Month: September 2023

Who Runs the AEA?

by  Tyler Cowen in

That is a new JEL publication (gated) by Kevin D. Hoover and Andrej Svorenčík, here is the abstract:

The leadership structure of the American Economic Association is documented using a biographical database covering every officer and losing candidate for AEA offices from 1950 to 2019. The analysis focuses on institutional affiliations by education and employment. The structure is strongly hierarchical. A few institutions dominate the leadership, and their dominance has become markedly stronger over time. Broadly two types of explanations are explored: that institutional dominance is based on academic merit or that it is based on self-perpetuating privilege. Network effects that might explain the dynamic of increasing concentration are also investigated.

And this:

The current paper is based on an extensive prosopographical database covering the entire leadership of the AEA over the
1950–2019 period, including all Presidents, Presidents-elect, Vice Presidents, ordinary members of the Executive Committee, as well as the losing candidates for all elective offices, and members of the Nominating Committee.

The results?:

The 14 institutions in the table account for almost more than 80 percent of the positions for the whole 1950–2019 period. Even within this select group, the distribution is highly skewed with Harvard, the top supplying institution over the period accounting for more than a fifth of the total, and the last five universities accounting for around 2 percent each. The top five institutions, Harvard, MIT, Chicago, Columbia, and Stanford, which we designate as the first tier, account for over half (57.1 percent) of the positions over the whole period…

The authors summarize their findings:

The most obvious lessons are, perhaps, hardly surprising: the AEA leadership is overwhelmingly drawn from a small group of elite, private research universities—in the sense that its leaders were educated at these universities and, to a lesser degree, employed by them. What is less well-known is that for much of the past 70 years, the AEA leadership has been drawn predominantly from just three universities—Harvard, MIT, and Chicago.

By the way, institutional concentration has become more pronounced over time, not less.  But since about eighty percent of U.S. students go to state schools, most of those large state schools, I guess we can reconfigure all these panels to have eighty percent state school representation, rather than 80 percent elite school representation.  Right?  Right?

You may or may not like these facts (I for one am willing to admit to more elitism than are many people), for the time being I will say only this: “Do not listen to what they say, watch what they do!”

Saturday assorted links

by  Tyler Cowen

1. The Howdy Doody longhorn steer car culture that is Nebraska, good video too (NYT).  Who needs an old-style NJ hood ornament?

2. Investment is booming in Ohio.

3. Markets in everything: buy a government surveillance van for 26k.

4. The political economy of the Magna Carta.

5. Become an expert in something specific and boring.

6. Parfitian, Kafkaesque insects (New Yorker).

7. New Melissa Dell et.al. data set from historical U.S. newspapers, now with LLMs far more valuable than they realized when they started constructing it.

Towards a Platform for Dominant Assurance Contracts

by  Alex Tabarrok in

Moyamo at LessWrong is committed to getting dominant assurance contracts, aka refund bonuses up and running.

Imagine a world with no ads or paywalls. A world where open-source software gets the same level of funding as proprietary software. A world where people can freely reuse ideas and music without paying royalties. A world where people get paid for writing book reviews. A world where Game-of-Thrones-quality shows are freely available on YouTube. A world where AI safety research gets the same-level of funding as AI capabilities research. Is this a fantasy world? No, this is the world where people use Dominant Assurance Contracts.

If you think this is a bad idea that no one will support, click on the donation link and make some money. If you think it’s a great idea with lots of potential, click on the donation link and be the one to make this public good a reality. Read the first link to find out more.

*All the Kingdoms of the World*

by  Tyler Cowen in

The author is Kevin Vallier, and the subtitle is On Radical Religious Alternatives to Liberalism.  This is an excellent and important book, starting with its defense of classical liberalism over Catholic integralism and indeed illiberalism more generally.  But do note that Kevin, although a professional philosopher is also a Christian (Eastern Orthodox), and he is writing from a Christian perspective.  This is also an excellent book simply for learning what integralism is.  Overall, perhaps this is analytic political theology!?

In the final chapter, Kevin considers illiberal strands within Chinese Confucianism and Sunni Islam as well.

To be clear, if you are interested in neither religion nor political philosophy, this is not for you.  But it is likely to be one of this year’s books that turns out really to matter.

Does China need more consumption?

by  Tyler Cowen in

I am repeatedly puzzled by this claim, which you will find in Michael Pettis, Paul Krugman, and others (WSJ), even Stephen Roach.  It might make sense for short-run matters, when prices are (maybe) sticky.  But as of late we are talking about how to restructure China for medium- and long-term growth.

Investment good prices are not sticky forever!  If rates of return are too low, those prices will fall, thereby restoring higher rates of return.  Somehow I never see that point mentioned.

Note that China is not in a liquidity trap, so weird liquidity trap results are not going to apply here.  If you are worried about some kind of downward spiral of everything, monetary policy can fill the gap.

Paul Krugman for one writes (NYT):

The result is that China has a huge quantity of savings all dressed up with no good place to go.

China needs investment in lots of things, starting with say health care?  There is a major doctor shortage and the quality of Chinese health care is abysmal.  It is true that China also needs more consumption of health care, rather than production of health care with no one consuming it.  But that is not what people mean when they say China needs more consumption.

