Ben Thompson is an American business, technology, and media analyst, who is based in Taiwan. He is known principally for writing Stratechery, a subscription-based newsletter featuring in-depth commentary on tech and media news that has been called a “must-read in Silicon Valley circles”.
A reduction in the corporate income tax burden encourages adoption of the C corporation legal form, which reduces capital constraints on firms. Improved capital reallocation increases overall productive efficiency in the economy and therefore expands the labor market. Relative to the benchmark economy, a corporate income tax cut can reduce the non-employment rate by up to 7 percent.
That is from the new AEJ: Macroeconomics, by Daphne Chen, Shi Qi, and Don Schlagenhauf.
Many scholars argue that people who attribute human characteristics to genetic causes also tend to hold politically and socially problematic attitudes. More specifically, public acceptance of genetic influences is believed to be associated with intolerance, prejudice, and the legitimation of social inequities and laissez-faire policies. We test these expectations with original data from two nationally representative samples that allow us to identify the American public’s attributional patterns across 18 diverse traits. Key findings are (1) genetic attributions are actually more likely to be made by liberals, not conservatives; (2) genetic attributions are associated with higher, not lower, levels of tolerance of vulnerable individuals; and (3) genetic attributions do not correlate with unseemly racial attitudes.
That is from Stephen P. Schneider, Kevin B. Smith, and John R. Hibbing in the Journal of Politics. For the pointer I thank K.
2. New results on anti-discrimination statements (The Economist).
3. The Emperor of Japan still publishes (even though he has tenure). He also usually gets his name first.
4. New economics discussion forum set up by AEA, first question from Olivier Blanchard. In the comments you will find Jeremy Stein, Claudio Borio, Ricardo Cabellero, and Larry Summers, kind of like the MR comments section.
6. “Pursuit of T5 [top 5 joiurnal] publications has become the obsession of the next generation of economists. However, the T5 screen is far from reliable. A substantial share of influential publications appear in non-T5 outlets. Reliance on the T5 to screen talent incentivizes careerism over creativity.” Link here.
It starts with an extended discussion of Tyrone and more or less ends with a take on the meaning of Straussianism and the Straussian reading of my own books. (If you read the transcript, the sentence in the middle about my believing in God as a teenager is a transcription error, it will be corrected.) David is one of the best, and best prepared, interviewers I have interacted with. Here is the audio and transcript.
Here is one bit from the middle:
David: …should academics or people who seek to influence the world, and according to your value system should they try and boost economic growth more? I’m thinking of in your podcast, you’ve had venture capitalists. I think of these in some ways as public intellectuals who are trying to boost economic growth.
[00:39:12] Tyler: They think very conceptually venture capitalists.
[00:39:14] David: They do.
[00:39:15] Tyler: They’re generalists.
[00:39:15] David: They are. Are they similar to university professors?
[00:39:19] Tyler: Well, they’re much better.
[00:39:20] David: Better at?
[00:39:21] Tyler: Almost everything. They’re smarter than we are. They’re playing with real stakes. They understand more different things, they’re better at judging people, they’ve created better for the world in most cases, and so we should feel ashamed of ourselves if we sit down with venture capitalists.
[00:39:35] David: Yet they don’t win a Nobel Prize, and they can’t become call it historically famous or much less so. Obviously–
[00:39:41] Tyler: I think they will become historically famous.
[00:39:43] David: Do you?
[00:39:43] Tyler: Well, they already. Well, like Mike Moritz or Marc Andreessen or Sam Altman Y Combinator. I think they will go down in history as major figures of great import.
That is the theme of my latest Bloomberg column, here is one bit:
There is an asymmetry between male and female perceptions.
Most men are not abusers, yet very large numbers of women have been abused. So if a man is an abuser, there is a good chance he has abused a fair number of women.
That means many well-meaning men experience sexual abuse as a relatively rare phenomenon. They haven’t done it, and most of their male friends haven’t either. At the same time, most women have abuse, rape or #MeToo stories, and they experience these phenomena as relatively common and often life-altering. Probably they also have heard multiple such stories from their female friends. This structural asymmetry of perspectives is crucial to understanding the discourse and the often fundamental differences in opinion.
Our criminal justice system isn’t very good.
