Month: August 2007

Why I like Facebook

by  Tyler Cowen in

It sounds stupid, but every day I write a new sentence: "Tyler is [fill in the blank]" at the top of the page.  It might just be "Tyler is happy to be home again," or "Tyler is eating Rainier cherries."  Once a day, no more and no less.  It doesn’t matter how few or how many people are reading it.  It feels like an exercise in gratitude, which it is.  It is also an exercise in micro-blogging.

Here is Gretchen Rubin on the one-sentence journal.

For at least the next week, however, I’ll be keeping my sentence the same.

Robin Hanson crushes the Doomsday Argument

by  Tyler Cowen in

Robin writes:

It is interesting that doomsday argument proponents seem to challenge our usual way of doing inference, by preferring an extended state space where we explicitly model the idea that "I could have been you." However, if we try to do this in a physics-oriented way, avoiding describing states directly in abstract features of interest to humans but not the universe, we get seem to get the same chance of doom as if we hadn’t extended states at all. Humanity may in fact face doom soon, and we have many reasons to be concerned about this. But I do not think the doomsday argument is one of them.

Here is the full argument.  This piece is not new, but I believe most of you do not know it.  Here is a previous MR post on the Doomsday Argument, also not supportive.

The bottom line: You still have to save for your retirement.

What it’s like to talk to your voice

by  Tyler Cowen in

The first thing I said was "Hey, you have a much better voice than I do!"

The guy who heard that — I won’t tell you his name — is reading the audiobook CD book and audiocassette versions of Discover Your Inner Economist: Use Incentives to Fall in Love, Survive Your Next Meeting, and Motivate Your Dentist. 

He called me for advice on how to pronounce various words in the book.  My surprise was how many words and names I wrote that I didn’t really know how to pronounce.

Farewell to Alms, pp.112-192

by  Tyler Cowen in

1. Exactly which national groups evolved a sufficient love of capitalist ways of life?  Clark’s statistics show that the wealthy had more surviving kids in England, relative to the poor.  Furthermore some numbers suggest that the same was less true in accident-prone primitive societies, where selection is based more on luck and physical force.

Even putting aside the debate on how long evolution requires (who will be the first to mention lactose intolerance and dachsunds in the comments?), does this explain the economic supremacy of England?  Recall that England climbed out of the Malthusian trap but most of the rest of Europe did not.  Was positive selection more pronounced in England than in Italy?  Than in France?  There is no evidence for those propositions, which in any case strike me as unlikely.  Even if one buys into positive selection, we have at most "positive selection for some countries vs. others," not "positive selection elevating England over the rest of Europe and driving an industrial revolution."  Positive selection doesn’t get us very far in explaining the climb out of the Malthusian trap, which was more or less unique to England and the Netherlands. 

Clark mentions in passing that positive selection bred the Chinese to be natural capitalists.  If we accept this portrait, I am now more confused about a) where positive selection operated and where it did not, and b) what was the marginal product of positive selection, vis-a-vis industrialization?  Until the 1980s or so, the Chinese record simply isn’t very good over the last few centuries.

In fairness to Clark we have not yet finished his discussion of these factors.

I’ll also note that I see positive selection in terms of culture, family norms, and peer effects, rather than genes.  Or you might think it is some mix of the two.  If you focus on the biological issues in the comments I think you’re missing the strongest and most general version of the argument.

2. I am not persuaded by Clark’s argument that "institutions do not matter."  True, medieval England had limited government intervention but it did not industrialize or "take off."  Clark’s discussion is right on, and if the English example does not persuade you try medieval Iceland, which was probably even freer.

But my conclusion differs from Clark’s.  I conclude "science is more important for growth than we had thought, and the simple fact of freedom does not itself guarantee much progress for science."  In this view the institutions which support science matter profoundly.  Science, science, science.  I recommend Jack Goldstone’s forthcoming book, much of which focuses on science and engineering culture in early modern England. 

Infrastructure also matters.  In medieval England the state wasn’t strong enough to help establish a large open geographic area for trading.  Early English economies were still local rather than national, and yes economies of scale matter.

That all said, I will accept a reformulated argument: "Institutions matter, but we should not take institutions as exogenous."  On this middle ground just about all of Clark’s substantive contributions will hold up.  So I view him as overstating his case, and taking too big a swing at institutional theories.  This overreaching, however, does not negate his core arguments.  So maybe you disagree with Clark on this point, as I do, but you cannot use it as reason to dismiss his other claims.

By the way, here is Ricardo Hausman on the book.  Here was installment one of this BookForum.

In closing, we can now see that Clark’s core arguments don’t depend on Malthusianism; they require only that economic growth is something very difficult to accomplish, and indeed that is the case.

Kenya fact of the day

by  Tyler Cowen in

The two women carried on about liquidity and profit margins, and recalled with pride attending the first shareholder meeting of KenGen this year, an event so huge that it had to be held in the city’s largest soccer stadium. About 200,000 people from all corners of the country came like so many newly minted executives.

"I felt so good," Kariuki recalled. "It was just normal, common people. People dressed well. What impressed me was the number of old women — they were coming in their traditional clothes. They were telling me, ‘Yes, we bought!’ "

Here is the full story.  I am not in any particular sense bearish about Kenya’s future, relative to its starting point.  And I am pleased to see that the country is growing so rapidly.  But I do believe the time has come to sell, or if you can (ha!), sell short.

