How much of our boom has been an immigration boom?
Matt Yglesias directed me to a new CBO report, which confirms that immigration explains the recent GDP boom:
In our projections, the deficit is also smaller than it was last year because economic output is greater, partly as a result of more people working. The labor force in 2033 is larger by 5.2 million people, mostly because of higher net immigration. As a result of those changes in the labor force, we estimate that, from 2023 to 2034, GDP will be greater by about $7 trillion and revenues will be greater by about $1 trillion than they would have been otherwise. We are continuing to assess the implications of immigration for revenues and spending.
Correlations between spouses
Correlations between spouses
Extraversion: r= .005
Neuroticism: .082
Height: .227
Weight: .154
Education: .5
Political party: .6"Mates tend to be positively but weakly concordant on personality and physical traits, but concordance of political attitudes is extremely high" pic.twitter.com/BmdpySfakh
— Rob Henderson (@robkhenderson) February 10, 2024
Saturday assorted links
1. Liverpool man who inherited £100,000 lets 12 strangers give the money away.
2. Jonathan Eaton, RIP. And more on his work in trade economics.
3. ACX grants from Astral Codex. And new African School of Economics coming in Zanzibar.
4. The Monk and the Gun is a fun Bhutanese movie about the foundations of democracy (and markets).
5. Using AI to campaign and deliver your victory speech, while in jail.
6. Another 2014 post on Putin: “Putin is signaling to the Russian economy that it needs to get used to some fairly serious conditions of siege, and food is of course the most important of all commodities. Why initiate such a move now if you are expecting decades of peace and harmony?”
7. John Bruton, RIP (NYT, he negotiated peace with Northern Ireland and also set the corporate income tax rate low in Ireland and designed the referendum that overturned the country’s ban on divorce).
What should I ask Coleman Hughes?
I will be doing a Conversation with him, based in part around his new book The End of Race Politics: Arguments for a Colorblind America. On Coleman more generally, here is Wikipedia:
Coleman Cruz Hughes (born February 25, 1996) is an American writer and podcast host. He was a fellow at the Manhattan Institute for Policy Research and a fellow and contributing editor at their City Journal, and he is the host of the podcast Conversations with Coleman.
Also from Wikipedia:
Hughes began studying violin at age three. He is a hobbyist rapper—in 2021 and 2022, he released several rap singles on YouTube and Spotify, using the moniker COLDXMAN, including a music video for a track titled “Blasphemy”, which appeared in January 2022. Hughes also plays jazz trombone with a Charles Mingus tribute band that plays regularly at the Jazz Standard in New York City.
I saw Coleman perform quite recently, and I can vouch for his musical excellence, including as a singer. So what should I ask Coleman?
Is El Salvador special?
But Bukele copycats and those who believe his model can be replicated far and wide overlook a key point: The conditions that allowed him to wipe out El Salvador’s gangs are unlikely to jointly appear elsewhere in Latin America.
El Salvador’s gangs were unique, and far from the most formidable criminal organizations in the entire region. For decades, a handful of gangs fought one another for control of territory and became socially and politically powerful. But, unlike cartels in Mexico, Colombia and Brazil, El Salvador’s gangs weren’t big players in the global drug trade and focused more on extortion. Compared to these other groups, they were poorly financed and not as heavily armed.
Mr. Bukele started to deactivate the gangs by negotiating with their leaders, according to Salvadoran investigative journalists and a criminal investigation led by a former attorney general. (The government denies this.) When Mr. Bukele then arrested their foot soldiers in large sweeps that landed many innocent people in prison, the gangs collapsed.
It would not be such a simple story elsewhere in Latin America, where criminal organizations are wealthier, more internationally connected and much better armed than El Salvador’s gangs once were. When other governments in the region have tried to take down gang and cartel leaders, these groups haven’t simply crumbled. They have fought back, or new criminal groups have quickly filled the void, drawn by the drug trade’s huge profits. Pablo Escobar’s war on the state in 1980s-90s Colombia, the backlash by cartels to Mexican law enforcement activity since the mid-2000s, and the violent response to Ecuador’s government’s recent moves against gangs are just a few examples.
