Category: Web/Tech

The gender gap in preferences

This is taken from new work by Ángel Cuevas, Rubén Cuevas, Klaus Desmet, and Ignacio Ortuño-Ortín.  Here is the abstract:

This paper uses information on the frequency of 45,397 Facebook interests to study how the difference in preferences between men and women changes with a country’s degree of gender equality. For preference dimensions that are systematically biased toward the same gender across the globe, differences between men and women are larger in more gender-equal countries. In contrast, for preference dimensions with a gender bias that varies across countries, the opposite holds. This finding takes an important step toward reconciling evolutionary psychology and social role theory as they relate to gender.

Here is a bit more:

Our premise is that innately gender-specific interests should mostly conform to evolutionary psychology theory, whereas other interests should mostly conform to social role theory. We find strong evidence consistent with this premise.

And some detail on the categories:

We say that an interest is gender-related if it displays a systematic bias toward the same gender across the globe. More specifically, if in more than 90% of countries an interest is more prevalent among the same gender, then we refer to it as gender-related. For example, “cosmetics” and “motherhood” are universally more common among women, whereas “motorcycles” and “Lionel Messi” are universally more common among men. Conversely, we say that an interest is non-gender-related if its gender bias varies across countries. More specifically, if an interest is more common among men in at least 30% of countries and more common among women in at least another 30% of countries, then we refer to it as nongender-related. For example, “world heritage site” and “physical fitness” do not display a systematic gender bias across the globe.

And indeed everything works out as one ought to expect.  In the more gender-equal countries, men have “more male” interests, and the women have “more female” interests.  But for the less gender-specific interests, greater equality ends up resulting.  As for magnitude:

the standardized β is 30% when taking 9 dimensions, meaning that a one standard deviation increase in gender equality increases the difference in preferences between men and women by 30% of its standard deviation. The corresponding standardized β when taking 68 dimensions is 19%. Overall, the evidence points to a positive relation between gender equality and the difference in interests between men and women.

Hope you all are interested in this one!

Mobile internet and political polarization

So far this paper is my favorite of the job market papers I have seen this year, and it is by Nikita Melnikov of Princeton.  Please do read each and every sentence of the abstract carefully, as each and every sentence offers interesting and substantive content:

How has mobile internet affected political polarization in the United States? Using Gallup Daily Poll data covering 1,765,114 individuals in 31,499 ZIP codes between 2008 and 2017, I show that, after gaining access to 3G internet, Democratic voters became more liberal in their political views and increased their support for Democratic congressional candidates and policy priorities, while Republican voters shifted in the opposite direction. This increase in polarization largely did not take place among social media users. Instead, following the arrival of 3G, active internet and social media users from both parties became more pro-Democratic, whereas
less-active users became more pro-Republican. This divergence is partly driven by differences in news consumption between the two groups: after the arrival of 3G, active internet users decreased their consumption of Fox News, increased their consumption of CNN, and increased their political knowledge. Polarization also increased due to a political realignment of voters: wealthy, well-educated people became more liberal; poor, uneducated people—more conservative.

My read of these results (not the author’s to be clear!) is that the mobile internet polarized the Left, but not so much the Right.  What polarized the Right was…the polarization of the Left, and not the mobile internet.

And please do note this sentence: “This increase in polarization largely did not take place among social media users.”  It seems that on-line versions of older school media did a lot of the work.

Here are further papers by Melnikov.

The teleshock

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

If you have had a relatively comfortable job during the pandemic, it might now be time to worry.

The more culturally specific your knowledge and skills, however, the more protected you will be. Doing math and writing code are universal skills. But if you are a wedding consultant, even an online wedding consultant, you’re probably not going to lose business to a competitor from Zimbabwe, no matter how sharp. On the whole, more people will end up in jobs that feel very “American,” for lack of a better word. Legally protected sectors — law, medicine and other professions requiring occupational licenses — will also get more crowded.

