Philosophy

His new book Inequality: What Can Be Done?, is out mid-May but already available in some bookstores.  Here is an interview with Atkinson.  I thought this book did not take sufficient care with some very basic distinctions, such as the difference between a problem of poverty and a problem of inequality.   Nor does it put enough emphasis on wealth creation, or explain why Korean-Americans have done pretty well over the last thirty years, among other possible examples.

The book is dedicated to the NHS workers of Britain.  That’s fine, many of them are very good, but Atkinson doesn’t mention a few key points, namely that a) the British system ranks relatively poorly by European standards, b) the British system probably has too much governmental ownership and provision, and c) bureaucracies usually underpay their best workers and thus do not generate enough initial income inequality.

François Bourguignon has a very good and readable new book on the international dimension of inequality, The Globalization of Inequality.

Martin Wolf has an FT review of both books.

For the pointer to the Atkinson interview I thank Enrico Schaar.

Eric Posner’s (with Adrian and Blakey Vermeule) new and excellent venture The New Rambler asked me to write a book review for them.  The impish side of me thought “what book better to review than the old Rambler?”, namely by Samuel Johnson?  Here is the opening of my piece:

A blogger by the ostensible name of “Samuel Johnson” has compiled his previous posts into a book, edited by a supposed W.J. Bate and Albrecht B. Strauss. But the true work here is “Johnson’s,” and the sequential editing, as such, seems to have been done by WordPress. The editorial illusion, of course, is a trick dating from the eighteenth century, as for instance Jonathan Swift and Alexander Pope presented the work of an imaginary Martinus Scriblerus in the 1740s. These Johnson posts claim to date from the early 1750s, a typical blogger’s conceit and misdirection, but the content is too modern and innovative to sustain that illusion for long.

Cutting through the postmodern trappings, Johnson’s blog reflects his ongoing interest in behavioral economics. He is continually skirting the frontier of the latest research insights, although like many bloggers he is lax in providing the proper citations. He writes off the top of his head, though without care for what came before from Thomas Schelling, Jean Tirole, or Cass Sunstein, among other titans of the field. Reading these short pieces is thus a fascinating but often frustrating experience. And as is true for most of the work in behavioral economics, there are insights but a fully fleshed out model, applied consistently to all human choices, is nowhere to be found.

Here is the full review, recommended!

Chad writes me:

What jobs (particularly ones we think of as being inherently beneficial to society) might America have too many of? Political journalism comes to mind this particular month, since we apparently have enough to carefully monitor the Chipotle orders of presidential candidates 19 months before the election. Writers might be another, particularly in a world of self-publishing.

One can imagine lots of reasons for a greater-than-optimal number of people in a particular profession, from government subsidies to cultural biases, but I’m curious if you have a gut feeling about any professions in particular.

A good question, in my view the answer is not so simple.  Writers and artists are indeed a possible nomination, but some of the demand for these professions is likely for consumption, which makes the overinvestment difficult to judge.  And what about lawyers?  Relative to the number of laws and regulations (too many in my view, but take them as given), it is not obvious to me that we have too many lawyers.  Someone has to tell companies when it is safe to proceed, or not.

How about too many people selling medical devices and other high margin items?  Too many people making alcohol?  Too many people raising and selling animal meat?  Those would be my picks.

The finance sector is another obvious culprit, but as a fraction of wealth I do not think it is larger than in the past.  Admittedly people in the finance sector may be engaging in the wrong activities, but I am not sure the case for fewer employees per se is so obvious.  Still, it is another candidate, if only because it (often) involves people selling high-margin items.

Claims about embryos

by on April 24, 2015 at 12:29 am in Current Affairs, Philosophy, Science | Permalink

A pressing question, said Rudolf Jaenisch, an M.I.T. biology professor, is why anyone would want to edit the genes of human embryos in order to prevent disease. Even in the most severe cases, involving diseases like Huntington’s in which a single copy of a mutated gene inherited from either parent is enough to cause the disease with 100 percent certainty, editing poses ethical problems. Because of the way genes are distributed in embryos, when one parent has the gene, only half of the parent’s embryos will inherit it. With gene editing, the cutting and pasting has to start immediately, in a fertilized egg, before it is possible to know if an embryo has the Huntington’s gene. That means half the embryos that were edited would have been normal — their DNA would have been forever altered for no reason. “It is unacceptable to mutate normal embryos,” Dr. Jaenisch said. “For me, that means there is no application.”

If I were grading an undergraduate philosophy class, I am not sure Dr. Jaenisch would exceed a C minus with that answer (the source article is here).  Besides I have never known a normal embryo.  Then there is the all too obvious question as to why it should be acceptable to abort embryos, but not to modify or mutate them.  Oops.

