Category: History

Me on the end of the Great Stagnation

Here is some (edited) transcript from an AEI symposium, via Jim Pethokoukis:

We’ve come up with great new ideas, took a little while to figure out how to use them and how to spread throughout the economy, and eventually they made big differences. Are we assuming that these new technologies are like the ones in the past and they’ll have that eventual impact?

I think the new innovations will be special in at least one significant way: A lot of them will not contribute that much to per capita GDP. So, if you take the mRNA vaccines, they’re influencing what would normally be called the “cyclical component.” If you think of older people as more likely to die from COVID-19 . . . by saving lives — I’m not suggesting per capita GDP will go down — but the impact on human welfare will be much greater than what would appear to be the long-term secular trend in GDP. Also, two of the big advances that might happen are a vaccine against HIV/AIDS and an effective vaccine against malaria. Those would be incredible advances for humanity, but I don’t know how much they would show up in US per capita GDP or productivity — possibly not really much at all.

The other new wave of innovations, which you could call green energy — again, you could be very optimistic about those, but the main thing they’re doing is helping us avoid a catastrophe. So they’re boosting GDP relative to a quite awful counterfactual of just continuing to burn coal and other fossil fuels. But I’m not sure we’ll feel we have higher standards of living relative to what we were used to simply because there’s a solar panel on your home. It might in some ways make your energy supply better, but again, it will be hidden by the counterfactual. So, it will be a very strange kind of technology boom when I look at the two main areas where I see a lot of progress.

If we go through a period where none of this stuff is really showing up in data and maybe it’s not obvious that people’s living standards are rising, do we risk having less societal tolerance for the kinds of disruptions that economic growth and progress naturally make?

Here’s one of my fears: The biomedical innovation progress is so fast but the rest of the economy stays relatively static, so we become older as a society more quickly than we had been expecting. You could have a lot more status quo bias — just more entrenchment, 10 years more of a problem — and we could, in a funny way, innovate ourselves into a tighter complacency and a tighter stagnation.

I’m not rooting against increases in life expectancy. Ceteris paribus, I would take them, obviously. But that said, you want to be careful about the order in which progress comes, and I’m not sure if we’re going to get it in an optimal order.

Here is the complete excerpt.

Lucan’s *Civil War* is grossly underrated, and I found reading it to be a revelation

COWEN: Why does reading Lucan’s The Civil War make more sense in 2021 than it might have 30 years ago? To me, it seems remarkably contemporary — more than Virgil. People are crazy. They’re at each other’s throats, but not really for any good reason.

BARTSCH: Lucan seems contemporary. Lucan is very much after and in response to Virgil. He reads Virgil as saying the possibility of the good state, the good empire is a real thing. What Lucan says is, “No, that is never possible. There will always be men grubbing for power and killing each other, and civil war is, frankly, a condition of life, a condition of history. Right now, I’m writing under Nero, who is not a good emperor. I’m writing about the events that led to Nero coming to power, and I hate them. They’re terrible. People lie to each other. Brothers killed brothers. Friends slashed each other in the face, all for political reasons. People use language, again, incorrectly to distort what they meant, and then — here’s the rub — because I’m writing under Nero and because Nero is one of the bad emperors, I can’t complain about writing under Nero. I have to praise him. Otherwise, I’ll get in trouble.”

So you get this beautiful juxtaposition of a poet starting out his poem with almost over-the-top praise. “Oh, Nero, you’re going to heaven, and you’re going to be a star in the constellations. There’s never been anybody so wise as you. Civil war was worth it if you were the outcome.”

Then the rest of the poem is this blistering indictment of the present, which is the present under Nero. By indicting the present but praising Nero, he effectively shows us that his praise is false, but that false praise is what everybody has to engage in in a world where there’s no freedom. Maybe that is what seems topical to you. Or maybe it’s just about fake news, and you see Lucan is writing fake news in the beginning of his epic.

COWEN: I think the lack of obvious self-interested motivation for the polarization is what strikes me as so contemporary about Lucan. It’s not primarily about rent-seeking. There’s simply some logic of escalation that never stops. Now, maybe at the end of the poem, there’s a return to sanity in some ways, but there’s still this total immersion in violence, and the dynamics of that, the nonrationality or arationality — it struck me if I had read Lucan in 1991, I would have been quite puzzled, like this is something of antique interest. But I read it today — I’m not so pessimistic about the Western world, but it seems to hit much closer to home.

BARTSCH: Why is that? Sorry, you’re supposed to be asking me questions, but why does it seem to strike closer to home to you now?

COWEN: There seems to be a logic in contemporary politics where people take opposite sides of an issue because other people have taken a side. They don’t necessarily care anymore what it’s about. This may have moderated in the last few months, but there was a sense, if Trump tweeted some view about Turkey, some people would agree, and other people would take the other side, whether or not they had agreement about Turkey.