Among the winners will be American managers, shareholders and consumers. Managers will be able to hire the world’s best talent, at least from the English-speaking world, while productivity gains will translate into more profitable companies and better and cheaper products.

Big business will likely benefit more than small business. The larger companies have the networks and the brand names to attract the best overseas talent. And if a worker overseas cannot perform all the functions of a particular job, a larger company can more easily fill in the gaps with other talent.

It will also be very good for American U.S. soft power. The U.S. has a lot of successful, well-known multinational corporations. Think of all the many people around the world who might like to work for Apple, for example. American culture also seems to produce highly talented managers, and U.S. business is used to working with people from many different cultures. (This is in contrast to, say, Japan, which will not benefit as much as the U.S. from the teleshock, while Anglophone-friendly countries such as Sweden and the Netherlands may do well.)

The teleshock is likely to continue for a considerable period of time, perhaps longer than the China shock. It is conventional wisdom that “software is eating the world.” As software and tech become larger and more important, more of their jobs can be outsourced. The process will have no natural end. Furthermore, more people in the world will learn English, including in low-wage countries, so the potential competitive supply of affordable workers will not be exhausted anytime soon.

Recommended.

Tyrone on crypto assets

Egads, what a fool this man is!  Nonetheless he has grown wealthier as of late, so I thought I would give him the indulgence of another MR post.  Little did I know what arrant nonsense he would come up with.  Here is what he started with, the transcription from the Pig Latin being mine:

“Tyler, let’s play the envelope game.  I give you an envelope with $100, and I tell you it is going to either double or half in value.  (Think of it like a floating exchange rate that either will go to 2-1  or 1-2, with equal probability.)  So you will end up with either $200 or $50, the expected value therefore being $125.  That is a good deal for you!  You started with $100, and you can expect now $125.

You would love to keep on playing this envelope game of course, except no one will play that envelope game with you even once.  Until now.

In essence, by “tolerating” cryptocurrency, big-time fiat money holders have agreed to keep on playing this game.  And so, if this continues, over time crypto will absorb more and more of the wealth in an economy.  Just by playing the envelope game!

After all, the indirect utility function is convex in prices and the rest of the world is creating a floating exchange rate game for us for free!  That is why so many different crypto assets keep proliferating!

The only joke about dogecoin is that it isn’t doing even better than it is.

What is philanthropy going to look like in five years’ time?  All life extension technologies?

The envelopes game, of course, doesn’t boost the quantity of real resources, so eventually the purchasing power of non-crypto holders will shrink, shrink, shrink.  That is why we will need a UBI, not because of AI.

Of course you might think that the fiat holders won’t tolerate the crypto game forever.  And maybe not.  But as long as there is any chance whatsoever that crypo assets turn out to have real value, at least some of those fiat money sows will be lining up at the trough to trade at some exchange rate…the envelopes game thus will continue!

At this point I had to push Tyrone down the stairs.  Such fallacies!  Such absurdities!  I even offered him an envelope of his very own if he would shut up, but to no avail.  I demanded that he write down the transversality condition for this fool game he had postulated, but all he could was recite the envelope theorem, another sign of his deep and utter confusion.

As he was falling down the stairs, he kept on insisting that Satoshi really was Satan, that all of the world’s wealth would fall into the hands of The Whales, that we all needed to reread Melville, and Johan Jensen, and ponder the Leviathan from Psalms, Jonah, and Job, and our sins, and that everyone trading with crypto holders was caught in a massive prisoner’s dilemma — collectively handing them volatile exchange rates and thus envelope games for free — and yes this was a long and deep stairwell…

Dear reader, I hope you never have to suffer under such sophistries and indignities again.

I return you now to your regularly scheduled programming, for however long it may last…at the very least writing this blog does not require much money.  Yes, my cherished reader, it is my UBI…and so crypto will be allowed to proceed…

Will stablecoins have fluctuating prices?

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

Even if all goes well, why should those different brands of stablecoins remain priced at $1 apiece? In most well-functioning markets, suppliers compete on innovation, quality and price. That diversity is the natural outcome of trying to figure out which coin systems — fully stable or not — are best.

