Category: Games
The economics of Lego (investment markets in everything)
Here is one excerpt from a lengthy and data-intensive post, which likely offers more than you ever would wish to know:
The internet can be blamed for the size and scope of the secondary LEGO market. On the website, BrickLink, you can find almost any set that LEGO has ever produced. In addition, the site keeps records of trends in the market and value of individual pieces. This site is invaluable to a LEGO collector and has given many the ability to grow their collections. Before the advent of this site and sites like eBay, collecting LEGO required going to garage sales. There are now whole sites dedicated to buying LEGO as an investment, but that is a topic for another article.
This creation and expansion of the secondary market in conjunction with LEGO now marketing some of their products to an older audience has made the prices of some old sets increase exponentially. On the extreme range, there is the UCS Millennium Falcon that is selling new for upwards of $2,000 (and close to $1,500 USED!). It sold for $500 new in 2007. Even non-licensed sets can run a premium, such as the Cafe Corner that was one of the original modular buildings. It was $150 new and now it can sell for over $1,000.
For pointers I thank Michael Rosenwald and Kevin Won.
The best at what they do
When you look at a competition where one of the inputs of the production function is an exogenously distributed characteristic, players with a high endowment on that dimension have a head start. This has two effects on the distribution of the (partially) acquired characteristics that enter the production function. First, there is the pure statistical effect I alluded to above. If success requires some minimum height then the pool of competitors excludes a large component of the population.
There is a second effect on endogenous acquisition of skills. Competition is less intense and they have less incentive to acquire skills in order to be competitive. So even current NBA players are less talented than they would be if competition was less exclusive. So what are the sports whose athletes are the best at what they do?
My ranking
1. Table Tennis
2. Soccer
3. Tennis
4. Golf
5. Chess
How would such a ranking look for the social sciences? Among a broader list of activities, where would blogging fall on the scale?
Questions which are rarely asked
All Scrabble players know that Q and Z are the highest scoring tiles. You can get 10 points for each, in the English language version of the game.
But according to one American researcher, Z really only deserves six points.
And it’s not just Z that’s under fire. After 75 years of Scrabble, some argue that the current tile values are out of date as certain letters have become more common than they used to be.
“The dictionary of legal words in Scrabble has changed,” says Joshua Lewis, researcher and creator of a software programme which allocates new, up-to-date values to Scrabble tiles.
“Among the notable additions are all of these short words which make it easier to play Z, Q and X, so even though Q and Z are the highest value letters in Scrabble, they are now much easier to play.”
Here are some details on the reforms:
According to Lewis’s system, X (worth eight points in the current game) is worth only five points and Z (worth 10 points now) is worth six points.
Other letter values change too, but less radically. For example, U (one point currently) is worth two in the new version, G (two points) becomes three and M (three points) becomes two.
Here is more, via @timharford, and here is further information.
Defenses of the platinum coin
You will find Krugman’s here, and here are comments from a former head of the U.S. Mint.
In which countries is crude libertarianism most and least true?
For least true, I nominate South Korea. Other than comparing it to North Korea, how much do you hear libertarians claiming South Korean policies as their own? It seems the government there did a lot and mostly it paid off. The best the libertarian can manage is something like “their economy would have grown rapidly in any case,” and that may not even be true.
For “most true” you might say North Korea, but that is too easy a pick. How about India? Government there has done lots but most of it has worked out quite badly, whereas their deregulations generally have gone well (see our India unit on MRUniversity.com). Further deregulation of the economy would likely be a good idea.
Singapore can be claimed for either category.
In which country is Marxism most true (“least untrue?”)? Least true? How about other ideologies?
Measuring the distribution of spitefulness
There is a new paper by Erik Kimbrough and J. Philipp Reiss, of importance for my world view:
Spiteful, antisocial behavior may undermine the moral and institutional fabric of society, producing disorder, fear, and mistrust. Previous research demonstrates the willingness of individuals to harm others, but little is understood about how far people are willing to go in being spiteful (relative to how far they could have gone) or their consistency in spitefulness across repeated trials. Our experiment is the first to provide individuals with repeated opportunities to spitefully harm anonymous others when the decision entails zero cost to the spiter and cannot be observed as such by the object of spite. This method reveals that the majority of individuals exhibit consistent (non-)spitefulness over time and that the distribution of spitefulness is bipolar: when choosing whether to be spiteful, most individuals either avoid spite altogether or impose the maximum possible harm on their unwitting victims.
