Category: History
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.
*Deliberating American Monetary Policy: A Textual Analysis*
The author is Cheryl Schonhardt-Bailey and that is a new book published by MIT Press. The Amazon link is here. Here is a bit from the book’s home page:
In this book, Cheryl Schonhardt-Bailey provides a systematic examination of deliberation on monetary policy from 1976 to 2008 by the Federal Reserve’s Open Market Committee (FOMC) and House and Senate banking committees. Her innovative account employs automated textual analysis software to study the verbatim transcripts of FOMC meetings and congressional hearings; these empirical data are supplemented and supported by in-depth interviews with participants in these deliberations. The automated textual analysis measures the characteristic words, phrases, and arguments of committee members; the interviews offer a way to gauge the extent to which the empirical findings accord with the participants’ personal experiences.
Chat with James Pethokoukis on *Average is Over*
Here is one of several interesting bits:
Well the Brynjolfsson and McAffee book, “Race Against the Machine,” that’s a great book. It’s influenced my thinking. I just read their second forthcoming book, “The Second Machine Age.” They focus more on automation than I do and less on inequality and much less on social issues. But I think of myself as thinking along the same lines as they do. But they and I, we differ a lot about the past. So they don’t think the past has been a great stagnation. I agree with them a lot about the future, but disagree with them a lot about the past.
Gordon, I disagree with him about the future, but agree with him about the past. So Gordon, like me, sees a great stagnation. And he thinks it will never ever end. I think that’s crazy. Even if it were true, how would you know? But I see a lot of areas, not only artificial intelligence, but medicine and genomics, where the advances are not on the table now. But it’s hard to believe there’s not going to be a lot more coming. Science is very healthy. There’re new discoveries all the time. The lags are much longer than we’d like to think, but absolutely progress is not over, and we’re about to see a new wave of progress over the lifetimes of our children.
The full dialog is here.
My *New Yorker* interview on *Average is Over*
It was with Joshua Rothman, here is one bit:
The whole narrative you unfold—intelligent software, human-computer cooperation, deferring to our smartphones—sounds very futuristic. Do you think we’re living through a historically unprecedented period?
I don’t accept the view that this new era is so different from every time in the past. Consider the industrial revolution, which starts in Great Britain in the seventeen-seventies or seventeen-eighties. For a long time, you had rising inequality, fairly stagnant living standards, a lot of problems adjusting. Of course, we did eventually get over it in the longer run, and it was much better for everyone. But it took, arguably, fifty or sixty years for us to make that transition. I think this future wave of inequality, which is already underway, will be a lot like that. It will take us decades to make the transition. Those decades will bring a lot of problems. But I think that in the much longer run—which is not what the book is about—it will be much more positive than it will seem during the transition era. I think this period fits quite nicely with historical precedent.
There is also this:
In the U.S., New York City is probably the most unequal place we’ve got. And I find it striking how many people believe, first, that inequality is terrible, and that this vision for the future is horrible, and, at the same time, think, “Oh, I love New York City!”
We already have places with extreme inequality, but life there goes on, and we don’t recoil in horror. The non-wealthy parts of New York are very vital, and have the best of humanity in them. We have intuitions [about equality and inequality] that are derived from American post-war history. I don’t want to dismiss those intuitions altogether, but I think we need to be more skeptical of them.
More on peak driving and its implications
Reihan reports:
University of Minnesota economist David Levinson envisions a future in which per capita vehicle travels falls significantly, bringing traffic congestion down with it. The chief driver of this death of traffic is not the emergence of a new transportation technology, though technology certainly plays a role in Levinson’s scenario. Rather, it is the shrinking of the American workweek coupled with new business models which draw primarily on existing technologies. Though written in an understated style, it is quite entertaining. I recommend reading it in its entirety. A few aspects of his vision struck me as particularly notable:
1. Just as it was once standard for U.S. workers to work a six-day week, Levinson imagines that the workweek will continue to shrink. Every-other Friday off (the 5/4 schedule) becomes standard by 2015; by 2020, the standard schedule becomes a 9 hour day with four days a week in the office and 4 additional hours of checking in from home; by 2025, workers are taking every-other Monday off (the 4/3 schedule); and by 2030, the “flipped” office, like the “flipped” classroom, becomes the norm — i.e., workers do the bulk of their work at home, and they come to the office for “interactive collaboration days.”
