Results for “my favorite things”
241 found

Paris advice

1. A few of the best restaurants are Pierre Gagnaire, Taillevent, Le Cinq, and perhaps Guy Savoy.  Most critics might put Gagnaire as number one.

2. Michelin "two-forkers" are quite good, but you must book to get in.  In general you can’t get a seat in a decent Parisian restaurant unless you either book or show up at opening.  If you are wandering around looking for good food at 8:30 p.m., or for that matter 1 p.m., you are unlikely to do well.

3. In The Louvre, spend an hour in the Poussin room and also obsess over Watteau’s Voyage to Cythera.

4. In Musee d’Orsay, gaze at Courbet’s Origin of the World (sorry, I can’t link to the image on a family blog but do Google it) and Puis de Chavannes, in addition to the usual delights.

5. Go see the medieval tapestries at Musee Cluny.

6. Spend a few hours walking the main roads of the Left Bank.  Start at Invalides and take the major arteries through to the Islamic Center.  Walk, walk, walk.

7. Watch The Triplets of Belleville and spend hours walking through the (rapidly gentrifying) working-class neighborhoods of the Right Bank.  The Metro is splendid but it robs you from seeing the greatest walking city on earth (Buenos Aires is number two).  Don’t take it.  Walk, walk, walk.

8. Go into a good cheese shop and spend $40.  Focus on the weirder cheeses.  Buy the non-pasteurized delights.  Sit down with a baguette and some fruit as well, finishing the meal with small squares of outrageously priced dark chocolate.  Throw in a sausage for good measure.  Keep the cheese leftovers in your room at night and eat them for breakfast the next day.  And the day after that.  See how many days they will keep, you will be surprised.

9. Rue de Bussi and thereabouts has a convenient collection of cheese, fruit and bread shops, and it is in an excellent part of the Left Bank.

10. Internet Cafes are hard to come by.  You must rely on the dumpy area near Centre de Pompidou.  I find Paris to be the hardest city to blog from.

11. See a "world music" concert from Algeria, Madagascar, or the Congo.  Or try contemporary music at IRCAM.

12. Here is my previous post My Favorite Things French.  Douse yourself in Godard films  before going.  Start with Breathless, Band of Strangers, and My Life to Live.

13. If you want to read recent French social science (if you can call it that), try Bruno Latour’s We Have Never Been Modern, Jean Baudrillard, Alain Badiou’s Metapolitics, and Gilles Deleuze’s Anti-Oedipus.  Don’t get too upset if these books only make intermittent sense.  At least they are alive.  For a recent hit novel, try Houllebecq’s The Elementary Particles.

Comments are open, and I encourage all of you but especially John Nye and Barkley Rosser — both Paris experts — to make a few suggestions for my friend.

Wednesday assorted links

1. “The telltale sign of a successful intellectual life is weirdness – weird in the best possible way.”  Short essay on my approach to things, a good piece I thought.

2. How much did slavery and cotton accelerate U.S. economic growth?

3. Will China build a dam with an army of robots and 3-D printers?  (Would not take entirely at face value this one.)

4. “The New York Times has apologised after the word “fetus” was included as the solution to the day’s Wordle challenge for some players.

5. Are these really Werner Herzog’s favorite eight films?

6. Who measures prices to determine inflation rates? (WSJ)

Sunday assorted links

1. New Yorker on DAOs.

2. Are deontological ethics incompatible with Progress?

3. Good NYT story on Pegasus.

4. “My favorite is Ragnheidur Eiríksdóttir, who “has been a nurse, journalist, sexual health and self-confidence instructor, and, of all things, knitting tour operator.””  Link here.  The feminized culture that is Iceland!

5. “Bored in the pandemic, she made art by bruising bananas. Now she has an international following.

6. Straussian Magnus Carlsen — can you figure it out?

“But are you short the market?”

“But are you short the market?” That is my favorite rejoinder to expressions of radical pessimism. It came to mind recently when I read an opinion piece suggesting that “the United States as we know it could come apart at the seams.”

…Besides, shorting the market does not have to be impossibly risky. Just buy some unleveraged market puts each year until that position pays off. That’s not a great investment tactic for most people, but it makes sense for diehard pessimists. Are they even asking around about how to do this, the way you might ask for recommendations for a good restaurant or a masseuse?

