Kenneth Arrow, weather officer

by  Tyler Cowen in

Following the U.S. declaration of war on December 8, 1941, Arrow, who was certain to be drafted, enlisted in the hope of securing an officer’s commission in the U.S. Army Corps where he believed he would have a chance to use his mathematical and statistical training.  He was quickly approved to attend an aviation training program at New York University in October 1942, taking “active duty” breaks from classes for rifle drill, which he and his colleagues thought rather silly.   Nonetheless, he came out of that program in September 1943 commissioned as a weather officer with the rank of second lieutenant and was assigned to a weather research facility in Asheville, North Carolina; in July 1945 he was transferred to the weather division headquarters of the Army Air Force.  It was during that time in Asheville that he wrote a memorandum that later, in 1949, became his first professional paper (“On the Use of Winds in Flight Planning” in the Journal of Meteorology).  That paper presented an algorithm for taking advantage of winds aloft to save fuel on North Atlantic air crossings, an idea that was not acted upon by the military at that time but became the canonical practice for North Atlantic flight paths in the postwar period.

That is from the new, excellent, and consistently interesting Finding Equilibrium: Arrow, Debreu, McKenzie and the Problem of Scientific Credit, by Till Düppe and E. Roy Weintraub.  Unlike many history of economic thought books, this one tells you “what actually happened,” such as how an Econometrica editor (Robert Strotz) decided to publish the McKenzie paper before the Arrow-Debreu paper, when he had both in hand.

*Unfabling the East*

by  Tyler Cowen in

That is the new and noteworthy book by Jürgen Osterhammel, and the subtitle is The Enlightenment’s Encounter with Asia.  Here is one good bit of many:

For Alexander Hamilton, there was nothing more acoustically disturbing on his extensive travels in Asia than the bells that tolled through the night in Portuguese Goa.  Asian cities are quieter than European ones because they have hardly any paved roads and there are few, if any, carriages with iron fittings.  Festive banquets are marked by an absence of polite conversation because the hosts are too busy tucking into their food to bother with such niceties.  Court ceremonies generally unfold in an atmosphere that strikes Europeans as eerily hushed.  Few words are exchanged during Siamese and Tibetan audiences.  All is calm around the Chinese emperor too, as courtiers and mandarins glide to and fro in felt-lined slippers.

Definitely recommended.  Here is the book’s home page.

The capitalization of Coinbase

by  Tyler Cowen in

Consumers who sign up with Coinbase must feel sure that their online wallets will not be hacked, its executives say. To minimize the risk of a catastrophic data breach, Coinbase stores roughly 99 percent of its customers’ funds in formats that are not connected to the Internet. The remaining 1 percent — the liquid funds that Coinbase uses to carry out trades — comes from the company’s reserves, so that customer funds are never directly connected to the marketplace. That 1 percent is privately insured by Lloyd’s of London, Hirji said, offering another layer of protection.

Here is more from Brian Fung at WaPo.

Markets in everything, metals from dead bodies edition

by  Tyler Cowen in

The recycling bin behind the cremation chamber is the first tip-off that Elgin Mills Crematorium, north of Toronto, is up to something different.

The green bin is full of medical implants, including titanium hips and knees, stainless steel bone screws — even gold teeth.

The pieces gathered here were, until recently, inside the bodies of deceased people. Cremating a body incinerates nearly all biological material, but artificial materials can be collected quite literally out of the ashes.

But the Mount Pleasant Cemetery Group, which operates Elgin Mills Crematorium, has adopted a system not only to safely recover these materials but recycle them with a rather altruistic buyer — who compensates them based on what they pass on.

Here is the story, via Shaun F.

*The Radical Fool of Capitalism*

by  Tyler Cowen in

Bentham…appraised the trophies — dismissively dubbed “baked heads” — as technical innovations and recognized their potential for his own plans.  He enthusiastically praised the “savage ingenuity.”  An 1824 draft of his will was the first to contain the score of his wishes: first, to see the corpse as an inheritance…

According to legend, Behtam carried around the glass eyes intended for the Auto-Icon in his pocket in his final years.  (Supposed) attempts to dehydrating body parts in his home oven are said to have yielded satisfactory results.  Bentham believed the [Maori] mokomokai process would discolor facial traits and produce a parchment- or mummy-like appearance (which could be corrected with paint), while maintaining the physiognomy.

But Southwood Smith botched the job.  He sprinkled sulfuric acid onto the head, and in doing so docked Bentham’s nose.  He used an air pump to aid dehydration, which caused the skin to shrivel.  Bentham’s face appeared melted, the physiognomy destroyed.  In spring 1833, Smith commissioned a replacement head of wax…

That is from the new, excellent, and short The Radical Fool of Capitalism: On Jeremy Bentham, The Panopticon, and the Auto-Icon, by Christian Welzbacher.

