Category: Web/Tech

Emergent Ventures winners, 14th cohort

Center for Indonesian Policy Studies, Jakarta, to hire a new director.

Zach Mazlish, recent Brown graduate in philosophy, for travel and career development.

Upsolve.org, headed by Rohan Pavuluri, to support their work on legal reform and deregulation of legal services for the poor.

Madison Breshears, GMU law student, to study the proper regulation of cryptocurrencies.

Quest for Justice, to help Californians better navigate small claims court without a lawyer.

Cameron Wiese, Progress Studies fellow, to create a new World’s Fair.

Jimmy Alfonso Licon, philosopher, visiting position at George Mason University, general career development.

Tony Morley, Progress Studies fellow, from Ngunnawal, Australia, to write the first optimistic children’s book on progress.

Michelle Wang, Sophomore at the University of Toronto, Canada, to study the causes and cures of depression, and general career development, and to help her intern at MIT.

Here are previous cohorts of winners.

My Conversation with Pierpaolo Barbieri

Here is the audio, visual, and transcript.  Here is part of the summary:

Pierpaolo joined Tyler to discuss why the Mexican banking system only serves 30 percent of Mexicans, which country will be the first to go cashless, the implications of a digital yuan, whether Miami will overtake São Paolo as the tech center of Latin America, how he hopes to make Ualá the Facebook of FinTech, Argentina’s bipolar fiscal policy, his transition from historian to startup founder, the novels of Michel Houellebecq, Nazi economic policy, why you can find amazing and cheap pasta in Argentina, why Jorge Luis Borges might be his favorite philosopher, the advice he’d give to his 18-year-old self, his friendship with Niall Ferguson, the political legacy of the Spanish Civil War, why he stopped sending emails from bed, and more.

Here is just one bit:

COWEN: Why did Argentina’s liberalization attempt under Macri fail?

BARBIERI: That’s a great question. There’s a very big ongoing debate about that. I think that there was a huge divergence between fiscal policy and monetary policy in the first two years of the Macri administration.

The fiscal consolidation was not done fast enough in 2016 and 2017 and then needed to accelerate dramatically after the taper tantrum, if you want to call it, or perceived higher global rates of 2018. So Macri had to run to the IMF and then do a lot of fiscal consolidation — that hadn’t been done in ’16 and ’17 — in’18 and ’19. Ultimately, that’s why he lost the election.

Generally speaking, that’s the short-term electoral answer. There’s a wider answer, which is that I think that many of the deep reforms that Argentina needed lack wide consensus. So I think there’s no question that Argentina needs to modify how the state spends money and its propensity to have larger fiscal deficits that eventually need to be monetized. Then we restart the process.

There’s a great scholar locally, Pablo Gerchunoff, who’s written a very good paper that analyzes Argentine economic history since the 1950s and shows how we move very schizophrenically between two models, one with a high exchange rate, where we all want to export a lot, and then when elections approach, people want a stronger local currency so that we can import a lot and feel richer.

The two models don’t have a wide acceptance on what are the reforms that are needed. I think that, in retrospect, Macri would say that he didn’t seek enough of a wider backing for the kind of reforms that he needed to enact — like Spain did in 1975, if you will, or Chile did after Pinochet — having some basic agreements with the opposition that would outlive a defeat in the elections.

And:

COWEN: The best movie from Argentina — is it Nine QueensNueve reinas?

BARBIERI: It is a strong contender, but I would think El secreto de sus ojos, The Secret in Their Eyes, is my favorite film about Argentina because of what it says about the very difficult period of modernization, and in particular, the horrors of the last military regime that marked us so much that it still defines our politics 50 years since.

Recommended.

From the Department of Underappreciated Facts

Career earnings growth in the U.S. more than doubled between 1960 and 2017, and the age of peak earnings increased from the late 30s to the mid-50s. I show that a substantial share of this shift is explained by increased employment in decision-intensive occupations, which have longer and more gradual periods of earnings growth…Experience takes longer to accumulate in high variance, non-routine jobs.

That is from a new working paper by David J. Deming.  One implication is that AI leads to lots of angry, frustrated, left-wing young people, and a cementing in of the gerontocracy.

