Saturday assorted links
1. “”Globally more and more men and women are stepping away from clinical (medical) sperm donation environments and choosing to find each other through online connection websites such as the UK-based PrideAngel through which we conducted our study,” said Mr Whyte, from the QUT Business School.” Link here.
2. Does linguistic bias limit English-speaking investment into Quebec?
3. Have I mentioned that Sixthtone.com is a great place to read about China? And on Twitter.
The limits of refrigerator privacy?
It seems we never quite reach them:
Walmart is testing a service that delivers groceries straight to your fridge when you’re not home.
On Friday, the retail giant announced a partnership with August Home, a smart-lock startup, that would allow a delivery person to enter customers’ orders and put groceries away in their refrigerators…
Delivery drivers will have a one-time passcode that allows them to unlock the August smart lock if customers do not answer the door when the delivery team arrives to drop off groceries. They will then drop off packages in the foyer, unload groceries in the fridge, and leave — with the door locking behind them.
Customers get a notification when the driver rings the doorbell. August home-security cameras allow them to watch the entire process from the app if they wish.
Here is the story, via Peter Metrinko.
Is there a Rawlsian argument for redistribution as a form of social insurance?
Here is one presentation of such an argument, but keep in mind these points:
1. The strongest argument for redistribution is when redistribution boosts economic growth and benefits all or most of society. That is by no means always the case, but it is sometimes true and of course it is not a Rawlsian argument.
2. The second strongest argument for redistribution is that it is sometimes intrinsically better if a poor, needy person has a resource, as opposed to a wealthier person having that same resource. That is in fact what most people think, no matter what argument they give you.
3. As we’ll see, the Rawlsian argument is parasitic upon #2, so why not use #2 directly? Admittedly, #2 is a difficult conclusion to establish in a scientific manner, but the Rawlsian gloss, upon examination, makes it weaker not stronger. It does however make the argument look a) more academic, and b) apparently more in line with neoclassical economic modes of thinking.
4. Most political philosophers, or indeed most philosophers, are not Rawlsians, even if they have been influenced by Rawls, which is frequently the case. So why should you, if you’re an economist, be a Rawlsian? Is it that you read Rawls and the critics, sided with Rawls, and then sat down to derive its implications? Or did you find it a convenient rationalization for something you already believed or wanted to believe?
4b. Rawls is almost always invoked selectively, rarely being applied across national borders or across the generations, cases where it yields screwy results. Rawls himself hesitated to approve of economic growth, because it does not maximize the well-being of the original “worst off” generation, which of course has to do some saving. He had sympathies with the idea of Mill’s stationary state. It’s fine to reject those conclusions, as indeed you should, but again maybe you’re not really a Rawlsian. You are a selective Rawlsian, if that.
4c. Most people — rightly I might add — believe just as much in redistribution or maybe more when the position of the unfortunates is certain in advance. How many times have you heard social immobility cited as a problem that requires redistribution for its solution? That argument is fine on its own terms, but again we’re back to #2. The funny thing about econo-Rawlsians is that they want to cite the uncertainty of the wealth distribution as a reason for redistribution, and then they wish to turn around and cite the certainty of the wealth distribution as yet another reason for redistribution!
Yes, maybe you can apply a Rawlsian transform to those situations with certain allocations, using a “…but*if* these people were all behind a veil of ignorance…” But look, a Rawlsian transform is appropriate with only some probability, so if you adhered to Rawls as the “most likely correct moral theory,” you still in these cases of certain distributions ought to believe in less redistribution. But that is not how people’s opinions are structured, nor is it how they should be structured, so in other words again we are not really Rawlsians but rather again motivated by #2.
5. When it comes to redistribution as social insurance, the biggest problems with the Rawlsian method is this. People have all sorts of preferences across the distribution of income. Some are merit-related, some liberty-related, some non-Rawlsian-fairness related, some insurance-related, maybe even some rooted in prejudice. The list of motives and reasons is long. As the veil is typically used by economists, it strips away all of those preferences but…the preference for insurance. So it is no wonder that the final construct produces an argument for insurance. You get out of the construct what you put into it.
6. If you already believe in #2, #5 won’t bother you much. But #2 is doing the real work here.
7. Almost everyone stops applying #2 at some point or margin. For instance, do you always and everywhere favor boosting the scope of the Obamacare mandate? It would save lives. If you don’t favor increasing the mandate, are you a despicable killer? In fact what I observe is people taking the status quo, and its current political debates, as a benchmark of sorts, and choosing sides, yet without outlining the “stopping principles” for their own recommendations. That’s a pretty sure sign a person is not thinking about the issues clearly.
8. Even #2, which I think of as a kind of “brute egalitarianism,” isn’t as straightforward as you might think. We do not always apply it to people in other countries, wealthy people who are poor in net terms because they are about to die, ugly men who cannot get sex, and many of the disabled. Just about everyone is more of a particularist, situation-based egalitarian than they like to let on.
In sum, the arguments for (some limited) redistribution are stronger than the arguments for Rawls.
