Month: June 2021
Ann Bernstein interview with Lant Pritchett
Ann Bernstein: From your knowledge of India and Indonesia, what are the core causes of their lack of educational
progress? These are places with highly qualified civil servants and, at least in India’s case, a democratic
government. How do you see this problem? How do we get out of this trap?Lant Pritchett: I’m head of this very large research project called RISE and we’re spending millions of dollars to
find out the answer to that question. One of the countries where education improvements have been dramatic
is Vietnam. At a tiny fraction of the spending in most countries – including South Africa – Vietnam is achieving
OECD levels of learning. When we asked our Vietnam team why the country has produced this amazing success,
they told us: ‘because they wanted it’.On one level, that seems silly; on another level, it is the key. Unless, as a society, you agree on a set of achievable
objectives and actually act in a way that reveals that you really want those objectives, you cannot achieve
anything.
*Sweat*
One of the better movies of this year, Sweat (or this review, spoilers in both) focuses on a female Polish Instagram star, and what she has to go through to produce fresh content each day, and how she gets hooked on the income and status of her privileged position. At first it seems like a standard “costs of fame” production, but it quickly deepens with subtle and hitherto unexplored looks into family, friends, potential romantic relationships, and media interactions.
And are those other lives really better anyway?
“If you’re not going to share it, then what does it mean?’ Or something like that.
Sunday assorted links
2. Jennifer Doleac on lead and crime.
3. Can we reduce sonic booms? (New Yorker)
4. Will Singapore learn to live with Covid?
5. Pending regulation of DeFi? (FT) And the outrage of Britney. And is forced contraception legal? (NYT)
6. Non-alcoholic vacations are now “a thing”? (NYT) I guess that is good, sort of…but bad that it is good?
Andreessen on Crypto
From Noahpinion’s interview with Marc Andreessen:
[C]rypto represents an architectural shift in how technology works and therefore how the world works.
That architectural shift is called distributed consensus — the ability for many untrusted participants in a network to establish consistency and trust. This is something the Internet has never had, but now it does, and I think it will take 30 years to work through all of the things we can do as a result. Money is the easiest application of this idea, but think more broadly — we can now, in theory, build Internet native contracts, loans, insurance, title to real world assets, unique digital goods (known as non-fungible tokens or NFTs), online corporate structures (such as digital autonomous organizations or DAOs), and on and on.
Consider also what this means for incentives. Up until now, collaborative human effort online either took the form of a literal adoption of real-world corporate norms — a company with a web site — or an open source project like Linux that had no money directly attached. With crypto, you can now create thousands of new kinds of incentive systems for collaborative work online, since participants in a crypto project can get paid directly without a real-world company even needing to exist. As great as open source software development has been, far more people are willing to do far more things for money than for free, and all of a sudden all those things become possible and even easy to do. Again, it will take 30 years to work through the consequences of this, but I don’t think it’s crazy that this could be a civilizational shift in how people work and get paid.
Finally, Peter Thiel has made the characteristically sweeping observation that AI is in some sense a left wing idea — centralized machines making top-down decisions — but crypto is a right wing idea — many distributed agents, humans and bots, making bottom-up decisions. I think there’s something to that. Historically the tech industry has been dominated by left wing politics, just like any creative field, which is why you see today’s big tech companies so intertwined with the Democratic Party. Crypto potentially represents the creation of a whole new category of technology, quite literally right wing tech that is far more aggressively decentralized and far more comfortable with entrepreneurialism and free voluntary exchange. If you believe, as I do, that the world needs far more technology, this is a very powerful idea, a step function increase in what the technology world can do.
I agree. See also my earlier post Blockchains and the Opportunity of the Commons:
Today smart contracts on blockchains like Ethereum (and Elrond, AT!) have the potential to create a sophisticated set of global common resources that will form the foundation for much of the economic and social structure of this century–this is the opportunity of the blockchain commons.
