Category: Uncategorized
Wednesday assorted links
1. Progress against cancer? (NYT)
2. Bern may experiment with a version of cocaine legalization.
3. Is Africa (very slowly) splitting into two continents?
4. Kiwi culture uh-oh the culture that is Kiwi?
5. WSJ Deirdre review of Acemoglu and Johnson.
6. Is it bad to prefer attractive partners?
7. Yes, have been telling you people that crypto is now underrated.
Update on the War on Poverty
We evaluate progress in the War on Poverty, as President Johnson defined it, which established a 20 percent baseline poverty rate and adopted an absolute standard. While the official poverty rate fell from 19.5 percent in 1963 to 10.5 percent in 2019, our absolute Full-income Poverty Measure, which uses a fuller income measures and updates poverty thresholds only for inflation, fell from 19.5 to 1.6 percent. However, we also show that relative poverty reductions have been modest. Additionally, government dependence increased over this time, with the share of working-age adults receiving under half their income from market sources more than doubling.
That is from a newly published Richard V. Burkhauser, Kevin Corinth, James Elwell, and Jeff Larrimore piece in the JPE. Here are ungated versions of the paper.
Masai village
It has about fifty people, and when you enter all the women come out and shake your hand, saying “Sopa!”. The children bend their heads down, expecting to be patted on top.
A typical dwelling is about 18 by 15 feet, and it is made out of mud, cow dung, and sticks, the latter material is in place to hold it together when it rains. In one half of the dwelling, the young sheep come and sleep at night, so that the predators cannot kill them. In the other half of the dwelling, ten (!) people sleep, at least for the house I visited.
Polygamy is the norm, with two or three wives being typical. Someone from the previous generation might have had ten wives or more. When you ask them about the “adding-up constraint” — what about the men who can’t get wives? — it is difficult to get a straight answer.
I very much enjoyed the hocking, polyphonal vocal music I heard.
I asked the women what they most want from their government, and their answers were 1) a road, and 2) a better water supply, the current water tank being a few kilometers away. At night a few small lights go on, powered by solar. Cell phones are commonplace, and many of the children now go to school, a recent development.
A poor family might own 100 cattle, a rich family perhaps 200 cattle. A typical cow might sell for $80 in the market.
They do not know what America is, though if you point toward the sunset you can tell them you come from that direction.
The rate of smiling is fairly high. One woman had lost her leg, it is believed because of a snakebite requiring amputation.
Tuesday assorted links
Elephant tusks, incentives, and the sacred
In a heap of burnt and powdered elephant tusks, you can see so much of social science.
If you visit Nairobi National Park, you will see rhinos, hippos, and giraffes, all within sight of the city skyline. You also will see an organized site showing several large mounds of burnt and powdered elephant tusks. They are a tribute to the elephant, and along with the accompanying signs, a condemnation of elephant poaching.
Starting in 1989, the government had confiscated a large number of tusks from the poachers, and as part of their anti-poaching campaign they burnt those tusks and placed the burnt ashes on display in the form of mounds. There are also several signs telling visitors that it is forbidden to take the ashes from the site. There have since been subsequent organized tusk burns.
In essence, the government is trying to communicate the notion that the elephant tusks are sacred, and should not be regarded as material for either commerce or poaching or for that matter souvenir collecting. “We will even destroy this, rather than let you trade it.” In economic terminology, you could say the government is trying to shift the supply and demand curves by changing norms in the longer run.
The economist of course is tempted to look beneath the surface of such a policy. If the government destroys a large number of elephant tusks, the price of tusks on the black market might go up. The higher tusk price could in turn motivate yet more poaching and tusk trading, thus countermanding the original intent of the policy.
This scenario, whether the most relevant equilibrium or not, is not just fantasy. Economics Nobel Laureate Michael Kremer (with co-author Charles Morcom) has a well-known paper simply called “Elephants.” In that research, symbolic goods and the sacred are put aside and they take an “incentives only” approach to elephant tusk policy. The abstract runs like this:
Many open-access resources, such as elephants, are used to produce storable goods. Anticipated future scarcity of these resources will increase current prices and poaching. This implies that, for given initial conditions, there may be rational expectations equilibria leading to both extinction and survival. The cheapest way for governments to eliminate extinction equilibria may be to commit to tough antipoaching measures if the population falls below a threshold. For governments without credibility, the cheapest way to eliminate extinction equilibria may be to accumulate a sufficient stockpile of the storable good and threaten to sell it should the population fall.