If market prices do not communicate this information, how can you discover it? In my vision, higher prices will signify a coin’s quality and attract more business; the coins with strictly fixed prices will fill a niche; and the coins with lower prices will lose business, or otherwise serve as discount issues for those of lower means.

And:

On a more positive note, if you think stablecoins serve so many new and marvelous functions, you would expect many of those assets to sell for more than a dollar.

And:

For another look at why prices won’t stay fixed, consider the incentives of a stablecoin issuer. Let’s say your issue is currently one-to-one with the U.S. dollar and you are holding 100% reserves of very safe assets. Might you then be tempted to go down to 98% reserves? 95%? If the price of your coin stays at $1, fine, you come out ahead. If the price declines in proportion to the new and higher risk, you as an issuer still have broken even. So it seems that coin issuers will have an incentive to test the one-to-one exchange rates by diluting their backing.

Recommended.

Markets in everything

In the latest phase of the quest to turn everything into an NFT, crypto traders are now bidding to digitally own a 1,784-lb. cube of tungsten in Willowbrook, Illinois. According to the terms of the sale, which will have the receipt posted to the blockchain for posterity, the “owner” can have one supervised visit to the cube per year to touch or photograph it.

Over the past two weeks, a joke fired off by Coin Center’s Neeraj Agrawal about a nonexistent tungsten shortage thanks to crypto traders buying cubes of tungsten due to a meme actually caused one for Midwest Tungsten Service. The Illinois manufacturer actually creates small cubes of tungsten, and the tweet caused a 300 percent increase in sales that depleted the company’s stock on Amazon, Coindesk reported.

Last week, The Block reported that the company entered a partnership with crypto payment processor OpenNode to accept Bitcoin payments. One explanation as to why this is happening, which doesn’t really explain why this is happening, was offered to The Block by CMS Holdings’ Dan Matuszewski, who said “crypto just has a propensity for the density.” Tungsten is a very dense metal, comparable to uranium or gold, and its surprising weight is, apparently, pleasurable.

Midwest Tungsten told Coindesk that it primarily makes these cubes for industrial firms, and Sean Murray, the company’s director of e-commerce, suggested to Coindesk there would be a 14-inch cube next. The company offers cubes ranging from an 18-gram, 1-centimeter cube that costs $19.99 to a 41-pound, 4-inch cube that costs $2,999.99.

Well, the 14-inch cube is finally here. It weighs 1,784 poinds and is now listed on OpenSea as an NFT. Seemingly, it’s the biggest cube that Midwest Tungsten can create.

“Since we began selling the cube we have constantly asked ourselves, ‘What is the right size?’, and ‘Would anyone buy a bigger cube?’ Only recently has anyone asked us, or have we asked ourselves, ‘What is the biggest cube we can make?’

Here is the full story, via the excellent Samir Varma.  You know, circa 2010 I thought MR was about to run out of startling “Markets in Everything” examples — how wrong I was!

Will this revolution be televised?

More than a century after the artists of the Vienna Secession declared “to every age its art; to art its freedom”, the Austrian capital has found a new site for artistic expression free from censorship: the adults-only platform OnlyFans.

Vienna’s tourism board has started an account on OnlyFans – the only social network that permits depictions of nudity – in protest against platforms’ ongoing censorship of its art museums and galleries.

In July, the Albertina Museum’s new TikTok account was suspended and then blocked for showing works by the Japanese photographer Nobuyoshi Araki that showed an obscured female breast, forcing the museum to start a new account. This followed a similar incident in 2019, when Instagram ruled that a painting by Peter Paul Rubens violated the platform’s community standards which prohibit any depictions of nudity – even those that are “artistic or creative in nature”.

In 2018, the Natural History Museum’s photograph of the 25,000-year-old Venus of Willendorf figurine was deemed pornographic by Facebook and removed from the platform.

