Month: October 2018

Wednesday assorted links

1. Cryptocurrency pump-and-dump schemes.

2. No Coase theorem: “Opinion polls show more than 50 per cent of Greeks oppose the June deal because the government controversially accepted the existence of Macedonian ethnicity and language in return for the change of name.”  FT link.

3. Chocolate is older than we had thought.

4. The world’s Scrabble champion in French cannot speak French (NYT).

5. “A Russian scientist working in Antarctica is facing attempted murder charges after allegedly stabbing a colleague for telling him the endings of books he wanted to read.

6. David Card vs. Peter S. Arcidiacono.  Good piece, Card is wrong.

7. MRU Halloween video.

Do female department chairs matter?

Appointing female managers is a common proposal to improve women’s representation and outcomes in the workplace, but it is unclear how well such policies accomplish these goals. Using newly-collected panel data on academic departments, I exploit variation in the timing of transitions between department chairs of different genders with a difference-in-differences research design. For faculty, I find female department chairs reduce gender gaps in publications and tenure for assistant professors and shrink the gender pay gap. Replacing a male chair with a female chair increases the number of female students among incoming graduate cohorts by ten percent with no evidence of a change in ability correlates for the average student.

That is from a new paper by Andrew Langan, who is a job market candidate from Princeton this year.  He has another paper with Leah Boustan, here is an excerpt from the abstract:

We find that schools with better outcomes for women also hire more women faculty, facilitate advisor-student contact, provide collegial research seminars, and are notable for senior faculty with awareness of gender issues.

In yet another piece he estimates the value of unpaid cooking time in Mexico, always higher than you think I would say.

Can You Outsmart an Economist?

Can You Outsmart an Economist? is an excellent book of puzzles put together by Steven Landsburg. Steve includes a lot of classics such as the Girl Named Florida Problem, the Potato Paradox and Newcomb’s paradox, the former two problems are presented in slightly different and in the first case improved forms so you might not recognize them on first reading. Steve also includes many economic puzzles, Bayes puzzles, common knowledge problems and more. Readers of this blog will certainly know some of the puzzles but will also find lots of novel problems and puzzles. Also included are philosophical paradoxes. For example, the headache problem.

A billion people are experiencing fairly minor headaches, which will continue for another hour unless an innocent person is killed, in which case the headaches will cease immediately. Is it okay to kill that innocent person?

The puzzle here isn’t the answer. The answer is obvious. The puzzle is that smart people can’t agree which answer is obvious.

Overall, this is the best and most diverse collection of puzzles that I know. It’s meant to be dipped into and sampled at leisure. My only complaint is that the puzzles are followed by answers which makes it too easy to fool yourself into thinking you always knew the answer! Answers in the back of the book would have been a minor form of commitment. Recommended.

Will the decline of galleries reshape art?

Heidi Mitchell reports (NYT):

“The gallery is a format that is struggling,” said the Argentine curator Ximena Caminos, formerly of the Malba museum in Buenos Aires and now chief creative officer of the Honey Lab cultural space in Miami’s Blue Heron hotel and residential project, which is now under development. “It’s transactional; the artist doesn’t have that much creative freedom, and there is a lot of pressure to make money in a short period of time.” Artists, she said, are seeking new places to showcase their work, especially if the pieces are large in scale.

If the number and relevance of galleries were to decline (continue to decline?), how might this affect artistic content?  Here are a few hypotheses:

1. More artists will commission pieces for corporate lobbies and condominiums, as the article reports.  That will tend to favor mainstream abstract art and disfavor political statements and obscenities.

Erica Samuels notes:

“There is a great responsibility on the real estate developers that maybe they don’t even realize, while at the same time, the stigma of an artist working with a rich developer is fading.”

2. Corporate-owned works are usually less liquid and may not be sold at all, short of bankruptcy or liquidity crunches, when they are sold under panic conditions.  Artists therefore will be less likely to have dominant dealers who prop up their prices and cultivate markets for them.  That will likely encourage greater artistic output, though also lower quality output, as might be defined by elites.  The resulting art will have to appeal to buyers at first glance, as the artist cannot count upon “sophisticated” galleries to persuade or educate potential buyers.

