Month: November 2015
How different professions try to predict and plan for the future
Here is Jessica Gigot, farmer:
We don’t really plan for the weather short-term. That makes me sound like a bad farmer, but I’ve been surprised so many times that I don’t want to get too attached to one scenario. That’s what old farmers tell you: Be open to unpredictability. The drought will continue, that seems to be the consensus. And I may adjust my planting dates, putting in crops early to harvest early, and putting more in late to harvest again late. I kind of go with instincts. There are great farm planners out there and a lot of spreadsheets to follow, but I honestly don’t do that for every crop. You just get in a time bind and could spend all winter doing that and nothing else. Sometimes, it’s scary looking forward as a farmer. From our farm, we can see Mount Baker and the Puget Sound, a volcano and a rising sea. We’re kind of living for the moment, in a geological sense.
The NYT story, by Ryan Bradley, also interviews an economist, a biologist, a musician, and others.
Tuesday assorted links
1. Singapore’s “vertical village” named building of the year.
2. “This film [Spectre] doesn’t exactly hide its place within Lovecraftian mythology.” An interesting piece, but I have to say the film stunk past the first thirty minutes. I find it more interesting that such a mediocre Bond film is today achieving such cultural resonance. And Hollywood average is over, uh-oh I say (NYT).
3. There is no great stagnation: a new Uber-like app for casual fighting for free.
4. Sarah Kliff reviews the Amazon bookstore. And what college students spend on textbooks is going down each year. It’s less than what many sources claim.
Coming Apart: The State of White England?
Some surprising findings from researchers at the Institute for Fiscal Studies about education in England:
All ethnic minority groups in England are now, on average, more likely to go to university than their White British peers. This is the case even amongst groups who were previously under-represented in higher education, such as those of Black Caribbean ethnic origin, a relatively recent change.
These differences also vary by socio-economic background, and in some cases are very large indeed. For example, Chinese pupils in the lowest socio-economic quintile group are, on average, more than 10 percentage points more likely to go to university than White British pupils in the highest socio-economic quintile group. By contrast, White British pupils in the lowest socio-economic quintile group have participation rates that are more than 10 percentage points lower than those observed for any other ethnic group.
Combined with the Case-Deaton results about rising/not falling death rates among middle aged white Americans and the other measures of increasing social polarization among white Americans that Charles Murray discusses in Coming Apart this may be signs of a trend.
Hat tip: Tim Harford.
The economics of diners in New York City
They are disappearing, though still with a cluster in Queens, here is one trouble they are having:
It costs as much as $4 million to open a new diner these days…compared to $500,000 for a higher-end restaurant, because diners require so much storage space for the inventory that their large menus require.
The full article, by Aaron Elstein, is here, it has numerous interesting bits.
Stuff I’ve been reading, or not
The Pavlov biography and volume two of Moore on Thatcher — both superb — having been taking a lot of my reading time, so you should not take my limited attention for some of these books as a mark against them.
James A. Harris, Hume: An Intellectual Biography. I quite liked and admired the parts I read, my main hesitation is that such books have to compete against…reading Hume himself. In any case many commentators seem to consider this the definitive study. If you think maybe you should read this, you should.
Paul Murray, The Mark and the Void. He is the author of the novel Skippy Dies, which has a strong cult following, this one. Australian, snarky, deals with a financial crisis.
Richard McGregor, The Party: The Secret World of China’s Communist Rulers. As Chris Blattman wrote, a very good book. In China, never underestimate the role of The Party.
Louise O. Fresco, Hamburgers in Paradise: The Stories Behind the Food We Eat. A pro-capitalist, pro-globalization, pro-technology food book, or so it seems. I am eager to spend more time with this one.
Jamie Holmes, Nonsense: The Power of Not Knowing. How to turn uncertainty and ambiguity to your advantage as a thinker, I kind of enjoyed it.
Riad Sattouf, The Arab of the Future: A Childhood in the Middle East, 1978-1984. A graphic novel set in Libya, Syria, and France, very moving and effective.
The new Umberto Eco novel, Numero Zero, didn’t do much for me.
Questions that are rarely asked
49% of UK trade is with EU; 14% of EU’s trade is with UK. Who would be most desperate to do a deal post Brexit?