I put Bryan Caplan on the “least spiteful” side of the distribution.
For the pointer I thank (the non-spiteful) Michelle Dawson.
How to Win at Poker
On April 15, 2011, a day that has been dubbed “Black Friday” in the poker community, the DOJ shut down the American operations of three major sites: PokerStars, Full Tilt Poker, and Ultimate Bet.
Michael Kaplan has an update on the story:
In January of this year, Full Tilt and the DOJ worked out an arrangement in which the DOJ took ownership of Full Tilt with the intention of selling it to raise funds to pay back American players. Seven months later, on July 31, PokerStars purchased Full Tilt from the DOJ. Businessweek estimated that the transaction would make $547 million for the U.S. government. At the time, the DOJ vowed to reimburse Full Tilt’s U.S. players; Stars said that it would take responsibility for returning $184 million to non-American customers.
PokerStars followed through on its end of the deal and recently relaunched the Full Tilt site outside of the U.S.
So has the DOJ paid the U.S. players? Of course not.
According to Steven L. Kessler, an attorney based in New York City who specializes in forfeiture law…“In one of its publications [the ‘National Asset Forfeiture Strategic Plan 2008–2012’], the government talks about bringing in $2 billion in forfeitures and returning only $700 million.” Recouping Full Tilt funds will be “a long, drawn-out process to the point that you will need to be out five or six or seven figures for it to be worth pursuing. The system is set up so that you are discouraged from going after your money….Plus, look at what you’re exposing to get back what belongs to you. You have to wonder if it will turn into a tax case.”
In other words, as in other asset forfeiture cases, the government is grabbing up property and keeping as much as it can for its own coffers. Even if some of these sites were fraudulent, one wonders if the players would not have better off without government “protection.”
The full article also includes a good markets in everything item.
Hat tip: Ben Mathis-Lilley.
A simple model of lifetime happiness
Suppose that what makes a person happy is when their fortunes exceed expectations by a discrete amount (and that falling short of expectations is what makes you unhappy.) Then simply because of convergence of expectations:
- People will have few really happy phases in their lives.
- Indeed even if you lived forever you would have only finitely many spells of happiness.
- Most of the happy moments will come when you are young.
- Happiness will be short-lived.
- The biggest cross-sectional variance in happiness will be among the young.
- When expectations adjust to the rate at which your fortunes improve, chasing further happiness requires improving your fortunes at an accelerating rate.
- If life expectancy is increasing and we simply extrapolate expectations into later stages of life we are likely to be increasingly depressed when we are old.
- There could easily be an inverse relationship between intelligence and happiness.
Political sorting in social dating relationships
Gregory Huber and Neil Malhotra have a new research paper Political Sorting in Social Relationships: Evidence from an Online Dating Community (pdf). Here is one useful bit:
Relative to the average standard deviation by respondent for each outcome…shared ideology increases interest in responding by 12% of that amount, interest in long-term dating by 16%, and assessments of shared values by 20%. By the same comparison, shared lack of political interest increases assessments of likelihood of responding by a statistically significant 18%, but has more modest…effects on interest in long-term dating and assessments of shared values, respectively.
There is much more data in this paper, including a discussion of which issues matter to people the most. Here is one upshot:
…online dating pairings where communication takes place display greater political homogeneity than the population as a whole.
A Macro Homework Question: Answer in the Style of…
I just returned from a trip to South Korea. Today, to prepare for the next trip, I took my jacket to the dry cleaners. Turning the pockets out, I discovered a substantial number of South Korean won. The transaction costs of exchanging the won for dollars are now very high. I will keep the won as souvenirs.
Question: What are the consequences of my decision for the South Korean economy? Answer in the style of a well-known economist. What would Scott Sumner say? (almost too easy!) What about Keynes? Krugman? Cowen? Prescott?