Whether you think Kavanaugh is innocent or guilty, we can all agree there are large numbers of intelligent people on both sides of the debate, and even after a week of intense national scrutiny there is no resolution. The reality is that ordinary accused people, who are basically presumed guilty by the criminal justice system, don’t receive very fair judgments. And if Kavanaugh is innocent, might we hope that this experience will make him more sympathetic to the plight of the unjustly imprisoned and accused?
But perhaps now we can move on to talking about the renegotiation of the trade agreement formerly known as NAFTA…
…led by Pat Bajari, Amazon has hired more than 150 Ph.D. economists in the past five years, making them the largest employer of tech economists. In fact, Amazon now has several times more full time economists than the largest academic economics department, and continues to grow at a rapid pace.
That is from the new Susan Athey and Michael Luca paper “Economists (and Economics) In Tech Companies.”
Negotiations for the preliminary agreement would be conducted under a new process, which the State Department, employing classic bureaucratic jargon, called “the selective nuclear-multilateral approach.” In preliminary discussions held in July 1945, the Canadians had proposed this method of negotiations led by a small group of influential nations — which effectively became the model for multilateral trade negotiations for the remainder of the twentieth century — as a compromise between the strictly bilateral approach, which had been favored politically by FDR and Cordell Hull, and the broader multilateral approach the British insisted upon. The Americans believed they were constricted by the requirements of the Reciprocal Trade Agreements Act specifically, and by political realities in Congress more generally, to negotiating bilaterally on select tariffs on an item-by-item basis.
That is from the new and highly useful and still under-discussed book The Wealth of a Nation: A History of Trade Politics in America, by C. Donald Johnson, Oxford University Press. I am happy to second Doug Irwin’s blurb: “This splendid book covers the politics of American trade policy from the country’s beginnings through Trump. Johnson provides a great overview of a fascinating subject.”
2. Commuting by bicycle in the U.S. is down since 2014. The post also considers why.
4. Eighth-graders can in fact contribute to science (short video on listeria).
Booking.com is making your Willy Wonka dreams come true with its new chocolate cottage (you read that right, chocolate) in Sèvres, France.
No, this isn’t simply a cottage filled with chocolate treats. Instead, it’s a cottage made entirely of the sweet stuff located at the glass house L’Orangerie Ephémère in the gardens of the Cité de la Céramique.
“Designed and manufactured by Jean-Luc Decluzeau, the renowned artisan chocolatier who specializes in chocolate sculptures, this unique, 18-square-meter chocolate cottage will be crafted out of approximately 1.5 tons of chocolate,” Booking.com shared in a statement.
In a post which is interesting more generally, Arnold Kling makes this point:
I think Tyler missed the important difference between taking identity into account and having someone appeal to their identity. I agree with Bryan that the latter is a negative signal. Opening with “Speaking as a ____” is a bullying tactic.
Many have had a similar response, but I figured I would save up that point for an independent blog post, rather than putting it in the original. Here are a few relevant points:
1. If someone opens with “Speaking as a transgender latinx labor activist…”, or something similar, perhaps that is somewhat artless, but most likely it is relevant information to me, at least for most of the topics which correlate with that kind of introduction. I am happy enough with direct communication of that information, and don’t quite get what a GMU blogger would object to in that regard. Does the speaker have to wait until paragraph seven before obliquely hinting at being transgender? Communicate the information in Straussian fashion?
2. Being relatively established, most of the pieces I write already give such an introduction to me, for instance a column by-line or a back cover photo and author description on a book. Less established people face the burden of having to introduce themselves, and yes that is hard to do well, hard for any of us. You might rationally infer that these people are indeed less established, and possibly also less accomplished, but the introduction itself should be seen in this light, not as an outright negative. It is most of all a signal that the person is somewhat “at sea” in establishment institutions and their concomitant introductions, framings, and presentations. Yes, that outsider status possibly can be a negative signal in some regards, but a GMU blogger or independent scholar (as Arnold is) should not regard that as a negative signal per se. At the margin, I’d like to see people pay more attention to smart but non-mainstream sources.
3. For many audiences, I don’t need an introduction at all, nor would Bryan or Arnold. That’s great of course for us. But again we are being parasitic on other social forces having introduced us already. Let’s not pretend we’re above this whole game, we are not, we just have it much easier. EconLog itself has a click space for “Blogger Bios,” though right now it is empty, perhaps out of respect for Bryan’s views. Or how about if you get someone to blurb your books for you?