3. Some artists will take their craft directly to the street, as is done in Belfast or Newark, New Jersey.  They will paint for local community status, and for the joy of it, and for political self-expression, rather than for pay.  They will use cheaper materials, brighter colors, and indulge in themes and images with strong local meaning.  Political art and paid art will separate further.

4. Galleries pursue their own coherent reputations, which encourages carried artists to fit into slots which match gallery reputations.  So there are “conceptual art galleries,” “Pop Art galleries,” and so on, and artists in turn target those styles, so as to achieve entry to galleries.  When galleries are weaker, the slottable categories are created by some other set of intermediaries — might it someday be Instagram hashtags?  eBay search terms?  Something else?  In any case, those new slots or styles might have to be less “you know it when you see it” and more “you can type those words into a search function.”

5. The decline of browsing has hit published books as well, especially fiction, which saw a big decline in sales over 2013-2017: “The most commonly shared view is that it has become extremely difficult to generate exposure for novels. Fiction, more than nonfiction, depends on readers discovering new books by browsing. Now, with the number of physical stores down from five years ago (despite a rise in ABA membership), publishers cannot rely on bricks-and-mortar stores providing customers with access to new books.”  It is easier to type the topic of a non-fiction book into a search function.  In this world it is harder to develop new authors [artists], and the link directly above, while about books, is a good way to start thinking about the galleries issue.

6. Most galleries, either intentionally or not, create a distinction between what is shown on the floor and what is held in the back room.  Non-gallery art is less likely to be bifurcated in the same way, even if some pieces are more prominent on the home page than others.  That may make internet-displayed art less “bubbly,” less subject to elite manipulations and prejudices and enlightenments, and also both fuzzier and lower in price.

7. If there are fewer galleries, perhaps more will be bought and sold at auction.  The winning bidder will be less likely to be ripped off by say 3x on the price, so it will be easier to experiment with buying unfamiliar styles: “I liked the Persian carpet I saw at Sotheby’s, and figured the winning bid wouldn’t have too much winner’s curse in it.”  You can’t say the same when you go to a gallery relatively uninformed.

8. Galleries offer high implicit returns to regular buyers, who end up getting a crack at the best works in advance, even before the show opens.  That encourages buyer specialization, whereas internet and auction-based methods of selling do not.

9. What else?

The sushi restaurant in the D.C. Trump International Hotel

I offer a mostly sociological review in my latest Bloomberg column.  When I went the restaurant was completely empty the entire time.  D.C. really doesn’t like Trump, or being affiliated with him.  But here is my assessment of the food and restaurant:

And what about the food? It may be the best restaurant in Washington right now — and it was the second-best sushi meal I’ve had in America, behind only Masa, the Michelin three-star temple in Manhattan. Sushi Nakazawa flies in lots of sushi from Hokkaido, a premier source of supply, and the presentation is impeccable.

If I have a complaint, it is about the décor and atmosphere: the tacky carpet, highly visible fire alarm and annoying muzak were all magnified by the absence of human beings in the main dining room. The room is ugly without being informal or relaxing or culturally interesting.

And here is my theory of tax incidence:

How much money did I funnel to the pockets of Trump? I don’t know the details of the restaurant’s contract with the hotel, but unless business picks up, I suspect I was merely limiting its losses. Still, there is a small chance that my single meal — or maybe this column — nudges its operators into extending their lease. Then again, if a sushi restaurant is a worse fit for the hotel than, say, another bar or steakhouse, I could just as easily be helping to keep the hotel’s profits down. I don’t feel I have committed a utilitarian sin.

Be there, or be square!

Tuesday assorted links

1. David Perell on marketing.

2. David Gelernter on stuff I don’t want you to discuss in the comments section.

3. Bytedance (the world’s most valuable start-up?, NYT).

4. More on Bolsonaro.  Delusional in some ways, most of all in denial about Brazilian violence ex ante, but still interesting.

5. “We find that left-wing electoral victories cause significant and substantial short-term decreases in stock market valuations and in the US dollar value of the domestic currency, while the response of sovereign bond markets is muted.”  Link here.

6. Why are sales of fiction declining?

*Persecution and Toleration: The Long Road to Religious Freedom*

That is the forthcoming book by my excellent colleagues Noel Johnson and Mark Koyama, due out next January, you can now pre-order here.

