A Masterpiece in Every Home

Artists and intellectuals bemoan markets for ruining art in so many ways – one could write all day about all the ways markets allegedly corrupt art. But here’s a great, perhaps indisputable, fact about art and market economies – any person can have a masterpiece in their own home, or at least a decent copy.

Consider the following: For a few dollars, any person can download pictures of their favorite Picasso from the Internet at minimal cost and print out color copies at Kinko’s. For about $40, anybody can buy a book, magazine or gallery catalogue with a full color reproduction of your favorite fish tank basketballs. If you want it on the wall, for a few hundred bucks, you could easily buy a nice poster and have it framed. For a few thousand bucks, you could probably hire an artist to make you an uncanny reproduction of the original work. And of course, if you have a few hundred thousand bucks to spend, or millions, you could have Gerhard Richter come to your house and paint a nice blurry portrait of you and your family. Not a bad deal when you think about it.

Obama and The Limits of Black Politics in America

The New Republic’s Noam Scheiber has an insightful article on Barack Obama, an Illinois state senator who has just won the Democratic senatorial primary. Leading in the polls, the election is now his to lose. Scheiber’s question is the one many have had about Obama’s victory: how did Obama avoid the pitfalls that have ensnared so many African-American politicians?

The challenge African-American politicians must overcome is this: if you appeal too much the African-American base, you’ll alienate moderate whites; if you appeal too much to moderate whites, your opponent will claim that you aren’t “black enough.” Witness Cory Booker’s difficult campaign for mayor of Newark, when the Yale educated councilman was tarred by the incumbent.

Scheiber appeals to research showing that white Americans routinely make distinctions between “good” and “bad” blacks. Once advertising showed to voters he was of Kenyan ancestry, as opposed to African-American, Schebier believes, the voters reframed Obama as different than traditional black politicians. Scheiber concludes that Obama’s act is tough to follow – how many self-deprecating half-Kenyan Harvard Law Review editors are there?

On the contrary, if successful, Obama could be in the position to establish a new brand name in national politics. It’s easy to imagine Obama establishing a sort of “DLC” for the African-American community, much in the same way Clinton tried pulling his party towards more moderate positions on trade and social programs. A congressional caucus under such a banner would powerfully reshape debates over race relations in this country.

Buying Collaboration II

On Monday, I described a controversial auction by William Tozier of Ann Arbor, Michigan. The highest bidder would win the chance to collaborate and write an academic article with him.

A number of readers sent interesting comments. Some, like Davis King, pointed out that collaboration for pay already exists and is quite common in some fields like computer science. He also pointed out a lot of de facto collaboration for pay, such as when undergraduates pay tuition and get the opportunity to co-author papers with professors.

Two readers noted that at least one scientist, Miriam Rothschild – a noted bug scientist, was independently wealthy and funded a long string of collaborations in fields that weren’t receiving much attention. The resulting work is well accepted in biology and her self-funding didn’t seem to raise suspicions about her work.

One reader noted that pay for collaboration might be hard to distinguish from research assistance. This is a good point, but I think there is a simple response – research assistants merely carry out the instructions of the researchers while paid collaborators are compensated for original, creative work.

Mr. Tozier himself wrote to me and told me about his current project, an online forum that would facilitate collaboration among non-academic researchers. I think the future probably holds a continuum of possibilities – universities will probably sponsor only “altruistic” research while scientists outside the academy will probably work together in more varied contexts.

Death to the Hackers!

Steven Landsburg has a clever column (click here) pointing out that the economic damage prevented by executing a murderer is less than damage caused by the author of a wildly successful computer virus. If we’re willing to fry Jack the Ripper, why not send Urkel to the chair?

Landsburg notes that governments provide goods markets won’t, such as crime prevention. The implication is that cost-benefit analysis would dictate that people would be more willing to pay for prevention of property crime rather than personal safety.

For me, Landsburg misses a simple point: human beings are probably hard wired to care about concentrated damages (like murder of a person) rather than diffuse damages (like screwing up everybody’s email for an hour). No cost-benefit analysis will likely persuade people to go against this intuition.

Jean-Jacques Rousseau’s public opinion theory

It’s pretty well known that Rousseau thought that the public was always right. But while reading On the Social Contract translated by Donald A. Cress, I came upon this less frequently discussed quote:

“The former [‘will of all’] considers private interest and is merely the sum of private wills. But remove from these [private] wills the pluses and minuses that cancel each other out, and what remains as the sum of differences is the general will,” which Rousseau claims in the previous paragraph is “always right” and tends towards the “public utility.”