El Salvador also had more formidable and professional security forces, committed to crushing the gangs when Mr. Bukele called on them, than some of its neighbors. Take Honduras, where gang-sponsored corruption among security forces apparently runs deep. That helped doom Ms. Castro’s attempts to emulate Mr. Bukele from the start. In other countries, like Mexico, criminal groups have also reportedly managed to co-opt high-ranking members of the military and police. In Venezuela, it has been reported that military officials have run their own drug trafficking operation. Even if presidents send soldiers and police to do Bukele-style mass roundups, security forces may not be prepared, or may have incentives to undermine the task at hand.
Here is more from Will Freeman and (NYT), interesting throughout.
How much does status competition lower Korean fertility?
Using a quantitative heterogeneous-agent model calibrated to Korea, we find that fertility would be 28% higher in the absence of the status externality and that childlessness in the poorest quintile would fall from five to less than one percent. We then explore the effects of various government policies. A pro-natal transfer or an education tax can increase fertility and reduce education spending, with heterogeneous effects across the income distribution. The policy mix that maximizes the current generation’s welfare consists of an education tax of 22% and moderate pro-natal transfers. This would raise average fertility by about 11% and decrease education spending by 39%.
Here is the full paper by Seongeun Kim, Michèle Tertilt, and Minchul Yum. Here is the version forthcoming in the AER.
Friday assorted links
1. NBA In-Season Tournament renamed ‘NBA Cup’ with Emirates as a sponsor.
2. “We instruct GPT to make risk, time, social, and food decisions and measure how rational these decisions are. We show that GPT’s decisions are mostly rational and even score higher than human decisions.” Link here.
3. My old post on Putin as a reader of history. And my 2014 post on modeling Putin.
4. You can’t understand contemporary culture without pondering the notion of mental illness (I’m on Larry David’s side here).
5. California’s attempt to strangle AI.
6. “After adjusting for publication selection bias, the median probability of the presence of an effect decreased from 99.9% to 29.7% in economics.” Link here.
7. Liberalismo a la madrileña, a new book.
8. “Anchovy sex is a force of nature.” And is there an “orgasm gap” (with humans)? And which groups does it favor?
9. Seiji Ozawa, RIP (NYT).
Literacy or Loyalty?
Why does schooling in much of the developing world not result in much in the way of increased skills? Maybe because education bureaucrats in these counties want obedient citizens more than literate, numerate, informed citizens.
In a discrete choice experiment in which bureaucrats in education were asked to make trade-offs between foundational literacy, completion of secondary school, and formation of dutiful citizens, respondents valued dutiful citizens 50% more than literate ones. For many policy makers, the goal is not the production of knowledge, but the fostering of nationalism.
This may sound like an odd set of priorities, but both European and Latin American countries had similar priorities when they expanded their education systems to serve more than a small elite around the turn of the 20th century. The goal was not to produce scientists or entrepreneurs but to inculcate a reliable workforce that would support the state.
…Developing-country schools are trying to achieve much the same ends. Students learn to memorize, to obey, and to not question — but they do not particularly learn to read or write. But then again, that was never the goal — developing countries are following the path trod on by developed countries. Just like developed countries, they will try to “teach ordinary people obedience, respect for the law, [and] love of order.”
I am reminded that if you want to predict which countries invest a lot in education, look at which countries invest a lot in government owned television stations.