The Leopold Museum has likewise struggled to promote its collection of nudes by the expressionist Egon Schiele, with advertising regulators in Germany, the UK and US refusing to show them in a city tourism campaign in 2018. (The tourist board successfully resubmitted the posters with banners obscuring the bare bodies reading: “Sorry – 100 years old but still too daring today.”)

Here is more from The Guardian, via Jason D.

Stripe v. Elrond! Crypto and the Payments System

Recently Elrond, the blockchain startup for which I am an advisor, bought a payments processor (conditional on approval from the Romanian government). On the same day, Stripe, the payments processor, announced that they are moving into crypto. None of this is coincidental. Elrond understand that the payments market is a multi-trillion dollar opportunity. Stripe knows that crypto innovation could undercut them very quickly if they aren’t prepared.

How did Stripe turn into a multi-billion dollar firm almost overnight? Obviously, Stripe is a great firm, led by the brilliant Collison brothers, CEO Patrick Collison and President John Collison. But it’s also important to understand that the payments market in the United States is a $100 trillion dollar market. Yes, $100 trillion. Any firm that captures even a small share of this market is going to be big. Credit cards are actually a small part of payments, about $7 trillion with roughly a 2% transaction fee or a $140 billion market. (Quick check. Credit card companies had 2020 revenues of $176 billion).  ACH debit and credit transfers are the big market, $65 trillion, which at a .5% transaction fee amounts to a $325 billion market (this is retail price, wholesale is lower). Thus, payments revenue is on the order of $465 billion. A small share of $465 billion is a very big market (and that is just the US market).

Now consider the following. Crypto payments are in principle at least an order of magnitude cheaper than ACH payments. On Elrond, for example, a very fast and low cost blockchain compared to Ethereum or Bitcoin, someone recently transferred $17.5 million for less than a penny. Moreover, crypto payments are global while every other payments system gets much more expensive as you cross borders. I recently sent $1500 to India and it cost me $100 in transaction fees! To be sure, payments made through the banking system have to obey “Know Your Customer” regulations and also include invoicing and billing services which adds both to value and cost. The main reason, however, that payments through the banking system are expensive is because the banking system rails are taped together with two hundred years of spit and duct tape.

Crypto payments are the future. Stripe knows it. Elrond knows it. The race is on.

More details on Instagram being underrated

Contrary to The Wall Street Journal’s characterization, Instagram’s research shows that on 11 of 12 well-being issues, teenage girls who said they struggled with those difficult issues also said that Instagram made them better rather than worse.

That is from…Facebook, but it seems to be true.  Here is some further exposition:

In fact, in 11 of 12 areas on the slide referenced by the Journal — including serious areas like loneliness, anxiety, sadness and eating issues — more teenage girls who said they struggled with that issue also said that Instagram made those difficult times better rather than worse. Body image was the only area where teen girls who reported struggling with the issue said Instagram made it worse as compared to the other 11 areas. But here also, the majority of teenage girls who experienced body image issues still reported Instagram either made it better or had no impact.

The mainstream media, not surprisingly, are interpreting all this as a big takedown for Facebook, one of their main competitors I might add.  Here is one relevant image:

I would make two more general points.  First, you could very easily argue that eyeglasses make (many not all) teenage girls feel worse about their body image.  Lots of things will.  Automobiles.  Parties.  Clothes shops.  Such costs are not zero, but they have to be put in perspective.

Second, the lives of teenage girls are messy and complex.  Anything that plays a noticeable role in said lives also will have effects that are messy and complex.  Deal with it.  The same used to be true of the (old-fashioned) telephone as well, not to mention birth control pills and automobiles.

Instagram is a huge “universe,” and I have only a fragmentary knowledge of it.  Yet virtually everything I have seen, read, and heard indicates it is one of the more positive corners of the internet.