BARTSCH: Absolutely. The polarization of political views — that is completely in Lucan. Everything is binary. Both sides are at each other’s throats. The problem is, neither side is good. They’re just both opinionated. Yes, he constantly shows us horrible, meaningless scenes of butchery, which will never lead to anything meaningful. I think in that sense, yes, it’s an interesting comparison to what happens today.

Another interesting thing that he does is that, even though everything has been boiled down into them versus us — or actually them versus them because there’s nobody good in the epic except for Cato, who ends up dying — even as he takes on so serious a subject, he refuses to partake of its seriousness in a way. What I mean by that is that his battle scenes are ridiculous. They’re not realistic.

Here’s an example. You’re fighting for Julius Caesar, and you’re on a boat, and you’re trying to get onto a boat that belongs to Pompey, so you grab it with one arm as it comes by, but the people in Pompey’s boat chop off your arm. Then you grab it with your other arm, and then they chop that arm off. Then you’ve got no arms. So, what do you do? Well, Lucan says, you just lob yourself onto the boat armlessly and hope that you can make a difference that way. There’s arms and legs flying everywhere.

In Virgil or Homer, somebody stabs you, you groan, blood comes out, you die. In Lucan, you just bop around like a puppet losing limbs and legs. That’s very strange.

That is from my Conversation with Shadi Bartsch.

My excellent Conversation with Shadi Bartsch

She is a Professor of Classics at the University of Chicago, and recently published a translation of Virgil’s Aeneid.  Here is the audio, visual, and transcript.  Here is part of the summary:

Shadi joined Tyler to discuss reading the classics as someone who is half-Persian, the difference between Homer and Virgil’s underworlds, the reasons so many women are redefining Virgil’s Aeneid, the best way to learn Latin, why you must be in a room with a native speaker to learn Mandarin, the question of Seneca’s hypocrisy, what it means to “wave the wand of Hermes”, why Lucan begins his epic The Civil War with “fake news”, the line from Henry Purcell’s aria that moves her to tears, her biggest takeaway from being the daughter of an accomplished UN economist, the ancient text she’s most hopeful that new technology will help us discover, the appeal of Strauss to some contemporary Chinese intellectuals, the reasons some consider the history of Athens a better allegory for America than that of Rome, the Thucydides Trap, the magical “presentness” of ancient history she’s found in Italy and Jerusalem, her forthcoming book Plato Goes to China, and more.

Here is one excerpt:

COWEN: You may not agree with this, but many readers I speak with tend to think that Homer is somehow deeper, more mystical, or just more fun to read than Virgil. What accounts for that perception and how might you challenge it?

BARTSCH: I think they think that because both of Homer’s epics are not, per se, about politics or governments. They don’t offer etiologies of a state. They don’t talk about history. They are stories in the true sense. They are about heroes in the true sense, not about some guy who’s pushed around the world by the gods, constantly getting into trouble, crying, wishing he didn’t have to go found Rome, etcetera.

Achilles — figure larger than life. His pride is everything to him. He stops fighting in the Trojan War because he’s been insulted. The drama is, what compels him to go back into battle after that insult?

Odysseus — a fairy tale of a man wandering from island to island, meeting ever stranger creatures, but eventually making it back home. It’s a great yarn. You don’t have to learn history to read these. You get involved in the psychology of the characters, their tragedies and their triumphs.

Nobody is really interested in getting involved in the psychology of the state and its triumphs. On the one hand, you’ve got a poem that’s an etiology for a particular government. On the other hand, you have two amazing stories. I can see how reading The Aeneid would be considered duller for some.

Excellent throughout, and again here is Shadi’s excellent translation of Virgil’s Aeneid.

*Nuclear Folly: A History of the Cuban Missile Crisis*

Although they did not know it at the time, the seamen of the USS Cony and other ships of the Randolph group were moments away from being killed or shipwrecked by the tremendous waves that a nuclear explosion would produce. Savitsky’s torpedo carried a warhead with 10 kilotons of explosive power.  If dropped on a city, that would suffice to kill everyone with a half-mile radius. Moreover, the torpedoes’ nuclear warheads were designed to create shock waves that would topple or incapacitate ships. The 20-kiloton load tried by the US Navy in the Baker underwater test in 1946 produced waves up to 94 feet high. The Soviets tested their T-5 torpedoes near Novala Zemlia in the Arctic in 1957 but never released the results. Any ship hit by the torpedo would almost certainly have been destroyed, while the rest of the Randolph group would have suffered significant damage.

That is from the new book on this topic by Serhii Plokhy.  An excellent book, with much more on the Soviet side than any other source I am aware of.