Can you judge a book by its cover?

by  Tyler Cowen in

Greatman
I saw this and thought I should buy the book — Kate Christensen’s novel The Great Man — just because I liked the cover.  As an experiment, I deliberately did not scan the contents or read the blurbs on the back.  The title isn’t very descriptive either.  I then bought the book.

My thought was this: presumably the publisher designs the cover to
appeal to people who will spread favorable word of mouth about the
book.  As a sometimes good (but non-reductionist) Bayesian, if I like
the cover I should infer I will praise the book.  Furthermore I should
be especially keen to buy on this basis for a "word of mouth book," and
indeed this author does not have a celebrity name.

If I like the cover *a lot*, can I receive a worse evaluation by
checking out the blurbs and thus skewing or minimizing my gut reaction
to the image?  Surely if someone is able to manipulate me, my optimal
strategy is let just some of the manipulative information through.  The
case for viewing the cover — and only the cover — is simply that many
more people see the cover than evaluate any other part or aspect of the
book.  Might we then not expect the cover to be the strongest and best
thought out signal?

I can now report that the topic of the book interests me greatly,
and I am enjoying the first half of the book.  I fully expect to finish
it.

I will continue this experiment by buying another book just for its cover.

I do understand that this is usually considered the strategy of a relatively stupid person.

Under what conditions should a smart person prefer books with stupid or ugly covers?

Under what conditions should you — for non-superficial reasons — prefer other items, just because of their looks?

What I’ve been reading

by  Tyler Cowen in

1. A Culture of Improvement: Technology and the Western Millennium, by Robert Friedel.  A very good treatment of the history of Western technology, although it is not accessible reading for most non-specialists.

2. Storm World: Hurricanes, Politics, and the Battle Over Global Warming, by Chris Mooney.  The lower your social discount rate, the more you should worry about (growth-reducing) storms, and the less you should worry about one-time adjustments, such as moving islanders to a mainland.  In other words, you should worry about storms.

3. Art Out of Time: Unknown Comics Visionaries, 1900-1969, by Dan Nadel.  Some of the best evidence that comic books are valuable art.

4. Tristram Shandy, by Laurence Sterne.  On this rereading, I am obsessed by the notion that it is actually Uncle Toby who is Tristram’s biological father.  In any case this book has held up very well.

5. Indian Summer: The Secret History of the End of an Empire, by Alex von Tunzelmann.  Yet another high quality book on modern Indian history, here the theme is the departure of the British, the establishment of modern India, and of course partition.

Did industrial policy drive Asian economic growth?

by  Tyler Cowen in

…there is considerable evidence that industrial policy has influenced the sectoral composition of output and trade in Japan.  However, rather than being the forward-looking driver that proponents of selective promotion envision, at least in terms of measurable interventions, the evidence suggests that such policy was aimed overwhelmingly at internationally noncompetitive natural-resource-based sectors.  Indeed, once general equilibrium considerations are taken into account, in all likelihood the manufacturing sector as a whole experienced negative net resource transfers.

That is from the very interesting Industrial Policy in an Era of Globalization: Lessons from Asia, by Marcus Noland and Howard Pack.  This book is a good rebuttal to the claim that Asian economic success was fundamentally driven by industrial policy.  I thank a loyal MR reader who sent me this book, as a supplement to exchanges with Dani Rodrik.

Addendum: Do see Rodrik’s response in the comments…

How important is overcoming bias?

by  Tyler Cowen in

Arnold Kling summarizes Robin’s argument:

If you have a cause, then other people probably disagree with you (if nothing else, they don’t think your cause is as important as you do). When other people disagree with you, they are usually more right than you think they are. So you could be wrong. Before you go and attach yourself to this cause, shouldn’t you try to reduce the chances that you are wrong? Ergo, shouldn’t you work on trying to overcome bias? Therefore, shouldn’t overcoming bias be your number one cause?

Here is Robin’s very similar statement.  I believe these views are tautologically true and they simply boil down to saying that any complaint can be expressed as a concern about error of some kind or another.  I cannot disagree with this view, for if I do, I am accusing Robin of being too biased toward eliminating bias, thus reaffirming that bias is in fact the real problem.

I find it more useful to draw an analogy with statistics.  Biased estimators are one problem but not the only problem.  There is also insufficient data, lazy researchers, inefficient estimators, and so on.  Then I don’t see why we should be justified in holding a strong preference for overcoming bias, relative to other ends.

When I think of a blog that tries to eliminate or reduce bias, say by considering a wide variety of views and methods, I think of Dan Drezner or Matt Yglesias.  I view Robin’s blog as exemplifying bias, and indeed showing that bias can be very useful, especially if embedded in a broader discovery process with checks and balances.  (I would describe Robin’s blog as one of the dozen "must reads" out there.)  Robin’s blog is one very select group of very smart people, pushing one unpopular, specialized, but very interesting and analytically powerful research method as far as it can go.

If I were allowed to retitle Robin’s blog (and I am not), I would call it "Reaping the Fruits of Bias."