Month: December 2022
Wednesday assorted links
1. Martin Ravallion has passed away.
2. Americans are far more likely to move to Mexico than to Canada.
3. Top science advances of 2022?
5. Do social media lead to an underinvestment in boredom?
6. Follow-up post by the guy who criticized peer review.
7. Djokovic back in Australia (that was then, this is now).
Are Progressives in Denial About Progress?
That is the title of a new paper by Gregory Mitchell and Philip E. Tetlock, here is the abstract:
Scott Lilienfeld warned that psychology’s ideological uniformity would lead to premature closure on sensitive topics. He encouraged psychologists to question politically convenient results and did so himself in numerous areas. We follow Lilienfeld’s example and examine the empirical foundation beneath claims that positive illusions about societal change sustain inequalities by inducing apathy and opposition to reform. Drawing on data from a large-scale survey, we find almost the opposite: a pervasive tendency, across ideological and demographic categories, to see things as getting worse than they really are. These results cast doubt on functionalist claims that people mobilize beliefs about societal trends to support political positions and suggest a simpler explanation: Most laypeople do not organize information in ways that provide reliable monitoring of social change over time, which makes their views on progress susceptible to memory distortions and high-profile current events and political rhetoric.
This argument is also a theme in my much earlier In Praise of Commercial Culture.
Does more construction raise rents?
Matt Yglesias has a long post on that question, recommended albeit gated. Matt’s take is hard to summarize, so I will provide a somewhat different view, though one that is still pro-YIMBY though with a different slant.
Without loss of generality, we can assume that sometimes “more building” raises rents and other times lowers them, or rents stay the same.
Let’s say there are no big “ideas externalities” from a new NYC apartment building, and as we put more of those buildings in, the rents fall somewhat. Furthermore, say we keep on building until those rents in NYC equal those in Nashville. There is gain on the inframarginal units of construction, but at the final margin the new building in NYC has about the same social value as the new building in Nashville. The inframarginal gains are the relevant ones.
Now who gets those inframarginal gains? If land is the truly scarce factor, as NIMBY critics suggest, landlords get a lot of them! Nothing against that, I love landlords. Still, that is a slightly different story from what you hear from the YIMBYs. Landlords don’t get all of those gains, because the land scarcity constraint is precisely what is being relaxed. But the available evidence seems to indicate you need to build a lot before rents fall much. So landlords probably receive a healthy share of those new gains. Rents may fall, but not by that much. And so the gains for new urban entrants (who did not wish to migrate at the old rent levels) are correspondingly meh.
Again, let me repeat I love YIMBY and I love landlords. You should too.
Alternatively, say you keep on building and the new residents bring lots of information externalities to the urban area — ever been to Seoul? They have built like crazy and it is still quite expensive, all the more so in fact. By building more, they made the land more valuable. Good for them. (NB: The biggest beneficiaries may be the rest of Korea, and K-Pop consumers around the world, not Seoul residents.)
Now who do you think reaps most of those gains? Under standard NIMBY assumptions, I would think it is mainly the landlords. Which is not to deny the residents receive some gains from increased product diversity in Seoul (good Thai food there now, etc.), and other non-primary effects.
It’s not all the landlords. But still, the knowledge externalities make land in Seoul, in economic terms, more scarce. The landlords will do really well.
When I read or hear YIMBYs, I often feel they have a public choice model of politics, slanted toward recognizing the influence of the landlords and homeowners, but not a comparable model of factor price incidence to boot. They somehow want the lower rents and the positive information externalities both at the same time. That to me seems unlikely. And so it is harder to redistribute income away from landlords than you might think.
I again would stress that all the YIMBY changes are Pareto improvements here. But the extreme remedies suggested by the Georgists, which to be clear I do not favor, are quite explicable to me.
Two attitudes toward the GPTs
The first is: “Look, I asked it to discuss the importance of Haitian voodoo flag maker Antoine Oleyant, and it failed miserably.”
The second is: “The answers to some of my questions and requests are amazing. If it can do this at all, over time it will be able to do much, much more.”
2b is: “I recognize that the initial releases are geared toward defensibility and survivability, not optimized for actual regular practical use.”
Needless to say, I am in camp #2, and you should be too.
What should I ask Yasheng Huang?
I will be having a Conversation with him, the first but not last “China conversation” for the podcast. Here is part of his Wikipedia page:
Yasheng Huang (Chinese: 黄亚生) is an American professor in international management at the MIT Sloan School of Management, where he founded and heads the China Lab and India Lab. His research areas include human capital formation in China and India.
