Month: February 2010

The fact I would like to know about the stimulus

by  Tyler Cowen in

I break the stimulus into three parts: the tax cuts and transfer increases, the aid to state and local governments, and the traditional spending programs.  Here I'm talking about only the third part.  (If you are wondering, I regard the first part as mostly ineffective and the second part as mostly effective.)

Of the workers employed by this third part of the Obama stimulus, what percentage of them already had jobs?  What percentage moved from unemployed to employed?  More hypothetically, what percentage had jobs but would have lost them, thus effectively counting as a move from "unemployed" to "employed" status?

I'm not talking about the maybe-hard-to-estimate effects from boosting aggregate demand, I'm talking about the "mere counting" aspect of the problem.  "We hired him, he didn't have a job before.  Now he has a job."  What percentage of the hired people fall into that category?

I've read plenty on these studies, but they don't seem "net" to me.

Does anyone know where this information is available?

Census Miscounts

by  Alex Tabarrok in

Wow, Justin Wolfers reports on a new NBER paper (ungated) by Trent Alexander, Michael Davern and Betsey Stevenson, that finds big errors in Census data, especially for citizens 65 years and older.

What’s the source of the problem? The Census Bureau purposely messes with the microdata a little, to protect the identity of each individual. For instance, if they recode a 37-year-old expat Aussie living in Philadelphia as a 36-year-old, then it’s harder for you to look me up in the microdata, which protects my privacy. In order to make sure the data still give accurate estimates, it is important that they also recode a 36-year-old with similar characteristics as being 37. This gives you the gist of some of their “disclosure avoidance procedures.” While it may all sound a bit odd, if these procedures are done properly, the data will yield accurate estimates, while also protecting my identity. So far, so good.

But the problem arose because of a programming error in how the Census Bureau ran these procedures. The right response is obvious: fix the programs, and publish corrected data. Unfortunately, the Census Bureau has refused to correct the data.

The problem also runs a bit deeper. If the mistake were just the one shown in the above graph, it would be easy to simply re-scale the estimates so that there are no longer too many, say, 85-year-old men – just weight them down a bit. But it turns out that the same coding error also messes up the correlation between age and employment, or age and marital status (and, the authors suspect, possibly other correlations as well). When you break several correlations like this, there’s no easy statistical fix.

Worse still, the researchers find that related problems afflict the microdata released for other major data sources. All told, they’ve found similar errors in:

  • The 2000 Decennial Census.
  • The American Community Survey, which is the annual “mini-census” (errors exist in 2003-2006, but not 2001-02, or 2007-08).
  • The Current Population Survey, which generates our main labor force statistics (errors exist for 2004-2009).

These microdata have been used in literally thousands of studies and countless policy discussions.

What is interdisciplinarity?

by  Tyler Cowen in

Maybe not what you think.  Louis Menand writes:

Interdisciplinarity is not something different from disciplinarity.  It is the ratification of the logic of disciplinarity.  In practice, it actually tends to rigidity disciplinary paradigms.  A typical interdisciplinary situation might bring together, in a classroom, a literature professor and an anthropologist.  The role of the literature professor is to perform qua literature professor, bringing to bear the specialized methods and knowledge of literary study to the subject at hand; the role of the anthropologist is to do the same with the methods of anthropological inquiry.  This methodological constrast is regarded as, in fact, the intellectual and pedagogical takeaway of the collaboration.  What happens is the phenomenon of borrowed authority: the literature professor can incorporate into his work the insights of the anthropologist, in the form of "As anthropology has shown us," ignoring the probability that the particular insight being recognized is highly contested within the anthropologist's own discipline.

Because professors are trained to respect the autonomy and expertise of other disciplines, they are rarely in a position to evaluate one another's claims.  So there is nothing transgressive about interdisciplinarity on this description.  There is nothing even new about it.  Disciplinarity has not only been ratified; it has been fetishized.  The disciplines are treated as the sum of all possible perspectives.

