Month: October 2017

Monday assorted links

1.. It seems there is no decline in American adult sleep.

2. The scientist who spots fake videos.

3. 14-year-old Joseph Gray has a brief interview with Deirdre McCloskey.

4. What happened to the rest of The Doors?

5. “They later established that the 70-mile wide (110km) mass was a kaleidoscope of Painted Lady butterflies.

6. AI as autotelic.

That’s all for now, later today there will be some Nobel Prize coverage.

Sunday assorted links

1. Leo Strauss had a Coasean take on the Singularity, see Lecture 2, start at 4:30.

2. Will AI be able to identify partially concealed faces?

3. Gun research has not been shut down for 20 years.

4. Do short-term peer groups matter in higher education?

5. Caste and economic mobility in India.

6. Is trend forecasting helping or hurting fashion?

7. Using violence to force the retraction of peer-reviewed articles.

The preference for threat-related material in the supply and demand of information

That is the topic, here is the abstract:

Many rumors convey information about potential danger, even when these dangers are very unlikely. In four studies, we examine whether micro-processes of cultural transmission explain the spread of threat-related information. Three studies using transmission chain protocols suggest a) that there is indeed a preference for the deliberate transmission of threat-related information over other material, b) that it is not caused by a general negativity or emotionality bias, and c) that it is not eliminated when threats are presented as very unlikely. A forced-choice study on similar material shows the same preference when participants have to select information to acquire rather than transmit. So the cultural success of threat-related material may be explained by transmission biases, rooted in evolved threat-detection and error-management systems, that affect both supply and demand of information.

The piece is by Timothy Blaine and Pascal Boyer.  Of course this is one of the very best tips to know to understand what is actually happening on an Op-Ed page or your Twitter feed.  See through it, yes you can.

For the pointer I thank the excellent Kevin Lewis.

Update on seasteading in French Polynesia

From Emma Harris:

But the Seasteading Institute and the new for-profit spin-off, Blue Frontiers, have racked up some real-world achievements in the past year. They signed a memorandum of understanding with the government of French Polynesia in January that lays the groundwork for the construction of their prototype. And they gained momentum from a conference of interested parties in Tahiti in May, which hundreds of people attended. The project’s focus has shifted from building a libertarian oasis to hosting experiments in governance styles and showcasing a smorgasbord of sustainable technologies for, among other things, desalination, renewable energy and floating food-production. The shift has brought some gravitas to the undertaking, and some ecologists have taken interest in the possibilities of full-time floating laboratories.

…The next step in making the island a reality will be the passage of a law defining the ‘special economic zone’ that will cover the synthetic island. Blue Frontiers isn’t asking French Polynesia for any subsidies to build the island, but it is asking for a 0% tax rate, among other regulatory exceptions. It has hired French firm GB2A, based in Paris, to prepare legal research and a set of requests, which Blue Frontiers presented to the government at the end of September. The team hopes to see a bill emerge before the end of the year.

In the meantime, the Seasteading Institute is building excitement and courting potential investors with a series of gatherings. In May, it held talks, networking events and tours in Tahiti. Speakers included Fritch; Tony Hsieh, chief executive of online retailer Zappos in Las Vegas, Nevada; Tua Pittman, a master canoe navigator from the Cook Islands; and engineers, nanotechnologists and a ‘blockchain strategist’, a specialist in the distributed information systems behind cryptocurrencies. The seasteaders hope to use such systems to handle their financials, as well as any scientific data that they generate. But the event wasn’t all work. An announcement for a party on outrigger canoes cheerfully suggested: “Do not wear heels. Bring a swimsuit for an optional moonlight swim.”

On 22–29 October, Blue Frontiers will hold an Insiders Access Week for supporters and potential investors, a mix of tours, discussion and morning yoga with Hencken. Always ambitious, the team hopes to have draft legislation from the Polynesian government by then, and some detailed architectural plans. The goal is to break ground — or rather, sea — in 2018.