The Effect of Adult Entertainment Establishments on Sex Crime
This paper studies how the presence of adult entertainment establishments affects the incidence of sex crimes, including sexual abuse and rape. We build a high frequency daily and weekly panel that combines the exact location of not-self-reported sex crimes with the day of opening and exact location of adult entertainment establishments in New York City. We find that these businesses decrease sex crime by 13% per police precinct one week after the opening, and have no effect on other types of crimes. The results imply that the reduction is mostly driven by potential sex offenders frequenting these establishments rather than committing crimes. We also rule out the possibility that other mechanisms are driving our results, such as an increase in the number of police officers, a reduction in the number of street prostitutes and a possible reduction in the number of potential victims in areas where these businesses opened. The effects are robust to using alternative measures of sex crimes.
That is from a new paper by Ciacci and Sviatschi, via Jennifer Doleac. We find this clash of values repeatedly in public policy. Do you wish to side with the interests of the actual victims — the people who might end up abused and raped? — or do you wish to side with landlords and homeowners who might find their property values reduced by sex establishments? “Export the bad stuff!”, this is a NIMBy dilemma yet again.
What I’ve been reading
1. Ivo Maes, Robert Triffin: A Life. There should be more biographies of economists, and while this one does not succeed in making Triffin exciting, it is thorough and informative and shows there was more to the man than his famous dilemma. I hadn’t even known Triffin was from Belgium.
2. Elizabeth Bowen, The Last September. A wonderfully subtle Irish novel about the Anglo-Irish elite in south Ireland right after WWI, how they self-deceive about the impending doom of their rule and way of life, and the diverse forms those self-deceptions take. An underrated modernist classic.
3. Cynthia Saltzman, Plunder: Napoleon’s Theft of Veronese’s Feast. Among other things, this book shows how clearly Napoleon understood the role of art in both reflecting and cementing power. Nor had I known that Canova, Wilhelm von Humboldt, and Napoleon all had a single intersecting story, revolving around the theft and return of art.
4. Mircea Raianu, Tata: The Global Corporation that Built Indian Capitalism. No, this book does not “read like a novel,” and it could use more economics rather than plain history, but it is an entire book of full of content, meeting mainstream standards, on the still understudied topic of Indian business, one very major Indian business in particular.
There is Emily J. Levine, Allies and Rivals: German-American Exchange and the Rise of the Modern Research University, on yet another understudied topic.
Paul Strathern’s The Florentines: From Dante to Galileo: The Transformation of Western Civilization is probably the best current, general interest book on its (very important) topic.
*Sub-Saharan Africa: Architectural Guide*
Seven volumes, $200 in paperback, multiple editors, due out in July. I just pre-ordered. Much better than wasting your time reading about the debates du jour.
I am very much looking forward to this one, I will learn lots from it. Will this be the book(s) of the year?
Saturday assorted links
2. How to improve construction productivity, and why that is hard.
3. Best of Econtwitter Substack.
4. Mix and match for vaccines seems to be working out. And new and promising CRISPR results? Possibly important.
5. Architect Wang Shu on China’s new modernism.
6. Using novels to predict the next war? (speculative, Tetlock it ain’t)
7. Does the internet use up less energy than we think? (NYT) Research article here.
What should I ask Ruth Scurr?
Dr Ruth Scurr FRSL (born 1971, London) is a British writer, historian and literary critic. She is a Fellow of Gonville & Caius College, Cambridge.
Her first book, Fatal Purity: Robespierre and the French Revolution (Chatto & Windus, 2006; Metropolitan Books, 2006) won the Franco-British Society Literary Prize (2006), was shortlisted for the Duff Cooper Prize (2006), long-listed for the Samuel Johnson Prize (2007) and was listed among the 100 Best Books of the Decade in The Times in 2009. It has been translated into five languages.
Her second book, John Aubrey: My own Life (Chatto & Windus, 2015; New York Review of Books, 2016) was shortlisted for the 2015 Costa Biography Award and the James Tait Black Memorial Prize. It was chosen as a 2015 Book of the Year in fifteen newspapers and magazines, including: the Daily Telegraph, the Financial Times, the Times, the Sunday Times, the Times Literary Supplement, the Sunday Express, the Guardian, the Spectator and the New Statesman. It was chosen as a 2016 Book of the Year by Publisher’s Weekly, Kirkus Review and the Washington Post.
