Category: Games

The Peltzman Effect in Children

David Ball, a professor of risk management at Middlesex University, analyzed U.K. injury statistics and found that as in the U.S., there was no clear trend over time. “The advent of all these special surfaces for playgrounds has contributed very little, if anything at all, to the safety of children,” he told me. Ball has found some evidence that long-bone injuries, which are far more common than head injuries, are actually increasing. The best theory for that is “risk compensation”—kids don’t worry as much about falling on rubber, so they’re not as careful, and end up hurting themselves more often.

From The Overprotected Kid by Hanna Rosin in the Atlantic.

Addendum: More on the Peltzman Effect.

Crimea through a game theory lens

That is my latest NYT column and you will find it here.  Here is one excerpt:

Long before Malcolm Gladwell popularized the concept [of tipping points], Mr. Schelling created an elegant model of tipping points in his groundbreaking work “Micromotives and Macrobehavior.” The theory applies to war, as well as to marketing, neighborhood segregation and other domestic issues. In this case, the idea of negotiated settlements to political conflicts may be fraying, and the trouble in Crimea may disturb it further, moving the world toward a very dangerous tipping point.

First, some background: With notable exceptions in the former Yugoslavia and in disputed territories in parts of Russia and places like Georgia, the shift to new governments after the breakup of the Soviet Union was mostly peaceful. Borders were redrawn in an orderly way, and political deals were made by leaders assessing their rational self-interest.

In a recent blog post, Jay Ulfelder, a political scientist, noted that for the last 25 years the world has seen less violent conflict than might have been expected, given local conditions. Lately, though, peaceful settlements have been harder to find. This change may just reflect random noise in the data, but a more disturbing alternative is that conflict is now more likely.

Why? The point from game theory is this: The more peacefully that disputes are resolved, the more that peaceful resolution is expected. That expectation, in turn, makes peace easier to achieve and maintain. But the reverse is also true: As peaceful settlement becomes less common, trust declines, international norms shift and conflict becomes more likely. So there is an unfavorable tipping point.

In the formal terminology of game theory, there are “multiple equilibria” (peaceful expectations versus expectations of conflict), and each event in a conflict raises the risk that peaceful situations can unravel. We’ve seen this periodically in history, as in the time leading up to World War I. There is a significant possibility that we are seeing a tipping point away from peaceful conflict resolution now.

Do read the whole thing.

More generally, here is a new edited volume on the economics of peace and conflict, edited by Stergios Skaperdas and Michelle Garfinkel.

And here is the new forthcoming Robert Kaplan book Asia’s Cauldron: The South China Sea and the End of a Stable Pacific.  I have pre-ordered it.

In with the new, out with the old [Il mio papa]

The 68-page Il Mio Papa (My Pope) will hit Italian newsstands on Ash Wednesday, offering a glossy medley of papal pronouncements and photographs, along with peeks into his personal life. Each weekly issue will also include a pullout centerfold of the pope, accompanied by a quote.

“It’s a sort of fanzine, but of course it can’t be like something you’d do for One Direction,” the popular boy band, said the magazine’s editor, Aldo Vitali. “We aim to be more respectful, more noble.”

There is more here.  It will sell for fifty cents, but there are intellectual property issues:

“Various magazines publish the pope’s teachings, but they have an accord with us,” said the Rev. Giuseppe Costa, the director of the Libreria Editrice Vaticana. A similar accord has not been signed with My Pope, he added, though the magazine should have known better “because we have a relationship with Mondadori.”

“In the case they publish the pope’s words, I will have to intervene,” Father Costa said.

Meanwhile, on the other side of the ledger:

Former Pope Benedict, in one of the few times he has broken his silence since stepping down nearly a year ago, has branded as “absurd” fresh media speculation that he was forced to quit.

And his world of scarcity continues:

Libero also suggested that Benedict chose to continue to wear white because he still felt like he was a pope.

Benedict, who lives in near-total isolation inside a former convent on the Vatican grounds, was also asked about this and responded:

“I continue to wear a white cassock and kept the name Benedict for purely practical reasons. At the moment of my resignation there were no other cloths available.

