Wednesday assorted links

by  Tyler Cowen

1. Burkey Belser, RIP.

2. Why is multilateralism in the tax sphere surviving when multilateralism is collapsing elsewhere?

3. The U.S. effects of banning cousin marriage.

4. I am not convinced, but here is an argument that AI will lead to explosive rates of economic growth.  And a new AI hardware device? (this has been my standing prediction).

5. We’ve finally mapped all of Zealandia.

6. Brooks Robinson, RIP.

Patents, Intellectual Property and the Rise of the Rent Seeking Society

by  Alex Tabarrok in

During the summer I had the opportunity to spend a week at a16z’s crypto lab in New York City where I gave a fun talk on intellectual property including patents and copyrights, the great stagnation, the diffusion of ideas, American economic dynamism and even some discussion of AI and copyright in the Q&A.  Check it out!

Brazil facts of the day

by  Tyler Cowen

In the mid-1980s manufacturing accounted for a third of Brazil’s gdp; now it represents just 10%. The country’s surplus in manufacturing trade, $6bn in 2005, became a deficit of $108bn by 2019. Productivity in manufacturing and services has stagnated or shrunk.

Here is more from The Economist, note that the hinterlands, such as Mato Grosso, are growing faster than average.  Mining, agricultural, and commodities are doing well: “Seven of the ten municipalities that have grown most are in the farmbelt in the southern half of the country and the centre-west.”

Finally, note this:

…the capital, Brasília, grew by 1.2% a year, more than double the national rate.

The notion that Brasilia is simply some white elephant modernist failure has become one of the more enduring social science myths.  Like many other national capitals it is atrophied along some of the wrong dimensions, but taking that into account it is doing OK enough.  The real problem is Brazil, not Brasilia.

Emergent Ventures winners, 29th cohort

by  Tyler Cowen in

Dan Rivera, South Carolina, FavorPiedmont, addiction recovery and treatment.

Lukas Bogacz, Utrecht/South Africa, to start a company based on fine-tuning LLMs.

Brian Wang, MIT, Panoplia Laboratories, for DNA-based pan-virus vaccine research.

Gabriel Abrams, Washington, D.C., Sidwell (high school), LLMs and economic research.

Chloe Chia, Berkeley, to pursue computational research about human behavior in dense cities.

Jannik Schilling, 18, Hamburg, Bay Area (?), general career development.

David Siegel, to assist in the education of his son Micah Siegel, Bethesda, MD, to produce a YouTube channel about how to help animals.

Shannon Kim, University of Chicago, biology and the origins of life, “Can prebiotic networks and the spread of chiral information explain the origins of biological homochirality?”

Kyrylo Kalashnikov, mini-robotics, University of Toronto, from Ukraine.

Andrew Nijmeh, Toronto, to study the tech of traffic management systems, 15 years old.

Vinaya Sharma, Ontario, “VoltVision.AI is transforming electric grid fault detection and monitoring with autonomous drones, computer vision, and 3D and thermal imaging, helping embark on cheaper, faster and safer transmission line maintenance.” 

Stuart Buck, Houston, Good Science Project, to improve the study of meta science and improve science policy.

Leah Gimbel, Washington, DC, to create a new system to grade principals.

Benjamin Yeoh, London, to organize a London Unconference about home schooling.  Also works as a playwright.

Ukraine cohort:

Eugene Shcherbinin, London/LSE/Odesa, general career support, mathematics and economics.

Anna Orekhova, to aid her new company in science education, Kyiv.

Bohdana Pavlychko, Kyiv, venture capital and talent search, The Second Derivative Fund.

Nadia Parfan, Takflix, Ukrainian movies marketed abroad by streaming, Kyiv

Dmytro Marakhovskiya, co-founder and CEO of Rozmova, a Ukrainian tech platform that connects psychotherapists with clients, to expand into Poland.

And yes there are still other winners to be announced, forthcoming…

What should I ask Patrick McKenzie?

by  Tyler Cowen in

I will be doing a Conversation with him.  Patrick is a phenomenon of the modern age.  He writes the excellent Bits About Money, which focuses on money, banking, payments, and more.

