood affiliation or not, it’s time to admit “these people simply don’t know what they are doing.”  Fortunately, it does seem the Greek government has been walking back on this talk.

It’s in an economics journal, so it must be true.   Agne Suziedelyte reports, from Economic Inquiry:

According to the literature, video game playing can improve such cognitive skills as problem solving, abstract reasoning, and spatial logic. I test this hypothesis using the data from the Child Development Supplement to the Panel Study of Income Dynamics. The endogeneity of video game playing is addressed by using panel data methods and controlling for an extensive list of child and family characteristics. To address the measurement error in video game playing, I instrument children’s weekday time use with their weekend time use. After taking into account the endogeneity and measurement error, video game playing is found to positively affect children’s problem solving ability. The effect of video game playing on problem solving ability is comparable to the effect of educational activities. (JEL I2, J13, J24)

I wonder how much endogeneity can be overcome in such settings, but if nothing else there is positive selection into video games and perhaps you should not be upset if your child is playing them.

Do any of you see an ungated copy?  The pointer here is from Kevin Lewis.

Kevin Erdmann writes:

I think basketball would be vastly improved if after the 3rd quarter, we just added 20 points to the higher score, and said, first team to that score wins.

Or, for that matter, make it score based instead of time based. It’s halftime when one team gets to 30, and the game is over when one team gets to 60.

It gets rid of all the fouling and time outs at the end of close games, and it means that it doesn’t serve any purpose for the winning team to drain the clock. And, it means that a team that falls far behind has more of a chance to catch up – like in baseball.

Of course this would not maximize ad revenue, which tends to increase with close games as the number of timeouts rises.  Furthermore perhaps people do not enjoy the outcome as much if they do not have to wait a bit for it.  Nonetheless an interesting idea.

Those questions are considered by Jeffrey Ely, Alexander Frankel, and Emir Kamenica in their new JPE paper “Suspense and Surprise.”  Here is one to the point excerpt:

In the context of a mystery novel, these dynamics imply the following familiar plot structure.  At each point in the book, the readers thinks that the weight of evidence suggests that the protagonist accused of murder is either guilty or innocent.  But in any given chapter, there is a chance of a plot twist that reverses the reader’s beliefs.  As the book continues along, plot twists become less likely but more dramatic.

In the context of sports, our results imply that most existing rules cannot be suspense-optimal.  In soccer, for example, the probability that the leading team will win depends not only on the period of the game but also on whether it is a tight game or a blowout…

Optimal dynamics could be induced by the following set of rules.  We declare the winner to be the last team to score.  Moreover, scoring becomes more difficult as the game progresses (e.g., the goal shrinks over time).  The former ensures that uncertainty declines over time while the latter generates a decreasing arrival rate of plot twists.  (In this context, plot twists are lead changes.)

There are ungated versions of the paper here.  Note that at the very end of the paper…well, I’ll just let you read it for yourselves.

So says my Twitter feed.

For the last few weeks there have been three models in the running:

1. The Greek government is calling the Germans Nazis because they figure Grexit is coming no matter what and they want to get the populace riled up as a distraction from the disasters, or

2. The Greek government will cave so cravenly on the substance that they want to have it on the record books that they supplied some expressive goods for a few weeks’ time, namely insulting the Germans and claiming that the Troika is dead and buried, or

3. The Greek government is simply full of out-of-control, ideological maniacs.

Right now it is looking like #2 — however unlikely it may sound as a model of retrospective voting and intertemporal substitution — is closest to reality.  What the relevant legislatures will go along with, however, still remains to be seen.  Arguably the insults and posturing have narrowed the possible bargaining space by hurting feelings all around.

Monopoly games filled with real money, in this case euros, from France:

In honor of the game’s 80th anniversary this year, its French manufacturers have replaced its traditional fake bills with real money in 80 boxes now on sale.

As if Monopoly needed higher stakes.

Agence France-Presse reported that 69 of the prize sets will include five 10-euro notes and five 20-euro notes, while another 10 will include five real 20-euro notes, two 50-euro notes and one 100-euro note.

For the final box, the entire “bank” has been replaced with real bills, making the game — which costs about 26 euros before shipping and handling — worth 20,580 euros, or about $23,000.

The notes were replaced during a covert operation last month in the small forest town of Creutzwald in northeastern France.

The monopoly boxes are selling for the normal price, although of course without notice as to which boxes have the real money inside.  Hasbro’s U.S. wing, by the way, is planning a ““vintage style board” to complement the 27 other variations currently available.”

The article is here, hat tip goes to NinjaEconomics.