All via Nir Eyal.  And do note that I write for Facebook at marginalrevolution.bulletin.com.  Not afraid to tell you, though, that this post is what I really think.  I argued similar points years earlier in my book Big Business: Love Letter to an American Anti-Hero.

p.s. Every now and then tylercowenfairfax does some Instagram Stories…

*Ich bin dein Mensch*

The English-language title is the somewhat different “I’m Your Man,” as Mensch is a more universal and less gendered concept.  The premise is that a researcher woman is to spend three weeks with a robot man, possibly romantically, and then report back on the experience.  I thought this was a “good enough” AI movie, better than most American reviews are indicating.  Here are some links.  The first hour was quite good, with subtle German jokes about surveillance paranoia and grammar reform, among other matters.  It is partly about the German national character, and how difficult it is to fit together its earlier and current forms.  Then for a while the movie runs out of steam, though with a nice close.  I took the final message to be that older men and those content with inauthenticity will be the big winners from advanced AI and robots.  That might just be right.

Guardianship, in practice, is often worse than you might think: the surveillance of Britney Spears

Britney Spears’s father and the security firm he hired to protect her ran an intense surveillance apparatus that monitored her communications and secretly captured audio recordings from her bedroom, including her interactions and conversations with her boyfriend and children, according to a former employee of the security firm.

Alex Vlasov, the employee, supported his claims with emails, text messages and audio recordings he was privy to in his nine years as an executive assistant and operations and cybersecurity manager for Black Box, the security firm. He came forward for a new documentary by The New York Times, “Controlling Britney Spears,” which was released on Friday.

Recording conversations in a private place and mirroring text messages without the consent of both parties can be a violation of the law. It is unclear if the court overseeing Ms. Spears’s conservatorship was aware of or had approved the surveillance.

Mr. Vlasov’s account, and his trove of materials, create the most detailed portrait yet of what Ms. Spears’s life has been like under the conservatorship for the past 13 years. Mr. Vlasov said the relentless surveillance operation had helped several people linked to the conservatorship — primarily her father, James P. Spears — control nearly every aspect of her life…

Mr. Vlasov said that Ms. Spears’s phone had been monitored using a clever tech setup: The iCloud account on her phone was mirrored on an iPad and later on an iPod. Mr. Yemini would have Mr. Vlasov encrypt Ms. Spears’s digital communications captured on the iPad and the iPod to send to Mr. Spears and Robin Greenhill, an employee of Tri Star Sports & Entertainment Group, the former business manager for the singer’s estate.

This arrangement allowed them to monitor all text messages, FaceTime calls, notes, browser history and photographs.

Here is the full NYT story by Liz Day.  And by the way, there also was extensive surveillance of people in the “Free Britney!” movement, paid for ultimately by Britney herself.  Hi guys!

What is *the best* time zone for global work and Zoom?

That is the topic of my latest Bloomberg column, and my answer is Ireland and the UK (Portugal too).  Excerpt:

West Coast meetings are trickier. But if you don’t take any past 2 p.m., they’re still manageable. Keep in mind that a lot of technology types start their day at 7 a.m. or earlier, precisely because they are trying to more closely match East Coast hours. So the nominal time difference might be eight hours, but due to work norms you get about an hour and a half of that back, leading to what is in effect a six-and-a-half-hour time difference between your Cotswolds chateau and that conference room in Seattle.

And:

I, for one, prefer to be working in the British time zone, even though most of my commitments are on U.S. East Coast time. For one thing, I have mornings largely to myself. Emails have accumulated while I slept, but there is little pressure to answer most of them right away. Americans on the East Coast are sleeping; if they’re on the West Coast, they will soon be preparing for bed.

Call it an illusion if you wish. But sitting in Dublin with my computer, it feels like I am several hours ahead of everybody else. By the time the email and meeting onslaughts arrive, I’ve already gotten a lot done.

And if you believe in “money illusion,” you might not like that half hour trick they pull in India.  As a side note, you might wish to consider the times global chess tournaments are held (often starting 10 or 11 a.m. EST), or for that matter when pre-written MR posts pop up in the morning, namely between midnight and three a.m. EST.  You will again see a lot of catering to what I view as “the dominant time zone,” that of London.