I do have friends and acquaintances who work in finance who short particular assets. If they short the entire market, it might be in frothy times — when things seem good and indeed are good, albeit not as good as sky-high prices indicate. That trading tactic, whether prudent or not, is hardly an indicator of mega-pessimism.

There are committed pessimists in the world. Argentina, for instance, is full of pessimists about the Argentinian economy. Typically they have dollar-based bank accounts abroad, which take time and trouble to set up. So there are ways of expressing true pessimism, if you mean it.

Another curious response I hear from pessimists is that they aren’t short the market because the death of democracy in the U.S., or the birth of fascism, isn’t going to be bad for the stock market. That is at least a consistent view — but it is wrong and oddly anti-democratic.

I for one think that America’s biggest and best companies will do better in an era of stability, freedom and economic growth. Fascism is too terrible to succeed for very long.

That is from my latest Bloomberg column, I conclude that very few Americans are truly pessimistic.

Most Popular MR Posts of the Year!

As measured by page views here are the most popular MR posts of 2021. Coming in at number 10 was Tyler’s post:

10. Best non-fiction books of 2021

Lots of good material there and well worth revisiting. Number 9 was by myself:

9. Revisionism on Deborah Birx, Trump, and the CDC

TDS infected many people but as the Biden administration quickly discovered the problems were much deeper than the president, leading to revisionism especially on the failures of the CDC and the FDA. Much more could be written here but this was a good start.

Number 8 was Tyler’s post:

8. The tax on unrealized capital gains

which asked some good questions about a bad plan.

7. We Will Get to Herd Immunity in 2021…One Way or Another

Sadly this post, written by me in January of 2021, had everything exactly right–we bottomed out at the end of June/early July as predicted. But then Delta hit and things went to hell. Sooner or later the virus makes fools of us all.

6. Half Doses of Moderna Produce Neutralizing Antibodies

One of my earlier pieces (written in Feb. 21) on fractional dosing. See also my later post A Half Dose of Moderna is More Effective Than a Full Dose of AstraZeneca. We have been slow, slow, slow. I hope for new results in 2022.

5. A few observations on my latest podcast with Amia Srinivasan

Listener’s took umbrage, perhaps even on Tyler’s behalf, at Srinivasan but Tyler comes away from every conversation having learned something and that makes him happy.

4. The Most Impressive AI Demo I Have Ever Seen

Still true. Still jaw-dropping.

3. Patents are Not the Problem!

I let loose on the Biden administration’s silly attacks on vaccine patents. Also still true. Note also that as my view predicts, Pfizer has made many licensing deals on Paxalovid which has a much simpler and easier to duplicate production process (albeit raw materials are still a problem.)

2. A Nobel Prize for the Credibility Revolution

A very good post, if I don’t say so myself, on this year’s Nobel prize recipients, Card, Angrist and Imbens.

1. How do you ask good questions?

Who else but Tyler?

To round out the top ten I’d point to Tyler’s post John O. Brennan on UFOs which still seems underrated in importance even if p is very low.

Erza Klein’s profile of me still makes me laugh, “He’s become a thorn in the side of public health experts…more than one groaned when I mentioned his name.” Yet, even though published in April many of these same experts are now openly criticizing the FDA and the CDC in unprecedented ways.

UFOs going mainstream or Tabarrok’s view of the FDA going mainstream. I’m not sure which of these scenarios was more unlikely ex ante. Strange world.

Let us know your favorite MR posts in the comments.

The Rise and Decline and Rise Again of Mancur Olson

Mancur Olson’s The Rise and Decline of Nations is one of my favorite books and a classic of public choice. Olson may well have won the Nobel prize had he not died young. He summarized his book in nine implications of which I will present four:

2. Stable societies with unchanged boundaries tend to accumulate more collusions and organizations for collective action over time. The longer the country is stable, the more distributional coalitions they’re going to have.

6. Distributional coalitions make decisions more slowly than the individuals and firms of which they are comprised, tend to have crowded agendas and bargaining tables, and more often fix prices than quantities. Since there is so much bargaining, lobbying, and other interactions that need to occur among groups, the process moves more slowly in reaching a conclusion. In collusive groups, prices are easier to fix than quantities because it is easier to monitor whether other industries are selling at a different price, while it may be difficult to monitor the actual quantities they are producing.