He had previous appointments at the University of Michigan and Harvard Business School.
Huang is the author of Capitalism with Chinese Characteristics, a history of economic reforms in China.
I am a fan of his forthcoming book The Rise and the Fall of the EAST: Examination, Autocracy, Stability and Technology, reviewed by me here.
Here is Yasheng Huang on Twitter. So what should I ask him?
Tuesday assorted links
1. Stephen Carter best non-fiction of the year list.
2. Bahamas views on SBF (NYT).
3. Contemporary opera is now outselling classic opera at the Met (NYT).
4. You people are crazy those new service sector jobs $480 an hour.
5. Paul McCartney stops into New Jersey cafe.
6. Central Paris will ban non-essential car traffic for 2024 (Bloomberg).
7. The year in AI.
8. Why don’t people click on links? One hypothesis of mine is that people like scanning link titles (and not clicking), but from a credible source, simply so they can feel they didn’t miss anything big.
Top MR Posts of 2022
Here are the top MR posts by views from 2022. Biggest post was Tyler’s
1. Classical liberalism vs. The New Right
followed up by two posts by me on Biden’s student loan plan
2. The Student Loan Giveaway is Much Bigger Than You Think
3. Taxing Mechanical Engineers and Subsidizing Drama Majors
and further posts by me on FTX and the probability of a nuclear war.
5. What is the Probability of a Nuclear War, Redux
I said ProPublica was putting their reputation on the line with the lab-leak report but nevertheless I was too credulous. Much of the factual reporting remains correct, however. Lab leak is very much in play.
6. A “Safety Emergency” Happened at the Wuhan Institute of Virology in November of 2019
Tyler comes in next with a post on criticizing other people in private.
7. How much should you criticize other people?
and two posts on the Russian-Ukraine conflict.
9. How did the IR community get Russia/Ukraine so wrong?
Finally Tyler offers some advice:
Rounding out the top were Best Books of 2022, What Caused the 2020 Spike in Murders and How to Elect Republicans.
What were your favorite MR posts of 2022. What should we revisit?
How happy are Americans (and Danes) anyway?
That is the topic of my latest Bloomberg column, here is one excerpt:
Two economists, David G. Blanchflower of Dartmouth and Alex Bryson of University College London, have come up with a new and more intuitive way to measure well-being. The results are striking. If you consider US states as comparable to countries, 16 of the top 20 political units in the world for well-being are in the US — including the top seven.
Many happiness surveys ask individuals how satisfied they are with their lives. That is one way of phrasing the happiness question, but it has its biases. It tends to favor nations where people have a strong sense of self-satisfaction — or, if you want to put a more negative gloss on it, where the people are somewhat smug. Those are some of the studies in which Finland and Denmark come in first.
The genius of this most recent study is that it considers both positive and negative affect, and gives countries (and US states) separate ratings for the two. In other words, it recognizes there is more than one dimension to well-being. It lists four variables as part of negative affect: pain, sadness, anger and worry. Positive affect consists of four measures: life satisfaction, enjoyment, smiling and being well-rested. So life satisfaction is only one part of the measure.
One interesting result is that nations that avoid negative affect are not necessarily the same as those which enjoy the highest positive affect. Some countries — including the US — have a lot of extremes. Americans tend to go to the limit on both the upside and the downside.
Bhutan is an extreme contrast along these same lines. Measured only by positive affect, the Bhutanese are No. 9 in the world, an impressive showing. But for negative affect they rank No. 149 — in other words, they experience a great deal of negative emotion, perhaps due to the extreme hardships in their lives. Considering both positive and negative affect, they come in at No. 99, not a bad showing for such a poor country (better, in fact, than the UK’s 111.)
Denmark’s positive affect puts it only at No. 71, befitting the popular image of a country where not everyone is jumping for joy. Arkansas has a better positive affect, coming in at No. 67. But Denmark rates higher overall (38, to Arkansas’s 72) because Arkansas shows higher negative affect (87, to Denmark’s 66).
Measuring both positive and negative affect, the 10 happiest political units in the world are, in order: Hawaii, Minnesota, North Dakota, South Dakota, Iowa, Nebraska, Kansas, Taiwan, Alaska and Wisconsin. Of the top 50 places, 36 are US states (I include the District of Columbia, No. 16). China is No. 30.
Here is the original study. The Danes are #111 for smiling!