That is from Hugo Dixon on Twitter.
The digitization of immigration records
It is going slowly, to say the least:
Heaving under mountains of paperwork, the government has spent more than $1 billion trying to replace its antiquated approach to managing immigration with a system of digitized records, online applications and a full suite of nearly 100 electronic forms.
A decade in, all that officials have to show for the effort is a single form that’s now available for online applications and a single type of fee that immigrants pay electronically. The 94 other forms can be filed only with paper.
This project, run by U.S. Citizenship and Immigration Services, was originally supposed to cost a half-billion dollars and be finished in 2013. Instead, it’s now projected to reach up to $3.1 billion and be done nearly four years from now, putting in jeopardy efforts to overhaul the nation’s immigration policies, handle immigrants already seeking citizenship and detect national security threats, according to documents and interviews with former and current federal officials.
The article is here, hat tip goes to Felix Salmon.
Are the elite colleges really any better? (education sentences to ponder)
An article in The Wall Street Journal explores higher education as a lobbying force, and find colleges to have large and effective representation in Washington. Based on data from the Center for Responsive Politics, the article finds that higher education had 1,020 lobbyists in 2014, third among industries (after pharmaceuticals and electronics). In terms of effectiveness, the article notes the extent to which the Obama administration pulled back on its initial plans for rating colleges.
That is from InsideHigherEd, there is nothing more at the link. And here is another, meatier piece from the same issue, perhaps not totally unrelated, excerpt:
…they [the researchers] found that on only one of the five measures, cognitive complexity of the course work, did the elite colleges in the study outperform the nonelite institutions.
On two, standards and expectations of the course work and the level of the instructors’ subject matter knowledge, there were no meaningful differences by prestige level. On two others, though — the extent to which the instructors “surfaced” students’ prior knowledge and supported changes in their views, the lower-prestige institutions outperformed the elite ones.
That is from a new study which tries to measure, through classroom visits, whether classes at elite colleges are really any better. That article has many interesting points, including the usual evasive reply from commentators as to whether this really measures anything (“If I’m teaching a 15-week course, does one class really represent the quality of my teaching?” — TC says yes). Believe it or not, three elite institutions actually permitted such visits to take place, even though they presumably had nowhere to go but down. I cannot however find a copy of the paper on-line.
Please note by the way that I still adhere to my transformational/acculturation theory of higher education.
Sound makes your food taste different
In a live demonstration conducted in 2006 with the celebrity chef Heston Blumenthal, Spence found that when people were served a scoop of bacon-and-egg ice cream accompanied by the sound of sizzling bacon they described the taste of the ice cream as much more “bacony” than subjects whose consumption was accompanied by the clucking of chickens. This insight—that the appropriate soundtrack can intensify the flavor of a food—inspired Blumenthal’s iconic “Sound of the Sea” dish, for which diners at his restaurant, the Fat Duck, in Bray, are presented with an iPod loaded with a recording of crashing waves and screeching gulls to listen to while enjoying an artfully presented plate of seafood. The effect could be used similarly, Spence said, to design soundtracks that replace some of the lost flavor of food for the elderly.
That is from Nicola Twilley in The New Yorker, interesting throughout.
*Ivan Pavlov: A Russian Life in Science*
That is the new book by Daniel P. Todes, the first sentence is:
Contrary to legend, Ivan Pavlov (1849-1936) never trained a dog to salivate to the sound of a bell. In over three decades of research and tens of thousands of experimental trials, he and his coworkers used a bell only in rare, unimportant circumstances. Indeed, the iconic bell would have proven totally useless to his real goal, which required precise control over the quality and duration of stimuli (he most frequently employed a metronome, a harmonium, a buzzer, and electrical shock).
Nor was Pavlov a behaviorist, to address another common misconception.
This superb book — one of the year’s best — is 731 pages of original material on Russia, Russian communism, Russian science, and of course the life of Pavlov. The TLS Stephen Lovell review of the book had a good line: “Controls were unthinkable: all the dogs were individuals.”
Overkill for some, recommended for many.
Against kindergarten?
A new study on the mental health effects of kindergarten enrollment ages found strong evidence that a one-year delay dramatically improves a child’s self-regulation abilities even into later childhood.