7. Distributional coalitions slow down a society’s capacity to adopt new technologies and to reallocate resources in response to changing conditions, and thereby reduce the rate of economic growth. Since it is difficult to make decisions, and since many groups have an interest in the status quo, it will be more difficult to adopt new technologies, create new industries, and generally adapt to changing environments.

9. The accumulation of distributional coalitions increases the complexity of regulation, the role of government, and the complexity of understandings, and changes the direction of social evolution. As the number of distributional coalitions grows, it will make policy-making increasingly difficult, and social evolution will focus more on distributing wealth among groups than on economic efficiency and growth.

Olson’s book has become less well known over the years but you can gauge it’s continued relevance from this excellent thread by Ezra Klein which gets at some of the consequences of the forces Olson explained:

A key failure of liberalism in this era is the inability to build in a way that inspires confidence in more building. Infrastructure comes in overbudget and late, if it comes in at all. There aren’t enough homes, enough rapid tests, even enough good government web sites. I’ve covered a lot of these processes, and it’s important to say: Most decisions along the way make individual sense, even if they lead to collective failure.

If the problem here was idiots and crooks, it’d be easy to solve. Sadly, it’s (usually) not. Take the parklets. There are fire safety concerns. SFMTA is losing revenue. Some pose disability access issues. It’s not crazy to try and take everyone’s concerns into account. But you end up with an outcome everyone kind of hates.

I’ve seen this happen again and again. Every time I look into it, I talk to well-meaning people able to give rational accounts of their decisions.

It usually comes down to risk. If you do X, Y might happen, and even if Y is unlikely, you really don’t want to be blamed for it. But what you see, eventually, is that our mechanisms of governance have become so risk averse that they are now running *tremendous* risks because of the problems they cannot, or will not, solve. And you can say: Who cares? It’s just parklets/HeathCare.gov/rapid tests/high-speed rail/housing/etc.

But it all adds up.

There’s both a political and a substantive problem here.

The political problem is if people keep watching the government fail to build things well, they won’t believe the government can build things well. So they won’t trust it to build. And they won’t even be wrong. The substantive problem, of course, is that we need government to build things, and solve big problems.

If it’s so hard to build parklets, how do you think think that multi-trillion dollar, breakneck investment in energy infrastructure is going to go?
This isn’t a problem that just afflicts liberal governance, of course.

All these problems were present federally under Trump and Bush. They are present under Republican governors and mayors. But it’s a bigger problem for liberalism because liberalism has bigger public ambitions, and it requires trust in the government to succeed. I’m going to be working a lot over the next year on the idea of supply-side progressivism, and this is an important part.

Our Regulatory State Isn’t Learning

Outsourced to John Cochrane:

Delta is the fourth wave of covid, and amazingly the US policy response is even more irresolute than the first time around. Our government is like a child, sent next door to get a cup of sugar, who gets as far as the front stoop and then wanders off following a puppy.

The policy response is now focused on the most medically ineffective but most politically symbolic step, mask mandates. An all-night disco in Provincetown turns in to a superspreader event so… we make school kids wear masks in outdoor summer camps? Masks are several decimal places less effective than vaccines, and less effective than “social distance” in the first place.* Go to that all night disco, unvaccinated, but wear a mask? Please.

If we’re going to do NPI (non pharmaceutical interventions), policy other than vaccines, the level of policy and public discussion has tragically regressed since last summer. Last summer, remember, we were all talking about testing. Alex Tabarrok and Paul Romer were superb on how fast tests can reduce the reproduction rate, even with just voluntary isolation following tests. Other countries had competent test and tracing regimes. Have we built that in a year? No. (Are we ready to test and trace the next bug? Double no.)

What happened to the paper-strip tests you could buy for $2.00 at Walgreen’s, get instant results, and maybe decide it’s a bad idea to go to the all night dance party? Interest faded in November. (Last I looked, the sellers and FDA were still insisting on prescriptions and an app sign up, so it cost $50 and insurance “paid for” it.) What happened to detailed local data? Did anyone ever get it through the FDA’s and CDCs thick skulls that even imperfect but cheap and fast tests can be used to slow spread of disease?

…And then we indulge another round of America’s favorite pastime, answers in search of a question. Delta is spreading, so… extend the renter eviction moratorium. People who haven’t paid rent in a year can stay, landlords be damned.