The better arguments are surely the slippery slope worries that embryo tinkering will change the nature and future of humanity in dangerous ways, perhaps producing too much conformity, too much zero-sum competition (“buy the Harvard splice”), too much discrimination against various “types,” too much induced family loyalty, legal discouragement of rebellious genes, excess advantages for elites, too many decisions which too explicitly lower the social status of some groups of people, and perhaps ultimately too much drift from the world we know (and love?).

Those are my worries.  Whether or not they are valid, they would seem to merit at least a C+.  But many commentators wish to ensure these issues are not actually argued.  Will this prove the new face of anti-scientific, anti-philosophical thinking?  Check out the closing quotation from Professor Daley at Harvard, and his use of the word “deranged.”

A lot of parents will strongly desire some future version of this product, and I believe a number of countries are going to be willing to proceed with such innovations, if and when they become possible.  They’ll also be willing to live with the costs of the failures in the meantime.  So I don’t think the strategy of shutting down debate is going to fare so well in this case.

Dan Klein (from Abigail D.) directs my attention to an interesting paper by Fisher, Goddu, and Keil (pdf):

As the Internet has become a nearly ubiquitous resource for acquiring knowledge about the world, questions have arisen about its potential effects on cognition. Here we show that searching the Internet for explanatory knowledge creates an illusion whereby people mistake access to information for their own personal understanding of the information. Evidence from 9 experiments shows that searching for information online leads to an increase in self-assessed knowledge as people mistakenly think they have more knowledge “in the head,” even seeing their own brains as more active as depicted by functional MRI (fMRI) images.

Having done some further search on this topic, using Google, I can assure you that I now have a much better grasp on whether this hypothesis is true or not…

Jonathan Chait writes:

At a growing number of campuses, professors now attach “trigger warnings” to texts that may upset students, and there is a campaign to eradicate “microaggressions,” or small social slights that might cause searing trauma. These newly fashionable terms merely repackage a central tenet of the first p.c. movement: that people should be expected to treat even faintly unpleasant ideas or behaviors as full-scale offenses.

Read his whole discussion, but he more or less disapproves.  I’ve long wanted to disagree with Chait “from the left,” and it seems this is my chance, I had better grab it while I can.

While teaching Law and Literature this year, I attached very gentle, low key “trigger warnings” to a number of items on the syllabus, namely those dealing with extreme violence, rape, and some other very unpleasant situations.  I am glad I did this.  I told students that if they preferred to do a substitute assignment, I could arrange that.  Is that so unreasonable?  There were no takers, but I don’t see it did anyone harm or limited free speech in the classroom (or outside of it) to make this offer.  If anything, it may have eased speech a slight amount by noting it is OK to feel uncomfortable with some topics, or at least serving up that possibility into the realm of common knowledge.  That struck me as better and wiser than simply pretending we were studying the successful operation of the Coase theorem the whole time.

I don’t doubt that trigger warnings may be misused in some situations by some professors, but overall they seem to me like another small step to a better world.  I do agree we need to liberate trigger warnings from the strictures of the PC movement, no argument there.

Addendum: I am pleased to see that GMU was moved into the highest category for university free speech, according to FIRE.

Here is a long and excellent post, whereby Robin outs himself as a strange kind of environmentalist.  Do need the whole thing, but here is one summary excerpt:

So, bottom line, the future great filter scenario that most concerns me is one where our solar-system-bound descendants have killed most of nature, can’t yet colonize other stars, are general predators and prey of each other, and have fallen into a short-term-predatory-focus equilibrium where predators can easily see and travel to most all prey. Yes there are about a hundred billion comets way out there circling the sun, but even that seems a small enough number for predators to careful map and track all of them.

“At first they came for the rabbits…and then they came for me.”  I find that intriguing, but I have a more marginalist approach, and perhaps one which encompasses Robin’s hypothesis as a special case.  The death of human (and other) civilizations may be a bit like the death of the human body through old age, namely a whole bunch of things go wrong at once.  If there were a single key problem, it would be easier to find a patch and prolong things for just a bit more.  But if we have reason to believe that, eventually, many things will go wrong at once…such a concatenation of problems is more likely to defeat us.  So my nomination for The Great Filter, in a nutshell, is “everything going wrong at once.”  The simplest underlying model here is that a) problems accumulate, b) resources can be directed to help solve problems, and c) sometimes problems accumulate more rapidly than they can be solved.

This is also why, in many cases, there is no simple “fact of the matter” answer as to why various mighty empires fell in the past.  Here is my earlier review of Apocalypto, a remarkable and still underrated movie.

