Friday assorted links

My take on the Jeffrey Epstein case

I asked myself the question of how those events have induced me to revise my priors.  Here is one bit of many:

I am now, at the margin, more inclined to the view that what keeps many people on good behavior is simply inertia. They are oddly passive in their core inclinations, but will behave badly if given an easy opportunity. And since many of these people probably are not active independent malefactors on a regular basis, their sense of risk may not be entirely well developed. Thus they themselves may have been fairly naïve in their dealings with Epstein, not quite understanding that their invulnerability in everyday life might not carry over to all situations.

Here is the rest of my Bloomberg column, many distinct points contained therein.

Oversight of cost overruns does not always help

In the United States, 42% of public infrastructure projects report delays or cost overruns. To mitigate this problem, regulators scrutinize project operations. We study the effect of oversight on delays and overruns with 262,857 projects spanning 71 federal agencies and 54,739 contractors. We identify our results using a federal bylaw: if the project’s budget is above a cutoff, procurement officers actively oversee the contractor’s operations; otherwise, most operational checks are waived. We find that oversight increases delays by 6.1%–13.8% and overruns by 1.4%–1.6%. We also show that oversight is most obstructive when the contractor has no experience in public projects, is paid with a fixed-fee contract with performance-based incentives, or performs a labor-intensive task. Oversight is least obstructive—or even beneficial—when the contractor is experienced, paid with a time-and-materials contract, or conducts a machine-intensive task.

That is from a new paper by Calvo, Cui, and Serpa, via the excellent Kevin Lewis.

How to reform the economics Ph.D

This has been bothering me, so I’m putting it out there – The shift to 6 yrs for an Econ PhD is a TERRIBLE trend for female PhD students – & also some men, obviously – but especially for women. This issue warrants much more attention.

So says the wise Melissa S. Kearney.

Along those lines, I have a modest proposal.  Eliminate the economics Ph.D, period.  Offer everyone three years of graduate economics education, and no more (with a clock reset allowed for pregnancy).  Did Smith, Keynes, or Hayek have an economics Ph.D?  This way, no one will assume you know what you are talking about, and the underlying message is that economics learning is lifelong.

After the three years is up, you would be free to look for a job, or alternatively you might find someone to support you to do additional research, such as in the newly structured “post doc without the doc.”  The researchers who absolutely need additional training would try to glom on to a lab or major grant, but six years would not be the default.

Of course, in that setting, schools could take chances on more students, and more students could take a chance on trying economics as a profession.  Furthermore, for most of the most accomplished students, it is already clear they deserve a top job by the time their third year rolls around, usually well before then.  Women would hit their tenure clocks much earlier, also, easing childbearing constraints.  A dissertation truly would become just a job market paper, which has already been the trend for a long time.  Why obsess over the non-convexity of “finishing”?  Finish everyone, and throw them into the maws of some mix of AI and human evaluators sooner rather than later.

Over time, I would expect that more people would take the first-year sequence in their senior year of undergraduate study, and more first-year jobs would have zero or very low teaching loads.  All to the better.

And if you’re mainly going to teach Principles at a state university, three years of graduate study really is enough.  You’ll learn more your first year teaching anyway.

Which other fields might benefit from such a reform?

People, you have nothing to lose but your chains.

How Harvard makes admissions decisions

Here are some new and very thorough results from Peter Arcidiacono, Josh Kinsler, and the excellent Tyler Ransom:

The lawsuit Students For Fair Admissions v. Harvard University provided an unprecedented look at how an elite school makes admissions decisions. Using publicly released reports, we examine the preferences Harvard gives for recruited athletes, legacies, those on the dean’s interest list, and children of faculty and staff (ALDCs). Among white admits, over 43% are ALDC. Among admits who are African American, Asian American, and Hispanic, the share is less than 16% each. Our model of admissions shows that roughly three quarters of white ALDC admits would have been rejected if they had been treated as white non-ALDCs. Removing preferences for athletes and legacies would significantly alter the racial distribution of admitted students, with the share of white admits falling and all other groups rising or remaining unchanged.

Am I allowed to observe that this seems wrong to me?  And that our “liberal elite” (not my preferred term, but what you see in the discourse and I don’t know which other referent to use) has failed us?

And from Garett Jones:

Controlling for academic traits and much else, being Asian American predicts a substantially lower probability of Harvard admission… And being female predicts a substantially higher probability of admission.

Here is the full paper.  For the pointer I thank various MR readers.

The Intuitive Monty Hall Problem

Many puzzles are difficult to solve from one perspective but easy from another. A challenge on stackexchange was to find an equivalent version of the Monty Hall problem where the correct solution of switching is obvious. Joshua B. Miller has an excellent answer. To recall, in the original there is a great prize hidden behind one of three doors. You choose a door. Monty Hall then reveals a lousy prize behind one of the other two doors (it’s always a lousy prize). Do you switch doors? Most people see no reason to switch. Even Paul Erdos was a no switcher! Moreover, most of those who do switch get to that conclusion with an unintuitive Bayesian calculation.

