Thursday assorted links

1. “As the interminable lines at DMV offices grow longer and timely appointments become nearly impossible to schedule, an Oakland startup offering “expedited appointments” for $19.99 has seen its business boom.” Link here.

2. Casper is opening a nap store.

3. Are you Chinese but spiritually Finnish? #jingfen

4. What is up with charter cities and other such things?

5. A list of top economics influencers.

6. The art scene in Addis Ababa, Ethiopia.

7. Thomas Edsall on the growing gender gap in politics (NYT).

Which elements of the Trump legacy will persist?

That is the topic of my latest Bloomberg column, here is one bit from it:

There is evidence that American attitudes toward immigrants are growing more positive. There is also evidence that simply thinking about immigrants makes Americans less likely to support them, so Democrats may decide to de-emphasize the issue. The intensity of anti-immigration sentiment has helped Republicans take control of all three branches of the federal government, and Democrats would probably prefer for the next big set of political debates to be about health-care policy and additional benefits for women. The American public actually trusts Trump more than congressional Democrats to deal with border security.

There is much more at the link, not all of it pleasant.

Augur is live

Augur is finally live.

The decentralized platform for betting on real-world predictions was one of the first applications built on top of the ethereum blockchain, and its creators  sold “reputation” (REP) tokens for over $5 million in 2015 – a time when few were talking about “ICOs” or “utility coins.” A public beta version of the platform came out the following year, and its team published a revised version of its white paper in January.

Now, the Forecast Foundation, the not-for-profit behind Augur’s development, has announced the launch of the long-awaited platform, which was accompanied by the release of the final version of the Augur application as open-source software.

And:

Augur allows participants to bet on anything.

As long as the outcome can be verified in the real world, users can create a prediction market for anything from ether’s price, an election in Brazil or the outcome of Iceland v. Argentina in the World Cup.

What distinguishes Augur from a traditional betting market is that no single party sits in the middle, meaning that users are likely to pay lower prices.

Removing the centralized intermediary from a betting market presents a problem, however: how to bring dispersed, financially interested parties into agreement about the actual outcome of the predicted event?

In Augur’s system, the creator of a prediction market designates a “reporter” to vet the outcome. This designated entity puts down a deposit of REP tokens, which they lose if they incorrectly report the outcome and other REP holders challenge them. The reporter is compensated through fees.

Day-to-day betting is not done in REP, but in ether, the native token of the ethereum blockchain (though, eventually, the plan is to support other ethereum-based tokens). Users can buy and sell shares in particular predictions, which are priced according to the likelihood the market attaches to each outcome.

Here is the full Coindesk article, here is the white paper, here is their home page.

How to give admissions officers more discretion

Heaven forbid that grading should occur on a common scale with strong safeguards against cheating.  This missive is from Princeton:

On July 5, the University dropped the need for applicants to submit an essay score from the SAT or ACT. Beginning this 2018-2019 application season, applicants will, instead, have to submit a graded high school writing sample, preferably a work either of English or history.

In a statement, the University said that this new policy shift “aims to alleviate the financial hardship placed on students, including those who have the opportunity to take the test without writing during the school day and for free.”

Taking either test with the writing section costs more than taking the test without the writing section. The ACT with the writing section costs $16.50 more than without it, and the SAT similarly costs $17 more with it.

According to the statement, University officials “believe that assessing a student’s in-class work will provide helpful and meaningful insight into a student’s academic potential.”

The net result of this decision is to lower the status of higher education.  Here is the full article, via Catherine Rampell.

Epp and Borghetto have solved for the equilibrium…

And most of you won’t like it:

This article investigates the effects of economic inequality on legislative agendas. It considers two competing hypotheses: (1) that policymakers will act to counter rising inequality by renewing their focus on redistributive social policies, and (2) that rising inequality makes legislative agendas especially vulnerable to the influence of economic elites, and that these elites will attempt to keep redistributive social policies off the agenda. Empirical tests, which are designed to arbitrate between these hypotheses, use data on public laws and parliamentary bills introduced in the legislatures of nine European countries between 1941 and 2014. The evidence is supportive of the second hypothesis: as inequality becomes more acute, European legislative agendas become systematically less diverse and this narrowing of attention is driven by a migration away from social safety-net issues toward issues relating to law enforcement, immigration, and national defense.

Here is the paper, via the excellent Matt Grossman.

Not the United States

The father was detained in February; three months later the mother was also taken away by authorities. They had allegedly shared extremist Islamist content on their mobile phones, family friends said. Despite protests from relatives, two of their children, aged 18 and 15, were then detained and their younger two, aged seven and nine, were sent to a state welfare centre. “The grandfather even wept, but the authorities would not let him keep his grandchildren,” recalled an acquaintance.