Money, Status, and the Ovulatory Cycle (politically incorrect paper of the month)

That is a new research paper by Kristina M. Durante, Vladas Griskevicius, Stephanie M. Cantú , and Jeffry A. Simpson, and the abstract is here:

Each month, millions of women experience an ovulatory cycle that regulates fertility. Previous consumer research has found that this cycle influences women’s clothing and food preferences. The authors propose that the ovulatory cycle actually has a much broader effect on women’s economic behavior. Drawing on theory in evolutionary psychology, the authors hypothesize that the week-long period near ovulation should boost women’s desire for relative status, which should alter their economic decisions. Findings from three studies show that women near ovulation seek positional goods to improve their social standing. Additional findings reveal that ovulation leads women to pursue positional goods when doing so improves relative standing compared with other women but not compared with men. When playing the dictator game, for example, ovulating women gave smaller offers to a female partner but not to a male partner. Overall, women’s monthly hormonal fluctuations seem to have a substantial effect on consumer behavior by systematically altering their positional concerns, a finding that has important implications for marketers, consumers, and researchers.

Here is some popular coverage of the piece.  For the pointer I thank C.

Tennis quant betting

For someone who says he bets millions of dollars on tennis a year, sports gambler Elihu Feustel doesn’t watch many matches.

“Which one is Granollers?” Feustel says, referring to Marcel Granollers, a Spaniard ranked 35th in the world. “Is he the one that’s good on clay courts?”

Feustel, from South Bend, Indiana, says he doesn’t need to pay attention to who the players on the men’s ATP World Tour are to double his money. He relies on an algorithm he created using data from 260,000 matches to make about 30 bets a day on Grand Slams such as the Australian Open, which started Jan. 13.

Gamblers and investment funds are increasingly vying for profits from tennis by using computer models to win money from more casual bettors, according to Scott Ferguson, a former Betfair Group Plc (BET) education officer. Such quantitative analysts, or so-called quants, are focusing on tennis in the same way their counterparts are employed by hedge funds to predict moves for stocks, bonds and other assets.

Betfair, a London-based company that enables bettors to wager against each other online, matched almost 50 million pounds ($82 million) of bets on the 2012 final in which Novak Djokovic beat Rafael Nadal. Djokovic is an 8-11 favorite to win a fourth straight title in Melbourne with U.K. bookmaker William Hill Plc, meaning a successful $11 wager would return $8 plus the original stake.

Granollers prefers clay courts, according to his men’s tour profile, and lost his first-round match with Marin Cilic of Croatia in five sets on the second day of play on the hard courts of this year’s Australian Open.

…Tennis is an “attractive” sport to create an algorithm for because there are only two players in a singles match and statistics are freely available, according to William Knottenbelt, an associate professor of computing at London’s Imperial College. He co-wrote a tennis algorithm that he says would have made a 3.8 percent return on bets on 2,173 ATP matches in 2011.

Feustel, who says he puts in a 60-hour week checking and improving his model, works with a computer programmer and trader. The programmer trawls the Internet for data such as serve speed and break-point conversions. That’s plugged into the model which comes up with “fair” betting prices for scheduled games.

If those odds diverge from market prices, Feustel says, his trader — who lives outside the U.S. — will gamble as much as the market will allow at bookmakers including Pinnacle Sports, based on the Caribbean island of Curacao. That can be about $30,000 on a match result in later tournament rounds.

There is more here, and for the pointer I thank Hugo Lindgren, who is joining Hollywood Reporter as acting editor.

The strongest Freestyle chess tournament since 2008

InfinityChess is pleased to announce a super strong Freestyle Tournament starting on February 4, 2014.  It’s a round robin for 30 of the best freestyle and engine players from all over the world. The total prize money is $ 20,000 USD.

There is more information here, and note that these are likely to prove the best chess games played — ever — as well as a notable contribution to the science and data of man-machine interaction.

By the way, is there anyone who can donate temporary use of a leading edge server for remote use, 12-32 cores?  Please email me if you can, thanks in advance, and credit (or anonymity) for you can be arranged if desired.

Given the suddenly prominent role of Freestyle chess in economics, Big Data, and the social sciences (see also The Second Machine Age), I hope this event receives some of the media attention which it deserves.

Triply stupid policies

Doubly stupid policies are pretty common, but here is a triply stupid one:

Unique to racino legislation is the allocation of a statutorily set percentage of gaming revenue to purses to support racing and breeding operations in the state.

So what are the three layers of stupidity here?  First, there shouldn’t, as a special legal category, be racinos (that’s casino-style gaming at racetracks).  Second, this legislation is a response to competition from state lotteries, which in general I do not favor.  Third, the money from a dubious policy should not be spent “to support racing and breeding operations in the state.”  Those operations can pay their own way: how about spending the money on poor people, rather than on sectors which extract money from a disproportionately lower income clientele?  Or spending money on animal welfare without at the same time having to subsidize a “legally privileged against competitors” commercial sector?

