Discover Your Inner Playboy

by  Tyler Cowen in

Playboy reviews Discover Your Inner Economist.  Excerpt:

In the self-conscious style of a seasoned blogger, Cowen’s best moments
come when he riffs on the "Me Factor," his term for ego-driven
consumerism. As an avid art and food lover, Cowen’s advice on
broadening your taste focuses on transcending your own Me Factor, to
trick yourself into paying greater attention to your life. Cowen offers
this tidbit for not getting bored in an art museum: "In every room ask
yourself which picture
you would take home — and why." Focusing attention, not letting it
grow scarce, produces economic rewards just as much as investing in
your portfolio.

The link is reasonably safe for work, though one of the ads may make your attention more scarce.  Here is also an NYT and Reuters piece from today on the book.

Paying the Tab

by  Tyler Cowen in

The subtitle is The Costs and Benefits of Alcohol Control, and the book (here is its home page) has more on the latter than the former.  The author, economist Philip J. Cook, produces a wide range of reasonable arguments that alcohol is too cheap on the supply side, given its social costs.

The quality of the argumentation is high, but perhaps I have too much of a libertarian closed mind (more or less) on the issue.  I hold the following views:

1. I don’t have an a priori belief in uniform rates of taxation, and if you twist my arm I’ll admit bad things should be taxed at higher rates than good things, at least provided we can avoid slippery slopes of ever-encroaching government paternalism.

2. Penalties for drunk driving should be much stricter.

3. I think the world would be a better place if most people simply stopped drinking, 100 percent plain, outright stopped.  Admittedly drink cross-subsidizes quality food, so if there is any loser it might be me.

4. For reasons of ethics and morality, I don’t think governments should regulate adult substance consumption.

5. I see some role for governments to regulate substance consumption to prevent spillover effects onto minors.

I do understand that #1, #4, and #5 are not fully consistent, but this mix of views still seems right to me.  And unless I see the world coming to an end through booze — and I don’t — I’m still stuck on #4, no matter how good Cook’s evidence and arguments.  Alcohol is but one issue in the age-old battle between liberty and tyranny, a fight which I see as more important in the longer run than sobriety vs. stimulants. 

I do worry about more powerful drugs or neurostimulators.  I am struck at how weak a temptation alcohol is, relative to what the future will bring.  In the meantime, if alcohol restrictions fail on the grounds of liberty, I guess I am back to my closed libertarian mind.

What Makes a Terrorist?

by  Tyler Cowen in

This new book by Alan Krueger, full of first-rate empirical work, punctures many myths about terrorism.  For instance poverty does not breed terrorism, once you look at the data.  Here is the book’s home page.

My only complaint is that the book does not deliver on its title; it tells me what doesn’t make a terrorist, but I still don’t know what does make a terrorist.  (Don’t even mention Islam in the comments unless you have something new — and analytical — to say; citing the Koran on jihad isn’t going to solve the puzzle.)

My crude view sees terrorism as meshed with three factors:

1. The belief that it is justified to kill innocent people for sufficiently important political ends.  Of course people who support the fighting of WWII hold this view too.

2. False positive beliefs about how the world works.  Osama bin Laden probably doesn’t know the Alchian and Allen theorem, the make-work fallacy, the Heckscher-Ohlin results, nor does he realize that his Islamic Caliphate would not work very well.

3. Some third factor(s), rooted in human psychology.

Most non-terrorists have more of #1 and #2 than is good for the world.  And I expect that terrorists have a special excess of #1 and #2.  I nonetheless think that the third factor is the key to understanding "what makes a terrorist."  You could start your reading here, and here, good luck.  Is it "narcissistic rage"?  Authoritarian or submissive personality types?  Freudian mumbo-jumbo at work?

By the way, the difficulty of pinning down the third factor(s) has policy implications.  We should adopt policies which are robust toward not understanding the strategies or game-theoretic solution concepts of the terrorists.  Complicated signals are unlikely to communicate the appropriate information in practice.  However bad is our model of the terrorists, I suspect that their model of us is even worse.

