Testosterone and economic behavior: some new results
The story starts off with this:
Women given testosterone for a month were no more likely than women not receiving the hormone to engage in risky financial decisions, according to researchers in Sweden. The findings could suggest that women are a safer pair of hands on the stock-market trading floor than men – or throw into doubt earlier findings about the effect of the hormone on men.
A spate of recent studies have found correlations between testosterone levels and risky behaviour in men, including one that found that male securities traders with more testosterone in their saliva made riskier financial decisions.
But now a team led by Magnus Johannesson, an economist at the Stockholm School of Economics, has found no such effects in a group of 200 post-menopausal women. The women were administered testosterone, oestrogen or a placebo for four weeks and asked to play a series of economic games that measure the player's propensity to take risks, their trust and their willingness to share resources.
One researcher notes:
"I'm relatively pessimistic of finding an effect in men," Johannesson says. He writes in the paper that it is possible that previously published links between testosterone and risk-taking are "spurious". Studies that do not find a correlation between sex hormone levels and economic behaviour may simply have a harder time getting published. "Negative correlation results don't get published," he says.
The original research is here. I would simply urge caution in interpreting results from this area. We're not yet in a "safe zone" of knowing what replicable results look like.
Peter Orszag’s tip for discipline
Orszag has employed this knowledge while training for a marathon.
"If
I didn't achieve what I wanted to, a very large contribution would
automatically come out of my credit card and go to a charity that I
very much didn't support," Orszag says of his training strategy. "So
that was a very strong motivation, as I was running through mile 15 or
16 or whatever it was, to remind myself that I really didn't want to
give the satisfaction to that charity for the contribution."
He declines to name the charity.
The source is here.
Lisbon bleg
I'll be there for a few days, next week, plus have one free day for a day trip. What should I do, what should I eat, and how should I think about what I am doing?
Your assistance is both requested and appreciated.
Shoe Fetish
Zappos maps shoe sales, with shoe pictures, online in real time. Check it out. For some reason, I think this is awesome but I couldn't tell you why.
Hat top to Flowing Data.
eBooks help the romance novel
At Fictionwise, the e-book seller recently acquired by Barnes &
Noble, about 50 percent of sales are romance books, said Steve
Pendergrast, chief technology officer. “Romance readers tend to be
voracious readers,” Mr. Pendergrast said. “The ability to instantly
download and start reading is potentially more important to that
audience than any other audience.”
…Many readers are still buying. “I would give up something else if money
was tight,” said Annmarie Anderson, a district manager in Atlanta for a
national retail chain, who said she still spent about $100 on romance
novels each month. “I would give up my manicure and pedicure. I have my
priority list, and books are pretty high on my priority list.”
The story is interesting throughout. Is it because eBooks are impulse, I-want-it-right-now buys? Or does the eBook-owning demographic have a special attachment to romance? Are romance books somehow better in the eBook format?
What groups talk about
Groups talk about what they already know:
A new meta-analysis (pdf) of 72 studies, involving 4,795 groups and over 17,000 individuals has shown that groups tend to spend most of their time discussing the information shared by members,
which is therefore redundant, rather than discussing information known
only to one or a minority of members. This is important because those
groups that do share unique information tend to make better decisions.
Another important factor is how much group members talk to each other. Ironically, Jessica Mesmer-Magnus and Leslie DeChurch found that groups that talked more tended to share less unique information.
Hey, Alex, demand curves slope downwards! Hey Robin, people signal! Hey, Bryan, etc.
Rand vs. Marx on Google Search
Eric Crampton informs me of this article:
So, in lots of the developing world, we're seeing lots of searches on
Marx and very little on Rand. Rand only registers in the Philippines.
In the US, Rand beats Marx by a small margin; same in India. In Canada,
Marx beats Rand; same in Norway and New Zealand and … pretty much
every country that makes the top ten in searches on Ayn Rand. The green
bars show searches for "Atlas Shrugged". Only in the US and India do
searches on Rand beat searches on Marx.
In other words, we are not currently at a "Rand moment," at least not globally. There is much more information at the link.
A Bayesian approach to legal gay marriage
Ezra had this good bit:
Due to D.C.'s strange system of governance, the District's laws are
subject to approval by Congress. If D.C. passes a gay marriage
ordinance, the House Committee on Oversight and Government Reform and
the subcommittee that handles District matters will have to either
reject D.C.'s decision or accept it. If they reject it, the outrage
from gay donors and activist groups will be overwhelming. If they
approve it, even on federalist grounds, the Right will argue that
Congress has literally approved gay marriage.
The interesting question is why there is so much opposition to legal gay marriage (which I favor). You can cite various evil opponents and their evil motives, but there are many good people who aren't all that enthusiastic about the idea.
Jennifer Roback Morse offers the argument that gay marriage requires ongoing statist intervention (as does the notion of a corporation) and will drive the Mennonites from Quebec.
I have a simple hypothesis about the cross-sectional econometrics. If you take the heterosexual couples who engage in the practice which is sometimes "associated" with male gay marriage, I predict those couples will favor legal gay marriage to an astonishingly high degree. Their marriage is already "affiliated" with that practice, and so the notion of legally married gay men (and the practices which go along with that) does not constitute an extra and unwanted affiliation for their marriage ideal.