My Conversation with Lex Fridman

2 hours 9 minutes long, Lex is one of the very best interviewers/discussants in the sector.  Here is the video, here is the audio.  Plenty of new topics and avenues, including the political economy of Russia (note this was recorded before the massing of Russian forces on the Ukraine border).  Lex’s tweet described it as follows:

Here’s my conversation with @tylercowen  about economic growth, resisting conformity, the value of being weird, competition and capitalism, UFO sightings, contemporary art, best food in the world, and of course, love, death, and meaning.

https://www.youtube.com/watch?v=7Grseeycor4

Recommended.

From Charles Kenny

Friends: I’m writing to tell you about my latest book and ask you to take a look (and share the news).

Your World, Better is written for the smart and engaged middle school student.  It looks at how America and the World has changed since the reader’s parents and grandparents were young: what has happened to health and wealth, homes, school and work, rights and democracy, war and the environment, happiness and depression.   It talks about the things that have gotten better, the sometimes-intensifying challenges that remain, and what readers can do about them.  (Some of you might hear echoes of my earlier book Getting Better –it is a source, but this is a very different text).

I wrote it because my (middle school age) elder daughter’s friends appear largely of the opinion that everything is terrible, and after the last eighteen months it is a little hard to blame them for thinking that. Your World Better is optimistic, but it doesn’t shy away from the considerable problems we face: from inequality through discrimination and depression to climate change and infectious threats.  It is meant to encourage kids to help make the world better: tip them from hopelessness toward action, not into complacency.  I hope you think I get the balance right.

The pdf of Your World Better is available to download in my blog for free.  Or you can buy a kindle version for 99 cents or a hard copy for $8.10.  Any author royalties from those sales will be donated to UNICEF.

My Conversation with the excellent Dana Gioia

Here is the audio, transcript, and video.  As I mention in the beginning, Dana is the (only?) CWT guest who can answer all of my questions.  Here is part of the summary:

Dana and Tyler discuss his latest book and more, including how he transformed several businesses as a corporate executive, why going to business school made him a better poet, the only two obscene topics left in American poetry, why narrative is necessary for coping with life’s hardships, how Virgil influenced Catholic traditions, what Augustus understood about the cultural power of art, the reasons most libretti are so bad, the optimism of the Beach Boys, the best art museum you’ve never heard of, the Jungianism of Star Trek, his favorite Tolstoy work, depictions of Catholicism in American pop culture, what he finds fascinating about Houellebecq, why we stopped building cathedrals, how he was able to effectively lead the National Endowment for the Arts, the aesthetic differences between him and his brother Ted, his advice for young people who want to cultivate their minds, and what he wants to learn next.

And here is one excerpt:

COWEN: Why is Olaf Stapledon an important writer?

GIOIA: It’s not a question I expected.

COWEN: How could you not expect that?

GIOIA: Well, first of all, I hope people know who Olaf Stapleton was. Tremendously influential, rather clumsy, visionary, early science fiction writer who wrote novels like Odd John and the First and Last Man. What Olaf Stapleton did was I think he was the first really great science fiction writer to think in absolutely cosmic terms, beyond human conceptions of time and space. That, essentially, created the mature science fiction sensibility. If you go even watch a show like Expanse now, it’s about Stapledonian concerns.

COWEN: He was also a Hegelian philosopher, as you know. My friend Dan Wang thinks Last and First Men is better than Star Maker. Though virtually all critics prefer Star Maker.

GIOIA: Michael Lind, the political writer, and historian, Stapledon is one of his formative writers. Star Maker is kind of an evolution of the Last and First MenOdd John is kind of the odd, the first great mutant novel.

Definitely recommended.  And I am very happy to recommend Dana’s latest book (and indeed all of his books) Studying with Miss Bishop: Memoirs from a Young Writer’s Life.

A Miniature Masterpiece

Superb NYTimes disquisition on a masterpiece of Indian miniature painting. The text, formatting, visuals, all beautifully done–better than any museum exhibit I can recall.

In addition to the subject matter this piece has a lot to say about online education and how news is becoming a winner take-most market. Note what Tyler and I said on endogenous fixed costs in our piece on online education in the AER and consider how many newspapers could put together a display of this quality.

Shaked and Sutton (1987) and Sutton (1998) show that when quality is primarily vertical, meaning that there is a measure of quality such that all consumers agree that higher quality is more preferred, then increased market size does not result in reduced concentration. Instead, as market size increases, firms invest more in quality, which endogenously increases economies of scale and maintains market concentration.

Along related lines, Berry and Waldfogel (2010) show that there are many more restaurants in larger than smaller cities, but even as city size increases by a factor of 10 there is no tendency for the number of newspapers to increase. Larger cities have more restaurants than smaller cities because economies of scale are limited and quality differs “horizontally,” according to taste (thus, larger cities have more diverse restaurants). Yet larger cities are served by roughly the same number of newspapers as smaller cities because quality is more vertical, most newspaper consumers want more coverage, better writers and more features.