They deserve at least a “pass” for this one
In Fall 2014, Wellesley College began mandating pass/fail grading for courses taken by first-year, first-semester students, although instructors continued to record letter grades. We identify the causal effect of the policy on course choice and performance, using a regression-discontinuity-in-time design. Students shifted to lower-grading STEM courses in the first semester, but did not increase their engagement with STEM in later semesters. Letter grades of first-semester students declined by 0.13 grade points, or 23% of a standard deviation. We evaluate causal channels of the grade effect—including sorting into lower-grading STEM courses and declining instructional quality—and conclude that the effect is consistent with declining student effort.
That is from a new NBER working paper by Kristin Butcher, Patrick McEwan, and Akila Weerapana.
Monday assorted links
1. “With this shirt you are allowed to get 1 Everyday Value Slam everyday [at Denny’s] for until 12/31/23.” What should such a shirt cost?
3. Those new service sector jobs.
4. Jolly Swagman podcast with Andy Matuschak.
6. Crypto wash trading (lots of it).
That was then, this is now
Barnes & Noble has a plan to open 30 stores in 2023, making the bookseller the leader in what’s being called a big-box revival. This expansion comes after more than a decade of shrinking its numbers in response to competition from Amazon. There are even a couple of the new stores being opened in the Boston area that are, perhaps fittingly, going to be in locations previously occupied by Amazon Books.
Here is the full story.
Zero-Sum Thinking and the Roots of U.S. Political Divides
We examine the causes and consequences of an important cultural and psychological trait: the extent to which one views the world in zero-sum terms – i.e., that benefits to one person or group tend to come at the cost of others. We implement a survey among approximately 15,000 individuals living in the United States that measures zero-sum thinking, political and policy views, and a rich set of characteristics about their ancestry. We find that a more zero-sum view is strongly correlated with several policy views about the importance of government, the value of redistributive policies, the impact of immigration, and one’s political orientation. We find that zero-sum thinking can be explained by experiences of an individual’s ancestors (parents and grandparents), including the amount of intergenerational upward mobility they experienced, the degree of economic hardship they suffered, whether they immigrated to the United States or were exposed to more immigrants, and whether they had experiences with enslavement. These findings underscore the importance of psychological traits, and how they are transmitted inter-generationally, in explaining current political divides in the United States.
That is from a new paper by Sahil Chinoy, Nathan Nunn, Sandra Sequeira, and Stefanie Stantcheva. The paper has many interesting particular results, here is one:
Respondents living in Utah exhibit the least zero-sum thinking, on average, and respondents living in Montana, Oklahoma and Mississippi exhibit the most. Importantly, there is no significant geographic clustering and the geographic distribution of zero-sum beliefs is not obviously correlated with that of political leanings.
And this:
If a respondent was born outside the U.S., then they tend to have a less zero-sum view of the world.
African-Americans have more zero-sum thinking than average, and also this:
Zero-sum thinking is also associated with more liberal [TC: the wrong word, right here the misuse is especially glaring!] economic policies and a political alignment with the Democratic Party rather than the Republican Party.
Recommended.
Sunday assorted links
Why did China do such a flip-flop on Covid?
After the so-called “Zero Covid” experiment, China now reports that 37 million people are being infected each day. What ever happened to the Golden Mean? Why not move smoothly along a curve? Even after three years’ time, it seems they did little to prep their hospitals. What are some hypotheses for this sudden leap from one corner of the distribution to the other?
1. The Chinese people already were so scared of Covid, the extreme “no big deal” message was needed to bring them around to a sensible middle point. After all, plenty of parts of China still are seeing voluntary social distancing.
2. For Chinese social order, “agreement” is more important than “agreement on what.” And agreement is easiest to reach on extreme, easily stated and explained policies. Zero Covid is one such policy, “let it rip” is another. In the interests of social stability China, having realized its first extreme message was no longer tenable, has decided to move to the other available simple, extreme message. And so they are letting it rip.
3. The Chinese elite ceased to believe in the Zero Covid policy even before the protests spread to such an extreme. But it was not possible to make advance preparations for any alternative policy. Thus when Zero Covid fell away, there was a vacuum of sorts and that meant a very loose policy of “let it rip.”
4. After three years of Zero Covid hardship, the Chinese leadership feels the need to “get the whole thing over with” as quickly as possible.
To which extent might any of these be true? What else?
The best dialogue or podcast I’ve heard this year
Martin Shkreli on how the criminal justice system will treat SBF….interviewer Laura Shin…