So what is the background here?

A key theme of the enabling legislation in most states permitting casino-style gaming at racetracks [i.e., racinos] is preservation of the racehorse and greyhound racing and breeding industries in light of competition from other forms of gaming, such as state lotteries and casinos.

In other words, the racinos receive special legal exemptions to help the racetracks compete with state lotteries.  (Why not opt for the simpler solution of no state lottery in the first place?  Or some other notion of a regulatory level playing field?  Oh, how my brain HURTS to ponder how this “problem” arose in the first place.)  But it gets worse.  Often “racino gaming devices” are placed under the state lottery’s regulatory authority.  (Note to self: when attempting to protect B against competitive ravages from A, do not appoint A as regulatory overseer of B.)

So might we have a quadruply stupid policy here?

But wait, on second thought government lotteries, while I do not favor them, perhaps should not be described as “stupid” policies, since there are some reasonable albeit in my view misguided arguments on their behalf.   So maybe we are just back to triply stupid after all, I am not sure.

That is all from Richard Thalheimer’s “The Economics of Racetrack-Casino (Racino) Gambling,” from The Oxford Handbook of the Economics of Gambling, edited by Leighton Vaughan Williams and Donald S. Siegel.

Dear readers, can you think of examples of triply or even quadruply stupid laws and policies?

Sentences to ponder…

Notably, easy-to-reach women are happier than easy-to-reach men, but hard-to-reach men are happier than hard-to-reach women, and conclusions of a survey could reverse with more attempted calls.

That is Ori Heffetz and Matthew Rabin, in the new AER.  An ungated version is here.  Understandably, the authors are worried about potential subject selection biases in studies of self-reported happiness.

The Betrayers Banquet

Here is something for you to try out tomorrow with the family, well some families. The Betrayers’ Banquet is a dinner party/event that ingeniously combines the iterated prisoner’s dilemma with good food, bad food and entertainment. Here is their description:

The event works as follows:

A banqueting table is set with 48 chairs, 24 on each side, at which players are seated at random. For a period of two hours, the food is served in small portions every fifteen minutes, and varies in quality; at the top end of the table, it is exquisite – food you could expect at a fancy restaurant. At the bottom end, the food is charitably described as unpalatable. In between, it is a spectrum between these two extremes.

At regular intervals, pairs of opposing diners are invited to play a round of the prisoner’s dilemma with each other; They are each provided with a small wooden coin with symbols on each side representing cooperation and betrayal, which they place on the table concealed under their palms, and then simultaneously reveal:

  •  If they both cooperate, then they are both moved up five seats towards the good food.
  •  If they both betray, they are both moved five seats down towards the worse food.
  •  If one betrays and one cooperates, the betrayer moves up ten seats, and other down ten seats.

The event is presented as an initiation ritual of a freemason–esque secret society; service is run by servers in hooded robes and the game is arbitrated by a dour, unsympathetic master of ceremony, who punctuate the courses with grave speeches describing the discovery of the game in the court of Charlemagne in the eighth century.

From the participant’s point of view, aside from getting to play a game and try a variety of different foods, the main attraction is that they get to move around the table and talk to a variety of people throughout dinner. The iterated prisoner’s dilemma is famous for creating very complex social dynamics, which keeps conversation lively and generates a high eagerness to continue playing.

But is he on time for low status people?

Being 50 minutes late for his first meeting with Pope Francis was nothing unusual for Russian President Vladimir Putin. That’s just the way he is — a character trait that provides some insight into his attitude toward power.

When Putin arrived on time to an audience with Pope John Paul II in 2003, the punctuality was considered a newsworthy aberration: “The President Was Not Even a Second Late,” read the headline in the newspaper Izvestia. He had been 15 minutes late for a similar audience in 2000.

The waits other leaders have had to endure in order to see Putin range from 14 minutes for the Queen of England to three hours for Yulia Tymoshenko, the former Ukrainian prime minister. Few people are as important in terms of protocol as the queen or the pope, and there is no country Putin likes to humiliate as much as Ukraine.

The typical delay seems to be about 30 minutes. Half an hour is enough in some cultures to make people mad. Koreans saw Putin’s 30-minute lateness for a meeting with their President Park Geun Hye as a sign of disrespect.