This is an interesting public opinion theory. It assumes that aggregate public opinion has two components – a selfish and biased component and a component that produces the “right” public policy. The difference between the optimal policy and the median voter’s policy is due not to ignorance or systemic error, but to selfish desires that undermine the provision of public goods. If readers know of a published formal model of this theory, or applications of this theory, feel free to email me.

Mall Science

Paco Underhill has made a career of studying shopping malls. In two well known books (click here) , he lays out a wealth of findings on the world of the mall, and describes how retailers lose sales by ignoring how people actually use malls and shops. For example:

– people tend to buy stuff that’s placed away from the door, stuff near the door sells poorly
– people tend to walk through the mall with the shops on their right hand side, so place your products facing in that direction; displays facing the wrong direction rarely get people to buy stuff
– chairs in stores are great, because impatient family members who are seated will wait longer while you shop

Who would’ve thought that malls provide such nice examples of systematic biases in consumer behavior and the market inefficiencies they create?

Buying academic collaboration

The Chronicle of Higher Education reports on an Ebay auction conducted by a certain William A. Tozier of Ann Arbor, Michigan. Mr. Tozier, a consultant who specializes in artificial intelligence research, auctioned off an opportunity to co-author a scientific paper. The winner of the auction would get 40 hours of Mr. Tozier’s time and if the work produced an interesting scientific finding, the auction winner and Mr. Tozier would submit a paper to a scientific journal. The benefit to the winner? Aside from producing some science, the winner would have an Erdos number of 5 (click here for an explanation of the Erdos number).

Unsurprisingly, this event has lead to some outrage. The winner of the auction, a mathematician named Jose Burillio, refused to employ Mr. Tozier because he thought Tozier was auctioning off a paper he had already written. If that were the case, then the auction winner was simply buying the opportunity to put his name on work he had no hand in producing – a form of dishonesty. Even when Mr. Burillo found out the truth, he still opposed the auction on the principle that collaboration should not be induced with pay. Mr. Tozier then declared a new winner – the second highest bidder, the owner of a company that makes online course materials.

This incident raises an interesting question – why can’t someone pay for an academic collaborator? In other walks of life, we often pay for crucial knowledge in a field we don’t have expertise in. In the consulting world, research reports are routinely written with individuals who have been paid for their services. It seems that pay for collaboration should be prohibited only when it threatens the integrity of the work. For example, it should be prohibited when the work has already been produced and wealthy individuals are seeking only to attach their name to scientific work in an attempt to buy prestige. This seems to have been the case for the calculus theorem known as L’Hopital’s rule, which some believe to have been discovered by Johann Bernoulli, who might have been paid by the wealthy aristocrat Guillaume de L’Hopital (click here for the story).

But if there is no conflict of interest, or damage to the integrity of the work, then it might be worth considering. It is often common for a researcher to realize they have no knowledge in an area which is crucial to completing their research. One option is to completely master a new field. Another is to hope that a specialist in that area will collaborate out of the goodness of their heart. While these are desirable and preferable outcomes, they are also difficult to obtain. It might also be useful to simply hire someone to help solve a particular problem. As long as the payment is acknowledged at the beginning of a scientific paper (“Professor X has been compensated for his assistance in this work…”), collaboration for pay might be a form of scientific cooperation worth considering. Readers are invited to email me pros and cons of scientific collaboration for pay. Summary of the discussions will be posted later this week.

Network Holes and Creativity

One of my favorite theories in sociology has been Ron Burt’s “structural holes” theory (click here to read about the book). Burt says that individual success often comes from taking advantage of “holes” in your personal network – gaps between two groups which represent opportunities. For example, if somebody in the marketing department discovers that consumers want X, then that person could go to research and development and ask for X. In other words, creativity is about crossing boundaries.

The NY Times has a nice article on Burt’s latest research showing that managers in a large engineering firm (Raytheon) are more likely to come up with new ideas when they cross group boundaries in the firm. Managers at Raytheon who didn’t have “holes” in their networks were much less likely to come up with ideas deemed as innovative. Burt concludes that creativity is all about combining ideas and closing gaps.

My big criticism of the idea is that holes may be great for creativity, but lousy for the mundane daily operations of corporations. Most organizational life is not about coming up with dazzling new ideas, but it’s about efficiently accomplishing routine tasks. This is probably best done when networks are dense – people will share the same goals and have the same knowledge because they are in constant contact with each other. It’s probably the case that corporations that depend on innovation for their success have separate think tanks where individuals are encouraged to experiment and span boundaries, such as the famed Bell Laboratories.