Here is my previous post on Menand's new book.

In what way is blogging science?

by  Tyler Cowen in

Scott Sumner has a long and thoughtful post.  Here is one bit:

According to the Official Method, none of these tidbits matter.  But I have noticed that they have had some impact on my readers.  They are each slightly persuasive about some aspect of my argument.

It has to be read in the context of the longer post, but it's a very important point.  And this:

So that’s the goal of my blog, to constantly use theoretical arguments, empirical data, clever metaphors, and historical analogies that make people see the current situation in a new way.

Read the whole thing.  It's one of the best statements of how blogging can make a difference; just don't call Scott a blogger…

The world’s 25 dirtiest cities

by  Tyler Cowen in

Here is the article, here is the top of the list:

1, Baku, Azerbaijan

2. Dhaka, Bangladesh

3. Antananarivo, Madagascar

4. Port-au-Prince (pre-quake?  I believe they are now uncontested #1 or will be soon.)

5. Mexico City

Most of the rest are in Africa.  If I did the ranking, Mexico City would do much better than number five, since air pollution isn't as bad as the lack of sanitation in cities such as Conakry (a mere #19).  And why does Bangui (CAR) get such an idyllic photo?  Nor does Google offer up any nasty photos of the place.

Hat tip goes to the essential Rachel Strohm, Twitter feed here.

Obligatory budget post

by  Tyler Cowen in

I keep on hearing about a "pivot," but where is it?  Via Greg Mankiw and Arnold Kling, here is Keith Hennessey:

We can draw five important conclusions from this graph:

  1. At 8.3% of GDP, the proposed budget deficit for 2011 is still extremely high.
  2. President Obama is proposing larger budget deficits than he did last year.
  3. For 2011, the most relevant year of this proposal, the President is proposing a budget deficit that is 2.3 percentage points higher than he did last year (8.3% vs. 6.0%).
  4. Using his own numbers, the President’s proposed budget deficits will cause debt as a share of the economy to increase.
  5. Under the President’s proposal, budget deficits begin to increase as a share of the economy beginning in 2018.

Adding further detail to (4), the President’s own figures show deficits averaging 5.1% of GDP over the next 5 years, and 4.5% of GDP over the next ten years.  They further show debt held by the public increasing from 63.6% of GDP this year to 77.2% of GDP ten years from now.  I think it’s a safe assumption that CBO’s rescore of the President’s budget will be even worse.

Addendum: Brad DeLong objects.

Will the price of Haitian art go up or down?

by  Tyler Cowen in

Here's a report on the destruction of Haiti's cultural heritage and many Haitian paintings, including the supreme achievement of Haitian art, the murals in the Episcopalian cathedral.  Furthermore the "Nader Museum" in Petitionville has largely been destroyed; that was probably the single best collection of Haitian art.

OK, so the supply curve shifts up and to the left.  But will the prices of the remaining stock rise?  It's not so simple and that's because of how reputation drives art prices.  In part people buy art to be affiliated with something grand and glorious.  A so-so Rembrandt is worth more because the first-rate Rembrandts exist.  If the first-rate Rembrandts were destroyed, the so-so work might fall in value, not rise.

Art works also require buyers to promote them.  If not many people own an artist, not many people are speaking up for that artist.  Again, we see the higher quantities can increase rather than decrease price.  Arguably Andy Warhol's prices have benefited from Warhol's work being widely held and sold in deep, liquid markets.

Here is Wikipedia on Carel Fabritius and here is his goldfinch.

If you are curious to see some of the Cowen Haitian art collection, go through my home page.  (Addendum: Links are broken right now, I'm working on getting them fixed.)

This account of the damage also offers a good slideshow on Haitian art.

What about the data?  Natasha and I have bought four Haitian art pieces since the earthquake.  Their prices were exactly the same as what we had been quoted before the quake.  So far the jury is still out.