Here’s the intuitive version.

There are three boxers. Two of the boxers are evenly matched (no draws!); the other boxer will beat either them, always.

You blindly guess that Boxer A is the best and let the other two fight.

Boxer B beats Boxer C.

Do you want to stick with Boxer A in a match-up with Boxer B, or do you want to switch?

See also Miller’s new piece in the JEP which looks at the Monty Hall problem and the Hot hand puzzle.

*Something Deeply Hidden: Quantum Worlds and the Emergence of Spacetime*

That is the new, interesting, and engaging book by Sean Carroll.  Some of it is exposition, the rest argues for a version of Many Worlds Theory, but with a finite number of universes.  Here is one excerpt:

String theory, loop quantum gravity, and other ideas share a common pattern: they start with a set of classical variables, then quantize.  From the perspective we’ve been following in this book, that’s a little backward.  Nature is quantum from the start, described by a wave function evolving according to an appropriate version of the Schroedinger equation.  Things like “space” and “fields” and “particles” are useful ways of talking about that wave function in a appropriate classical limit.  We don’t want to start with space and fields and quantize them; we want to extract them from an intrinsically quantum wave function.

I very much liked the discussion on pp.300-301 on how a finite number of quantum degrees of freedom implies a finite-dimensional Hilbert space for the system as a whole, that in turn constraining the number of worlds in an Everett-like model.  If only I understood it properly…

You can buy the book here.

Frequency of conflict initiation worldwide

That is from the new and interesting Only the Dead: The Persistence of War in the Modern Age, by Bear F. Braumoeller, which is largely a critique of Pinker on trends toward peacefulness (Pinker gives only the more optimistic data on Europe).  And from the text:

…there is variation in the rate of conflict and war initiation over time, and it’s pretty substantial.  Leaving aside the two jumps during the World Wars, the median rate of conflict initiation quadruples in the period between 1815 and the end of the Cold War, after which it abruptly drops by more than half.

The “falling rate of conflict” is thus not entirely reassuring.

How about the deadliness of occurring conflicts?:

Analyzing the two most commonly used measures of the deadliness of war, I find no significant change in war’s lethality.  If anything, the data indicate a very modest increase in lethality, but that increase could very easily be due to chance…Worse still, the data are consistent with a process by which only random chance prevents small wars from escalating into very, very big ones.

Overall, the arguments in this book are strong, and the discussion of data issues is subtle throughout.  You can buy the book here, its arguments seem fundamentally correct to me.

Why we will end up piercing the corporate veil

The internet is one big reason why we will find it increasingly difficult to separate out the assets of a company from the assets of its founders or CEOs, as I discuss in my latest Bloomberg column:

More important, social media personalizes agency — in effect, making it easier to accuse particular individuals of wrongdoing. Mark Zuckerberg, Jeff Bezos, and the Koch brothers all have images or iconic photos that can be put into a social media post, amplifying any attack on their respective companies. It is harder to vilify Exxon, in part because hardly anyone can name its CEO (Darren Woods, since 2017), who in any case did not create the current version of the company. Putting the Exxon logo on your vituperative social media post just doesn’t have the same impact. With Bill Gates having stepped down as Microsoft CEO in 2000, it is harder to vilify that company as well.

This personalization of corporate evil has become a bigger issue in part because many prominent tech companies are currently led by their founders, and also because the number of publicly traded companies has been falling, which means there are fewer truly anonymous corporations. It’s not hard to imagine a future in which the most important decision a new company makes is how personalized it wants to be. A well-known founder can spark interest in the company and its products, and help to attract talent. At the same time, a personalized company is potentially a much greater target.

The more human identities and feelings are part of the equation, however, the harder it will be to keep the classic distinction between a corporation and its owners. As the era of personalization evolves, it will inevitably engulf that most impersonal of entities — the corporation.

Do read the whole thing.

Wednesday assorted links

Pollution, Climate Change and India’s Choice Between Policy and Pretense

Image result for pollution indiaDean Spears, one of the authors of Where India Goes has a new book on air pollution in India, Air. When I reviewed Where India Goes in 2017 I said it was the best social science book I had read in years. Spears is able to accurately explain academic work–much of it his own and with co-authors–in accessible language and to combine that with on-the-ground reporting to produce a book that is both informative and full of human interest. He brings the same skills to Air.