So what’s up?:

As the Trump administration struggles to reunite migrants and their children forcibly separated at the US border, China has been separating families on a far larger scale as part of a rapidly intensifying security campaign.

That is from Emily Feng at the FT, via Comrade Balding.

It’s all about investment, not tariffs and trade wars

I’ve been saying this for a while, here is an excellent piece by Shawn Donnan at the FT:

Since it was first created in 1975 as an inter-agency committee, Cfius has been able to review foreign investments only on narrow national security grounds. But if it adopts the broad Trumpian definition of national security as economic security, this could open a whole new range of transactions to its scrutiny. Might a mid-western auto plant that makes components purely for civilian vehicles suddenly be treated as a national security asset and be banned from foreign ownership?

Presidents have for years resisted efforts in Congress to require Cfius to consider an economic benefits test when it approves large foreign investments, as similar bodies do in countries such as Australia and Canada. Mr Trump, however, seems to be embracing the idea.  Legislation to reform Cfius, which the Trump administration will have broad powers to shape in its implementation, is nearing its final journey through Congress.

Maybe they’ll have to revise the Star Wars prequels too…

Lower travel costs boost scientific collaboration

Here is a kind of gravity equation for science:

We develop a simple theoretical framework for thinking about how geographic frictions, and in particular travel costs, shape scientists’ collaboration decisions and the types of projects that are developed locally versus over distance. We then take advantage of a quasi-experiment – the introduction of new routes by a low-cost airline – to test the predictions of the theory. Results show that travel costs constitute an important friction to collaboration: after a low-cost airline enters, the number of collaborations increases by 50%, a result that is robust to multiple falsification tests and causal in nature. The reduction in geographic frictions is particularly beneficial for high quality scientists that are otherwise embedded in worse local environments. Consistent with the theory, lower travel costs also endogenously change the types of projects scientists engage in at different levels of distance. After the shock, we observe an increase in higher quality and novel projects, as well as projects that take advantage of complementary knowledge and skills between sub-fields, and that rely on specialized equipment. We test the generalizability of our findings from chemistry to a broader dataset of scientific publications, and to a different field where specialized equipment is less likely to be relevant, mathematics. Last, we discuss implications for the formation of collaborative R&D teams over distance.

That is from a new paper by Christian Catalini, Christian Fons-Rosen, and Patrick Gaulé.

Monday assorted links

Why doesn’t Mexico’s economy grow more quickly?

That is the topic of my latest Bloomberg column, here is one bit:

Instead, it is education that is arguably Mexico’s most fundamental problem. In most emerging economies, if you are ambitious and seek higher wages, you will invest in more education. Mexicans have traditionally had another choice — crossing the border to work in the U.S. Mexicans who make this choice can move from earning a dollar or two a day to 10 or 15 dollars an hour, though with higher living costs. It is hard to beat that boost simply by finishing high school or even college in Mexico.

And:

Admittedly, this [informal, grey or black market] labor can be and often is absorbed into the more formal, more productive sectors of the economy, including exports. But the rate of absorption is quite slow, which in turn helps to set the slow growth rate of the economy. And in any case neither the high-productivity nor the low-productivity firms have that much room to grow within their respective categories, a major difference from many other emerging economies.

The odds are that Mexico will have to opt for the slow but steady long game, as Denmark once did.

Do better scientists smile more?

Theory and research indicates that individuals with more frequent positive emotions are better at attaining goals at work and in everyday life. In the current study we examined whether the expression of genuine positive emotions by scientists was positively correlated with work-related accomplishments, defined by bibliometric (e.g. number of citations) and sociometric (number of followers for scholarly updates) indices. Using a sample of 440 scientists from a social networking site for researchers, multiple raters coded smile intensity (full smile, partial smile, or no smile) in publicly available photographs. We found that scientists who presented a full smile had the same quantity of publications yet of higher quality (e.g. citations per paper) and attracted more followers to their updates compared to less positive emotionally expressive peers; results remained after controlling for age and sex. Thin-slicing approaches to the beneficial effects of positive emotionality offer an ecologically valid approach to complement experimental and longitudinal evidence. Evidence linking positive emotional expressions to scientific impact and social influence provides further support for broaden and build models of positive emotions.

I wonder for which fields this might not be true…?

The paper has many authors, including my colleague Todd B. Kashdan.  Via the excellent Kevin Lewis.