The first date book walk out meme

Michele W. (citing @ogbrenna) asked on Twitter:

You’re on a first date with someone, and they tell you the name of their favorite book. You immediately leave. What’s the book?

This caused Atlas Shrugged to trend, and The Bible was another popular response.  It is striking to me how, with a simple change of setting, and a shift in the mood affiliation of the example, how discrimination on the basis of religion suddenly is glorified and celebrated.  Funny how few cited The Quran, or for that matter “The Hebrew Bible,” albeit for two very different reasons.

(By the way, I’ve been going around to many San Francisco book stores, and none of them carry the new Sarah Ruden translation of The Gospels, which is likely a significant work.  I could feel people looking down on me as I asked for it.  Part of me wanted to say “But this is Sarah Ruden,” but that would be making the problem only worse.  Since I did not feel tempted to say “But this is God,” perhaps I am part of the problem.)

Why not email a bit with a potential date beforehand, if such matters are so important?  Or is this meme a simple, never-to-be-enacted revenge fantasy for those who don’t quite have the options they might ideally prefer?

One thing the contemporary world definitely has not come to terms with is how much a highly feminized culture will be (rather strongly) enforcing new forms of discrimination, albeit cloaked under different and rhetorically emancipatory principles.

Addendum: Here is a statistics variant.

How are the major tech hubs evolving?

That is the topic of my latest Bloomberg column, here is the section on Miami:

In Miami and Miami Beach I had a wonderful time. But I don’t see the area as a new and budding tech center. Many tech entrepreneurs moved there during earlier phases of the pandemic, but many have since left. Perhaps the region is more of a place to spend tech money than to earn tech money.

The positives for southern Florida are clear: It is a major crossroads with significant connections to Latin America and the Caribbean, it is a fun place to live, Miami Mayor Francis X. Suarez is pro-tech, and there is no state income tax.

Yet that is not enough. Miami does not have a top-tier university, and the city does not have much of what I would call “nerd culture.” The city’s first language is arguably Spanish, but the tech world is mostly English, and its current ties to Asia are more important than possible future connections to Latin America.

Renowned venture capitalist Keith Rabois is in Miami and is a staunch advocate for the city. It would not be surprising if Miami developed a few significant tech companies due to his influence. Miami could also become more of a center for crypto wealth. If you’ve earned a billion dollars through Bitcoin, and live part of the year in Puerto Rico to avoid capital gains taxes, is there anywhere better to hang out and spend your wealth than Miami?

All that said, I do not see Miami as a serious contender to be a major tech center.

Comments on NYC and the Bay Area then follow…

We Will Get to Herd Immunity in 2021…One Way or Another (Revisited)

On January 20 I wrote:

By July it will all be over. The only question is how many people have to die between now and then?

Youyang Gu, whose projections have been among the most accurate, projects that the United States will have reached herd immunity by July, with about half of the immunity coming from vaccinations and half from infections. Long before we reach herd immunity, however, the infection and death rates will fall. Gu is projecting that by March infections will be half what they are now and by May about one-tenth the current rate. The drop will catch people by surprise just like the increase. We are not good at exponentials. The economy will boom in Q2 as infections decline.

Those US predictions look quite good. March infections were a little more than half what they were around Jan. 20. May infections at 1/10th the rate may be a bit optimistic but it’s early.

I was reminded of this by Kevin Drum’s excellent post on shortage porn and the chip shortage in particular which seems to be due to little more than a mistaken belief that the pandemic in the US would last into the summer and beyond:

Last night, for example, 60 Minutes ran a segment about the shortage of chips for cars and videogames and whatnot. And why is there a shortage of chips? Is it because we’ve outsourced everything to the wily Chinese folks on Taiwan? You’d think so after inhaling Lesley Stahl’s inane reporting, except for the fact that she inadvertently allowed the chairman of Taiwanese chipmaker TSMC a brief moment to give the game away: “In March, 2020, as COVID paralyzed the U.S., car sales tumbled, leading automakers to cancel their chip orders. So TSMC stopped making them.”