My notes/outline on the rise of Scottish economic thought
1650s, wars with England, invasions, Cromwell repels the Scots
1690s – Darien Scheme in Panama, Scots more generally grow interested in empire
1707 – Union with England
Scotland keeps its Presbyterian church and laws
Scotland never settled by Rome, for a long time closer to France
Post Glorious Revolution, many Scots still loyal to the Stuart monarchy, recurring theme
Jacobites – loyal to James, who was expelled by the Glorious Revolution
Glasgow – tobacco and sugar trade
Edinburgh – Intellectual, educational, and administrative center
Overall good educational system at multiple levels
Frances Hutcheson – born in Ireland to Scots family, key works in the 1720s, beauty, approbation, ethics, 1729 starts professorship in Glasgow
1739-40 – David Hume, Treatise on Human Nature
1745 – Major Jacobite uprising
Post-1745: The Highlanders and the clan system starts its true decline
Linen, cotton, wool, jute industries
Good schools, good universities, competitive, English-language, no class system
1748 – David Hume, Enquiry Concerning Human Understanding
1750s – David Hume’s essays on economics
1755 – 1.3 million people in Scotland
1759 – Adam Smith, Theory of Moral Sentiments
1762 – Ossian [James Macpherson], beginnings of Scottish romanticism
1767 — Adam Ferguson – Essay on Civil Society, progress, commercial society, militarism
1776 – David Hume dies
1776 – Wealth of Nations
The sciences: the physician and chemist William Cullen, the agriculturalist James Anderson, chemist and physician Joseph Black, natural historian John Walker, and James Hutton, the first modern geologist.
Late 18th century – onset of Scot inventors/tinkerers, most of all James Watt and the steam engine
Thursday assorted links
2. How to model the Putin interview.
3. What really happened with the Hugo Awards?
4. In this one study, wage subsidies have a pass-through rate of about 28%.
5. When it comes to Ontario, the world is waking up.
6. Bard is now Gemini. And a quick overview here. And here is Zvi on Gemini. And Ethan Mollick.
Grandmaster-Level Chess Without Search
Scaling seems to be working here:
The recent breakthrough successes in machine learning are mainly attributed to scale: namely large-scale attention-based architectures and datasets of unprecedented scale. This paper investigates the impact of training at scale for chess. Unlike traditional chess engines that rely on complex heuristics, explicit search, or a combination of both, we train a 270M parameter transformer model with supervised learning on a dataset of 10 million chess games. We annotate each board in the dataset with action-values provided by the powerful Stockfish 16 engine, leading to roughly 15 billion data points. Our largest model reaches a Lichess blitz Elo of 2895 against humans, and successfully solves a series of challenging chess puzzles, without any domain-specific tweaks or explicit search algorithms. We also show that our model outperforms AlphaZero’s policy and value networks (without MCTS) and GPT-3.5-turbo-instruct. A systematic investigation of model and dataset size shows that strong chess performance only arises at sufficient scale. To validate our results, we perform an extensive series of ablations of design choices and hyperparameters.
Here is the full paper by Anian Ruoss, et.al. I guess AI is likely to get better at other things too — I’ve become numb to the miracles, frankly.
Should AM radios be mandated in cars?
No. Here is my Bloomberg column to that effect, excerpt:
Personally, I prefer to listen to XM satellite radio, a paid subscription service. It features channels that appeal to my specific tastes (in this case, if you’re asking, the Beatles, classical music and various Spanish-language programs). AM radio, which is usually advertiser-supported, tends to have more of a “least common denominator” flavor, as it must attract many listeners to pull in the ad revenue. I do not think the federal government should be using the force of law to favor cultural options that are already trying to appeal to the least common denominator.
When I bought my current car, it was capable of receiving a satellite radio signal, and I simply had to request that it be turned on. (This ease of use is one reason why I purchased the model, so the commercial considerations here are real.) There was no law requiring the satellite radio option — just as there should be none requiring an AM radio option. This symmetry of treatment meets standards of both fairness and economic efficiency.
So I’ll say it again, no AM radio should not be mandated in cars, even though Congress is thinking of doing this on a bipartisan basis.
My Conversation with the excellent Ami Vitale
Here is the audio, visual, and transcript. Here is the episode summary:
Ami Vitale is a renowned National Geographic photographer and documentarian with a deep commitment to wildlife conservation and environmental education. Her work, spanning over a hundred countries, includes spending a decade as a conflict photographer in places like Kosovo, Gaza, and Kashmir.
She joined Tyler to discuss why we should stay scary to pandas, whether we should bring back extinct species, the success of Kenyan wildlife management, the mental cost of a decade photographing war, what she thinks of the transition from film to digital, the ethical issues raised by Afghan Girl, the future of National Geographic, the heuristic guiding of where she’ll travel next, what she looks for in a young photographer, her next project, and more.