Saturday assorted links

by  Tyler Cowen in

1. “Morris attacks Kuhn in the time-honored Johnsonian style.”

2. Obituary for Richard Pipes (NYT).

3. “Today, deterrence through classical music is de rigueur for American transit systems.”

4. “Germany spent €37bn on defence last year. If we wanted to spend 2 per cent of GDP on defence by 2024 that would mean almost doubling the budget to around €72bn,” said Hans-Peter Bartels, the armed forces commissioner of the German parliament. “We cannot just double the size of the Bundeswehr. How is this going to work?” Marcel Dickow, a defence expert at the German Institute for International and Security Affairs, makes a similar point: “The Bundeswehr cannot spend that kind of money. It does not have the procedures in place, and it wouldn’t even know what to spend it on.”  FT link here.

5. This year, going to school has involved more fatalities than serving in the U.S. military.

6. John List on corporate social responsibility.

Erik Brynjolfsson interviews Daniel Kahneman

by  Tyler Cowen in

Mostly about AI, here is one bit:

My guess is that AI is very, very good at decoding human interactions and human expressions. If you imagine a robot that sees you at home, and sees your interaction with your spouse, and sees things over time; that robot will be learning. But what robots learn is learned by all, like self-driving cars. It’s not the experience of the single, individual self-driving car. So, the accumulation of emotional intelligence will be very rapid once we start to have that kind of robot .

It’s really interesting to think about whether people are happier now than they were. This is not at all obvious because people adapt and habituate to most of what they have. So, the question to consider about well-being and about providing various goods to people, is whether they’re going to get used to having those goods, and whether they continue to enjoy those goods. It’s not apparent how valuable these things are, and it will be interesting to see how this changes in the future.

Kahneman tells us that his forthcoming book is called Noise, though I don’t yet find it on Amazon.  Here is an HBR essay of his on that topic.

Ethiopia is still up and at it

by  Tyler Cowen in

Ethiopia, Africa’s second most populated country, is forecast to be the fastest growing economy in Sub-Saharan Africa this year, according to new data from the IMF.

Ethiopia’s economy is predicted to grow by 8.5 percent this year. The figures signal continued economic expansion following a long period of impressive growth. In the last decade, Ethiopia has averaged around 10 percent economic growth, according to the IMF.

To boost the economy, the country is pursuing a number of large-scale infrastructure projects, including the Grand Renaissance Dam and a railway network.

Here is the full story.  Ivory Coast, Rwanda, Senegal, and Ghana are also growing at rapid clips.

*My Morning Routine*

by  Tyler Cowen in

The editors and co-creators are Benjamin Spall and Michael Xander, and the subtitle is How Successful People Start Every Day Inspired.

They were generous enough to include a contribution from me, on my theory of how to get ready in the morning for the day to come:

I make sure I’ve already showered.  Too many people waste some of their most productive morning time showering.  Showering relaxes you and calms you down — why should that happen in the morning?  I prefer to enjoy my shower during the evening, when I know I’m winding down in any case.

And here is Scott Adams on related topics, from the same book:

I’m a trained hypnotist, and when I learned to do hypnosis I learned that self-hypnosis, if you’re trained to do it, is more effective and faster than meditation.

You can order the book here.

The real workplace issue is the elderly not the robots

by  Tyler Cowen in

That is the topic of my latest Bloomberg column.  Here is one bit:

The populations of the U.S. and many other developed nations are aging, and the big surprise has been that older people want to work more than in previous generations. Against many prior expectations, the labor-force-participation rate of older Americans started rising in the 1980s and 1990s. For instance, the labor-force-participation rate for men ages 65 to 69 was 25 percent in 1985 but 37 percent in 2016. By 2020, over one-quarter of the workforce will be over 55 years of age.

And the closer:

Our willingness to banter about the robot apocalypse is yet another sign that, too often, we just don’t want to confront the issues surrounding the elderly.

Do read the whole thing.

Does demography predict inflation?

by  Tyler Cowen in

Demographic shifts, such as population ageing, have been suggested as possible explanations
for the past decade’s low inflation. We exploit cross-country variation in a long panel to identify age structure effects in inflation, controlling for standard monetary factors. A robust relationship emerges that accords with the lifecycle hypothesis. That is, inflationary pressure rises when the share of dependents increases and, conversely, subsides when the share of working age population increases. This relationship accounts for the bulk of trend inflation, for instance, about 7 percentage points of US disinflation since the 1980s. It predicts rising inflation over the coming decades.

That is from a new BIS paper by Mikael Juselius and Előd Takáts.