Month: February 2005

Black markets in red

[In Saudi Arabia] Every heart, every rose and every item that’s red or that suggests
love and romance descends underground, to the black market, where its
price triples and quadruples. Red flowers are hidden in back rooms.

Ibrahim al-Ghaith, chief of the 5,000-man religious police, told
Al-Hayat newspaper his men were "acting upon instructions to confiscate
manifestations" of Valentine’s Day, birthdays and other celebrations.

"The feast of love is based on love and passion and things that are not proper for a Muslim to respond to," he told the paper.

Salesmen and waiters avoid wearing red; entrepreneurs whose stores maintain a red hue risk days in jail.

religious lectures at schools, teachers and administrators warn
students against marking the occasion, noting Saint Valentine was a
Christian priest, according to an educational supervisor, who spoke on
condition of anonymity.

Saint Valentine is believed to have been a 3rd-century martyred Roman priest or bishop.

Here is the story.

More Media Bias

Here is the New York Times on The Gates:

Even at first blush, it was clear that "The Gates" is a work of pure
joy, a vast populist spectacle of good will and simple eloquence, the
first great public art event of the 21st century.

Here is the Washington Post:

Ho-Hum.  They’re way, way better than the pandas, pigs, cows and other fiberglass tchotchkes that have "decorated" our cities over the past decade.  But it’s only a difference of quality, not kind.

What do Protesters Want?

  1. Unsurprisingly, general criticisms of the current administration were the most common reasons offered for protest. About 44% of the demonstrators we surveyed expressed a general anti-Bush theme. Domestic policy issues (e.g., housing, welfare, etc.) were the second most common reason for participating in protest. 28% of respondents reported these issues as a motivation for participating in the rally.

  2. Surprisingly, the third most common reason for participating was for expressive reasons. 26% of respondents said they wanted to exercise their freedom of speech and assembly. Respondents said they wanted their voices to be heard.

  3. Even more surprising was that anti-war messages (which we coded as “foreign policy grievances”) came in fourth. About 20% of the people we surveyed listed the war, or other foreign policy issues, as a reason to protest. This may have been a function of the context. One point of our paper is that the group that organizes a rally has the biggest effect on what grievances are expressed by the participants. If we had targeted solely anti-war events, this number may have been higher.

  4. I found it interesting that only 1% expressed pro-Kerry reasons. My collaborator likes to say that the events were anti-Bush and not pro-Kerry. Very true. We wouldn’t expect an outpouring of pro-Kerry sentiment during a rally for housing rights. But on the other hand, pro-Kerry was less popular than “personal reasons,” the category we created for reasons involving meeting friends and members of the opposite sex. That’s got to say something about the Senator’s ability to appeal to his base!

What’s the take home message? Yes, the war is an important and crucial issue in the progressive movement, as it is for the rest of America, but respondents were more likely to be motivated by a general ideological disagreement with the administration and by domestic policies. Events such as the anti-GOP rallies are an opportunity to exercise free speech, express political values and lobby for domestic policy agendas. Once again, we return to Tip O’Neil’s adage: “all politics is local.”

The economics and probabilities of cryogenics

Some people I know have contracted to have their heads chopped off and frozen after (before? during?) their death.  Here is one fun and engaging calculation of one’s chances of resurrection:

At the end, then, what is the combined probability of success? If all my best case figures are used, P(now) from the Warren Equation is 0.15, or a  bit better than one chance in seven. This is my most optimistic scenario. The pessimistic scenario puts P at 0.0023, or less than one chance in 400.

The idea that (in my personal estimation) cryonics has all told at best only   a 15% chance of working, may be a bit shocking. But answers of this sort fall naturally out of chained probability equations. Like it or not, the Warren equation simply forces one to remember that the success of cryonics depends on the correctness of at least four separate physical hypotheses, the fortunate consummation of at least eight modern social trends, and some luck in the circumstances surrounding one’s demise. That’s a lot of hurdles. Even if the probability for each of these 13 factors is a flat 95%, the total probability of success would still only be 51% — barely better than flipping a coin.

My take: The true estimate should be even more pessimistic.  I think simply no one will care to thaw you out.

Addendum: Robin Hanson responds…

Why has classical music declined?