Joseph Heath’s Enlightenment 2.0 is one of the best books I have read in years. I offer an extensive review at the New Rambler. Here’s the opening:

Heath-Enlightenment-2Joseph Heath is a Canadian philosopher who is unusually conversant with economics and also unusually capable of writing sparkling prose for a popular audience. His earlier book Economics Without Illusions was split into 6 right-wing fallacies and 6 left-wing fallacies, and he did a commendable job on both sides. Heath has his own left-liberal point of view: the subtitle of Economics Without Illusions was Debunking the Myths of Modern Capitalism and in the original Canadian version, the book was subtitled Economics For People Who Hate Capitalism. However, I like capitalism and I still enjoyed it! Enlightenment 2.0 is Heath’s foray into political philosophy. Drawing on psychology, economics and political science, Enlightenment 2.0 is a brilliant defense of reason, an important call for a more rational politics, and a great read.

Heath is worried that the foundations of liberal society are being eroded by the cultural denigration of reason combined with ruthlessly competitive economic and political forces that exploit the biases and hooks of our unreasoning mind.

Although I admire Enlightenment 2.0, I answer the question of the post differently than does Heath and my review contains plenty of critical commentary. Ayn Rand, Idiocracy, mind viruses and other interesting characters make an appearance. Read the whole thing.

Tyler Cowen’s three laws

by on April 15, 2015 at 9:55 am in Economics, Law, Philosophy | Permalink

Many of you have been asking for a canonical statement of what I sometimes refer to as Cowen’s Laws.  Here goes:

1. Cowen’s First Law: There is something wrong with everything (by which I mean there are few decisive or knockdown articles or arguments, and furthermore until you have found the major flaws in an argument, you do not understand it).

2. Cowen’s Second Law: There is a literature on everything.

3. Cowen’s Third Law: All propositions about real interest rates are wrong.

I coined those some time ago, when teaching macroeconomics, yet I remain amazed how often I see blog posts which violate all three laws within the span of a few paragraphs.

There is of course a common thread to all three laws, namely you should not have too much confidence in your own judgment.

Addendum: Kevin Drum comments.

Steven Quartz writes:

…our current Gilded Age has been greeted with relative complacency. Despite soaring inequality, worsened by the Great Recession, and recent grumbling about the 1 percent, Americans remain fairly happy. All of the wage gains since the downturn ended in 2009 have essentially gone to the top 1 percent, yet the proportion of Americans who say they are “thriving” has actually increased. So-called happiness inequality — the proportion of Americans who are either especially miserable or especially joyful — hit a 40-year low in 2010 by some measures. Men have historically been less happy than women, but that gap has disappeared. Whites have historically been happier than nonwhites, but that gap has narrowed, too.

In fact, American happiness has not only stayed steady, but converged, since wages began stagnating in the mid-1970s. This is puzzling. It does not conform with economic theories that compare happiness to envy, and emphasize the impact of relative income for happiness — how we compare with the Joneses.

Here is part of the answer, consistent with what I argued in my book What Price Fame?:

…social status, which was once hierarchical and zero-sum, has become more fragmented, pluralistic and subjective. The relationship between relative income and relative status, which used to be straightforward, has gotten much more complex.

…A new generation of ethnographers has discovered an explosion of consumer lifestyles and product diversification in recent decades. From evangelical Christian Harley-Davidson owners, who huddle together around a motorcycle’s radio listening to a service on Sunday mornings, to lifestyles organized around musical tastes, from the solidarity of punk rockers to yoga gatherings, from meditation retreats to book clubs, we use products to create and experience community. These communities often represent a consumer micro-culture, a “brand community,” or tribe, with its own values and norms about status.

The article is very interesting throughout, hat tip goes to Claire Morgan.

Note that the closing bit of this piece is…this: “Money may not buy happiness in the long run, but consumer choice has gone a long way in keeping most Americans reasonably content, even if they shouldn’t be.”

Walmart critics embrace two moral standards: in the first, morality requires payment of high wages to 1.2 million people. In the second, morality can be achieved without employing anyone at all–that is, by paying zero wages. Most of us have chosen to live by the second standard, and from our lofty moral position we can criticize Walmart for not meeting the first standard. How convenient!
There is more here, from Ryan Decker, via Ben Southwood.

A live stream version is posted here, slide to 6:00 to start, YouTube and podcast and transcript versions are on their way.  I thought Jeff did just a tremendous job.  We covered the resource curse, why Russia failed and Poland succeeded, charter cities, his China optimism, how his recent book on JFK reflects the essence of his thought, why Paul Rosenstein-Rodan abandoned Austrian economics for “big push” ideas, whether Africa will be able to overcome the middle income trap, where he disagrees with Paul Krugman, his favorite novel (Doctor Zhivago, he tells us why too), premature deindustrialization, and how we should reform graduate economics education, among other topics.

