Month: December 2018

Is the age of man-machine cooperation over in chess?

Given further data on the stunning performances of AlphaZero, Charles Murray asked me that on Twitter.  And for now the answer surely seems to be yes: just let AlphaZero rip, and keep the human at bay.  It’s a bit like the joke about the factory: “The dog is there to keep the man away from the machines, and the man is there to guard the dog.”  (Or is it the other way around?)

But here’s the thing: right now there is only one AlphaZero, and AlphaZero does not play like God (I think).  At some point there will be more projects of this kind, and they will not always agree as to what is the best chess move.  Re-enter the human!  Imagine a human turning on AlphaZero and five other such programs, seeing where they disagree, and then querying the programs further to find a better answer.  It is at least possible (though not necessary) that a human will be better at doing this than will a machine.

Keep in mind, the original role in the human in Advanced [man-machine] Chess was not to substitute human chess judgment for machine chess judgment in any kind of discretionary fashion.  It was to adjudicate disagreements across programs: “Rybka has a slightly better opening book.  Fritz is better in closed endgames.  Houdini is tops at defense.”  And so on.  The human then sided with one engine over the others, or simply spent more engine time investigating some options rather than others.

It could possibly run the same way for neural net methods, once we have a general sense of the strengths and weaknesses of different projects.  So yes, man-machine cooperation in chess is a loser right now, but it may well come back.  And there is a broader economic lesson in that, namely that automation may eliminate jobs, but it does not necessarily eliminate them permanently.

Friday assorted links

The Cost of Occupational Licensing

In an NBER paper, Blair and Chung find that occupational licensing reduces labor supply significantly. I had expected that occupational licensing would be worse for blacks than for whites because it imposes an additional locus of discrimination but that effect seems to be opposed by a certification effect (the license helps black workers to overcome statistical discrimination) so the net effect is not as bad for blacks as for whites:

We exploit state variation in licensing laws to study the effect of licensing on occupational choice using a boundary discontinuity design. We find that licensing reduces equilibrium labor supply by an average of 17%-27%. The negative labor supply effects of licensing appear to be strongest for white workers and comparatively weaker for black workers.

An Institute for Justice report by Morris M. Kleiner, the dean of occupational licensing studies, and Evgeny S. Vorotnikov attemps to calculate the net loss to the US economy from occupational licensing and concludes that when all costs are considered it is on the order of $200 billion annually.

In preventing people from working in the occupations for which they are best suited, licensing misallocates people’s human capital. In forcing people to fulfill burdensome licensing requirements that do not raise quality, licensing misallocates people’s human capital, money and time. And with its promise of economic returns over and above what can be had absent licensing, licensing encourages occupational practitioners and their occupational associations to invest resources in rent-seeking instead of more productive activity. Taking these misallocated resources into account, we find potential costs to the economy that far exceed those from deadweight losses and that likely provide a more complete picture of the extent to which licensing reduces economic activity.

…we find licensing costs the American economy $197.3 billion in misallocated resources.

Corporate science fiction markets in everything

…the business world has been increasingly aware of the genre’s potential. In 2017, PricewaterhouseCoopers, the professional services firm that advises 440 of the Fortune 500 companies, published a blueprint for using science fiction to explore business innovation. The same year, the Harvard Business Review argued that “business leaders need to read more science fiction” in order to stay ahead of the curve…

A number of companies, along with a loose constellation of designers, marketers, and consultants, have formed to expedite the messy creative visualization process that used to take decades. For a fee, they’ll prototype a possible future for a [corporate] client, replete with characters who live in it, at as deep a level as a company can afford. They aim to do what science fiction has always done — build rich speculative worlds, describe that world’s bounty and perils, and, finally, envision how that future might fall to pieces.

Alternatively referred to as sci-fi prototyping, futurecasting, or worldbuilding, the goal of these companies is generally the same: help clients create forward-looking fiction to generate ideas and IP for progress or profit. Each of the biggest practitioners believe they have their own formulas for helping clients negotiate the future. And corporations like Ford, Nike, Intel, and Hershey’s, it turns out, are willing to pay hefty sums for their own in-house Minority Reports.