According to the study co-authored by Stanford Graduate School of Education Professor Thomas Dee, children who started kindergarten a year later showed significantly lower levels of inattention and hyperactivity, which are jointly considered a key indicator of self regulation. The beneficial result was found to persist even at age 11.
“We found that delaying kindergarten for one year reduced inattention and hyperactivity by 73 percent for an average child at age 11,” Dee said, “and it virtually eliminated the probability that an average child at that age would have an ‘abnormal,’ or higher-than-normal rating for the inattentive-hyperactive behavioral measure.”
The study, aptly titled, “The Gift of Time? School Starting Age and Mental Health,” was published Oct. 5, by the National Bureau of Economic Research. A version of the article is also available here as a working paper from the Stanford Center for Education Policy Analysis at the GSE.
I have not yet read the study, but it seems to me this paper, along with some other recent results, does not exactly help the case for preschool…
For the pointer I thank Peter Metrinko.
From the comments, on Amish health and health care
I was just at two Amish weddings and would add a few observations:
– I wonder what they’d find for a later cohort. Amish folks born between 1890 and 1921 were almost all farmers. Today, fewer than 10% are. Most have far more sedentary jobs–though not as sedentary as mine. But they still eat as if they were out in the fields all day. Obesity is rampant and growing. Also, the diet has changed. The Amish eat a lot of processed, brand name food. They do have their own kitchen gardens, but salads are covered in dressing and cheese. In many homes, every meal (even breakfast!) comes with pie as desert.
– Nobody is left alone in old age. I had a long talk with an older Amish woman who couldn’t believe that, in NYC, some people live alone, interact with no close relatives or friends, have no one to watch over them. Her husband told a story of a very ornery old man with no children or wife who nobody likes but, still, people visit regularly to make sure he’s OK and to give him comfort.
– They absolutely use hospitals for urgent and emergent care. There are big fundraising auctions all the time to help those with big bills. And the church district will also help.
Yes, that is the Adam Davidson.
Sunday assorted links
2. More details on rising white mortality.
3. “At this point, it takes a lot for Star Wars-branded crap to surprise us.” And there is no great stagnation: Chinese smart phone doubles as a chopping board.
4. Ramanujan: still better than you think. And India may move to a national sales tax, lower barriers to interstate commerce.
5. Benhabib, Bisin, and Luo (pdf): in the Piketty tradition, but a more useful disaggregation of the data, slides here (also pdf). For most of you the slides are more useful than the paper. On p.58 of the slides: “Estimate of inter-generational correlation on returns on wealth is about zero”.
Satoshi Nakamoto Nominated for Nobel Prize
Bhagwan Chowdhry, a professor of finance at UCLA, has nominated Satoshi Nakamoto, the creator of Bitcoin, for a Nobel prize in economics. It’s an excellent choice. Nakamoto made a fundamental breakthrough that combined cryptography and a distributed database to create the first decentralized cryptocurrency. Moreover, Nakamoto implemented his theoretical breakthrough to create a working cryptocurrency with real benefits to potentially billions of consumers.
Chowdry writes:
The invention of bitcoin — a digital currency — is nothing short of revolutionary….It offers many advantages over both physical and paper currencies. It is secure, relying on almost unbreakable cryptographic code, can be divided into millions of smaller sub-units, and can be transferred securely and nearly instantaneously from one person to any other person in the world with access to internet bypassing governments, central banks and financial intermediaries such as Visa, Mastercard, Paypal or commercial banks eliminating time delays and transactions costs.
But beyond demonstrating the possibility of creating a reliable digital currency, Satoshi Nakamoto’s Bitcoin Protocol has spawned exciting innovations in the FinTech space by showing how many financial contracts — not just currencies — can be digitized, securely verified and stored, and transferred instantaneously from one party to another.
…Not only will Satoshi Nakamoto’s contribution change the way we think about money, it is likely to upend the role central banks play in conducting monetary policy, destroy high-cost money transfer services such as Western Union, eliminate the 2-4% transactions tax imposed by intermediaries such as Visa, MasterCard and Paypal, eliminate the time-consuming and expensive notary and escrow services and indeed transform the landscape of legal contracts completely. Many industries such as Banking, Finance, Law will see a big upheaval. The consumers will be big beneficiaries and indeed the poor and marginal sections of the society will reap the benefits of financial and social inclusion in the coming decades. I can barely think of another innovation in Economic and Finance in the last several decades whose influence surpasses the welfare increases that will be engendered by Satoshi Nakamoto’s brilliant, path-breaking invention. That is why I am nominating him for the Nobel Prize in Economics.