Here is one excerpt:
COWEN: As you probably know, there’s a long-standing and recurring set of debates between animal welfare advocates and environmentalists. The animal welfare advocates typically have less sympathy for the predators because they, in turn, kill other animals. The environmentalists are more likely to think we should, in some way, leave nature alone as much as possible. Where do you stand on that debate?
VITALE: It depends. It’s hard to make a general sweeping statement on this because in some cases, I think that we do have to get involved. Also, the fact is, it’s humans in most cases who have really impacted the environment, and we do need to get engaged and work to restore that balance. I really fall on both sides of this. I will say, I do think that is, in some cases, what differentiates us because, as human beings, we have to kill to survive. Maybe that is where this — I feel like every story I work on has a different answer. Really, I don’t know. It depends what the situation is. Should we bring animals back to landscapes where they have not existed for millions of years? I fall in the line of no. Maybe I’m taking this in a totally different direction, but it’s really complicated, and there’s not one easy answer.
And:
COWEN: As you know, there are now social networks everywhere, for quite a while. Images everywhere, even before Midjourney. There are so many images that people are looking at. How does that change how you compose or think about photos?
VITALE: Well, it doesn’t at all. My job is to tell stories with images, and not just with images. My job as a storyteller — that has not changed. Nothing has changed in the sense of, we need more great storytellers, visual storytellers. With all of those social media, I think people are bored with just beautiful images. Or sometimes it feels like advertising, and it doesn’t captivate me.
I look for a story and image, and I am just going to continue doing what I do because I think people are hungry for it. They want to know who is really going deep on stories and who they can trust. I think that that has never gone away, and it will never go away.
I am very happy to have guests who do things that not everyone else’s guests do.
Might a Georgist land tax help revive Detroit?
That is the topic of my Bloomberg column. Maybe they should try it for federalism/discovery purposes, but overall I am skeptical. Here is one excerpt:
The history of “enterprise zones,” which are specially designated areas (usually urban) with lower taxes and fewer regulations, offers a cautionary tale. Enterprise zones have at best mixed results in revitalizing declining areas. Could fiddling with the marginal incentives embedded in the property tax code really make that much more of a difference? Most economic decisions are made on the basis of broad criteria such as labor force quality, nearby markets and the ease of doing business.
By itself, the uneven record of enterprise zones is no reason not to experiment with land value taxation. But it does limit the upside from any change.
A possible downside from land value taxation is that it discourages land speculation. Land speculators do not, I concede, have the best reputation — but speculation can be either a positive or negative, depending on whether entrepreneurs have good foresight. On the plus side, speculation can keep land from being developed prematurely, or from being locked into uses that later turn out to be too low in value.
If dormant land in Detroit is taxed at a higher rate, that might encourage property owners to develop low-quality housing or retail to lower their tax burden. A landowner might build a small house, for example, rather than holding out for a large, higher-quality apartment complex. The city might get modest growth, but lose out on the chance for a bigger economic redevelopment. Detroit has in recent times shown signs of a revival, so perhaps waiting for the right opportunity is sometimes best.
Of course, speculators can also make mistakes, for example by failing to develop their property more quickly. Still, whether the tax authorities have the foresight and flexibility to do better than property speculators is an open question. In the meantime, some speculators may abandon their holdings to avoid the tax, putting more property in the hands of the municipal government — hardly an ideal outcome.
Note also that the proposal is revenue neutral by design (taxes on developments are supposed to go down), but over time it might simply evolve into a flat-out tax increase.
Wednesday assorted links
1. “That work suggested it was not how many times a word was repeated that predicted whether Roy’s son learned it early, but whether it was uttered in an unusual spot in the house, a surprising time or in a distinctive linguistic context.” Link here.
2. Neruda update (New Yorker). The poor Tamil maid.
3. Positive rather than adverse selection into life insurance.
4. Deutsche Bahn is still using Windows 3.11 (auf deutsch).
5. The Norwegian Century is indeed upon us (in Norwegian).