Month: March 2022

The cost of applying

by  Tyler Cowen in

These applications are hefty. Before you even start applying for an NSF grant, you should probably read the 79 pages of instructions. The NIH helpfully provides a 10-part instructional video series. Rhodes Scholarships require a mind-boggling eight letters of recommendation. I tell college seniors to expect fellowship applications to be a six-month part-time job.

All this applying doesn’t just burden applicants. Professors run themselves ragged writing recommendations. The NSF relies on volunteers to complete 240,000 reviews every year. Entire university offices exist just to manage the paperwork that grants generate; universities bill this back to funders in the form of “indirect costs,” which at Harvard go as high as 70% of incoming grant funding. Grant agencies seem not to realize that by making everything about their grants burdensome, they allow universities to spend much of the grant money managing the grant itself!

Here is more from Adam Mastroianni.  Via Anecdotal.

*Amongst Women*

by  Tyler Cowen in

That is the title of a 1990 Irish novel by John McGahern, well-known in Ireland but as of late not so frequently read outside of Ireland.  In addition to its excellent general quality, I found this book notable for two reasons.  First, it focuses on the feminization of Ireland, being set in the mid-century decades after independence.  An IRA veteran slowly realizes that the Ireland he fought for — a place for manly men — was a figment of his civil war imagination, and not an actual option for an independent, modernizing Ireland.  The latter will be run according to the standards and desires of women, and actually be far more pleasant, whether or not Moran likes it.  Second, the book is an excellent illustration of the importance of context for reading fiction.  The story reads quite differently, depending how quickly you realize the protagonist is an IRA veteran with his wartime service as a fundamental experience.  Few readers will know this from the very beginning, but I suspect many Irish readers — especially older ones — will figure this out well before they are told.  In general, the very best fiction is context-rich, and this is one reason why many people may not appreciate all of the literary classics.

I thought these people wanted lower trade deficits?

by  Tyler Cowen

…[Tom] Cotton argued that America “ought to ban US investment in strategic Chinese industries and encourage reshoring of US factories and jobs — and punish offshoring to China. Further, we need to scrutinise and regulate Chinese investment in America much more closely.” In a 2021 report he highlighted a wide range of “financial weapons”.

Republican senator Marco Rubio is another outspoken critic of globalisation. In December, he sent an open letter to his colleagues, declaring it a “strategic disaster” that “American financial investment is pouring into [China] at its highest rate ever” and seeking support for his “American Financial Markets Integrity and Security Act,” which would block investment in Chinese companies flagged by the Departments of Defense and Commerce.

Here is more from the FT, by Oren Cass.  Keep in mind that capital flows are the mirror image of the trade deficit!  Be careful not to slip into the language of causality here, because it is all mutually determined.  But a world of higher net American capital flows into China is also a world with a lower American trade deficit with China.  Which is it going to be?  There are legitimate national security reasons for restricting some U.S. investments into China.  But an analysis such as this should start by recognizing the relevant trade-offs.  How about calling it “the new Republican coalition for a higher trade deficit with China?”

My Conversation with the excellent Lydia Davis

by  Tyler Cowen

Here is the audio, video, and transcript.  Here is part of the episode summary:

Lydia joined Tyler to discuss how the form of short stories shapes their content, how to persuade an ant to leave your house, the difference between poetry and very short stories, Proust’s underrated sense of humor, why she likes Proust despite being averse to long books, the appeal of Josep Pla’s The Gray Notebook, why Proust is funnier in French or German than in English, the hidden wit of Franz Kafka, the economics of poorly translated film subtitles, her love of Velázquez and early Flemish landscape paintings, how Bach and Schubert captured her early imagination, why she doesn’t like the Harry Potter novels — but appreciates their effects on young readers, whether she’ll ever publish her diaries, how her work has evolved over time, how to spot talent in a young writer, her method (or lack thereof) for teaching writing, what she learned about words that begin with “wr,” how her translations of Proust and Flaubert differ from others, what she’s most interested in translating now, what we can expect from her next, and more.