That is from Brian Merchant on Medium.

Tamara Winter on how to generate compound returns

This is a concordance of responses she received on Twitter, I am not sure she endorses all of these ideas, the rest is her I won’t double indent:

Interpersonal and Mindfulness

  • Wake up early.
  • Spend time in prayer and/or meditation first thing in the morning. Or, if you can’t fit it in then, find time later in the day. I love using Headspace. If you’re Catholic, pray the Rosary daily.
  • Practice gratitude, and be specific when thanking someone.
  • Keep a personal calendar.
  • Write something, anything, everyday.
  • Study a foreign language for 5, 15, or 25 minutes a day. Here’s a list of 10 great options.
  • Eat meals with people you love.
  • Keep in touch with close friends.
  • Read to your children, and take pictures of them frequently.
  • Read for at least 15 minutes daily.
  • Read or watch something new daily. Ideally something you’re curious about.
  • Ask questions often.
  • Don’t slouch.
  • Learn to dance.
  • Call your parents and grandparents.
  • Go on lots of first dates. Law of large numbers.
  • Introduce yourself to new people.
  • Before dinner, write down tomorrow’s priority list.
  • Restrict your tv time. Or substitute tv time for your most potent distraction. For me that’s Twitter. Here are some practical ways to reduce screen time.
  • For young people, ask people you admire in your area for coffee once, twice, or a few times a month. Email is another option. The likelihood of a positive response in both scenarios is probably higher than you expect.

Finances

  • Negotiate your salary.
  • Practice making money online. For a fun place to start, try PredictIt.
  • Contribute early and often to your IRA/401(k).
  • Invest as you’re able to. (Would welcome reading suggestions in the comments).
  • Save a predetermined percentage from each paycheck.
  • Pay off your credit cards monthly.

Health

  • Sleep 8 hours or more each night. Limiting your blue light exposure after sunset can also improve your sleep quality.
  • Try not to use your cell phone in bed. You can also go even further, and put away your phone 30 minutes, an hour, or even two hours before bedtime.
  • Increase your water consumption, and whenever possible, drink it to the exclusion of everything else.
  • Reduce your sugar, carb, and processed food intake.
  • One way you can do this is by bringing your lunch from home to work rather than ordering take out. Added bonus: saving money.
  • When you do eat out, choose the healthier options.
  • When grocery shopping, check the ingredients of what you’re buying. Try to avoid processed foods with numerous and complicated ingredients.
  • Take the stairs if and when you can. If you live in a fairly walkable area, walk everywhere within a mile.
  • Don’t overeat — stop just before you’re full.
  • If you can, try intermittent fasting at least once a week.
  • Exercise daily. Try exercises that you enjoy, otherwise it’s unlikely that you’ll stick with them.
  • Incorporate resistance weight-training into your routine.
  • Floss!

TC again: Here is the full Medium essay.

*The Economist* covers *Stubborn Attachments*

Philosophers are accustomed to discussions about how to value lives distant from our own in time and place; economists are not. But in a new book, “Stubborn Attachments: A Vision for a Society of Free, Prosperous, and Responsible Individuals”, Tyler Cowen of George Mason University argues that the moral status of human lives ought not to be traded off over time in the same way that a bond portfolio might be. He puts the results of discounting in evocative terms: given a 5% rate of discount, one human life today is worth 132 a century hence. Is it really ethically acceptable to save one life now at the expense of so many in the future? The lives of humans born decades from now might be difficult for us to imagine, or to treat as of equal worth to our own. But our own lives were once similarly distant from those taking their turn on Earth; the future, when it comes, will feel as real to those living in it as the present does to us. Economists should treat threats to future lives as just as morally reprehensible as present threats to our own.

Here is the full article, on Twitter attributed to Ryan Avent.