2. But it’s not just the workweek that will change. The pattern of how we work over the life course will also change. Levinson envisions a world in which almost half the population doesn’t enter the paid workforce until age 30, as firms lose interest in financing training. Instead, most people go through an extended apprenticeship period that can last as long as a decade, combining unpaid internships and attending school online. And most people exit the workforce by age 60, as technological advances reduce the value of older workers.
3. The changing workweek causes the value of office buildings to plummet. As office buildings are converted to apartments, the least desirable of which become home to the 20-somethings toiling away at their unpaid internships (subsidized, presumably, by parents, or sustained by part-time work), residential constructions in the suburbs grinds to a halt, and suburban property values drift down, thus making suburban neighborhoods more attractive to low-income households. Large garages are transformed into stores, workshops, and accessory dwellings as families choose to maintain fewer automobiles. Car-sharing, meanwhile, grows more entrenched as a larger share of the population comes to reside in urban cores. (This has the effect of reducing per capita vehicle trips because while car-sharing eliminates many of the fixed costs associated with vehicle ownership, it increases the marginal cost per trip.)
4. Shopping, once a big contributor to vehicle trips, is transformed as people (and their autonomous agents) order online and have goods delivered; decentralized manufacturing and 3-D printing on-demand, in turn, shrink supply chains
There is more at the link…
*Tune In: The Beatles: All These Years, volume I*
That is the new book by Mark Lewisohn, and I was so keen to finish it that I neglected to see the Ender’s Game movie yesterday. 944 pp. and you only get up to 1962 and the beginnings of the first LP! Despite the length, it is gripping throughout. In addition to the obvious angles on The Beatles, it is a study of Liverpudlian history, the nature of poverty, why educating even really smart people can be problematic, why relative age matters so much for young people, how groups gel, the importance of practice, the importance of management, and the importance of origins, among a variety of other more general topics.
This work is one of my five favorite non-fiction books of the year. And if you are wondering, it is not just me: the book has received very positive reviews elsewhere.
How many time zones does America need anyway?
Allison Schrager writes:
This year, Americans on Eastern Standard Time should set their clocks back one hour (like normal), Americans on Central and Rocky Mountain time do nothing, and Americans on Pacific time should set their clocks forward one hour. After that we won’t change our clocks again—no more daylight saving. This will result in just two time zones for the continental United States. The east and west coasts will only be one hour apart. Anyone who lives on one coast and does business with the other can imagine the uncountable benefits of living in a two-time-zone nation (excluding Alaska and Hawaii).
And why?:
It sounds radical, but it really isn’t. The purpose of uniform time measures is coordination. How we measure time has always evolved with the needs of commerce. According to Time and Date, a Norwegian Newsletter dedicated to time zone information, America started using four time zones in 1883. Before that, each city had its own time standard based on its calculation of apparent solar time (when the sun is directly over-head at noon) using sundials. That led to more than 300 different American time zones. This made operations very difficult for the telegraph and burgeoning railroad industry. Railroads operated with 100 different time zones before America moved to four, which was consistent with Britain’s push for a global time standard. The following year, at the International Meridian Conference, it was decided that the entire world could coordinate time keeping based on the British Prime Meridian (except for France, which claimed the Prime Median ran through Paris until 1911). There are now 24 (or 25, depending on your existential view of the international date line) time zones, each taking about 15 degrees of longitude.
Now the world has evolved further—we are even more integrated and mobile, suggesting we’d benefit from fewer, more stable time zones. Why stick with a system designed for commerce in 1883? In reality, America already functions on fewer than four time zones. I spent the last three years commuting between New York and Austin, living on both Eastern and Central time. I found that in Austin, everyone did things at the same times they do them in New York, despite the difference in time zone. People got to work at 8 am instead of 9 am, restaurants were packed at 6 pm instead of 7 pm, and even the TV schedule was an hour earlier.