It is plausible to argue that China has inefficiency wedges that favor some kinds of investment over consumption, such as massive subsidies for infrastructure construction.  But it is odd to conclude that China needs outright “more consumption,” which indeed will limit China’s prospects for the future.  What China needs is “both more consumption and more investment in the discouraged sectors.”  That would both boost growth and the welfare of Chinese citizens.

The policy differences here are quite concrete.  Don’t expect to get far by printing up lots of money, giving it to Chinese consumers, and telling them to spend it.  You might, however, help growth rates if you could free up or otherwise assist China’s numerous dysfunctional sectors, again with health care being one very obvious example.

The WSJ wrote:

…top leader Xi Jinping has deep-rooted philosophical objections to Western-style consumption-driven growth…

C’mon people!  Can I call it “Western-style production-driven growth”?  (Where do you think most real income for consumption comes from?)  The rebellion against Say’s Law has gone way too far.

South Appalachia > North Appalachia

by  Tyler Cowen in

The ARC classifies 27.2 percent of North Appalachian counties as distressed but only 9.6 percent of South Appalachian counties that way. Over 70 percent of counties in South Appalachia have grown in population since the 2020 Census. North Appalachia lost 17,131 people in total, while South Appalachia gained 127,585. The difference in net in-migration is even more stark. While the North posted positive net domestic in-migration of 22,563, the South tallied almost 300,000—13 times as high. The story is similar for jobs, with the North losing 227,049 positions since the pre-pandemic year of 2019, while the South actually exceeded its pre-Covid levels by 66,377. In other words, much of South Appalachia is seeing a population inflow and is growing in both population and employment.

Here is much more from Aaron M. Renn, of interest and with good maps, and for the pointer I thank Terry O’Connor.

Driverless Cars May Already Be Safer Than Human Drivers

by  Alex Tabarrok in

Tim Lee runs the numbers:

Waymo and Cruise have driven a combined total of 8 million driverless miles, including more than 4 million in San Francisco since the start of 2023.

And because California law requires self-driving companies to report every significant crash, we know a lot about how they’ve performed.

For this story, I read through every crash report Waymo and Cruise filed in California this year, as well as reports each company filed about the performance of their driverless vehicles (with no safety drivers) prior to 2023. In total, the two companies reported 102 crashes involving driverless vehicles. That may sound like a lot, but they happened over roughly 6 million miles of driving. That works out to one crash for every 60,000 miles, which is about five years of driving for a typical human motorist.

These were overwhelmingly low-speed collisions that did not pose a serious safety risk. A large majority appeared to be the fault of the other driver. This was particularly true for Waymo, whose biggest driving errors included side-swiping an abandoned shopping cart and clipping a parked car’s bumper while pulling over to the curb.

Cruise’s record is not impressive as Waymo’s, but there’s still reason to think its technology is on par with—and perhaps better than—a human driver.

Human beings drive close to 100 million miles between fatal crashes, so it’s going to take hundreds of millions of driverless miles for 100 percent certainty on this question. But the evidence for better-than-human performance is starting to pile up, especially for Waymo. And so it’s important for policymakers to allow this experiment to continue. Because at scale, safer-than-human driving technology would save a lot of lives.

Driverless cars never break the speed limit, the driver is never drunk, nor distracted by their cell phone or the fight they had with their spouse. Another advantage that people might not think of is that these cars are far better for cyclists as Parker Conrad notes:

It’s so, so obvious to anyone riding a bike in SF that autonomous vehicles are WAY safer for bicyclists than human drivers. They see me every time; human drivers constantly turn right into the bike lane without thinking.

Why? Because driverless cars literally have eyes in the back of their heads.

Driverless cars are in general less good at edge cases but the advantages add up.

I would qualify this only slightly by noting that some locations are more difficult than others and while San Francisco is quite difficult terrain, Phoenix, Arizona was chosen because of flat terrain and sunny weather. Still, the bottom line is absolutely correct. Driverless cars are safer and more capable than many people think and we should always measure their defects relative to realistic alternatives and not to some idealized notion of perfection.

Latin America fact of the day

by  Tyler Cowen in

The year 2022 was a vintage one for political turmoil in Latin America. Colombia elected a leftwing former guerrilla as president, Chile considered (and rejected) a radical new constitution, Peru’s elected president was impeached and imprisoned pending trial after after a failed attempt to seize extraordinary powers and Brazil’s far-right leader Jair Bolsonaro narrowly lost a bid for re-election.

It was also a record year for foreign direct investment. Investors committed $225bn to Latin America and the Caribbean in 2022, according to ECLAC, the UN’s economic agency for the region. That was 55 per cent more than the previous year and comfortably surpassed the previous peak a decade earlier. Part of the increase was a post-pandemic rebound but the number of future projects announced also rose, though more modestly.

And this:

Brazil was so popular with investors that it became the world’s number five destination for foreign investment last year, behind the US, China, Hong Kong and Singapore, according to Unctad. Brazil is also the top developing economy for international renewable energy investment, according to Unctad, with $115bn in projects.

Here is more from Michael Stott at the FT.  Latin America is such a mess it is hard to be flat out optimistic.  Yet I feel the highlights, such as southern Brazil and parts of Mexico, are going to surprise people on the upside.  Mexico has survived terrible governance, and Colombia is likely to as well.  Chile has turned back from the abyss.  Argentina may be willing to try something different, even if it doesn’t seem on track to succeed.  So these are heady days down south, noting that most of the major problems still have not gone away.