Why Brexit is so important

In this dilemma, I think of U.K. citizens as a kind of stand-in for the human race. Per capita income and education in the U.K. are well above the global average and, more important, Great Britain has one of the most firmly established democratic traditions in the world. So if the U.K. cannot get this decision right, it’s pretty gloomy news for all of us. I am reminded of the scene in Ingmar Bergman’s “The Seventh Seal,” where the traveling knight has to play a game of chess against the figure of Death, and his life will be spared if he wins…

Paul Krugman opined recently that Brexit would likely cost the U.K. about 2 percent of GDP, a fair estimate in my view. But that is not the only thing at stake here. Humanity is on trial — more specifically, its collective decision-making capacity — and it is the U.K. standing in the dock.

I’ll be glued to my seat, watching.

Recommended!  Here is the full column.

“Maybe it’s not that I am a regional thinker, but a regional feeler.”

Portugal has now had two lost decades. Adjusting for inflation, GDP per capita grew 7% between 2000 and 2008. I mean it grew 7% over that whole period, not on a yearly basis. Then it fell during the crisis and only last year did it get back to 2008 levels, so that between 2000 and 2017, total growth was 7%…

The population who lived in Portugal through the last 10 years now get extactic over 2.2% year-on-year growth. After so many years of nothing, mediocre growth feels amazing. Still, if you cross the border into Spain it no longer feels “this is what Portugal will be in 2021”, it feels like a much wealthier, qualititatively different, better economy. Portugal could have been that, but, at least in my lifetime, it probably won’t be. This is a lost opportunity and it brings me sadness.

Maybe it’s not that I am a regional thinker, but a regional feeler. I have a visceral feel for what it means to “grow to the level of Greece and then stop there” that comes from lived experience.

In summary, this is why I recommend you read Stubborn Attachments.

That is from Luis Pedro Coelho, there is more of interest at the link.

What I’ve been reading

1. Sevket Pamuk, Uneven Centuries: Economic Development of Turkey since 1820.  The best economic history of Turkey I know, it comes with strong recommendations from Daron Acemoglu and Dani Rodrik.  Not an engaging read, but a useful survey.

2. Nell Dunn, Talking to Women.  Interviews with British (and Irish) women, circa 1964, remarkably frank and open, “witty, anarchic, and sexually frank.”  Strongly recommended, is it possible that the quality of discourse on these matters has not much advanced or even declined?

3. Charles Allen, Coromandel: A Personal History of South India.  “I have called this book Coromandel chiefly for sentimental reasons.  I first became aware of that sonorous word as a fifteen-year-old schoolboy exiled in England.  Coromandel! was the title of the third in a series of Boy’s Own-style adventure stories set in India written by John Masters, an ex-Indian Army officer turned popular novelist.  It was all about a West Country lad who sails to India with a map to find the legendary Coromandel and make his fortune.  I reread it recently and found it not half as good as I thought it was — but the magic of that word Coromandel has always stayed with me, as the very essence of South India in all its elusiveness and allure.  I’m not alone in thinking this.”

4. Sally Rooney, Normal People.  A novel, they’re not, Irish, recommended.

Louise I. Shelley, Dark Commerce: How a New Illicit Economy is Threatening Our Future, is a useful survey of varying kinds of black and dark markets.

M. Todd Henderson, Mental State, “When conservative law professor Alex Johnson is found dead from an apparent self-inflicted gunshot wound at his house in Chicago, everyone thinks it is suicide.  Everyone except his brother, Royce, an FBI agent.”

Kimberly Clausing, Open: The Progressive Case for Free Trade, Immigration, and Global Capital delivers exactly what its subtitle promises.

Jeffrey Lane, The Digital Street, is an interesting and original urban ethnography of how digitalized media, and the recording of street interactions, affect gang norms and patterns of violence.

Wednesday assorted links

1. “The type of puffer jacket someone chooses to wear is important.