Everybody endures the wait, though.

There is more here, hat tip to Elizabeth Dickinson.

A future service sector job?

Jason Kottke suggests:

I could imagine Glass Concierge becoming a future job title, basically a personal assistant who looks in on your Google Glass video feed to make helpful suggestions and advice, basically a rally co-driver for your life.

Most of the post is about using Google Glass to cheat at poker.  In response to inquiries, I will review the product once I can get one.

Nettlesomeness, and the first half of the Carlsen-Anand match

After six games, Carlsen leads by two points, with four draws added to the tally.  Anand seems hell bent on founding a campaign to abolish the advantages of playing with the white pieces.

I find two aspects of the match notable so far.  First, in the last two endgames Carlsen has been outplaying the computer programs (and Anand), sometimes for dozens of moves in a row.  That isn’t easy, to say the least.  And kudos to Alan Turing for realizing early on, in his 1953 paper, that chess-playing computer programs would face special difficulties in understanding some endgames.  The sequences required to establish the importance (or not) of a measurable material advantage can stretch beyond the time horizon of the program, for instance, and the endgame tablebases take us only so far.

Second, Carlsen is demonstrating one of his most feared qualities, namely his “nettlesomeness,” to use a term coined for this purpose by Ken Regan.  Using computer analysis, you can measure which players do the most to cause their opponents to make mistakes.  Carlsen has the highest nettlesomeness score by this metric, because his creative moves pressure the other player and open up a lot of room for mistakes.  In contrast, a player such as Kramnik plays a high percentage of very accurate moves, and of course he is very strong, but those moves are in some way calmer and they are less likely to induce mistakes in response.

Nettlesomeness is an underrated concept in our world, and kudos to Ken for bringing it to our attention.  It should play a larger role in formal game theory than it does currently.  It’s already playing a decisive role in the world of chess.

Addendum: Here are some of Ken’s metrics for “nettlesomeness.”

IBM’s Watson will be made available in a more powerful form on the internet

Companies, academics and individual software developers will be able to use it at a small fraction of the previous cost, drawing on IBM’s specialists in fields like computational linguistics to build machines that can interpret complex data and better interact with humans.

That is a big deal, obviously.  The story is here.

“Nobody dislikes currency inflation more than strippers”

The link to the associated cartoon with that caption is here, from Tim Harford’s Twitter feed.

But is that claim true?  It depends on the margin.  Let’s say the standard tip is a dollar, and price inflation lowers the real value of that dollar.  A lot of customers won’t substitute into stuffing $1.43 into the stripper’s garments.  They might do two or three singles, but strippers will be shortchanged at various points going up the price pole.  There is something about handing out a single bill that is easier and more transparent, or so it seems.

Say inflation gets high, or runs on for a long time for a large cumulative effect.  At some point the customers switch to giving $5 bills.

Does it help strippers if the Fed issues lots of $2 bills?  Well, the leap up to the larger tip comes more quickly, but the customers also stay at the $2 tip level a long time before moving up to $5.

At some margins inflation is bad for current strippers, but good for some set of future strippers.  If the economy is close to the margin where individuals upgrade from a $1 tip to a $5 tip, then inflation is good for current strippers but bad for future strippers (for a while).

The answer also may depend on whether the Fed adjusts the ratio of $5 to $1 bills to keep in proper synch with the stripper customers.  If the Fed doesn’t increase the supply of fivers rapidly enough, future strippers may not get their deserved payoffs for a long time.

Let’s explore this assumption that handing out a single bill of a given kind is easier (admittedly there may be other ways to specify the assumptions).  And let’s assume that overpaying some strippers and underpaying others is less efficient for some reason, whether Benthamite or having to do with the unevenness of medium-run supply elasticities.

In that case tips may be more efficient, with ongoing inflation, at the $5 level than the $1 level.  Given that two dollar notes are rare, the step up from a one to a five involves a fivefold increase.  But the step up from a five to a ten is only a twofold increase, as is the step up from a ten to a twenty.  Even the switch from twenties to fifties involves a smaller multiple than from a one to a five.  So there are fewer problems with the non-convexities within the 5-10-20-50 range than within the 1-5 range.

Perhaps the sooner we get the strippers away from “the ones” the better — who needs those non-convexities?  Strippers sure don’t.

On the whole, therefore, strippers may prefer price inflation.  Of course once the $100 bill is the standard tip, the next notch upwards is again hard to come by, outside of the eurozone that is.