Assorted links


"To everyone who aspires to create." Pass the sick bag.

You give new meaning to judging a book by its cover, dearieme.

The writer proceeds to describe about 6 years of conformist slavery, yet proclaims it was the most fulfilling thing he has ever done.

Stockholm Syndrome.

Sad but true.

I've read >100 (maybe >1000) CS PhD theses in the past few years. Perhaps 10 were interesting. 1 got immediate plane tickets and dinner at Gotham Bar and Grill.

CS (theoretical and applied) is just brutal: the state of the art can be mastered in toto in 10 years. It's more like law than physics. Sorry, young-uns, you have little to offer at first, and either road is hard.

And that's of the ones you probably thought would be interesting. So, let's say half don't finish. 1% are interesting and 0.1% you'd pursue. Is the system really intended to identify 1 out of 1000? Maybe so. The classes are plausible deniability. Advisors too, mostly.

I imagine a punnet square with "convincing people" on one axis and "doing something real" on the other. CS seems to be the worst of both while economics might be the best of both. Engineering you don't have to convince anyone, just do it. But what you have to do might be impossible.

He's a kid, probably no more than 28 or so, and has spent his whole life in school.

I read the whole thing, and it is interesting in that he took a very "entrepreneurial" approach to his research. My guess is he'll end up doing a startup fairly soon; he's too entrepreneurial to waste time in post-doc purgatory.

Startup or go to Google/MS. It's an easy guess, since he specifically discusses and eliminates the postdoc/attempt to go for tenure options.

he currently works at Google

One of the things I worked on while employed at DEC - Digital Equipment Corporation - was time standards, DEC had a couple of time standards when I started in 1974, and over the years more and more standards and coding to these standards were done within DEC, and was advocated to the international standards committees. I can't recall the exact date, but DEC had an internal time standard that was also an international standard, and early in the 90s we had implemented in our commercial systems the time adjustment smear, and implemented them for distributed time coordination and synchronization. And DEC, like other companies like IBM and Sun contributed code like this to the public domain and the industry reference code for operating systems and networking.

The thing that made me look for a new career was the been-there-done-that nature of the computer industry. So many computer people are "libertarian" and reject standards, industry standards, and especially international standards because they want freedom.

Plus, they are smarter than all those old computer engineers....

I'm sure former IBM, Sun, and other engineers have the same feeling about this I do.

So, the same old problems are solved by the same old solutions by a new generation, and they proclaim their hard work to repeat the past. But that's the nature of managers - they want to know why they should pay for those old guys, and then they want you to explain what you spent all that time doing what the old guys would have done from the beginning, but you can't say that to the managers who caused it.

Funny, since in reaction to things like the recent hubbub about the U.N regulating the internet, many techno-libertarians trumpeted the ability of voluntary actors in the industry to coordinate on standards rather than having it determined by governments. Of course the Crooked Timberites would respond that the process works more along the lines of Habermas rather than Hayek.

I believe Alex Tabarrok invented something called a "dominant assurance contract" which is supposed to be used to resolve a holdout problem. I don't know if anyone has attempted to apply it to condos.

Is that why DEC is a thriving company today?

It is now called Hewlett Packard.

> Why do condominiums even exist?

Rent laws and regulations. Who in their right mind, after submitting themselves to the labyrinth of zoning, development and construction regulations, would tie up their investment into something at the whim of bureaucrats and local politicians? Try to get rid of someone who doesn't pay their rent in a timely way.

Build it, sell it and let the suckers handle those details themselves.

You can also title the article: "Why buy property when holdouts exist?" But it's done all the time. Ask Elinor Ostrom. In Greece you sometimes have a dozen warring factions (in-laws) who are joint owners of a piece of junk property but they fight over it like it's the Taj Mahol. I think they enjoy the fight.

When I watched the condo-izing of apartments my coworkers living in during the 90s especially, begun in the 80s, it was clear it was a financial trick and slight of hand that would reap profits from locking thousands of individuals into a bad deal, but the lies told made it sound so wonderful for the individual condo owners who are eliminating the risks of a landlord hiking your rent or kicking you out.