2. More Scott Sumner on China.  In a few places he is responding to points slightly different than the ones I made.  More generally, libertarians and classical liberals stress how the protection of private property rights is an essential function of government, and I agree.  Actions from the Chinese side have led to what is arguably, in the aggregate, the greatest peacetime theft of property in all of history.  So what should be done about that?  And why do classical liberals and libertarians not like to bring up this issue?

3. France is yet another example of unpopular climate change taxes.

4. The Minerva curriculum is doing well.

5. Ross Douthat defends the WASP elites (NYT).

6. The self-help books that Tim Harford likes.

My Conversation with Paul Romer

Here is the audio and transcript, Paul was in top form and open throughout.  Yes economic growth, blah blah blah, but we covered many related topics too:

COWEN: And you also think we should simplify the English language. Right?

ROMER: [laughs] Well, there’s two parts to that. One is, in writing and communication, there should be a very high priority on clarity. It’s hard to know what’s the mechanism that enforces that. There are variants on English, like the English used to write the manuals people use to service airplanes, where there’s a very restricted vocabulary. The words are chosen so that you can’t have any ambiguity because you don’t want somebody servicing a plane to get confused. So there are some things you could do on writing, word choice, vocabulary, exposition.

There’s a separate issue, which is that amongst the modern languages, English has the worst orthography, the worst mapping between spelling and sounds of any of the existing languages. And it’s a tragedy because English is becoming the universal second language.

The incidence of people who don’t learn to read is substantially higher in English than in other languages. People have known for a long time, it takes longer to learn to read in English because of the bad orthography. But what hasn’t gotten enough attention is that there’s an effect on the variance as well. There are more people who never get over this hurdle to actually learning to read.

If there were a way to do in English what they’ve done in other languages, which is to clean up the orthography, that could make a huge difference in the variation associated with whether or not people can learn to read English.

And:

COWEN: Can a charter city work if we import good laws from the outside world but not the appropriate matching culture?

ROMER: You’ve zeroed right in on the connection. The real motivation that I had for charter cities was exactly this one that you can see in the US versus New Zealand. You can think of a charter city exercise . . .

This is actually the story of Maryland: We’re going to create laws, and we’re going to guarantee freedom of religion in Maryland, and it’s in the laws; it’s in the institution somehow. That didn’t turn out very well. Maryland had a Catholic elite but then large numbers of Protestant indentured servants or workers. And this kind of commitment to freedom of religion was not stable in Maryland at all.

The case that’s worth trying to copy is Pennsylvania, where William Penn recruited large numbers of people who actually believed in freedom of religion. The word charter comes from the charter that Penn wrote for Pennsylvania, but it wasn’t the document that mattered. What mattered was that there were a bunch of people in the founding population who were committed to this idea of a separation of church and state and religious freedom. And that’s what made it durable in Pennsylvania in a way it wasn’t in Maryland.

And this:

ROMER: …Moses was of this generation that was too enamored of the car, and this is where I think Jacobs had a better intuition. But the challenge, the dichotomy I would pose would be Jane Jacobs versus Gouverneur Morris.

Morris was the guy who drew the grid that laid out the rectangular street map for Manhattan.

We also discussed music, including Hot Tuna, Clarence White, and Paul’s favorite novel, dyslexia, what Paul has learned about management, and much more.  Self-recommending, if there ever was such a thing.

Solve for the equilibrium

The CEOs of Germany’s top three car firms, Volkswagen, Daimler, and BMW, said they were optimistic on avoiding US tariffs after meeting US leader Donald Trump in Washington Tuesday. “We made a big step forward to avoid the tariffs,” Volkswagen boss Herbert Diess said. The visit caused annoyance in EU circles, where trade commissioner Cecilia Malmstrom was meant to conduct US trade talks on behalf of the whole EU.

Here is the link, via Bruno.

Why is most travel writing so bad?

The most painful sections of a bookshop to have to read through would be the management books, self-help, and also the travel books.  Yet management, self-help, and travel are all very important and indeed extremely interesting matters, so I am wondering why these books are so bad.  Today let’s focus on travel.