In the Nature article there is much, much more.

For the pointer I thank Michelle Dawson.

What should I ask Brink Lindsey and Steve Teles?

I will be having a Conversation with them, in part connected to their very important forthcoming book The Captured Economy: How the Powerful Enrich Themselves, Slow Down Growth, and Increase Inequality.  But not only.  What should I ask these two leading lights?

By the way, here is an abstract for the book:

The relentless increase of inequality in twenty-first century America has confounded analysts from both ends of the political spectrum. While many can point to particular contributing causes, so far none of the policies that have been enacted-not just in the United States but in other advanced countries-have been able to lessen the wealth and income gaps between the top decile and the rest. Critics on the left are more forceful critics of rising inequality, and they tend to blame capitalism and the private sector. Predictably, they see solutions in government action. Many on the right worry about the issue, too, but they come from a position that is more sanguine about corporations and more suspicious of government. But as the libertarian Brink Lindsey and the liberal Steve Teles argue in The Captured Economy, perhaps all of us-left, right, and center-are looking in the wrong places for culprits and solutions. They hone in on the government-corporate sector nexus, apportioning blame not only to both forces but also to the distorted form of governance that this partnership has created. Through armies of lobbyists, corporations and the wealthy have become remarkably adept at shaping policy-even ostensibly progressive policies-so that the field is tilted in their favor. Corporations have become classic ‘rentiers,’ using their monopoly power of influence over highly complicated legislative and regulatory processes to shift resources in their direction. FCC policy, health care regulation, banking regulation, labor policy, defense spending, and much more: in all of these arenas, well-resourced corporate rentiers have combined to ensure that the government favors them over everyone else. The perverse result is a state that shifts more and more wealth to the already-rich-even if that was never the initial intent of Congress, the President, or the electorate itself. Transforming this misshapen alliance will be difficult, and Lindsey and Teles are realistic about the chances for reform. To that end, they close with a set of reasonable policy proposals that can help to reduce corporate rentiers’ scope and power to extract excessive rents via government policy. A powerful, original, and genuinely counterintuitive interpretation of the forces driving the increase in inequality, The Captured Economy will be necessary reading for anyone concerned about the rising social and economic divisions in contemporary America.

Who will win Monday’s Nobel Prize in economic science?

From the WSJ:

Clarivate Analytics, formerly a unit of Thomson Reuters, maintains a list of possible Nobel Prize winners based on research citations. New additions to its list this year were Colin Camerer of the California Institute of Technology and George Loewenstein of Carnegie Mellon University (“for pioneering research in behavioral economics and in neuroeconomics”); Robert Hall of Stanford University (“for his analysis of worker productivity and studies of recessions and unemployment”); and Michael Jensen of Harvard, Stewart Myers of MIT and Raghuram Rajan of the University of Chicago (“for their contributions illuminating the dimensions of decisions in corporate finance”).

Dozens of additional names appear on Clarivate’s list of possible future economics winners, including prominent figures on the American economics scene like Stanford’s John Taylor, a monetary-policy scholar who President Donald Trump is said to be considering for Federal Reserve chairman; Paul Romer of New York University, an expert on economic growth and the chief economist at the World Bank; Martin Feldstein of Harvard, who was chairman of the White House Council of Economic Advisers under President Ronald Reagan and has studied pensions, taxation and other topics in public finance; William Nordhaus of Yale University, who has studied climate change; Dale Jorgenson of Harvard, who has studied productivity; Robert Barro of Harvard, who has researched economic growth; Oliver Blanchard of the Peterson Institute for International Economics, the former top economist at the International Monetary Fund; and Richard Thaler of the University of Chicago, who has studied behavioral economics.

Former Fed chairman Ben Bernanke’s name has been floated in the past, given his academic work on the Great Depression, and his longtime collaborator Mark Gertler of NYU appears on the Clarivate list.  So does Richard Posner, the recently retired federal judge who has written on the intersection of law and economics.