Now, if you are a rational heterosexual Bayesian and neither engage in that associated practice nor favor legal gay marriage, and then you learn about these cross-sectional econometrics, what should you infer about the correctness of your point of view?
If you're still not sure, reread Gulliver's Travels and get back to me.
Addendum: Comment 51 is apparently from Roissy.
Felix Salmon’s new Reuters blog
Up and running, welcome back Felix. Here is one to-the-point excerpt:
Andrew Ross Sorkin
has been digging around in the FDIC’s charter, and has discovered that
it is barred from incurring any obligation greater than $30 billion.
Which is a bit inconvenient, seeing as how it’s about to guarantee as
much as $1 trillion as part of the PPIP bank bailout program.
The sneaky way that the FDIC is getting around this obstacle is to
say that the value of those obligations is actually zero, since zero is
the “expected cost to the corporation”.
China book fact countercyclical asset of the day
The People’s Press – the biggest publishing
house for China’s orthodox revolutionary books – reports that Marx’s
anti-capitalism opus "Das Kapital" has been selling about 4,000-5,000
copies nationwide a month since last November. That’s a big jump from
before the economic crisis, when the book sold well under 1,000 copies
per month on average.
The "Selected Works by Mao Zedong," a book
owned by almost every Chinese citizen a few decades ago, is also
witnessing a big jump in sales since late last year, according to Mr.
Pan from the People’s Press circulation department.
Here is the full story and I thank Ryan Tetrick for the pointer.
Assorted links
1. Michael Spence defends the Geithner plan.
2. Chimpanzee markets in everything; research is here.
3. Via Michelle Dawson, more on the fMRI voodoo correlations debate; relevant papers can be found here.
4. A tauntaun sleeping bag: do you get the reference?
My email to Brad DeLong
I agree with your point
that fiscal policy can work through V and that is the correct way to
think about it. In fact Alex and I present this in our forthcoming
Principles text.
I think, however, you put too much emphasis on
interest elasticity. Which is the relevant "M" in the equation of
exchange? Surely not currency. Yet I can earn an interest return on
most parts of M2, if I care to.
The key arguments for sometimes
using fiscal rather than monetary policy have, I think, to do with
targeting very particular parts of the real economy.
Plus maybe the Fed doesn't have a strong enough political constituency to be asked to handle the entire macroeconomic problem.
To
me those two factors are much more important than anything having to do
with interest elasticity. Plus I am still influenced by Cooley's old
AER paper (1981?) and I don't trust any of the interest-elasticity
estimates, no matter what they find.
Tyler
Addendum: This paper prompted the email.
Location, location, location
Craig Newmark reports:
Matthew Kahn notes that one median-priced house in Westwood could be exchanged–ignoring transactions costs–for 100 median-priced houses in Detroit. Would this be a good trade? I report, you decide.
If you are skeptical, here are the data on Detroit.
The War on Drugs: Methamphetamine
Remember when you could walk into a pharmacy and buy a decongestant like Sudafed? The key ingredient was pseudoephedrine, a precursor to methamphetamine. A series of laws made it more and more difficult to buy or manufacture pseudoephedrine (despite it's legality). So what did we get for our loss of liberty? A new paper (AEA) (free here) in the March AER says not much:
In mid-1995, a government effort to reduce the supply of methamphetamine precursors successfully disrupted the methamphetamine market and interrupted a trajectory of increasing usage. The price of methamphetamine tripled and purity declined from 90 percent to 20 percent. Simultaneously, amphetamine related hospital and treatment admissions dropped 50 percent and 35 percent, respectively. Methamphetamine use among arrestees declined 55 percent. Although felony methamphetamine arrests fell 50 percent, there is no evidence of substantial reductions in property or violent crime. The impact was largely temporary. The price returned to its original level within four months; purity, hospital admissions, treatment admissions, and arrests approached preintervention levels within eighteen months.
The authors conclude:
This is quite possibly the DEA’s greatest success in disrupting the supply of a
major illicit substance. The focus on disrupting the supply of inputs rather than of the drug itself proved extremely successful. This success was the result of a highly
concentrated input supply market and consequently may be difficult to replicate for drugs
with less centralized sources of supply, such as cocaine and heroin. That this massive
market disruption resulted in only a temporary reduction in adverse health events and
drug arrests and did not reduce property and violent crimes, is disappointing. (italics added)
FYI, this paper makes its case almost entirely by carefully laying out the data rather than with theory or econometrics–that was nice to see in the AER.
The Dark Side?
Gretchen Rubin interviews Todd Kashdan (of GMU I might add, though I don't know him):
Is there anything you find yourself doing repeatedly that gets in the way of your happiness?
There is a dark side to my desire to become an expert in psychology,
knowledgeable about science and literature, skilled as a parent,
mountain biker, and weightlifter, and attentive as a husband. When I
think I know something, I stop paying attention. It happens far too
often and when it does, opportunities close. I constantly have to
remind myself to let go of my ego, let go of my expectations, and stay
flexible and profoundly aware of what is right in front of my senses.
Here is Todd's new blog. Here is Todd on the Mayan afterlife. Here is Gretchen's version of phony advertising markets in everything.
Here is Todd's home page, with Todd's lists.