Live – from Dubuque, Iowa!!

Readers with XM radio are encouraged to tune to channel 132 – C-Span radio! There is a live democratic caucus in Dubuque, Iowa. If you have ever wondered what it’s like in a famed Iowa caucus, this is your chance. It’s noisy and chaotic – people argue over the rules and the candidates and it’s hard to decipher what’s happening. People wander from group to group looking for enough people to give their guy a delegate. People are trying to pull each other from group to group.

People just clapped when a Kucinich person migrated to a Dean group… followed by a football fan style “EDWARDS!! EDWARDS!! EDWARDS!!” chant… heady stuff… tune in before you miss it!

Marriage Mathematics and Political Change

John Gottman has spent decades studying how married couples interact. His most striking finding is the tendency of couples at risk of divorce to have markedly different interaction styles. His recent book, The Mathematics of Marriage, summarizes his observations of married couples and presents a parsimonious model of marriage (see here for Slate’s review). The highlight of the research is that couples where the dominant mode of interaction includes criticism, contempt, defensiveness and stonewalling are very, very likely to divorce. Successful marriages involve a great deal of mending and reworking of the relationship. The mathematics links some theories about emotions and interaction to this observed pattern.

What I find interesting is the implication for thinking about politics. Let’s assume that political order is a sort of “marriage” between state and citizen. At least from the perspective of the citizen, it’s a relationship that can be broken, if warranted. This is a premise of many normative theories of revolution – the citizens have a right to a new government if they feel the written and unwritten rules have been violated. Unfortunately, what we know about exactly how this happens – moving to abandon the social contract – is sketchy at best, although political scientists and sociologists have a hunch that it involves some combination of repression of the population and a de-legitimizing of the government, which itself might have multiple causes.

Gottman’s approach to studying relationships offers a useful way to think about these issues. Gottman’s point is that there may be varying sources of the emotions that destroy marriages, but the road to divorce usually starts in the same place – once spouses have learned certain interaction strategies, they create hard to change feedback loops. Similarly, governments and populations that learn certain strategies for interacting with each other probably set up hard to break cycles leading to long term stability or perpetual crisis. The nice thing about Gottman’s analysis of marriage is that the math predicts stability or decline, and not much in between – a non-trivial prediction. The same prediction for states is that states tend to be on a tough to change road to constant crisis (like in Africa and the Middle East) or stability (like in the US). Switches from one path to the other should be infrequent and difficult, which seems to describe the world pretty well.

Get a (Virtual) Life!!

The NY Times has a nice article on the Sims online game, where for a monthly fee you can join a virtual society and create an alter ego. Since your online personna can accumulate possessions that only exist in the game, people sell these virtual possessions for real dollars on ebay, especially the rare Sims pet – the cheetah! If you accumulate enough virtual dollars, you can sell these for real cash.

Trouble’s brewing, though. The owners of Sims online have expelled Peter Ludlow from their game, presumably because he was a virtual muckracker. In the Alphaville Herald, he’d report on criminal rings and teenage prostitution. The problem is that these are all constructs in a computer, not real world events. Of course, free speech issues come into play because Sims online has become a sort of quasi-public space, like the shopping mall. But there are important differences – you have to pay to get in and you sign away certain rights. It will be interesting to see if any regulation is ever applied to virtual online communities aside from the laws applying to any legitimate business.

Deirdre McCloskey’s Sins

Deirdre McCloskey has made a name for herself by critically examining the logic and rhetoric of economic arguments. She has a nice pamphlet summarizing her claims called “The Secret Sins of Economics.” It’s written for non-economists and nicely makes three points:

1. Some alleged problems of economics are virtues. For example, using math to describe and analyze economic behavior is actually good because math allows you to clearly deduce conclusions from premises.

2. There are some drawbacks to economics that are annoying, but acceptable. For example, economists assume people are always chasing profits. Her response is to say that this narrow focus tends to yield interesting insights. McCloskey identifies other drawbacks of economics and economists, such as professional arrogance, but asks that we forgive those because they really aren’t that bad.

3. McCloskey identifies two horrible, unforgivable economic sins – (a) economists tend to prove qualitative mathematical theorems whose conclusions depend on arbitrary, qualitative premises and (b) statistical analyses routinely confuse statistiscal and substantial significance.

These are pretty weighty charges – that much theoretical economic work is just a useless game and economists (among others) make routine statistical errors no decent statistics undergrad would ever make.