Norman Lebrecht writes:

Why the world has gone off classical concerts is a conundrum in which
almost every reasonable assertion is disputable. Take the
attention-span thesis. Many in the concert world believe that its
decline stems from the public’s flickering tolerance for prolonged
concentration. If politicians speak in soundbites, how can we expect
voters to sit through a Bruckner symphony?

It is a persuasive argument but one that I have come to find both
fatuous and patronising. Around me I see people of all ages who sit
gripped through four hours of King Lear, Lord of the Rings or a
grand-slam tennis final but who, ten minutes into a classical concert,
are squirming in their seats and wondering what crime they had
committed to be held captive, silent and legroom-restrained, in such
Guantanamo conditions…

So what, precisely, scares them off? In a word, the atmosphere. The
symphony concert has stultified for half a century. It starts in
mid-evening and last two hours. The ritual cannot be altered without
inconveniencing the musicians and alarming the subscription audience;
so nothing changes.

My take: You can cite twenty factors, but my core hypothesis is simple.  First, the stock of "non-classical" music is much better and much larger than it used to be.  The competition gets tougher every year.  Second, we are biologically programmed to respond to individual personalities in the arts, also known as celebrities.  Classical music, as hard as it tries, cannot communicate such personalities with equal ease.  The classics were not designed for electronic reproduction, most of the composers are long-dead, and the performers can innovate on the core material only so much.

Markets in everything

I find most of the installments in this series sad:

…the 3 tablespoons of water said to have been touched by The King at a 1977 concert…recently sold on eBay for $455. Then, someone else paid thousands for a "guest appearance" by the cup that held the water from which Elvis sipped nearly 30 years ago.

In recent years, someone paid nearly $1,500 for a billiard ball from Elvis’ pool table. A hanging macramé plant holder from Graceland, complete with a plastic fern, went for $633. And someone else paid $748 for a tree limb that "mysteriously" broke off and fell to the ground during Presley’s funeral at Graceland in 1977.

We all know that Elvis’ fans can be wacky, and Elvis himself has pride of place in the dead-celebrities pantheon. But does that explain the excitement surrounding the Feb. 15-17 tag sale of ordinary household items that belonged to the late Jacqueline Kennedy Onassis? (Related story: Nothing too icky to sell)

Sotheby’s expects to raise at least $1 million auctioning such things as her glass jars, wicker baskets, duck decoys and dirty oven mitts. And some experts think that estimate is way low – that many items will go for 10 times the estimates. Spending big bucks on an authentic antique that once belonged to the Kennedys is one thing, but spending hundreds of dollars for a couple of Jackie’s Mason jars?

"There are a lot of bored and lonely people out there, and this would be their one little thing they can say was once part of a Kennedy estate," says Lynn Dralle, author of The 100 Best Things I’ve Sold on eBay.

Here is the story.  And how about this one?

Justin Timberlake…made an appearance on a New York radio station and failed to finish the French toast he was served. The partially eaten toast sold on eBay for more than $3,100.

Retraction: The Power of Volunteers

Update: The following post contains a substantial error. I was under the mistaken impression from another news article that the Central Park installation involved many volunteers. At least two readers have pointed out this error. My apologies to anybody who was mislead by my statement. Question for art oriented readers: What is the largest or best public art installation assembled mainly by volunteers?

Original Post: Artists Christo and Jeanne-Claude have assembled a team of hundreds of volunteers to assemble what might be the largest art installation ever (click here for an account from the NY Times). Starting earlier this week, hundreds of volunteers showed up to assemble 7,500 orange gates in New York City’s Central Park. It was an outstanding show of volunteer work. I’ve never been a believer that the world’s problems can be solved through volunteers, but moments like this bring a smile to my face.

Markets in Everything: Valentine’s Edition

This one is about how markets go wrong.

For $40, Without Reservations will sell you a dinner reservation for Valentine’s Day at a top-notch restaurant in New York, San Francisco or LA.  How do they get the reservations?  Simple, WR calls up restaurants a few weeks before a big event and they reserve under a fake name (you are in fact buying the fake name.)  So all this "service" is doing is selling you something for which they in part have created the shortage. 

True, scalping can create some social benefits by reallocating goods from low-valued to high-valued users but it’s not obvious that the foresighted people are the ones with low-demand so I think that benefit is likely to be small in this context.  In addition, it’s much easier for a firm to monopolize restaurant reservations than concert tickets and a monpolist seller of reservations has an incentive to keep some reservations off the market thereby leeching from both the customer and the restaurant.