Lydia is hard to excerpt, as the flow is very important, but here is one bit:

COWEN: What do you think is your most unusual productivity habit?

DAVIS: Unusual.

COWEN: And successful, that is.

DAVIS: It’s hard to say because I imagine that a lot of writers share some of the things I do. So, unusual. I know that I have a more chaotic approach than some writers would want to have, and that’s always been true. It’s, in a way, very wasteful, like the books I don’t finish reading. There are also a number of very interesting projects — or very interesting to me — that I’ve done a lot of work on and then gone on to another project.

I have at least three or four or five big projects. These are not small stories. These are biographical projects or grammar projects or history projects — crossing genres — that I’ve done a lot of work on and then gotten distracted from. But then, when you say productive or successful, it does work very well with shorter things that you can actually finish.

The way I work on stories is to get busy immediately and write down what occurs to me, and write it until I’ve exhausted that vein for the moment. Then I usually have enough to come back to later. I’ll have 10, 15, 20, 30 unfinished stories, and every now and then, I’ll pick one up again. Sometimes I don’t even remember what it is. I’ll see a title and think, “I don’t know what that story was.” I’ll pick it up again and try to discern what it was that moved me, and what it was that made me want to write it, and get back into that and see if I could finish it. That’s a chaotic method that works pretty well.

Recommended.

Wednesday assorted links

by  Tyler Cowen

1. WHO delays in getting Sputnik vaccine approved for travel purposes.

2. Why income share agreements did not work out.

3. The Arab Israeli parties do not seem to be siding with Ukraine.

4. Why we have 0.05.

5. “…the paper demonstrates that indigenous communities in Mexico are better able to escape predatory criminal rule when they are legally allowed to carve a space of autonomy from the state through the institution of “usos y costumbres.”” Link here.

What Operation Warp Speed Did, Didn’t and Can’t Do

by  Alex Tabarrok in

Operation Warp Speed was a tremendous success and one that I was pleased to support from the beginning. Many people, however, are concluding from the success of OWS that big Federal funding can solve many other problems at the same speed and scale and that is incorrect.

First, it’s important to understand that OWS did not create any scientific innovations or discoveries. The innovative mRNA vaccines are rightly lauded but all of the key scientific ideas behind mRNA as a delivery mechanism long predate Operation Warp Speed. The scientific advances were the result of many decades of work, some of it supported by university and government funding and also a significant fraction by large private investments in firms such as Moderna and BioNTech. It was BioNTech recall that hired Katalin Karikó (and many other mRNA researchers) when she couldn’t get university or government funding. Since OWS created no new scientific breakthroughs there isn’t much to learn from OWS about the efficacy of large scale programs for that purpose.

Second, it’s important to understand that we got lucky. OWS made smart bets and the portfolio paid off but it could have failed. Indeed, some OWS bets did fail including the Sanofi and Glaxo-Smith-Klein vaccine and the at-best modest success of Novavax. Many other vaccines which we didn’t invest in but could have invested in also failed. To be clear, my work with Kremer et al. showed that these bets and more were worth taking but one should not underestimate the probability of failure even when lots of money is spent.

So what did Operation Warp Speed do? There were four key parts to the plan 1) an advance market commitment to buy lots of doses of approved vaccines–this was important because in past pandemics vaccines had entered development and then the disease had disappeared leaving the firms holding the bag with little to show for their investment 2) the lifting of FDA regulations to allow for accelerated clinical trials, for example, phase 3 trials could start before phase 2 trials were fully complete 3) government investment in large clinical trials–clinical trials are the most expensive part of the development process and by funding the trials generously, the trials could be made large which meant that they could be quick 4) government investment in capacity, building factories not just for the vaccines but also for the needles, vials and so forth, even before any of the vaccines were approved–thus capacity was ready to go. All of these steps shaved months, even years, off the deployment timeline.

The key factor about each of these parts of the plan was that we were mostly dealing with known quantities that the government scaled. It’s known how to run clinical trials, it’s known how to produce vials and needles. The mRNA factories were more difficult but scaling problems are more easily solved with investment than are invention problems. It’s also known how to lift government regulations and speed the bureaucracy. That is, no one doubts that lifting regulations and speeding bureaucracy is within our production possibilities frontier.