Here is the Amazon summary:

Religious freedom has become an emblematic value in the West. Embedded in constitutions and championed by politicians and thinkers across the political spectrum, it is to many an absolute value, something beyond question. Yet how it emerged, and why, remains widely misunderstood. Tracing the history of religious persecution from the Fall of Rome to the present-day, Noel Johnson and Mark Koyama provide a novel explanation of the birth of religious liberty. This book treats the subject in an integrative way by combining economic reasoning with historical evidence from medieval and early modern Europe. The authors elucidate the economic and political incentives that shaped the actions of political leaders during periods of state building and economic growth.

I have read the entire thing (a slightly earlier draft), very definitely recommended.

Young “stars” in economics

We use a novel dataset of job flyouts for junior economists to investigate three aspects of the market for “stars”. First, what is the background of students who become stars? Second, what type of research does the top of the market demand? Third, where do these students take jobs? Among other results, we show that stars are more international and less female than PhDs overall, that theoretical and semi-theoretical approaches remain dominant, that American programs both produce the most stars and hire even more, that the private sector is largely uncompetitive, and that there is a strong shift toward stars having pre-PhD full-time academic research jobs.

That is the abstract of a new paper from Kevin A. Bryan, also known as A Fine Theorem.  Via Beth Popp Berman.

And here is a point on the stickiness of academic rankings over time:

In economics, among the 13 programs with the most published pages in a Top 5 journal by their faculty between 2002 and 2009, all 13 were among the top 18 in the same ranking for publications between 1974 and 1978 (McPherson [2012])!

“!” is right!  And this:

…almost 80% of the faculty at a top 10 economics department did their PhD in a top 10, compared to 58% in mathematics and 63% in literature.

!!

There is no published research cited in this article

Nor are any criticisms of that research presented.  The title and subheader of the piece (NYT) are:

A Dark Consensus About Screens and Kids Begins to Emerge in Silicon Valley

“I am convinced the devil lives in our phones.”

Doesn’t a consensus have to be…scientific?  The article does cite many tech people who are limiting the screen time of their children.  That may well be a good thing.  But tech people also may not have the best balanced understanding of the scientific issues involved, or of how tech is used outside of tech communities (and their children) themselves.

Literally speaking, the headline refers only to a consensus in Silicon Valley.  But I do not myself see such a consensus out there during my visits, and it is not obvious within the article what the views of the dissenters might be, or how prominent or numerous those dissenters are.  Or even whether they are dissenters or the mainstream.  Furthermore, most readers will take this piece to be referring to a broader scientific consensus, which does not in fact exist.  And yes I have read some of the published research indicating that tech damages people’s mental capacities and, while such claims may end up being true, I do not find the current research very convincing.  In any case, such research ought to have been considered, pro and con.

We have now reached the point where tech is one of the worst covered subject areas by the U.S. and also British media.

Shopping While Black: Past, Present and Future?

The original Sears mail-order catalogue changed how African Americans in the South shopped:

…the catalogue format allowed for anonymity, ensuring that black and white customers would be treated the same way.

“This gives African Americans in the Southeast some degree of autonomy, some degree of secrecy,” unofficial Sears historian Jerry Hancock told the Stuff You Missed in History Class podcast in December 2016. “Now they can buy the same thing that anybody else can buy. And all they have to do is order it from this catalogue. They don’t have to deal with racist merchants in town and those types of things.”

More recently, Uber has alleviated many of the traditional difficulties that blacks have had hailing taxis.

In a heartfelt essay Ashlee Clark Thompson explains how the “grab and go” technologies now being tested at Amazon Go made her confront lessons learned from decades of shopping while black:

The idea of walking into a store, taking an item or several off the shelves and strolling right back out again boggled my mind. It ran counter to everything I had learned about being black and shopping.

…I grabbed one of the orange Amazon Go bags and began to make my way around the perimeter of the store. I was studying the various bottled waters and debating whether to get fizzy or still, or a bottle of kombucha, when I realized what I was really doing: I was stalling. The fear I had carried with me for decades reared its head as I stood in front of the refrigerated display. I was afraid to make a choice, remove it from a shelf and put it in my bag. I was afraid someone would pop out from behind a display of Amazon-branded merch and scream, “Get your hands off that!” And I was mad that this fear couldn’t even let me fully enjoy an experience that’s designed for everyone to grab and go, no questions asked.

Eff this, I thought. I’m getting some Vitamin Water.