As in other contexts, it it catches on this will encourage restaurants to sell their own reservations this would be better for restaurants than letting WR get the profits but for reasons that are somewhat puzzling it is evidently worse for restaurants than their current method of allocation.

Thanks to Courtney Knapp for the pointer.

What is the relevant intra-family externality?

…some parts of the analysis may apply to young children as well. Children are allocated to various "tasks" to their parents, and cannot easily trade or voice marketplace demands. In some countries parents or relatives allocate children rather ruthlessly to hard labor. Even in richer settings parents claim to be altruists but in fact many care more about the safety of their child per se, or about the social status of the child (proxies for their genetic investment), rather than caring for the utility of their child. Parents might therefore overinvest in safety and rigorous education for their child, not taking the child’s utility into account.  Under some conditions the policy recommendations would involve a reallocation of children into "fun" activities. This would favor easy schools, sugar-coated cereals, and disfavor government regulation of fun but dangerous children’s toys.

That is a possible concluding paragraph for a piece I am writing on animal welfare; you will hear more about this soon.  But that bit may not make the final cut.

Yes we don’t treat animals well enough, but what are the parallels between animals and children?  I am not sure where the relevant intra-family externality lies.  Are selfish parents not spending enough time looking out for their kids?  (Do partially benevolent parents get lazy and use the TV as a socially costly babysitter?)  Or do uptight parents seek too much control over their kids?  Are both somehow true at the same time?  I find these underexplored questions to be among the most important for normative economic investigation.

The earthquake that is Germany, a continuing series

Germany’s public employees, long perceived as lazy bureaucrats
insulated from real-world pressures, are now facing the same demands
for lower costs and more flexibility from governments that their
counterparts in the private sector have been confronted with from
German companies.

In negotiations taking place in Potsdam, just outside Berlin, federal
and local governments are demanding not only a wage freeze but also the
ability to extend working hours and curb overtime benefits, in what
would be the biggest overhaul of state work rules in more than 40 years.

And what is the response from the labor unions?

"We are flexible, but we need to see a salary increase."

Here is a previous installment in the Germany series.

Science of the Whole

The Chronicle of Higher Education has a wonderful essay about the new frontiers of science. Nobel laureate Robert Laughlin states it well here (click here to read the entire essay):

"What physical science thus has to tell us is that the whole being more than the sum of its parts is not merely a concept but a physical phenomenon. Nature is regulated not only by a microscopic rule base but by powerful and general principles of organization. Some of these principles are known, but the vast majority are not. New ones are being discovered all the time. At higher levels of sophistication the cause-and-effect relationships are harder to document, but there is no evidence that the hierarchical descent of law found in the primitive world is superseded by anything else. Thus if a simple physical phenomenon can become effectively independent of the more fundamental laws from which it descends, so can we. I am carbon, but I need not have been. I have a meaning transcending the atoms from which I am made.

I am increasingly persuaded that all physical law we know about has collective origins, not just some of it. In other words, the distinction between fundamental laws and the laws descending from them is a myth — as is therefore the idea of mastery of the universe through mathematics solely. Physical law cannot generally be anticipated by pure thought, but must be discovered experimentally, because control of nature is achieved only when nature allows this through a principle of organization."

This is the path to the future and we see it all the time in the physical and social sciences. Whether it be the study of social networks, consciousness or phase transitions, researchers are discovering that the 19th century view that all science strictly emerge from fundamental law – whether it be atomic physics or decision theory – leads us away from the great discoveries of the future.

The $800 million dollar pill?

The research by DiMasi et al. showing that the cost of the average new drug (new chemical entity) is about $802 million dollars is controversial with many people suggesting the results were doctored.  A new paper, Estimating the Costs of New Drug Development: Is it really $802m?, by two economists at the Federal Trade Commission, replicates that research using somewhat different data and they indeed find that DiMasi et al. are wrong.  The average new drug does not cost $802…it costs between $839 and $868 million.

An interesting aspect of the new study is that the authors break down development costs by drug category finding that AIDS drugs, for example, cost considerably less than average.  Why?  The authors suggest that AIDS drugs have been regulated less severely than other drugs resulting in lower costs as well as quicker times to market.