All true. I got dispirited on testing. It’s insane that we don’t have cheap, rapid testing and good ventilation ready for a new school year. As I wrote about earlier, even the American Academy of Pediatrics is shouting from the rooftops that the FDA is deadly slow. The eviction moratorium is a sick joke. Just a backhanded way to redistribute wealth without a shred of justice or reason. Disgusting.

Here’s one more bit (but read the whole thing there is more.)

To learn from the mistakes, and institutionalize better responses would mean to admit there were mistakes. One would think the grand blame-Trump-for-everything narrative would allow us to do that, but the mistakes are deeply embedded in the bureacracies of the administrative state. Unlike bad admirals in WWII, nobody less than Trump himself has lost their job over incompetent covid response. The institutions have an enormous investment in ratifying that they did the best possible job last time. So, as in so many things (financial bailouts!) we institutionalize last time’s mistakes to keep those who made them in power in power — which means we do not learn from mistakes.

At this point, do you wish to simply not look too closely at the Delta data?

The delta Straussians also don’t want to debate safety claims very much. They fear that studying the data more closely will worry and paralyze us more, without much limiting the overall number of infections. In their view, vaccines have made things about as safe as they are going to get, and the contagiousness of delta will create lots of infections, albeit mostly relatively safe ones.

That’s what the proprietor of one of my favorite local restaurants believes. He is aware of the delta strain, and knows it is worse, though without being up on the numbers or the details. Earlier in the summer, he lifted the mask mandate for his restaurant, and he isn’t interested in restoring it. He is not a “Covid denialist,” but he figures normal business has to continue at some point and that point is now. Someone may well catch Covid in his restaurant, but those people might well have caught Covid anyway.

Our school reopenings face a similar paralysis-inducing dilemma. If we test every child every day, it will seem as if we have far too many cases of Covid, and the schools will shut again quickly. Nonetheless, given that delta is highly contagious, many of those children will catch Covid whether or not they go to school…

I do not rue the growth of delta Straussianism among my fellow citizens. If you can’t do anything about delta, if your institution needs to reopen sooner or later, if the booster shots in large numbers are not right around the corner, and yet another new variant might be coming along anyway, maybe you really do just need to get on with things. Restaurant reservations are robust, and the gym industry is surging back. I do not wish to reverse those trends, and it is hard to believe those customers are only the Covid denialists.

Here is the full Bloomberg column, which also offers a take on the British test and trace system.

*Peace, Poverty and Betrayal*

The author is Roderick Matthews, and the subtitle is A New History of British India.  This book has been highly controversial for its supposed “whitewashing” of British rule in India, but so far I find it insightful and indeed revelatory.  It is to date my favorite book this year, most of all conceptual but also remarkably well-informed historically.  Here is one excerpt:

Ultimately, we should condemn [British] colonialism not because it was self-glorifying and arrogant, but because it was small-minded and fearful.

Colonial rule was undoubtedly heavily responsible for the fact that India remainder both poor and backward — but the high Rah hid a subtler hypocrisy, in the way that Indian landlords, for a muddle of humanitarian and political reasons, were denied the scope that their British counterparts had allowed themselves.  British landowners drove their tenants off the land and adopted new methods of husbandry to increase profitability, which allowed them to create the agricultural surplus that stimulated the industrial revolution, and provided Britain with a float of national wealth to pay for colonial adventures.  Rural India remained overmanned and underproductive.

This short charge sheet differs from the extensive accusations made by modern left-leaning historians, who recognize economic exploitation but choose instead to emphasize cultural issues, especially the bureaucratization of Indian society and the introduction of capitalist norms.  This is hardly fair, because the progressive middle classes in India would have done broadly the same things if they could.  Almost nothing of the imperial administrative agenda was undone in independent India.  However, it is true that the modernization process was rushed and defective.  It was too self-interested, and the guiding hands were not indigenous.  Something similar might have emerged, but with a more Indian face.  We cannot know.

I will be covering this book more, but so far strongly recommended.  It is no accident that the author, while an experienced Indian historian, is not an academic.