Once the plastic bottle hit the bottom of my reusable bag, I glanced around to see if anyone noticed. The Amazon employees shuffled around the small store and restocked shelves. Tourists chatted in small groups as they pointed and looked for the sensors that were keeping track of our every move. One guy with his phone on a selfie stick recorded himself as he selected snacks. And then there were the folks for whom the novelty had worn off and just wanted a vegetarian banh mi sandwich.

No one cared what I was doing. Is this what it feels like to shop when you’re not black?

…Amazon Go isn’t going to fix implicit bias or remove the years of conditioning under which I’ve operated. But in the Amazon Go store, everyone is just a shopper, an opportunity for the retail giant to test technology, learn about our habits and make some money. Amazon sees green, and in its own capitalist way, this cashierless concept eased my burden a little bit.

The similarities in these cases are interesting but so are the differences. In the Sears case most of the effect of diminished discrimination was driven by greater competition in one-shop towns. In the one-shop town the owners sometimes took a share of their monopoly profits in invidious racism–this appears to explain why shop owners would prevent blacks from buying more expensive products (or perhaps the one-stop shop had to cater to racist customers who demanded invidious discrimination.)

In the Uber case my bet is that a large share of the reduction in discrimination was due to the fact that Uber drivers don’t carry cash and so are less worried about robbery and the app increases safety because it records in detail rider, driver and trip data. In other words, the Uber system reduced the value of statistical discrimination. It’s difficult to know for sure, however, because there was probably also some decline in invidious discrimination brought about by Uber hiding some rider information from drivers until trips are accepted.

The last case, the Amazon Go case, is in part a decline in the value of statistical discrimination since shoplifting is no longer a problem (in theory, assuming the technology works) but in this case the decline in statistical discrimination is driven by much finer discrimination. The moment a shopper enters the Amazon Go store, Amazon knows their name, address, entire shopping history, credit history and potentially much more. Moreover, a shopper’s every movement within the store is tracked to a level of detail that no store detective could ever hope to match. To the customer, especially the black customer, it may feel like they are no longer being watched but in fact they are watched more than ever before–the costs of technological monitoring, however, are mostly fixed which means that everyone is monitored equally. No need for statistical discrimination in the panopticon.

Addendum: A good dissertation might be to incorporates the cost of information, the value of statistical discrimination and the demand for invidious discrimination in a general theory that explains the various cases mentioned here and the effects of information bans such as ban the box.

Hope is not lost

While some say wisdom comes with age, younger Americans are better than their elders at separating factual from opinion statements in the news, according to a new analysis from Pew Research Center.

And the gap is noticeable:

About a third of 18- to 49-year-olds (32%) correctly identified all five of the factual statements as factual, compared with two-in-ten among those ages 50 and older. A similar pattern emerges for the opinion statements. Among 18- to 49-year-olds, 44% correctly identified all five opinion statements as opinions, compared with 26% among those ages 50 and older.

When looking at the 10 statements individually, younger adults were not only better overall at correctly identifying factual and opinion news statements – they could do so regardless of the ideological appeal of the statements.

Maybe social media aren’t so terrible after all.  And maybe cable TV is less than perfect?

That is from Jeffrey Gottfried and Elizabeth Grieco, via the excellent Kevin Lewis.

Incentives matter

Chad Haag considered living in a cave to escape his student debt. He had a friend doing it. But after some plotting, he settled on what he considered a less risky plan. This year, he relocated to a jungle in India. “I’ve put America behind me,” Haag, 29, said.

He now lives in a concrete house in the village of Uchakkada for $50 a month. His backyard is filled with coconut trees and chickens. “I saw four elephants just yesterday,” he said, adding that he hopes to never set foot in a Walmart again.

His debt is currently on its way to default. But more than 9,000 miles away from Colorado, Haag said, his student loans don’t feel real anymore.

“It’s kind of like, if a tree falls in the woods and no one hears it, does it really exist?” he said.

The philosophy major concedes that his student loan balance of around $20,000 isn’t as large as the burden shouldered by many other borrowers, but he said his difficultly finding a college-level job in the U.S. has made that debt oppressive nonetheless. “If you’re not making a living wage,” Haag said, “$20,000 in debt is devastating.”

Here is the full story by Annie Nova, with photos and video.  Via the excellent Samir Varma.

Sunday assorted links