As Spears shows, pollution is killing Indians, especially babies, and those it doesn’t kill it harms as seen in statistics on stunting and respiratory disease. Spears isn’t naive, however, he knows that manufacturing is also bringing tremendous benefits. The issue, however, is that a lot of pollution in India comes from relatively low value activities like burning crops. Moreover, solar power in India is cost competitive with coal today, even before taking into account health benefits. Thus, the harms of pollution are tragic because they are unnecessary.

If the costs of pollution exceed the benefits why isn’t something being done? One of the things I like about Air is that it is clear that pollution in India is both a market failure and a government failure. The government has been slow to respond to pollution because much of the public remains unaware of pollution’s true cost and much of the true cost is born by children and future people who have no vote. In the meantime, the government enhances rational ignorance by refusing to fund even the most basic equipment to measure where and when pollution ebbs and flows. Instead the government engages in virtue-politics by banning plastic bags and creating odd-even restrictions on driving in Delhi. These activities are pointless, even counter-productive, but they are well publicized and the appearance of doing something matters more than reality.

Here’s one brilliant bit:

Just next to the Raebareli coal plant is a solar power plant. The solar plant is, in principle, capable of generating 10 MW. That capacity is 1 per cent of the 1000 MW capacity of the immediately neighbouring coal plant (which had another few hundred megawatts under construction when I talked with Gaurav).

I visited the solar plant on Independence Day. The ground around the solar panels was flooded with August rain. A shoe destroying walk through the mud and water brought me to the control room in a small building. There, a cheerful young engineer from Bengaluru watched a bank of computer screens. A TV monitor reviewed a list of fifteen highlights of the Prime Minister’s holiday speech that morning. The control room was set up in a museum-like display. The apparent goal was to impress visitors with modern renewable energy and with colourful displays of General Electric–branded software. The young engineer was excited to show me the screens. He clearly wanted the message to be good.

It was not good. That cloudy day, most of the dots were red, not green. The screens reported that the solar plant was generating 60 kW. The engineer assured me that one day it had gotten up to 7500 kW. A megawatt is 1000 kilowatts. So, at 0.06 MW, the solar plant was producing less than 1 per cent of the 10 MW that the signboard at the entrance promised, which would have been 1 per cent of the coal plant.

It is not surprising that a solar plant does not generate much electricity if it is built beneath the smoke of a coal plant with 100 times the capacity. Ordinarily, one places solar plants in the path of direct sunlight. This one was placed in the path of visitors.

Addendum: Case in point. India today bans e-cigarettes because of health risks!

So be it!

At this point, I can picture Tyler Cowen remarking, “You’re a bigger pessimist than I am. According to you, we’re richer than we think, but riches don’t matter much for happiness, so who cares?” The whole point of optimism, though, is to say, “You may not be happy, but you should be.” If you want to meme that as, “Optimism is pessimism about the dangers of pessimism,” so be it.

File under “Bryan Caplan, pessimist.

Lebanese/Gaza marriage markets in everything

Political parties sponsor weddings for young members to reinforce their loyalty, and gratitude. Religious and ethnic minorities — which means everyone in splintered Lebanon — consider marriage and procreation essential to their long-term survival. And armed groups encourage their fighters to marry so that their children can become the fighters of the future.

A few weeks before the Maronite nuptials, Hezbollah, the Shiite militant group and political party, oversaw a similar enormous wedding for 31 couples. That was tiny compared with a mass wedding in Lebanon earlier this year that brought together 196 couples and was sponsored by the Palestinian Authority president, Mahmoud Abbas.

But the nearby Gaza Strip — where an Egyptian-Israeli blockade keeps people poor and locked in — beats them all, often because of competition between foreign sponsors eager to win friends by expediting marriages.

In 2015, the United Arab Emirates sponsored a mass wedding there for 200 couples. Two months later, Turkey seriously upped the ante, bankrolling a ceremony for 2,000 couples that was attended by officials from Hamas, the militant group that rules the territory…

Fadi Gerges, an official with the league, said it was natural for minorities to encourage their youths to procreate in a country where demographics affect power.

Here is the rest of the Ben Hubbard NYT story, via the excellent Kevin Lewis.

Vending machine markets in everything

The engagement ring (size 6.25) is in the fourth machine in the B3 slot, almost hidden among the more colorful gifts. Made by Fitzgerald Jewelry of Williamsburg, Brooklyn, it features a yellow rose-cut diamond surrounded by gray-colored diamonds set in 14-karat gold band with matte finish. It costs $800 before tax…

Ms. Kelly jokingly added that you could almost pull off an entire wedding with items from the vending machines. Grooms can wear the Duncan Quinn cuff links ($525) and a necktie ($285). Brides can carry a dried bouquet that stays fragrant for three years ($25). Photos can be taken with a Polaroid camera ($100). The machine even sells Polaroid film in color or black and white ($17 each).

Here is more from the NYT.