It also cannot be underestimated that OWS funded people who were already extremely motivated. The Pfizer and Moderna staff put in near super-human effort–many of them felt this was the key moment of their life and they stepped up to their moment. OWS threw gasoline on fire–don’t expect the same in a more normal situation.

Another factor that people forget is that with vaccines we had a very unusual situation where the entire economy was dependent on a single sector–a macroeconomic O-ring. As a result, the social returns to producing vaccines were easily a hundred times (or more) greater than any potential vaccine profits. Thus, by accelerating vaccine production, OWS could generate tremendous returns. Most of the time, markets internalize externalities imperfectly but reasonably well which means that even if you accelerate something good the total returns aren’t so astronomical that you can’t overspend or spend poorly. Governments can spend too much as well as too little so most of the time you have to factor in the waste of overspending even when the spending is valuable–that problem didn’t really apply to OWS.

So summarizing what do we need for another OWS? 1) Known science–scaling not discovering, 2) Lifting of regulations 3) Big externalities, 4) Pre-existing motivation. Putting aside an Armageddon like scenario in which we have to stop an asteroid, one possibility is insulating the electrical grid to protect North America from a Carrington event, a geomagnetic storm caused by solar eruptions. (Here is a good Kurzgesagt video.) Does protecting the grid meet our conditions? 1) Protecting the electrical grid is a known problem whose solution does not require new science 2) protecting the grid requires lifting and harmonizing regulations as the grid is national/inter-national but the regulations are often local, 3) The social returns to power far exceed the revenues from power so there are big externalities. Indeed, companies could have protected the grid already (and have done so to some extent) but they are under-incentivized. (The grid is aging so insulating the gird could also have many side benefits.) 4) Pre-existing motivation. Not much. Can’t have everything.

I think it’s also notable that big pandemics and solar storms seem to occur about once in every one hundred years–just often enough to be dangerous and yet not so often that we are well prepared.

Thus, while I think that enthusiasm for an “OWS for X” is overblown, there are cases–protecting the grid is only one possibility–where smart investments could pay big returns but they must be chosen carefully in light of all the required conditions for success.

My 2021 “stories to watch” column

by  Tyler Cowen

Here is one excerpt:

A possible Chinese move against Taiwan has received a lot of attention, but a Russian union with Belarus could be a greater danger. Belarus might even agree to such a proposition, so it would be hard for NATO or the U.S. to decry it as a coercive invasion. Yet such a Russian expansion could upend political stability in Europe.

If Russia and Belarus became a single political unit, there would be only a thin band of land, called the Suwalki Gap, connecting the Baltics to the rest of the European Union. Unfortunately, that same piece of territory would stand in the way of the new, larger Russia connecting with the now-cut off Russian region of Kaliningrad. Over the long term, could the Baltics maintain their independence? If not, the European Union would show it is entirely a toothless entity, unable to guarantee the sovereignty of its members.

Even if there were no formal political union between Russia and Belarus, the territorial continuity and integrity of the EU could soon be up for grabs. The EU has more at stake in an independent Belarus than it likes to admit.

Here is the full column, do still keep your eyes on this one.  And read this too.  If Poland feels a large enough threat, might they do something to try to draw in NATO preemptively?  And here is commentary from Russian state TV.

The political economy of doomscrolling

by  Tyler Cowen in

The now-neverending stream of information shapes our perception of time. For many people, especially America’s news-intensive elites, it may make the war feel much longer than it actually has been.

This greater sense of witness to atrocities cements this impression. Each moral outrage, no matter how small, is taken in. Several generations ago, people may have heard that there was a big battle over a place called Dien Bien Phu. Nowadays, they can see, replay and share videos of people who died or were injured in the bombing of a theater in Mariupol. Each terrible event somehow feels more intolerable than the last, fueling the feeling that something must give and that the war has to end soon.

