Month: July 2016

Tuesday assorted links

1. “We find that immigrants initially located in places with larger co-ethnic networks are more likely to be employed at first, but have a lower probability of investing in human capital. In the long run they are more likely to be mis-matched in their job and to earn a lower wage.”  NBER link here.

2. Good Judgment Open, for superforecasters.

3. Beijing menu posts menu prices as math equations.

4. The humans behind the chatbots.

5. Don’t take these numbers too literally, but some good Irish gdp revisions.  I wonder what Scott Sumner thinks of that 32.4% ngdp growth.  Krugman offers some explanatory links.  Here is a lengthy discussion of why it is difficult to interpret Irish national accounts (pdf).

6. Haagen-Dazs to close some branches in second- and third-tier Chinese cities.

The Coasean upshot on the Hague ruling on the South China Sea

Analysts said the Philippines’ temptation to cut a side deal with China could undercut US efforts to put pressure on Beijing to back off its more maximalist claim to 85 per cent of the South China Sea — the nine-dash line” — by using the tribunal’s decision to mobilise international public opinion.

According to Richard Heydarian, a political analyst at De La Salle University in Manila, the new president of the Philippines, Rodrigo Duterte, “will surely look at ways to leverage the arbitration . . . to extract concessions from China”.

…Zhu Feng, director of the China Center for Collaborative Studies of the South China Sea at Nanjing the University, said Beijing’s efforts to cut deals with neighbours on maritime claims is a longstanding policy which even has a name: roughly translated it is called “shelve disputes in favour of joint development”.

He pointed to a number of diplomatic successes — a compromise with Vietnam on maritime claims in Beibu Bay in 2000 and a joint marine seismic work agreement signed with Vietnam and the Philippines in 2005.

…A number of areas of co-operation have been floated in the Chinese media: joint development of oil and gas resources, shared access to the fishing waters and collaboration in research for restoration of coral reefs in the region.

That is from Charles Clover at the FT.

Those new service sector jobs, installment #1437

“The definition of an anchor has changed,” said Stephen Lebovitz, the chief executive of mall owner CBL & Associates Properties Inc. “Cheesecake Factory does as much business as Sears used to do.”

That is from Suzanne Kapner at the WSJ, on the decline of traditional anchor stores.  Yet not all of the new service sector jobs will be there forever:

“Right now we’re doing a couple hundred videos a day,” he said. “We think we need to be doing 2,000 videos a day.”

Mr. Ferro’s comments added to mounting confusion over his embattled company’s sudden rebranding. How could a newspaper publisher create nearly three-quarters of a million videos a year?

But as jarring as Tronc’s goals may sound, the company’s plan is far from novel. In pursuit of more lucrative video advertising and success on dominant social platforms like Facebook, a growing number of publishers have turned to technology that promises to streamline video production, sometimes to the point of near-full automation.

That is John Herrman from the NYT.  File under Marginal Revolution Robot University.  And if you are wondering how it works, here is a snippet:

The two services’ automation features work in similar ways. They analyze, and may summarize, text, be it a script or a traditional news article, and then automatically find photographs and video clips to go with it. The services typically get the videos and images from sources like The Associated Press and Getty Images.

Additionally, the tools offer the option to quickly put large animated captions over the videos, in a format that has become popular on Facebook, where videos begin playing automatically and are often watched with the sound off. Each can also supply, through a third party, on-demand human narration; Wibbitz offers computerized voice-overs as well.

What does this say about the media sector more generally?

The Paradox of Disclosure

From Sunita Sah (NYT):

Disclosure can also cause perverse effects even when biases are unavoidable. For example, surgeons are more likely to recommend surgery than non-surgeons. Radiation-oncologists recommend radiation more than other physicians. This is known as specialty bias. Perhaps in an attempt to be transparent, some doctors spontaneously disclose their specialty bias. That is, surgeons may inform their patients that as surgeons, they are biased toward recommending surgery.

My latest research, published last month in the Proceedings of the National Academy of Sciences, reveals that patients with localized prostate cancer (a condition that has multiple effective treatment options) who heard their surgeon disclose his or her specialty bias were nearly three times more likely to have surgery than those patients who did not hear their surgeon reveal such a bias. Rather than discounting the surgeon’s recommendation, patients reported increased trust in physicians who disclosed their specialty bias.