So, what did the financial wizards do in the 00s? They condo-ized mortgage backed securities. And then to add insult to injury, they condo-ized the condos.
1 Take a 1000 mortgages and put them in a security
2 condo-ize the security into 5 different condos, each on a different strata
3. take a dozen ground floor security condos and put them in a package
4. condo-ize the package of ground floor security condos into five strata of security condos

Now try to redevelop and rehabilitate those 1000 mortgages without violating the rights of all the condo owners.

And in both real estate and security condos, the condo managers assessing fees on the condo owners are actually the ones who make the decisions that the condo owners are forced to accept, unless all the condo owners agree to replace them.

"From a professor's perspective, though, Klee-UC was a rousing
success! Since Dawson had tenure, his job was never in danger. In
fact, one of the purposes of tenure is to allow professors to take risks
by attempting bolder project ideas. However, the dark side of this
privilege is that professors will often assign students to grind on risky
projects with low success rates. And the students often can't refuse,
since they are funded by their advisors' grants. Thankfully, since I
was funded by fellowships, it was much easier for me to quit Klee."

Hmmm. Does a grad school reform jump out and smack you upside the head?

I notice it's been several days since ths post you made:
and you haven't addressed the widespread criticism of it, such as here:

or here:

I used this blogs search function but didn't find it. Did you address this somewhere else? I'd like to read it.

Let me try.

We need to accept the principle that sometimes poor people will die just because they are poor. Really.

See. I fixed it by adding a "Really." That is the kind of address that those criticisms deserve.

The weirdest thing about that type of criticism is the fact that they too share the exact same views. Unless they're advocating whatever health-care scheme they like should be applied 100% globally, they believe the same fucking thing. Of course they would never admit it, even to themselves...

Correct all around.

> "Correct all around."

Noted. Thanks.

No, seriously. Who X do you want to die because they have too little Y? Solve for X and Y.

I propose anti-aging research. What do you propose? Wallpaper?

In response to the article on condominiums:
Yes, Canadian tax policy does significantly favor owner occupied housing (although I’m not sure how we compare in scope of subsidy to the U.S.). In Canada, if you sell your house you are not required to pay capital gains tax on any profit. So, if you re-sell your house and make 25%, that’s a totally tax free where it would otherwise be taxable. However, Canada doesn’t allow you to deduct your mortgage payments from your income tax.

More generally, the author misses several points:
1) People like to control the place they live. Owning gives greater control over renting, so you up the value of the building by permitting more people to own it. The sum of the value of the individual condominiums, usually significantly exceeds the value of the building as a rental.

2) Maintenance is usually better for condominiums than other types of homes. First, at least in Canada, condominiums are required to put money away for capital repairs that will occur over a 25 year period. This is known as a “reserve fund”. These funds are set aside based on plans that are usually prepared by engineering firms, who have incentives to err on the side of a larger reserve fund (that way no one sues them if the reserve fund is deficient). This often makes for better disclosure to new home purchasers (who are provided access to the report) and makes it more difficult to put-off repairs than if you lived in a detached home. So the properties are better maintained and the quality of the individual building is easier to monitor (creating market efficiencies). (Some people actually believe reserve funds will provide a significant surplus to people when the projects are eventually torn down.)

Further, other features of condominiums also encourage good management. The existence of by-laws, rules and regulations and statutory powers to fine, provide tools that aren’t available to owners renting a building. You can’t fine a renter for misusing the pool, and renters don’t have an asset in the way of equity in a condominium unit you can go after to pay for your damages. (It is often prohibitive to sue someone for a few thousand dollars, but refusing to grant an estoppel certificate so the property can’t be sold, usually gets the message across in a hurry.)

Finally, owner-occupiers take better care of their property than owner-landlords. Owner landlords don’t spend money renovating their suites, because bad renters destroy property. Owner occupiers spend money because they want to increase the value of their unit to get a capital gain.