How to respond? I’m not a professional economist – so I can’t speak for the economics profession, but I think the second charge – misunderstanding of significance – is right on target. I’ve told students and colleagues many times that “not significant” does not mean “no effect.” It simply means that you can’t automatically reject the hypothesis that, according to an arbitrary standard, there is no effect, which is different than saying there really is no effect. As McCloskey says, significance is simply a measure of confidence in the effect’s measurement. The whole situation is quite bad. For a summary of anti-significance test views, see the book “What if there were no significance tests?”

This first charge doesn’t bother me too much. All academic endeavors must engage in thought experiments. In fact, bizarre, unrealistic thought experiments can lead to some great insights. But what McCloskey, I think, really focuses on is the lack of empirical discipline. That is to say, when you come up with the premise of your theorem, it should be well justified.

When I studied math, there was a real difference between how mathematicians did it and how physicists did it. Math people are purely concerned with what is logically possible (does B really follow from A?) but physicists employ “physical intuition” – a sense of what assumptions were appropriate, a gut feeling developed from doing lots of experiments and observation. That’s why a lot of physics seems mysterious to mathematicians – the math looks familiar, but why did the physics people choose mathematical model X over Y? McCloskey’s point could be rephrased as saying that economists should move away from the mathematician’s style of modelling (proving what is logically possible) to the physics style of modeling (developing models inspired and constrained by observation and experiment).

SUV safety debate

A theme in writings about SUV’s (see here for a recent New Yorker article) is that consumers tend to overestimate SUV safety and grossly misunderstand the factors behind auto safety. The basic point is that safety comes from avoiding risky situations and quickly responding to danger. It turns out SUV’s tend to lull drivers into a false sense of safety and they respond more slowly to danger (e.g., SUV’s come to a complete stop much more slowly than many other popular types of cars). Because SUV’s are cosmetically altered trucks, they don’t have many basic safety features now standard in small cars or minivans, so you are more likely to die in an SUV accident than in another car (an anti-SUV site collects some Insurance industry reports). Consumer Reports has for many years argued that SUV’s are quite likely to tip over.

One response I’ve seen is to avidly defend consumer choice (see here for Car and Driver’s Brock Yate’s defense, or here for Peter Klein’s comment), or to minimize the SUV’s dangerous design. I think this misses a basic point. When events are infrequent (like fatal auto crashes), or when cause and effect are hard to link, people can opt to believe anything they want. All economics tells us is that markets are extremely good at responding to possibly erroneous consumer beliefs.

My take on this entire issue is that the central issue is liability. In general, you can’t hold someone accountable for the fatalities created by the use of a car with less then optimal safety features, any more than you can hold somebody accountable for the extra risk created by using a less than best bicycle, motorcycle or other device. In short, there is not much people can do about SUV safety because some people will always want to make the trade-off between safety and other product features.

Since the insurance industry is still willing to insure SUV’s, I wonder if the risk associated with them is tolerable given our current legal and economic standards. I invite knowledgable readers to email me information about how much more it costs to insure SUV vs. other vehicles.

Against Broken Windows

James Q. Wilson’s broken windows theory is simple: broken windows, or other symbols of public disorder, invite crime. Thus, if you clean up the neighborhood, crime should go away. The NY Times discusses research conducted by Felton Earls, Rob Samson, Steve Raudenbush and Jeanne Brooks-Gunn testing this theory. They drove an SUV through *thousands* of Chicago streets and recorded with a video camera just about everything that was visible on the street – garbage, loitering, grafitti, etc. They also had data on crime and the attitudes and behavior of residents. Analysis of data showed that public signs of disorder such as garbage were not linked to crime. Instead, concentrated poverty and the willingness of residents to self-police (“collective efficacy”) explained the incidence of crime. The Times quotes Earls:

“If you got a crew to clean up the mess,” Dr. Earls said, “it would last for two weeks and go back to where it was. The point of intervention is not to clean up the neighborhood, but to work on its collective efficacy. If you organized a community meeting in a local church or school, it’s a chance for people to meet and solve problems.

“If one of the ideas that comes out of the meeting is for them to clean up the graffiti in the neighborhood, the benefit will be much longer lasting, and will probably impact the development of kids in that area. But it would be based on this community action – not on a work crew coming in from the outside.”

This point should be taken to heart by all students of crime. Yes, of course, police are necessary for public order and safety. But the police are finite resource – they can’t possibly monitor every street and corner. Thus, on a fundamental level, public safety comes from a community’s ability to regulate itself. The next time you hear a call for more police, or more prisons, or more public works, think about this insight.