There is more here.
*The Internal Enemy*
The author is Alan Taylor and the subtitle is Slavery and War in Virginia, 1772-1832.
This is one of the best history books I have read, ever. Every sentence is excellent (is there higher praise?). And let me add: 1) I hate reading books about Virginia, and 2) I feel “I’ve read enough books about slavery.”
I learned a great deal about a variety of topics including The War of 1812, how the British used escaped slaves against the Americans, the tensions between western and Tidewater Virginia, the early Virginia debates about how to eventually deport the slaves. But that hardly gets at what makes this book special. More importantly than any of those specifics, it brings an entire period to life in a memorable manner.
I read this one because Jon Elster urged me too. Don’t forget, by the way:
In 1819 Virginia remained the preeminent slave state, home to nearly a third of the nation’s one and a half million slaves.
Very highly recommended, I hope it wins the National Book Award and it will be prominent on my forthcoming best books of 2013 list.
Precocious Albion: A New Interpretation of the British Industrial Revolution
That is a new paper by Morgan Kelly, Joek Mokyr, and Cormac Ó Gráda, and the abstract is here:
Why was Britain the cradle of the Industrial Revolution? Answers vary: some focus on resource endowments, some on institutions, some on the role of empire. In this paper, we argue for the role of labour force quality or human capital. Instead of dwelling on mediocre schooling and literacy rates, we highlight instead the physical condition of the average British worker and his higher endowment of skills. These advantages meant that British workers were more productive and better paid than their Continental counterparts and better equipped to capitalize on the technological opportunities and challenges confronting them.
The British were fed better, they may have been smarter for nutritional reasons, and they also had a better system of apprenticeships.
Good sentences
We came to Moscow as political correspondents. We leave as crime reporters.
That is from an excellent Jonathan Steele LRB review (free registration) of two new books on Central Asia.
Hayek’s liberaltarian essay “”Free” Enterprise and Competitive Order”
I’ve been preparing a class on Hayek for MRUniversity.com, and I was struck by my reread of this essay, which was presented at the Mont Pelerin Society meeting of 1947 (it was later published in Individualism and Economic Order, pdf of the book here).
In this piece Hayek argues the following:
1. It is not enough for classical liberals to seek to limit the state, they also must outline what governments could and should do better.
2. Monetary policy should be used to limit unemployment, albeit in a rules-based framework.
3. Eminent domain is an essential function of government, especially in urban cities, and it needs to be thought through more carefully.
4. Many of the biggest dangers of monopoly stem from patent law and intellectual property protection, rather than from monopoly of the traditional “sole seller” sort. On this issue Hayek sounds like Alex or Larry Lessig.
5. It is not enough to defend “freedom of contract” in the abstract, rather the details of the law really matter.
6. Hayek questions whether limited liability for corporations is always the right way to proceed.
7. Finally, although inheritance taxes have in the past sometimes been abused, “…inheritance taxes could, of course, be made an instrument toward greater social mobility and greater dispersion of property and, consequently, may have to be regarded as important tools of a truly liberal policy…”
You will recall that in other settings Hayek endorsed the idea of a social welfare state and also the taxation of pollution.
The Ideological Migration of the Economics Laureates
That work fills up the latest issue of Econ Journal Watch.
This issue of Econ Journal Watch (download, .pdf) is given over to a special project that considers such changes as may have occurred among the 71 individuals who, through 2012, won the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.
Ideological profiles of all 71 laureates make up the bulk of the issue. The 71 profiles are bundled in a single large document that is equipped with handy links for internal navigation.
Ideological change is interpreted in terms of either growing more classical liberal or growing less classical liberal. Daniel Klein leads the project. In his overview essay he explains the investigation, its many limitations, and the findings.
…David Colander served as overseeing referee, and he reports on the project.