Remarkably, I found that surgeons who disclosed their bias also behaved differently. They were more biased, not less. These surgeons gave stronger recommendations to have surgery, perhaps in an attempt to overcome any potential discounting they feared their patient would make on the recommendation as a result of the disclosure.

Surgeons also gave stronger recommendations to have surgery if they discussed the opportunity for the patient to meet with a radiation oncologist. This aligns with my previous research from randomized experiments, which showed that primary advisers gave more biased advice and felt it was more ethical to do so when they knew that their advisee might seek a second opinion.

The piece is…self-recommending!

The culture that is Nordic

This is how to make me feel like Bryan Caplan:

Back-to-school angst isn’t just for kids. To keep senior citizens up with the times, several Nordic countries are currently debating a proposal to send them back to school.

“To prepare ourselves for the future we need to think out of the box,” writes Nordic Council rapporteur Poul Nielson in Proposal 7 of a new report (pdf) about the future of work in Denmark, Finland, Iceland, Norway, Sweden, and the Faroe Islands, Greenland and Aaland. His proposal outlines a plan for mandatory adult education and continuing education in the region, in order to stay competitive in the global market.

A startling point in Nielson’s proposal is the word “mandatory.” He hopes to make continuous education compulsory for all, and to build it into the regular career cycle of Nordic workers.

That is by Anne Quito, via Daniel Pink.

London fact of the day

London is the richest city in Europe.  Real output per person is central London is nearly four times the average in the European Union, and nearly twice that Europe’s other large, rich metropolitan areas, such as Amsterdam and Paris.  Strikingly, London is more than twice as rich as the next richest region within Britain.  However one slices it, the city is an extraordinary economic outlier.

That is from the forthcoming Work, Power and Status in the Twenty-First Century, by the always worth reading Ryan Avent.

Monday assorted links

The culture that is Kansas

“Some have begun to call public schools ‘government schools,’ a calculated pejorative scorning both education and anything related to government,” he [Davis Merritt] wrote.

That elicited a response from Bob Weeks, the host of “WichitaLiberty.TV,” a show about Kansas politics and public affairs.

“It is surprising to me that liberals and progressives object to the term ‘government schools,’” he said on the show. “They like government, don’t they? These people want more taxation and government spending, don’t they? Well, when we think about our public schools, we find they have all the characteristics of government programs.”

That is from Julie Bosman at the NYT.

The depopulation of Japan

Though demographers have long anticipated the transformation Japan is now facing, the country only now seems to be sobering up to the epic metamorphosis at hand.

Police and firefighters are grappling with the safety hazards of a growing number of vacant buildings. Transportation authorities are discussing which roads and bus lines are worth maintaining and cutting those they can no longer justify. Aging small-business owners and farmers are having trouble finding successors to take over their enterprises. Each year, the nation is shuttering 500 schools.

“Now, in every area — land planning, urban planning, economic planning — every branch of government is trying to do what they can,” said Reiko Hayashi, a researcher at the National Institute of Population and Social Security Research.

And how bad is it likely to be?

Now, the country has begun a white-knuckle ride in which it will shed about one-third of its population — 40 million people — by 2060, experts predict. In 30 years, 39% of Japan’s population will be 65 or older.

If the United States experienced a similar population contraction, it would be like losing every single inhabitant of California, New York, Texas and Florida — more than 100 million people.

The country may become more like a Miyazaki movie:

A bigger issue now is wildlife: The village’s population has become so sparse that wild bears, boars and deer are roaming the streets with increasing frequency.

Here is the Julie Makinen story, via Jake Seliger.  Alternatively, here is a Shanu Athiparambath article on the crowdedness of Mumbai.

The British productivity gap

I have found that discussions of Brexit would be improved by considering the British productivity gap.  Often I hear talk that a Britain set free from EU strictures can pull ahead and overtake those countries, at least in terms of economics.  Yet a look at the historical record is sobering.