Naughty Bits in the Bible

by  Alex Tabarrok in

From a review of The Uncensored Bible:

In court we swear to tell the truth with a hand placed on the Bible. But in the book itself, Jacob, nearing death in Egypt, asks Joseph to swear an oath not to bury him there by “put[ting] your hand under my thigh” (Gen. 47:29). Earlier in Genesis, Jacob wrestles with God, who touches “the hollow of his [Jacob’s] thigh” (32:25). “Thigh” happens to be a biblical euphemism for male genitalia; it’s from Jacob’s “thigh” or “loins” that his numerous offspring sprang.

This was new to me:

The practice of swearing an oath while touching one’s or someone else’s testicles was common in the ancient Near East (Abraham also orders a servant to do just that in Genesis 24:2). Its linguistic memory survives in our word “testify”–testis being the Latin both for “witness” and the male generative gland.

I will never be able to listen to George Clinton and Parliament's funkadelic classic, "I just want to testify, what your love has done for me," in the same way again.  The album title is interesting in this context also.   

How to fall six miles and survive

by  Tyler Cowen in

I found this article fascinating throughout, here is one excerpt:

Granted, the odds of surviving a 6-mile plummet are extra­ordinarily slim, but at this point you’ve got nothing to lose by understanding your situation. There are two ways to fall out of a plane. The first is to free-fall, or drop from the sky with absolutely no protection or means of slowing your descent. The second is to become a wreckage rider, a term coined by Massachusetts-based amateur historian Jim Hamilton, who developed the Free Fall Research Page–an online database of nearly every imaginable human plummet. That classification means you have the advantage of being attached to a chunk of the plane. In 1972, Serbian flight attendant Vesna Vulovic was traveling in a DC-9 over Czechoslovakia when it blew up. She fell 33,000 feet, wedged between her seat, a catering trolley, a section of aircraft and the body of another crew member, landing on–then sliding down–a snowy incline before coming to a stop, severely injured but alive.

Surviving a plunge surrounded by a semiprotective cocoon of debris is more common than surviving a pure free-fall, according to Hamilton’s statistics; 31 such confirmed or “plausible” incidents have occurred since the 1940s. Free-fallers constitute a much more exclusive club, with just 13 confirmed or plausible incidents, including perennial Ripley’s Believe It or Not superstar Alan Magee–blown from his B-17 on a 1943 mission over France. The New Jersey airman, more recently the subject of a MythBusters episode, fell 20,000 feet and crashed into a train station; he was subsequently captured by German troops, who were astonished at his survival.

Whether you’re attached to crumpled fuselage or just plain falling, the concept you’ll be most interested in is terminal velocity. As gravity pulls you toward earth, you go faster. But like any moving object, you create drag–more as your speed increases. When downward force equals upward resistance, acceleration stops. You max out.

It's possible to hit the ground (or whatever) at no more than 120 mph or so we are told.  The writer offers another tip: don't land on your head.

Hat tip goes to The Browser.

Another idea for Haiti

by  Tyler Cowen in

Haitians in Canada proposed another excellent idea: government-paid leaves of absence to allow expatriates (employed in government or the private sector) to return and rebuild civil society in their place of birth.

There is more here.  I am less sure about this one, largely for reasons of maintenance:

Instead of waiting for someone to build an expensive, centralized power grid, donors could think more flexibly on a smaller scale, using solar panels and LEDs to provide electricity and light cheaply, portably and quickly.

Assorted links

by  Tyler Cowen in

1. Keynes-Hayek rap video with Chinese subtitles.

2. The essential Rachel Strohm recommends development books.

3. Gretchen Rubin's The Happiness Project hits #1.

4. Credible sources report that JHabermas is fake.  Even more credible, note JH reports his email address is not available for the public.

5. Haitians are targeting aid to women.

6. The quest for university rankings favors the biosciences (and experimental economics?)

7. Educated women marry well these days.

8. Writing haiku, using the random movements of sheep.