The key sentence there, for our purposes, is that the government might end up selling its stock of tusks on the open market, to deter speculators. And thus, in that scenario, you do not want to be burning the tusks.
The Kremer and Morcom policy analysis (is it a recommendation? I am not sure) would of course involve the non-credible government in the market for elephant tusks. Periodically wiping out the speculators would have its benefits, for the economic reasons outlined in their paper. At the same time, a government playing around in that market would have a much harder time making the case that elephants and elephant tusks are something sacred. Such a government would have a much harder time making the case that the tusks never should be traded.
Which is better? The policy conducted by the Kenyan government, or the policy described in Kremer and Morcom?
From this distance, I do not pretend to know. I can also see that an anti-poaching government may not have credibility now, but it may wish to invest in “the sacred” for a pending future where its credibility is greater. Treating elephants and elephant tusks as sacred, even if counterproductive in some short runs, may contribute to establishing the credibility of said government. And indeed part of the credibility of today’s Kenyan government (while decidedly mixed) comes from its ability to keep many of the nature reserves up and running in good order. Many of the animals are coming back, and tourism continues to increase.
Many non-economists think only in terms of the sacred and the symbolic goods in human society. They ignore incentives. Furthermore, our politics and religious sects encourage such modes of evaluation.
Many economists think only in terms of incentives, and they do not have a good sense of how to integrate symbolic goods into their analysis. They often come up with policy proposals that either offend people or simply fall flat.
Wisdom in balancing these two perspectives is often at the heart of good social science, and not just for elephant tusks. And who exactly is an expert in that?
Can you help Max Thilo in Singapore?
Having experienced the strengths and weaknesses of the NHS firsthand — I recently completed treatment for Hodgkin’s lymphoma — Tyler kindly awarded me an Emergent Ventures grant to travel to Singapore to study their healthcare system. I would like to meet with health professionals and civil servants working in the health sector. I am looking for practical lessons that can be applied to the NHS i.e not user charges. I am particularly interested in industrial relations, the management of publicly-owned hospitals, and the cost-effectiveness of polyclinics. If you have insights to share or would like to connect, please feel free to reach out to me at [email protected]
Monday assorted links
1. Catfish noodling. “Catfish spawn in underwater holes, so when spawning season comes, you reach or dive underwater, stick your hand in the an underwater hole, wait for a catfish to bite down on your hand, and then you grab the fish by its jaw and wrestle it out of its hole and up to the surface. There are, however, a few nuances you’ll want to know about.”
2. Lina Khan update. That hardly ever happens.
Safari surprises
I learned just how accustomed I am to North American wildlife patterns. In much of North America, you see wildlife only sporadically, as for instance in Yellowstone Park you can easily drive for an hour and not see a bear.
In this part of Masai Mara, it is unusual to drive for more than thirty seconds without seeing something interesting. And very commonly you can see a tableau of multiple animals, such as buffalo, Thomson’s gazelle, warthogs, and zebras, all together at once.
On those 4-5 hour drives around the plains, usuually I am thinking about “solving for the equilibrium.” When you see a group of dik-diks, the immediate thought is “how do they escape the cheetahs?” You wonder what is the optimal number of a buffalo grouping to repel a lion attack, without crowding or overgrazing on a particular patch of land.
How close can your open vehicle come to the lions without arousing excessive interest? (Closer than you might think.)
When should a pride of lions split into two groups, balancing strength of collective attack against food scarcity?
Why do cheetahs go about it solo? And how is that fact related to their propensity to win chases on the basis of extreme bursts of speed?
Can you model why the zebras and wildebeest seem to get along so well together?
What is the deadweight loss from the fact that wildebeest use property allocation — over which the males fight — to attract females?
I have noticed that the guides are implicitly Lamarckian in their theorizing.
As dusk arrives, many of the larger cats become more active. And so the potential prey wake up and move to more open territory, where they can see predators arriving. They group and spread themselves out (optimally?), to maximize their own collective field of vision and aural acuity, in case a predator should approach. Those patterns are gone by the late morning.
There is definitely a set of land value gradients here, noting that waterholes are both a) super-valuable, and b) the place where you are most vulnerable to predators. Few potential prey wish to settle there, though they will visit and make haste to leave.
I enjoy watching the prey trigger equilibrium of “My durability in running speed exceeds yours, so I can hang around and expect you won’t charge me, at least not if I keep a safe enough distance. Furthermore, if I don’t run away I can keep you in plain view, which is preferable in any case.”