His blog is Kalzumeus.  He has lived most of his adult life in Japan, and has many excellent posts about Japan.  Here are his greatest hits on the blog.  He has run national shadow vaccine location information infrastructure.   On Twitter he is @patio11.

So what should I ask him?

Selection, Patience, and the Interest Rate

by  Tyler Cowen

I take it this is good news?  Or will it arrive too slowly?

The interest rate has been falling for centuries.  a process of natural selection that leads to increasing societal patience is key to explaining this decline.  Three observations support this mechanism: patience varies across individuals, is inter-generationally persistent, and is positively related to fertility.  A calibrated, dynamic, heterogenous-agent model of fertility permits us to isolate the quantitative contribution of this mechanism.  We find that selection alone is the key to explaining the decline of the interest rate.

That is from a new paper by Radoslav Stefanski and Alex Trew.  Via the excellent, patient Kevin Lewis.

From my email (on single-parent families)

by  Tyler Cowen in

I won’t do double indentation, but this is all from Rick from Baltimore:

“In your post today, you cite to an interview you gave in which you describe the negative effects of children growing up with one parent and state that “I don’t have a magic wand to wave to make all those men worthy of having a nice family, but we could do much more than what we’re doing now”.  So my question is what is it that we can or should be doing?  It seems like one of the more important questions of our day.

So what does a Tyler Cowen pro-parent plan look like?  I can think of a number of candidates for interventions, but most of them don’t strike me as things you would advocate for either because of their limited effectiveness or their unintended consequences.  Some possibilities that I can think of:

  1. Parenting interventions in poor communities (i.e. an army of social workers descending on poor communities to teach parenting and advocate for children).
  2. Shorter/fewer prison sentences in order to allow more poor men to be present for their children and improve the sex ratio in poorer communities (thereby encouraging more committed relationships).
  3. Similarly – more drug decriminalization?  Less?
  4. Tax reforms of the kind advocated for by people like Brad Wilcox to encourage rather than penalize marriage.  (Seems like a good idea to me, but I don’t know how many people there really are out there who choose not to wed for tax reasons).
  5. Better/more jobs for working class men and all-out brutes?  (Seems like an obvious idea, but how?  More unions? Fewer?  More tariffs and less free trade?  Get rid of the Jones Act?  More immigration? Less?  A larger standing army?  A return to more vocational education as advocated for by people like Mike Rowe?)
  6. The re-churching of America?  If so, what are your suggestions for how to accomplish this (evangelical minds would like to know)?
  7. Cultural shifts?  Melissa Kearney points out that up and down the educational ladder, Asian kids almost always have a dad.  Should we be more Asian?  More Mormon?
  8. Less cultural feminization?  Less blame cast on structural oppression and more of a return to a culture of personal responsibility as preached by Jordan Peterson et al.?
  9. More recognition of the downsides of the sexual revolution as described by Louise Perry?  Less premarital sex and pornography? The return of the shotgun marriage?
  10. More cultural depictions in Hollywood etc. of successful mixed-collar marriages in order to encourage more college-educated women to marry plumbers and electricians?

What else am I missing?  What do you think would work?”

TC again: I would add this.  We don’t know what would work.  But it can’t hurt to have the intelligentsia unified and vocal in a belief that a) this problem really matters, and b) like most problems it is not a hopeless one and improvement is possible.  I propose that as step number one — are you on board?

Monday assorted links

by  Tyler Cowen

1. “Decline in Independent Activity as a Cause of Decline in Children’s Mental Well-being.”

2. “We find that annual suicide attempts increased by 16%, or 5 attempts per 100k capita, after the enactment of [Polish] anti-LGBT statutes.”

3. Time preferences and food choice.

4. ChatGPT can now see, speak, and hear.

5. Tries to sound positive, but in fact shows that putting NYC congestion pricing on NJers isn’t going to work very well.  Again, you want to put stiffer congestion pricing on the residents.