Dan Wang’s 2020 letter

Most of it was about China, but here was my favorite part:

The key to reading Proust is not to pay too much attention to the plot. It’s of no great import, and one has to get used to abrupt shifts. In this way the novel is like Moby-Dick, which can shift from the politics of dining at Ahab’s table to a loving tour of the literal interior of a sperm whale’s head. Couldn’t find the transition? No matter, that detracts not at all from the wonderfulness of the scenes. Focus instead on the humor. There are many funny things that take place in the aristocratic set pieces, such as the constant misunderstandings of M. de Charlus at the dinner of the Verdurins, or his suspicion at the violinist who professes to enjoy solving algebra equations until late into the evenings, or his interactions with the Duc de Guermantes. Really anything with Charlus portends comedy.

Interesting throughout.  And:

I may not not have accomplished much in life, but I’m proud at least to have eaten thalis in Chennai, pizza in Naples, and mie goreng in Singapore.

I know that Beijing is not the world’s best food city, but it might be the best food city for me. One can grab expensive sushi at the restaurant favored by the Japanese embassy or walk a few blocks and order five plates of dumplings for $20. One can find decent dosas, lots of Thai food, and even a bagel store whose breads would be out of place on the Upper West Side but would not be in San Francisco. Best of all, every region of China is represented in this city. To deal with the various challenges of a pandemic year, I found solace in stuffing my face.

I managed to sample dishes from all the provinces this year, including the relatively obscure cuisines from places like Anhui, Guangxi, and Jiangxi. My favorites are: Shanghai, Sichuan, and Yunnan…

Here is my four-step process for ordering success in China:

  1. Greens are usually the glories of the cuisine: order as many vegetables as there are people
  2. If you will have a meat, consider the juiciness that pairs well with the starch: something saucy if you will eat with rice, or less saucy if you will have soup noodles
  3. Order Yunnan mushrooms if they are on the menu
  4. Fill out the rest with cold appetizers, they are never a bad idea

Here is the full piece.

Best classical music recordings of 2020

As you might expect, this has been a pretty spectacular year for listening to classical music on disc, too good you might say.  Here is what I enjoyed the most:

Beethoven Complete Piano works, by Martino Tirimo.  I probably know the performance canon for Beethoven piano sonatas better than any other area of classical music, and this is one of my two or three favorite sets of all time.  They are fresh, direct, and to the point, and remind me of the earlier Yves Nat set, though with better sound and the mistakes edited out.  Here is one review: “It’s decades since a pianist has managed to convey such an overwhelming sense that we’re listening to pure Beethoven. And there are 20 hours of it — surely the greatest recorded achievement of this anniversary year.”  The pianist is a 78-year-old Cypriot who is barely known even to most of the concert-going public.

Beethoven Bagatelles, by Tanguy de Williencourt.  This is Beethoven at his most arbitrary and willful and whimsical, all good things.  I have many recordings of these pieces, but these are perhaps my favorite.  Why again is it that French pianists are so good with Beethoven?

Beethoven, Complete works for Piano Trio, van Baerle Trio.  Again, the best recording of these works I have heard, and there is stiff competition.

Masaaki Suzuki put out more Bach organ music, and conducted an incredible version of Beethoven’s 9th symphony.  His genius remains under-discussed, as he is also a world-class harpsichord and keyboard player, and has produced the definitive recording of Bach’s entire cycle of cantatas.  Why is there no biography of him?  He is one of the greatest creators and performers in the entire world in any area.  If you are wondering, his parents were Japanese Protestants and he is a Calvinist.

Chopin CD of the year would be by Jean-Paul Gasparian.

Morton Feldman piano box set, played by Philip Thomas.  Five CDs if you go that route, this is what I listened to most this year.  It is also very good played at low volume, a useful feature in crowded pandemic homes.

I listened to a good deal of Szymanowski, who has finally started to make sense to me.  In prep for my CWT with Alex Ross, I relistened to a great deal of Wagner.  What rose in my eyes was the von Karajan Die Meistersinger and the Clemens Krauss Ring cycle.

As for contemporary classical music, I enjoyed:

Hans Abrahamsen, String Quartets.

Philippe Manoury, Temps Mode d’Emploi.

Caroline Shaw, Orange, Attaca Quartet.

This year I also rediscovered Robert Ashley’s opera Atalanta (Acts of God), and Raymond Lewenthal’s Alkan CD, one of my favorite recordings of all time, a kind of proto-rock and roll.

As for concert life, I did manage to see Trifonov play “Art of the Fugue” at the Kennedy Center before the whole season shut down, and in January the Danish Quartet playing Beethoven in NYC.