London’s Uber ban is a big Brexit mistake
That is the title given to my latest Bloomberg column. Excerpt:
The new Britain appears to be a nationalistic, job-protecting, quasi-mercantilist entity, as evidenced by the desire to preserve the work and pay of London’s traditional cabbies. That’s hardly the right signal to send to a world considering new trade deals or possibly foreign investment in the U.K. Uber, of course, is an American company, and it did sink capital into setting up in London — and its reputational capital is on the line in what is still Europe’s most economically important city. This kind of slap in the face won’t exactly encourage other market entrants, including in the dynamic tech sector that London so desperately seeking.
I should note that I prefer London cabs, because of their higher quality service, noting that the people most hurt by this ban are from lower-income groups.
Friday assorted links
2. Ramesh defends Graham-Cassidy.
3. The most disturbing pieces of music ever? What about Bernd Alois Zimmerman?
4. Markets in everything (OMG)
5. “Hapaxes are not limited to Latin.”
Winners and losers under Graham-Cassidy
…the greatest winners in 2026 would be Mississippi and Kansas, where federal health-care funding would more than triple and double, respectively. On the other hand, Connecticut’s aid would be cut by just over half.
And:
…the Kaiser Family Foundation…concluded that 35 states would lose $160 billion under the bill. The Kaiser study, like two earlier this week, looked at the cumulative effect from 2020 to 2026.
Here is the Amy Goldstein and Juliet Eilperin piece at WaPo.
Brazil fact of the day
Brazil, for example, has only 1/14th the number of guns per person that the U.S. does, but many more murders.
That is from Noah Smith, mostly about how to reduce crime.
Slower turnover for songs and movies
From my email:
Hi, Mr. Cowen. I recently read The Complacent Class recently and enjoyed it. I’m writing because there’s an another example of American complacency that’s only come to light in recent weeks…
Specifically: the Billboard music charts..
Shape of You by Ed Sheeran last week broke the record for most weeks in top 10, with 33 weeks. The song it beat, Closer by The Chainsmokers and Halsey, set the previous record less than a year ago. http://www.billboard.com/articles/columns/chart-beat/7948959/ed-sheeran-shape-of-you-record-most-weeks-top-ten
(And yet another song in last week’s top 10, That’s What I Like by Bruno Mars, currently holds the 8th-longest record on that metric — and potentially still rising.)
Meanwhile, Despacito by Luis Fonsi, Daddy Yankee, and Justin Bieber tied the all-time record with its 16th week at #1: http://www.billboard.com/biz/articles/news/record-labels/7942315/luis-fonsi-daddy-yankee-justin-biebers-despacito-ties-for
Meanwhile, the biggest country song in the nation right now, Body Like a Back Road by Sam Hunt, is currently in its record-extending 30th week at #1 on the Hot Country Songs chart: http://www.billboard.com/files/pdfs/country_update_0905.pdf
This did not happen in decades past. Look at the Billboard charts from the ’80s — it was a new #1 song almost every week! https://en.wikipedia.org/wiki/List_of_Billboard_Hot_100_number-one_singles_of_the_1980s
Just like how you describe in your book how people are moving less and want to stay in the same town where they were before, or how they’re switching jobs less and want to stay in the same job where they were before, people apparently just want to listen to the same songs they’ve been listening to already.
That is from Jesse Rifkin, who is a journalist in Washington, D.C. who writes about Congress for GovTrack Insider and about the film industry for Boxoffice Magazine. Jesse sends along more:
And if you want links for statistical evidence, here are two — one about which movies have spent the most weekends in the box office top 10, the other about which songs have spent the most weeks in the Billboard top 10:
What should I ask Doug Irwin?
I will be doing a Conversation with Doug in early October, although with no associated public event, just a later podcast and transcript. Here is Wikipedia on Doug:
Douglas Irwin is the John Sloan Dickey Third Century Professor in the Social Sciences in the Economics Department at Dartmouth College and the author of seven books. He is an expert in both past and present U.S. trade policy, especially policy during the Great Depression. He is frequently sought by media outlets such as The Economist and Wall Street Journal to provide comment and his opinion on current events.[1][2]
Prior to Dartmouth, Irwin was an Associate Professor of Business Economics at the University of Chicago Graduate School of Business, an economist for the Board of Governors of the Federal Reserve System, and an economist for the Council of Economic Advisers Executive Office of the President.
Doug has a very exciting new book on the history of trade coming out, which I covered here. Here is Doug on Twitter. Here is Doug’s recent WSJ Op-Ed on Steve Bannon, trade, and the history of America’s greatness.
So what should I ask Doug? Your grace and wisdom are always appreciated and never in short supply.
Thursday assorted links
1. Why Catalan separatism will fail.
3. Jacob Levy on black liberty.
4. “We are purchasing sovereignty from a government to create the world’s first Free Society.”
5. The German elections are not boring.
6. Acclaimed French chef asks to be stripped of Michelin stars.
As is sometimes the case, today’s links spell out somewhat of a sequential story, offering commentary on each other.