Scurr began reviewing regularly for The Times and The Times Literary Supplement in 1997. Since then she has also written for The Daily Telegraph, The Observer, New Statesman, The London Review of Books, The New York Review of Books, The Nation, The New York Observer, The Guardian and The Wall Street Journal.
That is from her Wikipedia page. She is an expert in the philosophy of biography and her new biography of Napoleon, which views his life through the medium of his involvement with gardens, has been receiving rave reviews. And here is her home page, and her article on her Cambridge house.
So what should I ask her?
“How Britney Spears was trapped in a web of injustice”
That from the FT is the kind of headline we should be seeing. From Henry Mance:
…for 13 years, courts in California have rewarded Spears’s father Jamie, a failed businessman who struggled with alcoholism, once filed for bankruptcy and who, according to the documentary Framing Britney Spears, was often absent from his daughter’s childhood. They have enabled arguably the most egregious villain of them all. In 2008, when his daughter suffered an apparent mental health crisis, Jamie asked a court to make him her conservator — that is, legal guardian. He has mostly kept the power since. He has decided which friends she sees, what medical treatment she receives and what happens to her fortune, estimated at $60m.
…They had made her work seven days a week, taken her credit cards and given her no privacy when undressing. “In California the only similar thing to this is called sex-trafficking,” she said. They would not let her have an intrauterine device removed, because they didn’t want her to have more kids. But they did allow a doctor to prescribe her lithium “out of nowhere”.
I get that you might have doubts about this case, or be able to cite many other cases where some form of guardianship might be useful. But if something like this is possible at all, it is time to realize the whole system is broken and we need to work much harder to root out its abuses.
Time to wake up! Be woke! Really woke.
#FreeBritney
The UAPs [UFOs] report
You can read it here. I don’t think it clarifies much, other than to stress the multiple sources of sensor data for the observations and the inexplicability of some number of the sightings, well into triple digits. So you can put aside Mick West, PewdiePie, and the like. It is “real stuff” being measured, no matter how you might account for the observations, not just shaky camera movements and flocks of birds.
The report also makes clear how poorly funded and chaotic the investigation has been to date. That is hardly a surprise, but isn’t it about time we did something properly right off the bat?
I’ll fall back on my “sincerity is the most underrated political motive” view. I think our own government is genuinely puzzled, as I am, and as you should be. I would stress my earlier points that we don’t have many reliable intuitions to fall back upon for thinking through this problem.
I believe the governmental message will be: “We are not sure, so for reasons of national security we have to move forward assuming some of these devices are from foreign powers.” That will rather rapidly meld into “foreign powers.” In any case that will keep the issue alive. Furthermore, if it is our earthbound adversaries, at some point we will know this for sure, for reasons of intelligence or eventual public use of the devices, or our ability to construct the same. By the way, if you are convinced by the “adversaries” take, you should update lots of your views on foreign policy! (Will you? Will anyone?) America would have a lot more to be afraid of.
It is important to resist jumping to conclusions here, if only because doing so will dull your critical faculties on this issue. In any case I will continue to follow developments in this area.
Friday assorted links
Is blockchain puny?
Here is a new and intriguing idea (link now fixed) from StarkWare, a blockchain start-up based in Israel. Authored by Eli Ben-Sasson, here is one excerpt:
Imagine if we accepted, for the foreseeable future, that we can only write on a given blockchain ten times per second, but instead of writing ten single transactions, made ten additions to the blockchain, each attesting to thousands of transactions. Despite the scale-up, there would be no significant rise in the number of kilobytes being added to the chain.
In short, I’m talking about a fix that would mean the same blockchains that I brazenly called puny would suddenly become mighty.
This fix is the adoption of cryptographic proofs — a concept that captured my imagination when I was a PhD student under Professor Avi Wigderson, one of the pioneers of this area of mathematics, and when I was a postdoc under Professor Madhu Sudan, another of the founding fathers of this field. After 20 years in academia, today I am president of StarkWare (@StarkWareLtd on Twitter), a company I co-founded to move this fix from the realm of theory to reality – a reality that will scale-up blockchain to an unprecedented degree.