Paul Milgrom, Nobel Laureate

Most of all this is a game theory prize and an economics of information prize, including game theory and asymmetric information.  Much of the work has had applications to auctions and finance.  Basically Milgrom was the most important theorist of the 1980s, during the high point of economic theory and its influence.

Here is Milgrom’s (very useful and detailed) Wikipedia page.  Most of his career he has been associated with Stanford University, with one stint at Yale for a few years.  Here is Milgrom on scholar.google.com.  A very good choice and widely anticipated, in the best sense of that term.  Here is his YouTube presence.  Here is his home page.

Milgrom, working with Nancy Stokey, developed what is called the “no trade” theorem, namely the conditions under which market participants will not wish to trade with each other.  Obviously if someone wants to trade with you, you have to wonder — what does he/she know that I do not?  Under most reasonable assumptions, it is hard to generate a high level of trading volume, and that has remained a puzzle in theories of finance and asset pricing.  People are still working on this problem, and of course it relates to work by Nobel Laureate Robert Aumann on when people should rationally disagree with each other.

Building on this no-trade result, Milgrom wrote a seminal piece with Lawrence Glosten on bid-ask spread.  What determines bid-ask spread in securities markets?  It is the risk that the person you are trading with might know more than you do.  You will trade with them only when the price is somewhat more advantageous to you, so markets with higher degrees of asymmetric information will have higher bid-ask spreads.  This is Milgrom’s most widely cited paper and it is personally my favorite piece of his, it had a real impact on me when I read it.  You can see that the themes of common knowledge and asymmetric information, so important for the auctions work, already are rampant.

Alex will tell you more about auctions, but Milgrom working with Wilson has designed some auctions in a significant way, see Wikipedia:

Milgrom and his thesis advisor Robert B. Wilson designed the auction protocol the FCC uses to determine which phone company gets what cellular frequencies. Milgrom also led the team that designed the 2016-17 incentive auction, which was a two-sided auction to reallocate radio frequencies from TV broadcast to wireless broadband uses.

Here is Milgrom’s 277-page book on putting auction theory to practical use.  Here is his highly readable JEP survey article on auctions and bidding, for an introduction to Milgrom’s prize maybe start there?

Here is Milgrom’s main theoretical piece on auctions, dating from Econometrica 1982 and co-authored with Robert J. Weber.  it compared the revenue properties of different auctions and showed that under risk-neutrality a second-price auction would yield the highest price.  Also returning to the theme of imperfect information and bid-ask spread, it showed that an expert appraisal would make bidders more eager to bid and thus raise the expected price.  I think of Milgrom’s work as having very consistent strands.

With Bengt Holmstrom, also a Nobel winner, Milgrom wrote on principal-agent theory with multiple tasks, basically trying to explain why explicit workplace incentives and bonuses are not used more widely.  Simple linear incentives can be optimal because they do not distort the allocation of effort across tasks so much, and it turned out that the multi-task principal agent problem was quite different from the single-task problem.

People used to think that John Roberts would be a co-winner, based on the famous Milgrom and Roberts paper on entry deterrence.  Basically incumbent monopolists can signal their cost advantage by making costly choices and thereby scare away potential entrants.  And the incumbent wishes to be tough with early entrants to signal to later entrants that they better had stay away. In essence, this paper was viewed as a major rebuttal to the Chicago School economists, who had argued that predatory behavior from incumbents typically was costly, irratoinal, and would not persist.

The absence of Roberts’s name on this award indicates a nudge in the direction of auction design and away from game theory a bit — the Nobel Committee just loves mechanism design!

That said, it is worth noting that the work of Milgrom and co-authors intellectually dominated the 1980s and can be identified with the peak of influence of game theory at that period of time.  (Since then empirical economics has become more prominent in relative terms.)

Milgrom and Roberts also published a once-famous paper on supermodular games in 1990.  I’ve never read it, but I think it has something to do with the possible bounding of strategies in complex settings, but based on general principles.  This was in turn an attempt to make game theory more general.  I am not sure it succeeded.

Milgrom and Roberts also produced a well-known paper finding the possible equilibria in a signaling model of advertising.

Milgrom and Roberts also wrote a series of papers on rent-seeking and “influence activities” within firms.  It always seemed to me this was his underrated work and it deserved more attention.  Among other things, this work shows how hard it is to limit internal rent-seeking by financial incentives (which in fact can make the problem worse), and you will see this relates to Milgrom’s broader work on multi-task principal-agent problems.