Greg Clark visits Australia and finds high rates of status persistence
The co-authors on this paper (pdf) are Andrew Leigh and Mike Pottenger, here is the abstract:
The paper estimates long run social mobility in Australia 1870–2017 tracking the status of rare surnames. The status information includes occupations from electoral rolls 1903–1980, and records of degrees awarded by Melbourne and Sydney universities 1852–2017. Status persistence was strong throughout, with an intergenerational correlation of 0.7–0.8, and no change over time. Notwithstanding egalitarian norms, high immigration and a well-targeted social safety net, Australian long-run social mobility rates are low. Despite evidence on conventional measures that Australia has higher rates of social mobility than the UK or USA (Mendolia and Siminski, 2016), status persistence for surnames is as high as that in England or the USA. Mobility rates are also just as low if we look just at mobility within descendants of UK immigrants, so ethnic effects explain none of the immobility.
Social mobility is indeed difficult to pull off. Hat tip goes to Ben Southwood.
Accurate genomic prediction of human height
They used to say this couldn’t be done:
We construct genomic predictors for heritable and extremely complex human quantitative traits (height, heel bone density, and educational attainment) using modern methods in high dimensional statistics (i.e., machine learning). Replication tests show that these predictors capture, respectively, ~40, 20, and 9 percent of total variance for the three traits. For example, predicted heights correlate ~0.65 with actual height; actual heights of most individuals in validation samples are within a few cm of the prediction. The variance captured for height is comparable to the estimated SNP heritability from GCTA (GREML) analysis, and seems to be close to its asymptotic value (i.e., as sample size goes to infinity), suggesting that we have captured most of the heritability for the SNPs used. Thus, our results resolve the common SNP portion of the “missing heritability” problem – i.e., the gap between prediction R-squared and SNP heritability. The ~20k activated SNPs in our height predictor reveal the genetic architecture of human height, at least for common SNPs. Our primary dataset is the UK Biobank cohort, comprised of almost 500k individual genotypes with multiple phenotypes. We also use other datasets and SNPs found in earlier GWAS for out-of-sample validation of our results.
While I don’t find “within a few centimeters” to be especially impressive, the question is still “what’s next?”
The authors on the paper are
Wednesday assorted links
2. Should Australian universities partner with the Chinese?
3. Does being colonized make a nation richer?
4. MIE: Go see Moana in Maori (NYT).
5. Did the gold standard bring lower volatility?
6. Like David Brooks, I enjoyed Eli J. Finkel’s The All-or-Nothing Marriage.
Facebook’s harm is taking life out of context
That is the theme and title of my latest Bloomberg column.
My Conversation with Larry Summers
Larry was in superb form, and we talked about mentoring, innovation in higher education, monopoly in the American economy, the optimal rate of capital income taxation, philanthropy, Hermann Melville, the benefits of labor unions, Mexico, Russia, and China, Fed undershooting on the inflation target, and Larry’s table tennis adventure in the summer Jewish Olympics. Here is the podcast, video, and transcript.
Here is one excerpt:
SUMMERS: Second, the VIX — people tend to underappreciate this. The volatility of the market moves very much with the level of the market. The reason is that if a company has $100 of debt and $100 of equity, and then the stock market goes up, it’s 50/50 levered.
If the stock market goes up by $100, then it has $100 of debt and $200 of equity and it’s only one-third levered. So when the stock market goes up, its volatility naturally goes down. And the stock market has gone way up over the last 10 months. That’s a factor operating to make its volatility go significantly down.
It’s also the case if you look at surprises. The magnitude of errors in the consensus estimates of company profits or the consensus estimates of industrial production or what have you, numbers have been coming in close to consensus to an unusual degree over the last few months.
I think all those things contribute to the relatively low level of the VIX, but those are more in the way of ex post explanations. If you had told me everything that was going on in the world and asked me to guess where the VIX would be, I would expect it to have been a little higher than it is right now.
And:
COWEN: If there’s an ongoing demand shortfall, as is suggested by many secular stagnation approaches, does that mean monopoly cannot be a major economic problem because that’s from the supply side, and that the supply side constraint isn’t really binding if you think of there as being multiple Lagrangians. Forgive me for getting technical for a moment. Do you see what I’m saying?
SUMMERS: That wouldn’t have been the way I’d have thought about it, Tyler, but what you’re saying might be right. I think I’d be inclined to say that, if there’s more monopoly, there’s more money going to monopoly firms where there’s a low propensity to spend it, both because the firms don’t invest and because the owners of the firms tend to be rich or endowments that have a low propensity to spend.
So the greater monopoly power, to the extent that it exists, is one factor operating to raise savings and reduce investment which contributes to demand shortfalls and secular stagnation.
I also think that there’s likely to be less entry in competition in markets that aren’t growing rapidly than there is in markets that are growing rapidly. There’s a sense in which less demand over time creates its own lack of supply.
And:
COWEN: What mental qualities make for a good table tennis player?
SUMMERS: Judging by my performance, qualities that I do not possess.
[laughter]
SUMMERS: I think a deft wrist, a certain capacity for concentration, and a great deal of practice. While I practiced intensely in the run-up to the activity, there were other participants who had been practicing intensely for decades. And that gave them a substantial advantage.
Recommended!
If you think you know someone who is very smart, Larry is almost certainly smarter.