4. I’ve noticed that, for whatever reasons, women in today’s world often feel less comfortable putting themselves forward in public spaces. In most (not all) areas they blog at much lower rates, and they are also less willing to ask for a salary increase, among other manifestations of the phenomenon. Often, in this kind of situation, you also will find group members who “overshoot” the target and pursue a strategy which is the opposite of excess reticence. I won’t name names, but haven’t you heard something like “Speaking as a feminist, Dionysian, child of the 1960s, Freudian, Catholic, pro-sex, pagan, libertarian polymath…”? Maybe that is a mistake of style and presentation and even reasoning, but the deeper understanding is to figure out better means of evaluating people who “transact” in the public sphere at higher cost, not simply to dismiss or downgrade them.
5. If someone like Bill Gates were testifying in front of Congress and claimed “Speaking as the former CEO of a major company, I can attest that immigration is very important to the American economy” we wouldn’t really object very much, would we? Wouldn’t it seem entirely appropriate? So why do we so often hold similar moves against those further away from the establishment?
How about “as a Mongolian sheep herder, let me tell you what kinds of grass they like to eat…”?
Then why not “As a transgender activist…”? You don’t necessarily have to agree with what follows, just recognize they might know more than average about the topic.
To sum up, appealing to one’s identity possibly can be a negative signal. But overall it should be viewed not as a reason to dismiss such speakers and writers, but rather a chance to obtain a deeper understanding.
The following is a series emails Vitalik Buterin and I [Glen] exchanged over the last day about RadicalxChange ideas. We thought the discussion might be useful to some as a) it covers a number of issues not discussed elsewhere that we consider important, b) it represents some of our latest thinking about these issues and c) it shows a bit of “the sausage being made” that some may find interesting. However, be aware that this is an internal communication and thus is at a pretty high level of specialization; there will be many parts that those not already well steeped in some combination of RadicalxChange ideas, economics, sociology, intellectual history, philosophy and cryptography may find hard to follow.
Here is the link. There are many excellent bits, here is one from Buterin:
Effect on centralization of physical power — one thing that scares me about more complex systems of property rights is that they would require more complex centralized infrastructure, including surveillance into people’s private activities, to be able to correctly enforce. Taxes already have this problem (you may recall Adam Smith believing that income taxes would be impossible because they would require an unacceptable level of intrusion into people’s private lives to enforce), and I wonder if the various proposals that we have for changing them would make things better or worse in this regard. I like Harberger taxes because they don’t require infrastructure to police whether or not undeclared transactions took place, though I worry in other cases, eg. your comment that your immigration proposal would require stronger enforcement of immigration rules, which realistically means stronger efforts to find and kick out people who overstay, which requires more surveillance of various kinds. All in all, I don’t think the radical markets ideas altogether fare that bad, but I guess my comment would be that non-panopticon-dependence should be an explicit desideratum to a greater degree than it is now.
Self-recommending…and which one of them do you think wrote this?:
The last couple of weeks talking to economists, sociologists and philosophers I have felt like they are hacking through a forest with pen knife and this perspective enables me to look from above (things still fuzzy) and have a crew of chainsaws at my command.
[Paul] McCartney was still wrestling with the comparison between the two bands [the Beatles and Wings]. A few months earlier he had commissioned veteran sci-fi author Isaac Asimov to write a screenplay. “He had the basic idea for the fantasy, which involved two sets of musical groups,” Asimov recalled, “a real one, and a group of extraterrestrial imposters. The real one would be in pursuit of the imposters and would eventually defeat them, despite the fact that the latter had supernormal powers.” Beyond that framework, McCartney offered Asimov nothing more than “a snatch of dialogue describing the moment when the group realised they were being victimised by imposters.” Asimov set to work and produced a screenplay that he called “suspenseful, realistic and moving.” But McCartney rejected it. As Asimov recalled, “He went back to his one scrap of dialogue out of which he apparently couldn’t move.”
That is from Peter Doggett’s excellent You Never Give Me Your Money: The Beatles After the Breakup.
3. “…greater variability is insufficient to explain male over-representation in STEM…the greatest difference in variability occurred in non-STEM subjects.”