Addendum: Tim and Marcos remind of previous items in this series which I also loved, The Birth of the Self Portrait and A Picture of Change.

The new Michela Wrong book

It is called Do Not Disturb: The Story of a Political Murder and an African Regime Gone Bad, and so far it is very good.  Here is one bit:

As a Rwandan psychologist once told me: “To show emotional reserve is considered a sign of high standing.  You do not just pour out your heart in Rwanda.  You do not cry.  It’s the opposite of Western oversharing, a form of stoicism.

A culture that glories in its impenetrability, that sees virtue in misleading: to someone proposing to write a nonfiction account embracing many of the most controversial episodes in Rwandan history, it posed a bit of a challenge.

Recommended, I will continue reading, and this one is likely to make the “best non-fiction of the year” list.

Arguments for Africa

Despite the past centuries’ economic setbacks and challenges, are there reasons for optimism about Africa’s economic prospects? We provide a conceptual framework and empirical evidence that show how the nature of African society has led to three sets of unrecognized “latent assets.” First, success in African society is talent driven and Africa has experienced high levels of perceived and actual social mobility. A society where talented individuals rise to the top and optimism prevails is an excellent basis for entrepreneurship and innovation. Second, Africans, like westerners who built the world’s most successful effective states, are highly skeptical of authority and attuned to the abuse of power. We argue that these attitudes can be a critical basis for building better institutions. Third, Africa is “cosmopolitan.” Africans are the most multilingual people in the world, have high levels of religious tolerance, and are welcoming to strangers. The experience of navigating cultural and linguistic diversity sets Africans up for success in a globalized world.

Here is the NBER paper from Soeren J Henn and James A. Robinson.

*Island On Fire*

A good book, recent winner of the National Book Award for non-fiction, the author is Tom Zoellner and the subtitle is The Revolt that Ended Slavery in the British Empire.  Here is one excerpt about Jamaica, the central theater for the book:

Among the staple crop civilizations of the nineteenth century, Jamaica was noteworthy for what it didn’t have in abundance: granite monuments, private gardens, schools, parks, beautiful churches, columned public halls.Nobody thought to bring a printing press until sixty-six years after the British takeover.  Graceful mansions like those built in the American South were less common in Jamaica and generally seen only around Kingston and on the shore of St. James Parrish, where the wealthier planters aimed to impress their neighbors with bloodwood floors, wine cellars, silverware, china sets, and ancestral portraits on the walls.  But the master’s “Great House” was more commonly made of crude materials and sometimes looked no better than a barn with windows.  As a government secretary described them, many country estates were “miserable, thatched hovels, hastily put together with wattles and plaster, damp, unwholesome and infested with every species of vermin.”

Recommended.

What should I ask Pierpaolo Barbieri?

I will be doing a Conversation with him, here is the opening part of his Wikipedia page:

Pierpaolo Barbieri (Buenos Aires, May 17, 1987) is an economic historian, researcher, Executive Director at Greenmantle[and founder of Ualá, an Argentina-based personal financial management mobile app. He is the author of the book Hitler’s Shadow Empire: The Nazis and the Spanish Civil War. He has been featured in publications like Financial Times, New York Times, Foreign Affairs, El País, and The Wall Street Journal.

Ualá has been highly successful as of late in the payments space, including with the unbanked, and here is Pierpaolo on Twitter (mostly Spanish language).

So what should I ask him?

The mortality of scholars

After recovering from a severe mortality crisis in the seventeenth century, life expectancy among scholars started to increase as early as in the eighteenth century, well before the Industrial Revolution. Our finding that members of scientific academies—an elite group among scholars—were the first to experience mortality improvements suggests that 300 years ago, individuals with higher social status already enjoyed lower mortality. We also show, however, that the onset of mortality improvements among scholars in medicine was delayed, possibly because these scholars were exposed to pathogens and did not have germ theory knowledge that might have protected them. The disadvantage among medical professionals decreased toward the end of the nineteenth century.

Here is more from Robert Stelter, David de la Croix, and Mikko Myrskylä.  Via the excellent Kevin Lewis.

Testing Todd

Emmanuel Todd, that is.  Here is a recent paper from Jerg Gutmann and Stefan Voigt:

Many years ago, Emmanuel Todd came up with a classification of family types and argued that the historically prevalent family types in a society have important consequences for its economic, political, and social development. Here, we evaluate Todd’s most important predictions empirically. Relying on a parsimonious model with exogenous covariates, we find mixed results. On the one hand, authoritarian family types are, in stark contrast to Todd’s predictions, associated with increased levels of the rule of law and innovation. On the other hand, and in line with Todd’s expectations, communitarian family types are linked to racism, low levels of the rule of law, and late industrialization. Countries in which endogamy is frequently practiced also display an expectedly high level of state fragility and weak civil society organizations.

Via the excellent Kevin Lewis.