I’ve never once been right, but this year I’ll predict William Nordhaus (“Green Accounting”) and Martin Weitzman (climate change and economics of risk).

The End of Free College in England

It seems to have been a largely pro-education, egalitarian development, at least according to a new research paper by Richard Murphy, Judith Scott-Clayton, and Gillian Wyness:

Despite increasing financial pressures on higher education systems throughout the world, many governments remain resolutely opposed to the introduction of tuition fees, and some countries and states where tuition fees have been long established are now reconsidering free higher education. This paper examines the consequences of charging tuition fees on university quality, enrollments, and equity. To do so, we study the English higher education system which has, in just two decades, moved from a free college system to one in which tuition fees are among the highest in the world. Our findings suggest that England’s shift has resulted in increased funding per head, rising enrollments, and a narrowing of the participation gap between advantaged and disadvantaged students. In contrast to other systems with high tuition fees, the English system is distinct in that its income-contingent loan system keeps university free at the point of entry, and provides students with comparatively generous assistance for living expenses. We conclude that tuition fees, at least in the English case supported their goals of increasing quality, quantity, and equity in higher education.

I have long been of the view that free tuition for U.S. state schools would be an educational disaster.

How important are sectoral shocks?

Enghin Atalay has a piece on that topic in the American Economic Journal: Macroeconomics, here is the abstract with emphasis added by me:

I quantify the contribution of sectoral shocks to business cycle fluctuations in aggregate output. I develop and estimate a multi-industry general equilibrium model in which each industry employs the material and capital goods produced by other sectors. Using data on US industries’ input prices and input choices,I find that the goods produced by different industries are complements to one another as inputs in downstream industries’ production functions. These complementarities indicate that industry-specific shocks are substantially more important than previously thought, accounting for at least half of aggregate volatility.

There is another recent paper, this one by Ernesto Pasten, Raphael Schoenle, and Michael Weber, an NBER Working Paper.  From p.3:

…heterogeneity in price rigidities changes the identity of sectors from which aggregate fluctuations originate, and generates GDP volatility from sectoral shocks independent of the sector-size distribution and network centrality.

In other words, sector-specific shocks are underrated as causes of aggregate fluctuations, most of all in the economic blogosphere.

Thursday assorted links

1. The long-term effects of slavery on inequality in Brazil.

2. David Geffen criticizes other philanthropists for not supporting his opening renovation gift to the NY Philharmonic (NYT).  Does the new hall really need to cost $500 million or maybe more?  What exactly has gone wrong here?

3. Is it unrealistic to expect undergraduates to think like economists? (McCloskey)

4. An unusual corporate presentation (Japan, SoftBank).  How do you interpret their message overall?  I wish to know.

5. The musical world of birdsong contests.

6. “Really I would not have predicted in 1994 how much of 2017’s financial news would involve the Wu-Tang Clan.

Who should lead the Federal Reserve?

That is the topic of my latest Bloomberg column, here is one excerpt:

We do not live under political normalcy, so traditional standards are not enough to guide this choice. In an age of consensus, it might be wise to nominate the candidate who knows the most about monetary policy, or who commands the most respect on Wall Street. Those remain significant factors, but the most important job of the next candidate is to prevent a polarization of opinion within the Fed itself.

I do consider some specific names at the link.

This will be most useful in China

Google is the first major tech company to build the Babel fish.

The search company, which is now making a slew of its own hardware products, announced the Google Pixel Buds at a San Francisco event today (Oct. 4). The earbuds connect wirelessly with Google’s latest smartphones, but more importantly, they’re able to access Google Assistant, the company’s virtual personal concierge, which launched exactly a year ago. Through this software, Google claims the earbuds can translate 40 spoken languages nearly in real time—or at least, fast enough to hold a conversation.

Here is the story at Quartz.  It’s funny how economists used to come up with theories that platform monopolies would stifle innovation…