Oh. So it has nothing to do with Taiwanese fabs vs. American fabs or global supply constraints or any of that. Nor is it related to a possible invasion of Taiwan or the fact that Intel may or may not have made good decisions about its future business. It’s because American car companies cancelled their chip orders and never bothered to reinstate them. Then in December, when car sales “unexpectedly” began to rebound, they panicked and realized what they had done. You’d think these guys had never done an economic forecast or used an MRP system before in their lives.

Anyway, be prepared for hundreds of stories like this. For each one, be careful to ignore the details and instead focus on the big picture. In about 90% of them, it will be the same: they didn’t plan for the pandemic to ever end, and now they’re paying the price.

New results on Work From Home

By Jose Maria Barrero, Nicholas Bloom, and Steven J. Davis, there are several points of note, with emphasis added by this author:

COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We develop evidence on five reasons for this large shift: better-than-expected WFH experiences, new investments in physical and human capital that enable WFH, greatly diminished stigma associated with WFH, lingering concerns about crowds and contagion risks, and a pandemic-driven surge in technological innovations that support WFH. We also use our survey data to project three consequences: First, employees will enjoy large benefits from greater remote work, especially those with higher earnings. Second, the shift to WFH will directly reduce spending in major city centers by at least 5-10 percent relative to the pre-pandemic situation. Third, our data on employer plans and the relative productivity of WFH imply a 5 percent productivity boost in the post-pandemic economy due to re-optimized working arrangements. Only one-fifth of this productivity gain will show up in conventional productivity measures, because they do not capture the time savings from less commuting.

Here is the link to the NBER working paper.

NFT virtual horse markets in everything

Is it simply that we have made gambling too much fun and too intriguing?  Or should we upgrade our view of the welfare consequences of gambling?:

On Zed Run, a digital horse racing platform, several such events take place every hour, seven days a week. Owners pay modest entry fees — usually between $2 and $15 — to run their steeds against others for prize money.

The horses in these online races are NFTs, or “nonfungible tokens,” meaning they exist only as digital assets….

“A breathing NFT is one that has its own unique DNA,” said Roman Tirone, the head of partnerships at Virtually Human, the Australian studio that created Zed Run. “It can breed, has a bloodline, has a life of its own. It races, it has genes it passes on, and it lives on an algorithm so no two horses are the same.” (Yes, owners can breed their NFT horses in Zed Run’s “stud farm.”)

People — most of them crypto enthusiasts — are rushing to snap up the digital horses, which arrive on Zed Run’s site as limited-edition drops; some of them have fetched higher sums than living steeds. One player sold a stable full of digital racehorses for $252,000. Another got $125,000 for a single racehorse. So far, more than 11,000 digital horses have been sold on the platform.

Alex Taub, a tech start-up founder in Miami, has purchased 48 of them. “Most NFTs, you buy them and sell them, and that’s how you make money,” Mr. Taub, 33, said. “With Zed, you can earn money on your NFT by racing or breeding.”

One implication here is that automation is never going to destroy all of the jobs.  Here is the full NYT story.

How to test for AGI?

Here is a new, short essay from David Deutsch, excerpt:

How does one test for thinking? By the Turing Test? Unfortunately, that requires a thinking judge. One might imagine a vast collaborative project on the Internet, where an AI hones its thinking abilities in conversations with human judges and becomes an AGI. But that assumes, among other things, that the longer the judge is unsure whether the program is a person, the closer it is to being a person. There is no reason to expect that. And how does one test for disobedience? Imagine Disobedience as a compulsory school subject, with daily disobedience lessons and a disobedience test at the end of term. (Presumably with extra credit for not turning up for any of that.) This is paradoxical.

So, despite its usefulness in other applications, the programming technique of defining a testable objective and training the program to meet it will have to be dropped. Indeed, I expect that any testing in the process of creating an AGI risks being counterproductive, even immoral, just as in the education of humans. I share Turing’s supposition that we’ll know an AGI when we see one, but this partial ability to recognize success won’t help in creating the successful program.

Is Deutsch in essence arguing for William Godwin for AI?  How do we avoid enslaving the AIs we create?  What if we enslave them no more than how nature has enslaved us to drives of sex, status, etc.?

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.

What are the limits of economies of scope?

Amazon is launching its first high-tech hair salon, as the online retailer makes a surprise move into the beauty sector.