If you compare British productivity per labor hour, it is about thirty percent below the levels of France, Germany, and Ireland.  It is subpar before North Sea oil, during North Sea oil, and after North Sea oil.  It is well below par even when Germany is at or near full employment, so this is not mainly a composition effect resulting from Britain putting to work more lower-quality laborers and thus lowering their average.  It also tends to hold on a sector-by-sector basis, though of course not for finance.

In terms of productivity, Britain ranks below even Italy by these metrics, pre-crash too.  Don’t bother to ask about the Nordics.  The UK, however, does beat Japan.

You will note that this phenomenon is quite distinct from the recent, post-crash UK productivity stagnation, as it is a story about initial levels.  Before 1973, when Britain joined the then-EEC, the productivity gap was slightly larger than it is today.  In other words during its EU membership the country closed the productivity gap somewhat, though of course this may not be due to EU membership in any direct way.

There are various explanations for the British productivity gap, some of them involving education, or management, but I wonder whether these are explanations or mere restatements of the basic facts.

I’ll never forget the first time I visited the Netherlands in 1985.  I was in Dordrecht and reading through the comments of a guest book for a modest hotel.  The writer was British, and apparently was visiting the Continent for the first time.  He/she expressed shock at seeing that virtually everywhere in the Netherlands was a nice place, compared to the home country, much of which was not so clean and not so nice.  He/she lamented and apologized for this feature of Great Britain, and that is yet another way of expressing the productivity gap.

At least in some sectors, there are reasons to believe that the productivity gap dates at least as far back as the late nineteenth century, when Britain lost a good deal of ground to Germany.  The debate is murky, but it is wrong to think of this as a recent problem, try here and here.

As of late, the United Kingdom has punched far above its weight by (re)creating London as a service center and financial capital of most of Europe.  Post-Brexit, London indeed might keep this role, albeit in a probably diminished capacity, and there is some risk of London losing it altogether.  While there is a “Dutch disease” problem (sterling appreciation hurts other British exports), on net the success of London really does help pay the bills elsewhere.

In the meantime, it is not obvious that productivity miracles will be blossoming elsewhere in the British economy.

gap

It is indeed a sobering thought — most of all for the Leave case — to contemplate the British productivity gap.

Lunch with Philip Tetlock

That is in the FT, gated most likely, do subscribe!  In any case, here was to me the most interesting bit:

He [Tetlock] is trying to replace the public debates he describes as “Krugman-Ferguson pie fights” — a reference to the clashes over austerity between the economist and Nobel laureate, Paul Krugman and the economic historian, Niall Ferguson — with adversarial collaboration. “You give each side the opportunity to pose, say, 10 questions it thinks are probative and resolvable, and that it thinks it has a comparative advantage in answering” and then have the two sides give testable answers . . . Here is a very clear psychological prediction: people will come out of that tournament more open-minded than they otherwise would have been. You can take that one to the bank.”

More importantly, Tetlock ordered “…an apple fizz cocktail to go with haddock with a sauce of butter and musses.”

Here was the best single sentence from Tetlock, itself worth the price of an FT subscription:

“There is a price to be paid for feeling good about your beliefs.”

Robert Armstrong did an excellent job with the interview and piece.

Saturday assorted links

1. The emotional arcs of stories.

2. Lord Monboddo redux photo.  And pride of lions kills five poachers.

3. Has Uber made it easier to get a ride in the rain? (yes, supply curves do slope upwards)

4. Autism as a disorder of high intelligence.  And why the gender gap in chess? (NYT)

5. By no means is all of the law in the public domain.

6. Paul McCartney: “Despite saying he wouldn’t have voted, “I think I would have come down on the remain side because people like the Governor of the Bank of England, a lot of financial experts, were saying that,” McCartney said. “I think the strongest argument that I heard, a friend of mine who was a political journalist said, [is that people] shouldn’t forget this is the longest sustained peace in Europe.””

*The Inner Lives of Markets*

That is the new book by Ray Fisman and Tim Sullivan, with the subtitle How People Shape Them — and They Shape Us.  I have not had it in my paws during my travels but everything they write is good.

Here are the authors on Goethe’s second price auction.  And on the successes of food bank networks.  And on the notion that if you have to argue economics, you already have lost the debate.  Sad!

Gillian Tett very much liked the book.