My biggest complaint is that travel books seem not to discriminate between what the reader might care about or not.  Here is a randomly chosen passage from a recent travel book of Jedidiah Jenkins:

We walked our bikes over one more bridge and into Tijuana.  Weston was barefoot, which he noted out loud as we entered Mexico.  We got on our bikes and rode into immediate chaos.

Or this:

I drank my coffee and read the news on my phone.  I felt him sitting next to me.

Who cares? And who is Weston anyway?  (Longer excerpts would not seduce you.)  Yet this book — To Shake the Sleeping Self: A Journey from Oregon to Patagonia, and a Quest for a Life with No Regret — has 85 reviews on Amazon with an average of four and a half stars and it was a NYT bestseller.

Is travel like (some) sex, namely that you can’t write about it because it is viscerally exciting in a “you had to be there” way?  Why cannot that constraint be overcome by shifting the focus to matters more factual?

Too many travel books seem like an inefficient blending of memoir, novel, and travel narration, and they are throughout too light on information.  Ideally I want someone with a background in geography, natural history, or maybe urban studies to serve up a semi-rigorous account of what they are doing and seeing.

Here is one mood-affiliated blurb for the Jenkins book:

“A thrilling, tender, utterly absorbing book. With winning candor, Jedidiah Jenkins takes us with him as he bicycles across two continents and delves deeply into his own beautiful heart. We laugh. We cry. We feel the glory and the agony of his adventure; the monotony and the magic; the grace and the grit. Every page of this book made me ache to know what happened next. Every chapter shimmered with truth. It’s an unforgettable debut.”
Cheryl Strayed, author of Wild and Tiny Beautiful Things

What do people want from travel books anyway?  It seems the Jenkins work sold well because he is famous on Instagram, which may or may not correlate with book-writing skills.

Here is another randomly chosen passage:

I wait.  I drink some more water.  It sit in the grass and chat with the others.  I have a few false starts: “Ooh, I’m feeling it…just kidding, no I’m not.”  “Okay, now I am!  No, that’s an ant on my ankle.”

Is the problem an absence of barriers to entry for writing travel books?  That many books will sell automatically “by country” rather than because of the quality of their content, leading to an excessively segmented market?  Other travel book readers seem to obsess over the mode of transportation, such as whether a particular trip was undertaken by bicycle.  Are there too many celebrities and semi-celebrities trying their hand at a relatively easy-to-fudge literary genre?

What are the microfoundations for this failure in the quality of travel books?

Here are various lists of the best travel books of all time.  Even there I find many overrated, noting that Elizabeth Gilbert is better than most.

If you are wondering, three of my favorite travel books are Robert Byron’s The Road to Oxiana, David G. Campbell, The Crystal Desert: Summers in Antarctica, and also Suketu Mehta, Maximum City: Bombay Lost and Found, perhaps the best travel book ever written.

Somebody — fix this problem!

Tariff Man

Some good economics in Tariff Man, sung to the tune of Piano Man (with apologies to Billy Joel) by Art Carden:

Now Paul is a real estate contractor
He’d like to buy things for his wife
But he canceled a deal because structural steel’s
More expensive—it’s doubled in price!
And the firms are all practicing politics
As their businessmen fly to DC!
Yes, they’re spreading a problem called poverty,
And calling it prosperity!

Jack up that tax, you’re a Tariff Man!
Let’s make Americans pay
For the right to buy stuff from those foreigners–
We should make it here, anyway!
These policies concentrate benefits
And they spread costs to you and to me
These costs are concealed, but see, they are still real—
They are there, though they’re harder to see.
Some goods are expensive that shouldn’t be
Because tariffs have made them cost more!
And we’d have more for bars, and put bread in their jars
But we’re stopping goods at our shores!

La la la, di da da
La la, di da da da dum

Jack up that tax, you’re a Tariff Man!