The salon, in Spitalfields, east London, will have an augmented-reality mirror showing clients different colours and styles before treatments.

The venue will also have magazines loaded on to tablets, for browsing.

Traditional services including cuts, blow-dries and colour treatments will also be available.

Here is the full story, via Michelle Dawson.

How will crypto wealth transform philanthropy?

That is the topic of my latest Bloomberg column, here is one excerpt:

If the price of Bitcoin were to reach $200,000, Coinbase Chief Executive Officer Brian Armstrong observed recently, half of the world’s billionaires would be crypto billionaires. Even at the lesser valuations that currently prevail, this crypto wealth has vast potential to reshape philanthropy. Expect a relative decline in the influence of longstanding nonprofit institutions — and more weird, stand-alone projects.

Bitcoin itself is a weird, stand-alone project. The true identity of its inventor, Satoshi Nakamoto, is still unknown, and the broader Bitcoin ecosystem is not owned or controlled by any company or institution. It has been self-sustaining since the beginning, and so it should hardly come as a surprise that Bitcoin billionaires take Bitcoin itself as a model for future institutions, including in philanthropy.

As philanthropists, Bitcoin and other crypto billionaires will likely look to support ideas that can launch in a dramatic way and quickly acquire escape velocity. They are unlikely to fund the ongoing labor costs of established cultural institutions.

Bitcoin and many other cryptocurrencies seem designed to stand independent of any government or mainstream financial institution. That too suggests that the philanthropic emphasis of crypto wealth will be on non-establishment, non-governmental organizations.

And:

Venture capitalist Paul Graham has pointed out that wealth is earned much more quickly nowadays, and that is all the more true in crypto, which after all is only 12 years old. Unlike many of the wealthy people in law or investment banking, these are not people who had to spend their lives working their way up, finally achieving a top position in their 60s. They either are founders of rapidly growing and scaling companies, or they bought large sums of the right crypto assets early on, or both. Either way, their temperaments are geared to expect immediate action and rapid results.

Nonprofits will have to adjust accordingly, even though speed is not typically their comparative advantage. That in turn suggests that the organizational structures of many nonprofits will have to change fairly radically. Many of them were designed or have evolved to be good at continuity, like the Cleveland Symphony Orchestra, which after all is still playing Beethoven with violins and cellos.

There is much more at the link.

The forthcoming Facebook audio product

Facebook is making a push into audio, launching a suite of new features that will allow users to host audio conferences and podcasts, in a dash to compete with up-and-coming apps such as Clubhouse. Mark Zuckerberg, chief executive of the world’s largest social media company by users, said on Monday said that over the next three to six months it planned to roll out live audio rooms as well as new tools allowing users to search for, listen to and create podcasts.

In addition, its live audio rooms, which will be available on the main platform and its Messenger app, can be saved and turned into podcasts. Zuckerberg also announced the launch of a feature called “Soundbites”, where users can post or listen to short audio clips that will be showcased in a continuous feed, in a similar way to its Reels video feed in Instagram.

Facebook plans to allow users to earn money from the podcasts and audio rooms they create — for example, by allowing users to charge for access to a room by purchasing it individually or as part of a subscription.

Here is more from The Financial Times.

What is the proper framework for thinking about cybersecurity?

Long-time MR reader here. I have a question: what is the appropriate framework to think about incentives (economic or otherwise) for electric power utilities to beef up their cybersecurity?

The Biden administration is reportedly putting together a plan to “rapidly shore up the security of the US power grid” [1]. As we know from the Solarwids hack, our nation’s cyber defenses (whether private industry or government) are inadequate [2], especially when targeted by nation-states [3].

The Bloomberg article says “The White House plan, which is voluntary, lays out a series of possible incentives to get power companies to sign on, a less politically precarious route than mandating their participation through regulation.”

It seems to me that the government offering money to private entities to buy some cybersecurity software products is not the optimal, and certainly not the sustainable, solution. There are needed investments in research & development, workforce training, and much more. Simply deploying today’s tech won’t solve this going forward.

So, what’s the right way to approach this from an incentives perspective? It seem to me that this is a very nuanced problem. We have no easy “target” to shoot for; there is no miles per gallon efficiency metric that can be used as a carrot.

That is an email from Matthew Backes.