That is a dangerous feeling, if only because it makes it harder for leaders to pursue strategies of patience. Polls show high U.S. public support for a no-fly zone, although in my view that would lead to an unacceptably higher risk of escalating the war. This hawkish stance is not hard to understand. If the current situation feels intolerable, then surely something dramatic and decisive has to happen very soon — and better to act than be acted upon. At the very least action will imbue a feeling of having “done something.”

Doomscrolling-induced impatience also induces people to underrate Russian military prospects.

Here is the rest of my Bloomberg column on the topic.

Tuesday assorted links

by  Tyler Cowen

1. New CBA for the child allowance, showing basically a 10x benefit to cost ratio.

2. New survey of the non-health effects of air pollution.

3. The importance of teaching frontier knowledge.

4. Marcus Rediker’s tips for historical writing, excellent and also of more general interest.

5. The current state of nuclear brinksmanship (NYT).

6. “Companies are marketing polygenic risk scores as part of IVF…”  And more here.

7. UCLA will pay that adjunct after all.

That was then, this is now, Russian political economy edition

by  Tyler Cowen in

From Dominic Lieven’s Russia Against Napoleon:

Though all four continental great powers were in theory absolute monarchies, no one doubted that the power of The Russian emperor was more complete than that of his French Austrian or even Prussian peers.  He could make laws and tax his peoples without their consent, and no laws protected even his most aristocratic subjects against his arbitrary whims.  By contrast, especially in France and Austria, aristocratic assemblies and judicial institutions inherited from medieval feudalism inhibited a monarch’s power, as indeed did the ethos of the social elites, including sometimes of the monarchs themselves and their relatives.  Other factors also enhanced the power of the Russian autocrat.  For examples, in Protestant Europe the previously enormous landholdings of the Catholic church had been confiscated during the Reformation and had mostly fallen into the hands of the aristocracy.  In eighteenth-century Catholic Europe most of these lands were still held by the Church.  In Russia, however, the monarchy had confiscated the vast wealth of the Orthodox Church by the 1760s and largely held on to it for itself.  That was one key reason why by the 1790s more than 40 per cent of the entire serf population “belonged” not to private landlords but to the crown.

And:

The Russian army traditionally fought with a higher ratio of artillery to infantry than was the case elsewhere in Europe.

And:

The Russians instead soon overran the principalities of Moldova and Wallachia, and made their acquisition the key war aim.

I found this book very useful for understanding the mindset of Putin and some of the other Russian elites.  For instance, none of the characters in this earlier history seemed to regard the national borders of the status quo as anything close to sacrosanct.

Monday assorted links

by  Tyler Cowen

1. Summers on the Fed and whether we can expect inflation to diminish much.  Some points I have not seen him make in earlier presentations.

2. A hypothesis as to why Russia is focusing on Mariupol.

3. Can you beat the football bookmakers?

4. “…we estimate that juvenile detention leads to a 31% decline in the likelihood of graduating high school and a 25% increase in the likelihood of being arrested as an adult.”

5. New results on whether NBA referees are racially biased.

6. UCLA zero wage job listing update.  I blame the whole fracas on HR departments, not that UCLA as a school did anything wrong.

Bounty Hunters Work

by  Alex Tabarrok in

New York pays bounty hunters for documenting parked trucks that idle their engines more than 3 minutes.

NYTimes. [The] Citizens Air Complaint Program, a public health campaign that invites — and pays — people to report trucks that are parked and idling for more than three minutes, or one minute if outside a school. Those who report collect 25 percent of any fine against a truck by submitting a video just over 3 minutes in length that shows the engine is running and the name of the company on the door.

The program has vastly increased the number of complaints of idling trucks sent to the city, from just a handful before its creation in 2018 to more than 12,000 last year.

…Mr. Slapikas said he pulled in $64,000 in rewards in 2021 for simply paying attention on his daily walks for exercise: “I would expect to get three a day without even looking.”

Who would have thought it? Bounty hunters are more effective than the police at discovering crimes. Imagine if they applied such a system to accused criminals out on bail?

Of course, as with tax-farming we don’t always want efficiency in the prosecution of the laws.