Month: February 2010

Jamie Lawrence’s principles for judging books

He writes me an email:

We somehow ended up talking about things we absolutely judge by first impression. We both read a lot and widely in general, and it was a fun topic.

An easy one for me to note was that I skip technical/professional/academic work that is far enough outside of my expertise that I know the baseline knowledge assumptions are beyond me.  Imperfect, but in general, a good filter.

I skip nearly all books by politicians, executives, and similar people. Even when people tell me that one is good, it usually isn't.

I really dislike reading music reviews. They almost never seem insightful, and rarely tell me anything I didn't realize I wanted to know.

Sort of the opposite of the above filters, I tend to really enjoy reading applied trade books for things far outside my expertise.  An example is that about six months ago, I read a treatise on elevator traffic management that was fascinating.

What other principles can you think of?  I go to Mary Riley Styles Falls Church Public Library and check the non-fiction Return carts, to see what other people have been reading.

The economics of placebos for self-remitting diseases

Daniel Carpenter, who just wrote the very impressive FDA book, has an interesting paper on his home page:

I develop a simple stochastic model of inference and therapeutic utilization in the presence of placebo effects, when the underlying medical condition may be self-remitting. In the model, expectations generate a “felt” health state which can mimic the medically cured health state even when the treatment in question has no real curing power. This effect may be augmented by self-limitation of the medical condition for which the treatment is utilized. A human agent then applies Bayes’ rule to the felt history as if it were generated pharmacologically. A more sophisticated agent knows of placebo effects but does not know the precise extent to which they contribute to curing. I describe the bias that attends inference and the under – or overutilization of therapies under such a model. A central result of the model is that human placebo learning is generally subject to greater bias in estimating treatment efficacy when diseases are self-limiting. Human agents may commit several types of decision errors under placebo learning. They may continually choose a more costly (expensive, hazardous) treatment when a less costly one would work as well, or they may continually use inferior treatments for life-threatening illnesses. When diseases are self-limiting, both these types of error are more likely when the human agent has high initial beliefs about the treatment. Possible applications of the model include the patent medicine industry, the robustness of markets for herbal and nutritional supplements, and the contemporary stability of counterfeit drug operations.

Of course this applies a lot more broadly than to medicine.  It helps explain why people overuse and underuse "treatments" of many different kinds, including education.  Here is Dan Carpenter's page on fly fishing.

Behavioral Economics in Song

Liam Delaney gives The Flaming Lips "a honourable place in the
behavioral economics songs hall of fame for the 'yeah yeah yeah song' which
reminds us that it is 'a very dangerous thing to do exactly what you
want because you cannot know yourself…'."

I take Delaney's Yeah, Yeah, Yeah and raise it with Chris Smither's Heh, Heh, Heh song which runs in part:

Pretty soon you're gonna ask me,
How come the life you lead,
Doesn't make you very happy,
Or satisfy your needs,
You talk about your needs as though
You know just what they are,
When in fact to really know them,
Is like traveling to a star,
It takes so long you die along the way,
So I say hey, hey, hey.

One of my papers, which never got very far, took this as inspiration to think about how preference discovery could modify various economic concepts.

Your nominations?

*The New Yorker* writes up Peter Chang and *China Star*

Yes I know the article is gated but I wanted to blog the link anyway, out of sheer enthusiasm.  It's a superb piece.  China Star is my favorite Fairfax restaurant and it's the #1 restaurant for GMU blogger lunches and debates (though one of us hates it; can you guess which one?  We make him go nonetheless).  It's also where we take job candidates, at least the ones we respect.  Even though Chang is now gone, the restaurant remains superb in the hands of his successors, who have kept many of his original recipes.  Some people claim they get better meals when I go there to eat with them.  It's so close to our house that sometimes Natasha and I walk there.  They know us well and are rarely surprised by our order.  For two, our default is the braised fish and Sichuan chili chicken, on the bone of course.  Scallion fried fish is a must for larger groups.  John Nye likes General Kwan's Spicy Beef there.  They have real kung pao shrimp.  Kudos to Calvin Trillin for covering Chang and his mobile culinary empire.

The culture that is Japan

“The concept of this restaurant is that Robot No. 1 is the manager, which boils the noodles, and Robot No. 2 is the deputy manager, which prepares for soup and puts toppings,” said Famen’s owner, Kenji Nagaya. “Human staffs are working for the two robots.”

Here is much more, interesting throughout.  Here is one more bit:

One entry, Beerbot, detects approaching people and asks for beer money. When it acquires enough, it “buys” itself a beer. Bystanders can watch it flow into a transparent bladder. As for other humanizing behaviors, “like a robot that doesn’t stop short at lighting a cigarette but actually goes ahead and smokes it?” Mr. Wurzer says, “We had that.”

Assorted links

*Reputation and Power*, a new theory of the FDA

The subtitle is Organizational Image and Pharmaceutical Regulation at the FDA and the author is Daniel Carpenter.  Here is the book's home page but I don't yet see an Amazon listing.  Here is a Barnes&Noble listing, note the price discount.

Where to start?  It exhausts me to even write about this book, which is the most comprehensive and most detailed study of a regulatory agency written — ever – to the best of my knowledge.  It supplements and overturns all existing work on its subject and it will prove a model for future investigations.  It's not short!

The starting point is the notion of reputational capital and the claim that the FDA seeks to preserve and extend its reputation, for a variety of political reasons.  One implication of this is that the FDA is sometimes too loose and other times too strict but that both biases are possible.  The framework is then used to address numerous questions, including the following:

1. Why the U.S. has the most bureaucratically intensive drug regulation in the world.

2. Why the 1962 amendments were passed.

3. Why FDA regulation is so often treated as de facto irreversible.

4. Why the tenure of a division director matters for how the decisions of that division are treated.

5. Why there is so much judicial deference to the FDA.

6. Why the FDA has been so influential on a global scale.

7. How public attention affects the speed of FDA procedures.

The author makes a strong case that the FDA is one of the most powerful and most important regulatory agencies in the world and one of the most important extensions of state power.  Everyone interested in the economics of regulation should read this book, just be prepared to be a little overwhelmed.  I would also note that this is not mainly a partisan book in one direction or the other, though on net I read the author as wishing to see a stronger FDA.  (On p.379, for instance, I read Carpenter as overly dismissive of the "drug lag" argument.)

Here is Carpenter's previous book, which I have not read.  For the pointer to this work I thank Steve Teles.

The laws of New York City (not from *The Onion*)

Here is a new one:

Months after it barred schools from holding most food fundraisers, the city says bake sales can go on–as long as no homemade treats with undisclosed calorie counts grace the fold-out tables. The new regulation, designed to combat ever-increasing childhood obesity, limits bake sales to "fresh fruits and vegetables, or one of 27 specific packaged items" that include low-fat Doritos, Nutri-Grain Cereal Bars (blackberry only) and Linden’s Cookies (butter crunch, chocolate chip or fudge chip cookies in two cookie packs) among other things.

The article is here and hat tip goes to Elmira Bayrasli.