You will find it here.  Here is one excerpt:

TYLER COWEN: New York City, overrated or underrated?

PETER THIEL: That’s massively overrated.

TYLER COWEN: Why?

PETER THIEL: We had a 25-year boom in finance, from ’82 to ’07. I think that’s slowly ebbing, slowly abating. It’s going to be increasingly regulated, and so if you want a long/short blue state trade, you want to be long California, short New York. The long/short red state trade, by the way, is you want to be long Texas, short Virginia.

If you ask, what do Virginia and New York have in common, and what do Texas and California have in common? Both Texas and California are very inward-focused places. California, both the Hollywood version and the Silicon Valley version, are very focused in on themselves. Texas is also a very inward-focused place.

What Virginia and New York, or let’s say DC and New York City, have in common is that they’re centers of globalization. Finance is an industry that’s fundamentally leveraged to globalization, and DC is fundamentally leveraged to international geopolitics.

I would bet on globalization slowly being in abeyance. I think with the benefit of hindsight, we will realize that 2007 was not just the peak year of the finance boom, but also the peak year of globalization, like maybe 1913. Happily, it hasn’t resulted in a world war, at least not yet, but I think we are in this period where globalization is steadily pulling back.

And so you want to be in places or industries that are levered to things other than globalization.

Self-recommending…The YouTube and podcast versions are here.

My latest column for The Upshot, at the NYT, is here.  Here is one excerpt:

Data from the Economic Report of the President [p.34] suggests that if productivity growth had maintained its pre-1973 pace, the median or typical household would now earn about $30,000 more today. Those higher earnings would constitute a form of upward mobility. For purposes of comparison, if income inequality had maintained its pre-1973 trend, the gain for the median household would be about $9,000 in income this year, a much smaller figure.

Those changes in productivity and inequality trends aren’t entirely separate, but accelerating the growth of productivity has the potential to do more for upward economic mobility than redistributing money from the top 1 percent.

And this:

In the book “Equality for Inegalitarians,” George Sher, a professor of philosophy at Rice University, argues that the equality we should care most about is giving everyone a chance to “live effectively.” Most of all that means ensuring that people have enough for their daily needs. We can tolerate many of the inequalities that arise above this minimum income level, provided there is protection on the downside and plenty of opportunities for those who are economically ambitious.

Read Sher, Harry Frankfurt’s excellent forthcoming book On InequalityDerek Parfit on equality and priority (pdf) and Huemer on Parfit (pdf).  Read about prioritarianism more generally.  I come away from these writings with the view that the current moral focus on inequality is a flat-out mistake in moral philosophy, analogous to how the philosophers sometimes make mistakes in economics.  That’s right, not a difference in values but a mistake.  (The difference in values, to the extent there is one, should be over the strength of our obligations to those at the bottom.)

This discussion of education provides another good example of how all this matters: if we successfully elevate people at the bottom, we don’t have to “fix” inequality.

A number of Twitter (and other) responses to my column are confusing several kinds of mobility: a) how many people from the bottom are elevated by how much, with b) what is the chance of people rising further quintiles?, and c) what is the intergenerational transmission of income and other variables?  It’s a) that matters, as b) and c) run into many of the same problems that inequality notions do.

I also am not impressed by the “Gatsby Curve” observation that inequality and mobility (some kinds, some of the time) are correlated.  Lots of things are correlated, but the question is what matters practically and morally.

By the way, here are estimates on how immigration might affect the Gini coefficient (pdf).  I find that egalitarians have a hard time developing consistent intuitions about immigration.

Interfluidity offers a very different view from mine.  Alex has much to say as well.  Here is Schneider and Winship on the Gatsby Curve.

Here is my conclusion:

It is quite possible the future will bring higher levels of income inequality, which will undoubtedly distress many commentators. But we are likely to be better off if we keep our eye on the ball, identify what really helps people the most and do whatever we can to increase economic mobility. That is a practical program that we all should be able to endorse.

When Lyndon Johnson hosted Lester Pearson in 1965, he hauled the Canadian prime minister up by his lapels and shouted, “you pissed on my rug” after his guest criticised the Vietnam war in a speech during his visit to the US. And when Prime Minister Pierre Trudeau learned that Richard Nixon had called him “an asshole”, he responded: “I’ve been called worse things by better people.”

From Demetri Sevastopulo, there is more here at the FT.  Alex and I, however, get along just great…