Milgrom also has a famous paper with Kreps, Wilson, and Roberts, so maybe Kreps isn’t going to win either.  They show how a multi-period prisoner’s dilemma might sustain cooperating rather than “Finking” if there is asymmetric information about types and behavior.  This paper increased estimates of the stability of tit-for-tat strategies, if only because with uncertainty you might end up in a highly rewarding loop of ongoing cooperation.  This combination of authors is referred to as the “Gang of Four,” given their common interests at the time and some common ties to Stanford.  You will note it is really Milgrom (and co-authors) who put Stanford economics on the map, following on the Kenneth Arrow era (when Stanford was not quite yet a truly top department).

Not what he is famous for, but here is Milgrom’s paper with Roberts trying to rationalize some of the key features of modern manufacturing.  If nothing else, this shows the breadth of his interests and how he tries to apply game theory generally.  One question they consider is why modern manufacturing has moved so strongly in the direction of greater flexibility.

Milgrom also has a 1990 piece with North and Weingast on the medieval merchant guilds and the economics of reputation, showing his more applied side.  In essence the Law Merchant served as a multilateral reputation mechanism and enforced cooperation.  Here is a 1994 follow-up.  This work paved the way for later work by Avner Greif on related themes.

Another undervalued Milgrom piece is with Sharon Oster (mother of Emily Oster), or try this link for it.  Here is the abstract:

The Invisibility Hypothesis holds that the job skills of disadvantaged workers are not easily discovered by potential new employers, but that promotion enhances visibility and alleviates this problem. Then, at a competitive labor market equilibrium, firms profit by hiding talented disadvantaged workers in low-level jobs.Consequently, those workers are paid less on average and promoted less often than others with the same education and ability. As a result of the inefficient and discriminatory wage and promotion policies, disadvantaged workers experience lower returns to investments in human capital than other workers.

With multiple, prestigious co-authors he has written in favor of prediction markets.

He was the doctoral advisor of Susan Athey, and in Alex’s post you can read about his auction advising and the companies he has started.

His wife, Eva Meyersson Milgrom, is herself a renowned social scientist and sociologist, and he met her in 1996 while seated next to her at a Nobel Prize dinner in Stockholm.  Here is one of his papers with her (and Ravi Singh), on whether firms should share control with outsiders.  Here is the story of their courtship.

The remixing of quality in the pandemic

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

Now consider another of my favorite pastimes, watching professional basketball. I have been following the NBA bubble with great interest. The Miami Heat are now favored to reach the NBA Finals, even though they were only the fifth-ranked team in the East at the end of the regular season. What happened? They have played with grit and determination, and their entire active roster showed up in first-rate physical shape. That’s not easy to do after a five-month layoff, as it required tremendous discipline.

In contrast, the Los Angeles Clippers were among the favorites to win the NBA title. They were recently eliminated by the Denver Nuggets, a very good team but not previously a top contender. In the final quarter of the last game of the series, the victorious Nuggets played with energy and verve, while the Clippers seemed to be gasping for air. After their defeat, some of the Clippers admitted that inferior conditioning was part of their problem.

So “staying in shape during a five-month layoff” is now a critical skill for a basketball player. But this doesn’t necessarily mean the Clippers need to revamp their roster. Maybe they should just wait for a return to normal times.

And:

Might these changes in quality affect your choices beyond work — such as your decisions about friends, family relations, romance, and much more? Should you buy a dog, knowing you probably won’t be homebound two years from now? How about dating? On a first date, presumably, looks should matter less and social carefulness more. But again, for how long? It would be very strange, and probably unwise, to form a lasting relationship based on how well your romantic interest wears a mask.

Sadly the world has entered a new paralysis, most of all because no one knows when things will return to normal, or what might become normal, or what might remain strange. When this pandemic ends, one thing we can all look forward to is making better plans.

Recommended, at least until the pandemic is over.

Richard Davis requests

Here are some answers, I put his questions — from Request for Requests – in bold:

Melancholy among academics.