Nonsense paper accepted by mathematics journal
Last month That’s Mathematics! reported another landmark event in the history of academic publishing. A paper by Marcie Rathke of the University of Southern North Dakota at Hoople had been provisionally accepted for publication in Advances in Pure Mathematics. ‘Independent, Negative, Canonically Turing Arrows of Equations and Problems in Applied Formal PDE’…
Each of these sentences [of the paper] contains mathematical nouns linked by the verbs mathematicians use, but the sentences scarcely connect with each other. The paper was created using Mathgen, an online random maths paper generator. Mathgen has a set of rules that define how papers are arranged in sections and what kinds of sentence make up a section and how those sentences are made up from different categories of technical and non-technical words. It creates beautifully formatted papers with the conventional structure, complete with equations and citations but, alas, totally devoid of meaning. Nate Eldredge – the blogger behind That’s Mathematics! – wrote Mathgen by adapting SCIgen, which does something similar for computer science. Papers generated by SCIgen have been accepted for publication at academic conferences and journals that claim to carry out peer review.
The article is here and it also excerpts from the referee reports, for instance:
We can’t catch the main thought from this abstract. So I suggest that the author can reorganise the descriptions and give the keywords of this paper.
For the pointer I thank Mark Thorson.
Crowdsourcing the lowest fare
Travelers with complex travel plans may have noticed, however, that the search results aren’t necessarily consistent. This has created a business opportunity for Flightfox, a start-up company based in Mountain View, Calif., which uses a contest format to come up with the best fare that the crowd — all Flightfox-approved users — can find.
A traveler goes to Flightfox.com and sets up a competition, supplying information about the desired itinerary and clarifying a few preferences, like a willingness to “fly on any airline to save money” or a tolerance of “long layovers to save money.” Once Flightfox posts the contest, the crowd is invited to go to work and submit fares.
The contest runs three days, and the winner, the person who finds the lowest fare, gets 75 percent of the finder’s fee that the traveler pays Flightfox when setting up the competition. Flightfox says fees depend on the complexity of the itinerary; many current contests have fees in the $34-to-$59 range.
Here is more, and for the pointer I thank @ArikSharon.
The equilibrium (with apologies to Daniel Klein)
On September 5, the first Sleeping Beauty in Polataiko’s exhibition awoke to a kiss from another woman. Both of them were surprised. Polataiko shot photos of them laughing and looking at each other. Then he posted the images to his Facebook profile, where he has been live-blogging the entire event. Now the Sleeping Beauty must wed her “prince,” thus queering the historically heteronormative fairtytale. Gay marriage is not allowed in the Ukraine, however, so these two women will have to wed in a European country that does allow for same-sex marriage.
Here is more. I believe that none of you had solved for this equilibrium. For the pointer I thank Eapen.
The next transformational technology?
Noah Smith writes:
Addendum: I seem to be the only person talking about Desire Modification as a transformational technology. Greg Egan and Vernor Vinge have written books in which this technology plays a central role. In my “spare time” I’m writing a couple of sci-fi short stories based on the idea. It’s a really big deal, and I’ll write a post about it soon.
The path dependence of astronaut walks
…there was a fierce behind-the-scenes battle between them to be first to set foot on the Moon. Early plans were for Aldrin, as module pilot, to step out first, but one version reported by Smith has it that Armstrong, as mission commander, lobbied more vigorously than Aldrin, and Nasa backed him up because he would be ‘better equipped to handle the clamour when he got back’ and, more mundanely, because his seat in the lunar module was closer to the door. Aldrin paid Armstrong back by taking no photographs of him on the Moon: the only manually taken lunar image of the First Man on the Moon is in one of many pictures Armstrong snapped of Aldrin, showing himself reflected in the visor of Aldrin’s spacesuit.
That is from this excellent Steve Shapin article, hat tip goes to @MauraCunningham. I liked this part:
…they were on the same basic pay rates as other US military officers: most were captains, making about $17,000 a year. (On their missions to the Moon, they were entitled only to the standard $8 per diem for being away from base, with deductions for ‘accommodation’ provided in the spaceship.)