Twelve of the laureates replied to a questionnaire requesting that they discuss their ideological outlooks at different times in their lives. The twelve who replied are Kenneth Arrow, Ronald Coase, Peter Diamond, Eric Maskin, James Mirrlees, Roger Myerson, Edward Prescott, Thomas Schelling, William Sharpe, Vernon Smith, Robert Solow, and Michael Spence. Their responses are included in their profiles, and they are also collected in a standalone appendix.
This is path-breaking work in intellectual history, the best contribution to the history of modern economics in recent memory, fascinating as intellectual biography and autobiography, and it should be snapped up immediately by some enterprising publisher.
Bubonic Plague
BBC: Madagascar faces a bubonic plague epidemic unless it slows the spread of the disease, experts have warned. The Red Cross and Pasteur Institute say inmates in the island’s rat-infested jails are particularly at risk.
…Madagascar had 256 plague cases and 60 deaths last year, the world’s highest recorded number.
Bubonic plague, known as the Black Death when it killed an estimated 25 million people in Europe during the Middle Ages, is now rare.
“If the plague gets into prisons there could be a sort of atomic explosion of plague within the town. The prison walls will never prevent the plague from getting out and invading the rest of the town,” said the institute’s Christophe Rogier.
Have a nice day.
Brink Lindsey predicts a slowdown of economic growth, even if we innovate more
Brink’s new paper is here, here is one excerpt:
Consider the four constituent elements of economic growth tracked by conventional growth accounting: (1) growth in labor participation, or annual hours worked per capita; (2) growth in labor quality, or the skill level of the workforce; (3) growth in capital deepening, or the amount of physical capital invested per worker; and (4) growth in so-called total factor productivity, or output per unit of quality-adjusted labor and capital. Over the course of the 20th century, these various components fluctuated in their contributions to overall growth. The fluctuations, however, tended to offset each other, so that weakness in one element was compensated for by strength in another. In the 21st century, this pattern of offsetting fluctuations has come to a halt as all growth components have fallen off simultaneously.
The simultaneous weakening of all the components of economic growth does not mean that slow growth is inevitable from here on out. The trends for one or more of them could reverse direction tomorrow. Nevertheless, it is difficult to resist the conclusion that the conditions for growth are less favorable than they used to be. In other words, growth is getting harder.
Brink offers further remarks here. On October 29, at noon, I’ll be doing a Cato Forum with Brink on this paper.
Cohorts born in the late 1930s and 40s did especially well
Via @ClaudiaSahm, there is a new paper (pdf) from Emmons and Noeth at the St. Louis Fed, the abstract is here:
The global financial crisis and ensuing Great Recession reduced the income and wealth of many families, but older families generally fared better than young and middle-aged families. The Federal Reserve’s Survey of Consumer Finances reveals that being young was a significant risk factor during the downturn, regardless of a family’s race, ethnicity, or education level. Among older families, those headed by someone 70 or over fared slightly better than those headed by someone between 62 and 69. Income and wealth also increased most strongly among older families during the two decades preceding the crisis. Part of the explanation for favorable income and wealth trends among currently living older Americans is a positive birth-year cohort effect. After controlling for a host of factors related to income and wealth, we find that cohorts born in the late 1930s and 1940s have experienced more favorable income and wealth trajectories over their life courses than earlier- or later-born cohorts. While it is too soon to know how cohorts born in recent decades will fare over their lifetimes, it appears that the median Baby Boomer (born in the 1950s and early 1960s) and median member of Generation X (born in the late 1960s and 1970s) are on track for lower income and wealth in older age than those born in the 1930s and 1940s, holding constant many factors other than when a person was born.
One driving force seems to be that the older generation was simply more motivated to save. And here is a dramatic sentence:
Among young and middle-aged families, the median levels of net worth were 30.5 percent and 24.1 percent lower in 2010 than in 1989, respectively.
The paper presents many interesting facts, but I would start with pp.9-10.
From The Guardian, here is an argument that middle class youth in Great Britain today will end up faring worse than did their parents.