I won’t do an extra indent, but this is all Glen, noting I added a link to the post of mine he referred to:
“Tyler, I hope all is well for you. I am writing to try to somewhat more coherently respond to our various exchanges, partly at the encouragement of Mark Lutter, whom I copy. As I understand it (but please correct me if I am wrong), you have two specific objections to the COST and QV and one general objection to the project of the book. If I have missed other things, please point me to them. Let me very briefly respond to these points:
- On the COST: you wrote (I cannot actually find the post at this point…not sure where it went) that human capital investments that are complementary with assets may be discouraged or otherwise prejudices by the COST. However, as we explain in the paper with Anthony (https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2744810), it has been known since at least Rogerson’s paper (https://academic.oup.com/restud/article-abstract/59/4/777/1542650) that VCG leads to first-best investment, including in human capital, as long as those investments are privately valued; we show that this property extends to the COST. You seem to focus on examples in your post where those human capital investments are privately valued. I thus do not see an economic efficiency objection to the COST on these grounds.
- On QV: you write (https://marginalrevolution.com/marginalrevolution/2015/01/my-thoughts-on-quadratic-voting-and-politics-as-education.html) that democracy is about far more than decision-making; it is about what people learn and are induced to learn through the democratic process. This is a deep and critical point and central to what Sen has called the “constitutive” role of democracy. And this objection has been lodged not just by you but, for example, by Danielle Allen. It is one I greatly respect and have struggled with. A fundamental problem here is that no one to my knowledge has managed to model this information acquisition process in a formal model in a way that allows comparison across systems; I have tried, but things get very messy very quickly. Nonetheless, I have not been able to understand the informal arguments that suggest this would be systematically worse under QV and there are several suggestive arguments that it would be better. For example, under QV people have the ability to specialize in certain areas of issue or candidate expertise, which in turn should allow for deeper education and for advertising campaigns targeted at those who actually know and care about an issue, rather than those who are hardly paying attention. Perhaps some would argue that this is a bug, not a feature, because we want every citizen to be informed about every issue; but this seems to be as implausible as suggesting that the division of labor degrades our ability to perform a variety of household tasks. For more on these, Eric and I have written several articles that discuss: https://www.vanderbiltlawreview.org/2015/03/voting-squared-quadratic-voting-in-democratic-politics/ [and] https://www.springerprofessional.de/en/public-choice-1-2-2017/12454020.
- There is a broader Burkean argument that you seem to be making, namely that these institutions are extremely different than those we have historically used and may well have very bad, unintended consequences. Here, I don’t think we disagree, but I think nonetheless there are at least two reasons I don’t see this as greatly diminishing the value of the ideas. First, all novel improvements, whether to technology or social institutions, must confront this objection. And they should confront it, I think, by experimenting at small scales and gradually scaling up and/or course-correcting as we learn about them. The questions are then a) does the innovation have enough promise to be worth experimenting with, b) is it so risky to experiment with at small scales even that this vitiates a) and c) does it seem like these experiments will teach us something about broader scale applicability. It seems to me that designs that so clearly address failures that economic theory we both accept says are very large, that are not just worked out in a narrow model but that we have studied from a range of not just economic but sociological and philosophical perspectives and which have caught the imagination of a broad set of entrepreneurs, activists and artists who are really interested in such experiments satisfies a). I don’t see any objections you or others have raised as raising significant concerns on b). And on c), it seems to me we will learn quite a lot from even relatively modest experiments (and already have) about the objections I hear most frequently (such as those related to collusion for QV or instability for the COST) that at very least will allow us to incrementally improve and scale a bit larger. So, it seems to me, the strong interest in experimenting with these ideas should be encouraged.
Finally, it seems to me that even if you remain convinced that there are unsurmountable practical difficulties with these mechanisms, that they play an important role in illustrating some pretty sharp divergences between what basic allocative efficiency calls for (and what the marginal revolutionaries like Jevons and Walras were quite explicit about their theories implying) and the outcomes we would expect to arise in the classic libertarian world. I think the liberal radicalism mechanism makes this sharpest. This seems instructive even if there is no way to remedy the limitations in these mechanisms because it suggests that the ideal toward which we should be steering societies using mechanisms that are not so dangerous are quite different than the ideal envisioned in standard libertarian theory. For example, the ideal would seem to involve a much greater role for a range of collective organizations at different community scales with some ability to receive tax-based support than standard libertarian theory would allow.
I am interested in your thoughts on these matters and continuing the exchange. Sorry for the length of this email, but I felt that I owed you a single, coherent and fairly detailed response.”