6. The avant-garde origins of Gumby.

It is the poor who are lonely (on average)

by  Tyler Cowen in

Lower-income people are more lonely

Jiska Cohen-Mansfield did a literature review with Haim Hazan, Yaffa Lerman, and Vera Shalom of the statistical correlates of loneliness in older adults and found that being low-income is a strong correlate of loneliness. You see the same thing in surveys of middle-aged and elderly Portuguese people, in the Nova Scotia Quality of Life Survey, and in Eastern Europe.

Michelle Lim, Robert Eres, Shradha Vasan have the interesting finding that low income predicts loneliness not only on the individual level but also that “living in poorer neighborhoods” is associated with loneliness.

Sometimes scholarly literatures feature big disputes, or at least nuanced disputes, but in this case there seems to be no dispute at all: loneliness is associated with lower income and thus probably not caused by big houses or lack of huts. I also think it’s notable that at least among rich countries, loneliness seems higher in the poorer (or perhaps “less rich”) ones like Greece and Italy than in the United States and Switzerland.

The low rates of loneliness in egalitarian Sweden and Denmark, in particular, suggest that having more money pretty literally leads to less loneliness. Note as well that while the United States has a somewhat threadbare welfare state, this is data for senior citizens who do enjoy universal health care in the United States and a basic income via Social Security.

It may be, in other words, that being able to afford to do more leisure activities is a significant protector against loneliness. You go do more stuff and you make more friends. Or you have more opportunity to maintain your relationship with friends because you can afford to hang out and do stuff. I don’t think the exact nature of the causal relationship is clear from the studies that I’ve seen, but it bears more examination, especially because a lot of people seem to intuitively spin out to “paradoxical” accounts of loneliness that don’t seem well-supported.

That is from Matt Yglesias ($).

The Productivity of Online Education Increases

by  Alex Tabarrok in

Teaching is a labor-intensive service industry for which it is difficult to increase productivity. Thus, the price of education rises over time, the Baumol effect. One of the reasons Tyler and I have put a lot of effort into online education is that it ties education to high productivity growth industries such as software and technology. Thus in the Industrial Organization of Online Education we argued:

…as more of the value of a course comes from software and less from live teaching, productivity will improve, thus removing the cost disease.

Here’s a case in point:

This is just a test but all of the videos for our textbook, Modern Principles, and our free online platform Marginal Revolution University are already subtitled in many languages and soon we will see more translations like the one above. Amazing.

Scoring fifty years of industrial policy

by  Tyler Cowen

Gary Clyde Hufbauer and Eujin Jung report on what has worked and what has not:

Industrial policy is making a comeback in the United States. It is more urgent than ever to understand how and whether industrial policy has worked to strengthen the US economy. This study analyzes and scores 18 US industrial policy episodes implemented between 1970 and 2020, in an effort to assess what went right and what went wrong—and how the current initiatives might fare. These case studies can guide policymakers as they embark on what appears to be a major initiative in US government involvement in the economy today. The authors divide the 18 case studies into three broad categories: cases where trade measures blocked the US market or opened foreign markets, cases where federal or state subsidies were targeted to specific firms, and cases where public and private R&D was funded to advance technology. The outcome of each episode is scored by grading three criteria: (1) the effect on US competitiveness in global markets (or in some cases the national market), (2) whether the annual cost per job saved or created in the sector was reasonable (i.e., no more than the prevailing average wage), and (3) whether support advanced the technological frontier. Some of the episodes are partly or entirely successful while others are complete failures. Industrial policy can save or create jobs, but often at high cost. A major political selling point for industrial policy is to save or create jobs in a specific industry or location. In most cases, import protection does not create a competitive US industry, and it imposes extreme costs on household and business users per job-year saved. Trade policy concentrated on opening markets abroad is a better bet. Designating a single firm to advance technology yields inconsistent results. The highly successful model of Operation Warp Speed vividly demonstrates that competition is an American strength. R&D industrial policy has the best track record by far. Among the 18 cases, the Defense Advanced Research Projects Agency (DARPA) has the outstanding record.

Are you listening?  From November 2021.