Since no one knows who Nakamoto is it might seem difficult to award him a prize but Chowdry notes that bitcoin itself provides a solution:
The Nobel committee can easily buy bitcoins for the award money from any reputed online Bitcoin exchange and transfer it to him instantaneously. A very early bitcoin transaction suggests that the bitcoin address 1HLoD9E4SDFFPDiYfNYnkBLQ85Y51J3Zb1 likely belongs to him. Of course, he could easily and verifiably let the committee know which address he wants the money to be transferred to.
Does the Obamacare mandate actually make people better off?
Here is my latest NYT Upshot column, on the topic of the Affordable Care Act. Here is what is to me the key excerpt:
But there is another way of looking at it, one used in traditional economics, which focuses on how much people are willing to pay as an indication of their real preferences. Using this measure, if everyone covered by the insurance mandate were to buy health insurance as the law dictated, more than half of them would be worse off.
This may seem startling. But in an economic study, researchers measured such preferences by looking at data known as market demand curves. Practically speaking, these demand curves implied that individuals would rather take some risk with their health — and spend their money on other things — partly because they knew that even without insurance they still would receive some health care. These were the findings of a provocative National Bureau of Economic Research working paper, “The Price of Responsibility: The Impact of Health Reform on Non-Poor Uninsureds” by Mark Pauly, Adam Leive, and Scott Harrington; the authors are at the Wharton School at the University of Pennsylvania.
One implication is that the preferences of many people subject to the insurance mandate are likely to become more negative in the months ahead. For those without subsidies, federal officials estimate, the cost of insurance policies is likely to increase by an average of another 7.5 percent; even more in states like Oklahoma and Mississippi. The individuals who are likely losers from the mandate have incomes 250 percent or more above the federal poverty level ($11,770 for a single person, more for larger families), the paper said. They are by no means the poorest Americans, but many of them are not wealthy, either. So the Affordable Care Act may not be as egalitarian as it might look initially, once we take this perspective into account.
I should stress that, at this point, I don’t see any realistic alternative to trying to improve ACA. Still, I find it distressing how infrequently this problem is acknowledged or dealt with, probably from a mix of epistemic closure, a “health insurance simply has to make people better off” attitude, and a dose of “let’s not give any ammunition to the enemy.” In fact, I think a lot of Democratic-leaning economists and commentators are doing a real disservice to their own causes on this one.
It’s worth noting that Kentucky, one of the best-functioning ACA state exchanges, just elected a Republican governor who very explicitly pledged to tank the current set-up as much as possible, Medicaid too. I think it’s time to admit this is not just Tea Party activism or Hee Haw political stupidity, rather a large number of the people subject to the mandate simply are not better off as would be judged by their own preferences. And that is not a secondary problem of Obamacare, it is a primary problem.
Interestingly, I found the NYT reader comments on my piece to be fairly supportive, which is not always the case. There’s a good deal of “this happened to me, too,” and not so much raw invective about whatever defects I may have.
I think it is a big mistake to argue Obamacare is on the verge of collapse, or whatever other exaggeration of the day may be at hand. Still, I don’t find the current set-up of the exchanges to be entirely stable, at least not in terms of ongoing popularity, much less consumer sovereignty.
A key question is what happens moving forward. One option, which I had not initially expected, is for the exchanges to narrow and evolve into an expanded version of some of the earlier plans for a segregated high-risk pool. In that case, the argument would morph from “don’t worry, enough people will sign up for the exchanges” into “the welfare effects here are still positive, because fortunately not everyone signs up for the exchanges.” The high risk pool would then at some point require additional subsidies. In the past, I argued that the penalties for not signing up were too low, but under this scenario it may be desirable to lower rather than raise those penalties.
We’ll see. The piece covers other issues as well, do read the whole thing.
Here is Megan on the costs of ACA plans. Here are some interesting calculations from Jed Graham.