So my biggest surprise is how visible the notion of equilibrium is here.
Zero profit condition, illustrated on the Kenyan plains
That is fresh kill from the night before, a buffalo hunted by lions, as the guide explained. As of about 7 a.m., lions had eaten and hauled away all of the carcass.
Hyenas carried away the bones.
The surrounding ground was utterly spotless.
This free lunch is over!
Sunday assorted links
Vertical migration externalities, or another reason why California taxes are too high
State income taxes affect federal income tax revenue by shifting the spatial distribution of households between high- and low-productivity states, thereby changing household incomes and tax payments. We derive an expression for these fiscal externalities of state taxes in terms of estimable statistics. An empirical quantification using American Community Survey data reveals that the externalities range from large and negative in some states, to large and positive in others. In California, an increase in the state income tax rate and the resulting change in the distribution of households across states lead to a decrease in federal income tax revenue of 39 cents for every dollar of California tax revenue raised. The externality amounts to a 0.27% decrease in total federal income tax revenue for a 1 pp increase in California’s state tax rate. Our results raise the possibility that state taxes may be set too high in high-productivity states, and set too low in low-productivity states.
That is from new research by Mark Colas and Emmett Saulnier, via the excellent Kevin Lewis.
Saturday assorted links
1. The Mechanical Turk is increasingly mechanical in fact.
2. Participating in a climate prediction market increases concern about global warming.
4. Taliban markets in everything, “Cash-strapped Taliban selling tickets to ruins of Buddhas it blew up.”
5. Guess who is being blamed for high rates of Swedish inflation?
6. SpaceX hires fourteen-year-old engineer, he is then denied a LinkedIn account.
7. Ross on C.S. Lewis and the weirdness of our time (NYT). Good Straussian clincher at the very end.
8. Daniel Ellsberg, RIP (NYT).
Agglomeration externalities from restaurants
We estimate agglomeration externalities in Milan’s restaurant sector using the abolition of a unique regulation that restricted where restaurants could locate. In 2005, Milan abolished a minimum distance requirement that had kept the number of establishments artificially constant across neighborhoods. We find that after 2005, the geographical concentration of restaurants increased sharply and at an accelerating rate. Consistent with the existence of strong and self-sustaining agglomeration externalities, restaurants agglomerated in some neighborhoods and deserted others, leading to a growing divergence in local amenities across neighborhoods. Restaurants located in neighborhoods that experienced large increases in agglomeration reacted by increasing product differentiation.
That is from a new AER Insights piece by Marco Leonardi and Enrico Moretti. Here are some ungated copies. I am myself repeatedly surprised how much the mere location of a restaurant can predict its quality.
Does Germany need more polarization? (from the comments)
My perception is that in Germany most major political decisions are not on the ballot: migration, nuclear energy, international, alliances, emission reduction policies to name but a few examples. Whereas people in the Americas worry about polarization, I would argue that Germany’s problem is the opposite. Compared to the historical average German politics is too tame and not polarized enough. Polarized debates were much more endemic when the country debated the Nato Doppelbeschluss, the Kohl era (re-unification) or the Adenauer era (West alliance, later the failed project of a European army). The counterfactual in many of these cases would have been different had the other party been in power. The same is not true for the Merkel era. The word ‘Alternative’ derives from her suggesting that her Euro-crisis management was without alternative. If I may offer one conjecture as to why this is happening, I would argue that the degree of elite convergence is greater than in the Americas. The opinion spectrum covered by public intellectuals is just so much smaller. And with trade unions and the church in decline so is the opinion spectrum covered by the country’s leading non-governmental institutions. (The treatment of that party’s very different initial leadership in the mid 2010’s illustrates this point.) So, in short, my (and many people’s) argument is that as in the Hotelling model ideological conformity of the elites has created the space for a non-ideologically aligned entrant. Naturally, this entrant is more extreme than a more conservative version of the Christian Democrats (and I tend to think that this is so because Christianity forbids you to go down certain tempting, yet inhumane rabbit holes but that is for another day) and of lesser quality because given the current intellectual climate the new party has trouble recruiting elites. Needless to say, you should not vote for this party. But I understand why it exists.
That is from “C.”
Friday assorted links
1. Is the south America’s hidden urban laboratory?
2. Beauty and on-line teaching in Sweden.
3. Peter Coy on the case against free parking (NYT).
4. Harvard body parts markets in everything.
5. Did Woke cause cultural decadence? (Not exactly my view, are areas such as instrumental or “minimal vocal” music seeing a different trend?)