We’re a pretty sorry bunch, and many of us don’t have so much professionally to live for, at least not at the relevant margin — it is easy to lose forward momentum and never recover it, given the constraints and incentives in the profession and broader pressures toward conformity.  Rates of depression in academia, and especially in graduate school, are fairly high.  Many of the core processes are demoralizing rather than inspiring.  It is remarkable to me how much other people simply have accepted that is how things ought to be and perhaps they believe matters cannot be that different.  I view the high rates of depression in academic life as a “canary in the coal mine” that doesn’t get enough attention as an indicator of bigger, more systemic problems in the entire enterprise.  What are you doing with your lifetime sinecure?

Your favorite things Soviet.

Shostakovich.  And the Romantic pianists, most of all Richter and Gilels.  Constructivist art and ballet up through the late 1920s.  The early chess games of Tal.  Magnitogorsk.  War memorials, most of all in Leningrad.  Tarkovsky.  I admire the “great” Soviet novels, but I don’t love them, except for Solzhenitsyn, whom I would rather read then Dostoyevsky.  Probably the poetry is amazing, but my Russian is too limited to appreciate it.

The optimal number of math PhDs worldwide.

I would think fairly few.  I am happy having lots of mathematicians, with independent tests of quality.  But is the Ph.D such a great test or marker of quality?  Did Euclid have one?  Euler?  Does it show you will be a great teacher?  Maybe we should work toward abolishing the math PhD concept, but out of respect for the profession, not out of hostility toward math.

What historical works of art were anticipated to be great prior to creation, were immediately declared to be great at creation and have continued to be judged great ever since?

Overall it is striking how popular how many of the great revolutionaries have been.  Michelangelo was a major figure of renown.  Mozart was quite popular, though not fully appreciated.  Beethoven was a legend in his time, and every Wagner opera was an event.  Goethe ruled his time as a titan.  A significant percentage of the very best writers were well known and loved during their careers, though of course there was uncertainty how well they would stand up to the test of time.

The future of Northern New Jersey.

Much like the present, plus defaults on the pension obligations and over time the Indian food may get worse, due to acculturation.  The Sopranos will fade into distant memory, I am sorry to say, as will Bruce Springsteen.  So many young people already don’t know them or care.  I feel lucky to have grown up during the region’s cultural peak.

Who are the greats that still walk among us (other than McCartney)?

The major tech founders and CEOs, Stephan Wolfram, Jasper Johns and Frank Stella and Richard Serra and Gerhardt Richter and Robert Gober, a number of other classic rock stars (Dylan, Brian Wilson, Jagger, Eno, etc.), Philip Glass, Richard D. James, and note most of the greatest classical musicians who have ever lived are alive and playing today (Uchida anyone?), at least once Covid goes away.  Many of the major architects.  Ferrante and Knausgaard and Alice Munro.  Many of the figures who built up East Asia and Singapore.  Perelman.  Jerry Seinfeld and Larry David.  Magnus Carlsen and all sorts of figures in sports.  A bunch of other people whom Eric Weinstein would list.

Why

Why not?

America’s reopening will depend on trust

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

The first wave of the Covid-19 pandemic brought serious economic damage for thinly capitalized face-to-face retailers, such as small family-owned restaurants. But many of those same institutions will lead the recovery — that is, if they have built up trust among their patrons. If they ask me to sit outside to eat my meal, I will trust that their kitchen procedures are “clean enough,” because I believe that the boss is watching [there I am referring to two of my favorite local places].

It is also worth asking whom I do not trust. When it comes to providing a fully clean and safe store, I do not trust most of the big-box retailers. I trust them just fine in ordinary times, but no single manager can oversee the entire cleaning and disinfectant operation. And can they monitor Covid-19 in the air? If they tell me that “all possible precautions have been taken,” I might believe their words, but I won’t believe that is enough.

And:

The NBA is wondering if it can resurrect its playoffs at a dedicated location with television coverage but no audience in the stands. So far the teams are hesitant, in part because they are afraid of public resentment if the league’s millionaire players have access to Covid-19 tests while the general public does not.

The reality is that if the NBA announced it was buying up a lot of tests, it would boost the supply of tests. That could provide testing with valuable positive publicity, with the NBA serving as a role model for what other businesses might do. Yet the NBA does not yet trust its fans to see things in such a positive light, and so reopening is delayed. There might be some danger to playoffs games without fans, but surely less than in, say, collegiate or professional football, where injuries and concussions are built into the very nature of the competition.

Which are the businesses that you really trust in matters pandemic?