3) The article is also missing that subdividing a building into condominium unit can also be another tool for raising capital. It is a lot cheaper to sell condominium units than to sell securities. Securities requires significantly more disclosure and legal fees than the legal fees to create a condominium. So, I can sell individual condominium units rather than create a company to manage the property. Some hotels are just condominiums that are rented through a management company. Even for condominiums where the developer doesn’t take a role in managing the property, it allows the developer to focus on building without either entering the management business on his own or being required to a much smaller pool of companies with sufficient assets to buy and manage an apartment. Most developers would prefer to stick with businesses they known, rather than be forced into businesses they don’t know about. Basically, it also allows for specialization in the development market.

4) Finally, residential rentals can be a tough business. Renters usually have few assets, and bad renters can be a disaster. Renters can bounce cheques, destroy suites (sometimes running marijuana grow-ops or meth labs), and otherwise cause problems. There are significant costs in going to court and hiring bailiffs to evict renters. Condominiums require a substantial down-payment, which can be used as basis for screening and as security as the condominium corporation is usually empowered to prevent re-sale if money is owed.

+1 You've given much more thought in this one comment than the author has in his column.

These are all plausible explanations, but they explain too much. These factors are ALWAYS at play, and yet in different places and different times, the rates of condo vs. rental tenure in multifamily buildings have varied dramatically (for example, in Toronto today nearly all apt bldgs are condos, whereas before WWII, all apt bldgs were rentals). To explain that divergence requires factors that have actually changed, unlike the four you cited, which are constant.

SS, I'm not sure about that. I think all that has to be added to these explanations is a further more general factor of the housing market--that before the revolution of securitization and downpayment-assistance and whatnot, the lower part of the market couldn't afford condos and the upper part of the market preferred detached houses (in NYC, where the latter wasn't true, you did see coops). Certainly there were probably places where condos could have worked as a midmarket play, but it's difficult to sell a novel legal structure, so until the incentives were overwhelming status quo bias won out. That theory also conveniently explains why they suddenly exploded in popularity, and after doing so were used even when the incentives weren't so strong in particular cases.

Okay, so the securitization could explain why owned-occupied apartments (condos + co-ops) spiked starting in the '80s, but then how do you explain the fact that other countries with sophisticated financial systems that can securitize with the best of 'em and large numbers of multifamily buildings, like Switzerland and Germany, have so few co-ops/condos compared to rental units? The condominium tenure system is well known there and people are aware of it as in the US, but they simply don't use it as much for apartments in multifamily buildings.

This is what I mean by "it explains to much." All of the four factors he lists apply in Germany, Switzerland, and Japan, and yet we see a different outcome. This tells me that it's got to be something that isn't constant across the word (i.e., it's not inherent attributes of renting), and is likely to be a policy difference instead.

Condominiums aren't a legal entity at common law (like a corporation). In Canada the statute allowing for condominiums to exist did not come into effect until the 1970s. So, to that extent, condominiums are themselves a market intervention. While the author of the article seems to believe this was a negative intervention, as it resulted in a scattering of title, I have my doubts, and would note most planning law that prohibits excessive subdivision are also based on government intervention. Given the boom in the form of ownership and that many people prefer living in condominiums to traditional housing, a better argument likely has to do with condominiums reflecting a positive intervention in the market place and legal innovation. It was lawyers and not engineers or scientists that created the tools that allow for condominiums and truly changed how many urban dwellers in Canada and the United States live. We’ve seen a huge change in the tools available to create and regulate housing, and if Tyler is looking for a successful innovation since the 1980’s, he, now, doesn’t have to look further than his own blog's comments section.

I'd also note that the story of condominiums becoming common place is a prime example of substantial innovation spurred by a government but implemented by the market without significant regulatory oversight. Governments often created barebones statutes permitting something not allowed by typical property rights (typically all elements of property are alienable, so a portion of the "common property", being the shared elements of the project, need to be alienable) and let the markets develop the idea. Developers – mostly through lawyers - took barebones statutes and created a range of different product and elaborations to create sophisticated and workable products.

We've seen publicity on the space program, but nothing on legal innovation as described above.


Why couldn't you have titled #5 "In Soviet Russia, ebook reads you."?

Before this, I was slightly negative on ebooks. Now I'm strongly so.

Why do condominiums even exist?

Market demand. Duh!

Not only does the Kindle monitor popular passages, but it also forces them on readers. Since I don't want other people writing in my books, I'll buy used. (cheaper, too)

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