Currently, Bitcoin establishes integrity the way you do it with your waiter or waitress. As you sit at your table, the waiting staff present a bill with the food you ordered, taking up the role of the “prover.” You check the calculation — making you the “verifier.”
With Bitcoin, the miner of a new block is the “prover.” Every block acts as proof that the payments contained in it are valid. And the nodes, meaning the many computers which host and synchronize a copy of the entire Bitcoin blockchain, naively replay each transaction in the block to verify that it is correct.
With cryptographic proofs, instead of recording this data-heavy information to the blockchain, we write on the chain in a kind of shorthand — proofs which verify that transactions have been conducted with integrity. All the heavy computational lift, meaning the work done to obtain the proof, happens in the cloud, not the blockchain.
It is logic we’re all familiar with in other areas of life. A large company may have its flagship office in central Manhattan, but wouldn’t dream of using such prime real estate for its huge factory, where the heavy lifting takes place.
Stay tuned….
Why is it OK to be mean to the ugly?
That is the new NYT David Brooks column, here is one excerpt:
Not all the time, but often, the attractive get the first-class treatment. Research suggests they are more likely to be offered job interviews, more likely to be hired when interviewed and more likely to be promoted than less attractive individuals. They are more likely to receive loans and more likely to receive lower interest rates on those loans.
The discriminatory effects of lookism are pervasive. Attractive economists are more likely to study at high-ranked graduate programs and their papers are cited more often than papers from their less attractive peers. One study found that when unattractive criminals committed a moderate misdemeanor, their fines were about four times as large as those of attractive criminals.
Daniel Hamermesh, a leading scholar in this field, observed that an American worker who is among the bottom one-seventh in looks earns about 10 to 15 percent less a year than one in the top third. An unattractive person misses out on nearly a quarter-million dollars in earnings over a lifetime.
The overall effect of these biases is vast. One 2004 study found that more people report being discriminated against because of their looks than because of their ethnicity.
In a study published in the current issue of the American Journal of Sociology, Ellis P. Monk Jr., Michael H. Esposito and Hedwig Lee report that the earnings gap between people perceived as attractive and unattractive rivals or exceeds the earnings gap between white and Black adults. They find the attractiveness curve is especially punishing for Black women. Those who meet the socially dominant criteria for beauty see an earnings boost; those who don’t earn on average just 63 cents to the dollar of those who do.
Recommended.
Liquidity trap for me but not for thee?
The idea has not held up. As I write the rate on 6-month T-Bills is 0.06%. That is pretty close to zero, right?
And yet everyone is debating what will happen with the rate of price inflation. No one is claiming it is indeterminate, as the simplest liquidity trap models suggest. Nor, with rising rates of price inflation, can it be argued that inflation inertia is dominant. Instead, it is obvious that the Fed has let the current inflation happen. It is true that the inflationary pressures stem from (roughly) coordinated acts of monetary and fiscal policy, rather than monetary policy alone. But no one is doubting that the Fed is in charge of forthcoming rates of inflation.
(And if the T-Bill rate is ever so slightly above zero, rather than at or below zero, that too seems to stem from higher expected rates of price inflation in the first place.)
I agree with those individuals who suggest that the currently higher rates of price inflation will not be with us 4-5 years from now, and that is because the Fed does not want that to happen.
Paul Krugman recently wrote (NYT):
Seriously, both recent data and recent statements from the Federal Reserve have, well, deflated the case for a sustained outbreak of inflation. For that case has always depended on asserting that the Fed is either intellectually or morally deficient (or both). That is, to panic over inflation, you had to believe either that the Fed’s model of how inflation works is all wrong or that the Fed would lack the political courage to cool off the economy if it were to become dangerously overheated.
In other words, the Fed to a considerable degree can indeed control the rate of price inflation, and with nominal T-Bill rates very close to zero. Open market operations on T-Bills alone won’t do it, but of course the Fed can use the expectations channel, and can deal in other assets as well — just as they do when they wish to be more expansive. Or maybe you think it is the promised currency path (not my view), but that too would be effective in either direction, if desired. Thus the liquidity trap doctrine is dead, discarded once it no longer provides an argument for an ever-more expansive fiscal policy.