Is health care good for you after all?

by  Tyler Cowen in

This paper is very clever:

Health care spending varies widely across markets, yet there is little
evidence that higher spending translates into better health outcomes,
possibly due to endogeneity bias. The main innovation in this paper
compares outcomes of patients who are exposed to different health care
systems that were not designed for them: patients who are far from home
when a health emergency strikes. The universe of emergencies in Florida
from 1996-2003 is considered, and visitors who become ill in
high-spending areas have significantly lower mortality rates compared
to similar visitors in lower-spending areas. The results are robust
across different types of patients and within groups of destinations
that appear to be close demand substitutes.

Here are non-gated versions.

Neglected growth miracles

by  Tyler Cowen in

Between 1962 and 2002, life expectancy in the Middle East and North Africa…increased from around 48 years to 69 years…it was…the strongest performance of any region in the world…

…China, which saw life expectancy growing at 1.6 percent in the 1960s, collapsing to around 0.2 percent in the 1980s and 1990s, while income growth was going in the other direction.

Did you know that The Gambia, Yemen, Bangladesh, Nepal, and Libya were all in the top ten gainers in life expectancy, 1962-2002?

Here is the paper.  Here is the guy’s (very interesting) blog, via Bryan Caplan.

Surprising evidence on the Flynn Effect

by  Tyler Cowen in

1. Non-verbal IQ has risen more rapidly than has verbal IQ.

2. Performance gains are smallest on the most culturally specific tests, and largest on the most abstract tests.

3. Performance gains, as they occur over time, are roughly constant for all age groups.

4. Problem-solving abilities have seen the biggest performance gains.

5. Gains on the "Ravens" test started occurring before the TV era, much less the computer game era.

#3 is perhaps the biggest surprise to me, as it contradicts most of the obvious explanations for the Flynn effect. 

Those results are summed up in the very interesting "The Flynn effect and its relevance to Neuropsychology," by Merrill Hiscock, Journal of Clinical and Experimental Neuropsychology, 2007.  Here is Andrew Gelman’s post on that paper.

Hiscock puts it well: "..the Flynn effect constitutes a compelling example of large between-group IQ differences [across generations] that are completely environmental."

Viscusi Interviewed

by  Alex Tabarrok in

The Federal Reserve Bank of Richmond’s Region Focus interviews Kip Viscusi.  Here is one good bit:

…in the case of Superfund cleanups of hazardous
wastes, the people who benefit from the cleanups are
not paying the costs directly and thus demand the most
stringent standards possible. The result is that the median
cost per cancer case averted is about $7 billion. It’s off the
charts because you are using the responsible parties’ money
to clean up the site. In contrast, if you look at the amount of
money people are willing to pay for houses that are not
exposed to hazardous waste risks, you don’t observe that
kind of large trade-off at all. It’s more like $5 million rather
than $7 billion. Similarly, the premium that workers require
to work in relatively dangerous jobs is a lot less than what
government agencies spend on regulations.

Farewell to Alms

by  Tyler Cowen in

I’d like to soon start the MR BookForum on Greg Clark’s A Farewell to Alms: A Brief Economic History of the World.  I hear you’re all getting your copies now.  Ideally I’d put up the first post within 5-10 days, noting that the first session will be setting and overview.  You won’t need to have started the book by then.  Are you in fact all getting your copies from Amazon or elsewhere?

Here is David Warsh attacking the book.  Don’t discuss book content in the comments (save that for the BookForum), just let me know if the copies are coming through…

Beware self-deprecation

by  Tyler Cowen in

It usually implies even greater self-praise:

Norman Mailer…ruminated on his failure to win the Nobel Prize.

It wasn’t
politics that soured his chances, he declared; it was stabbing his
second wife with a pen knife in 1960. "The Swedes are very intelligent
people and they’re proud of their prize, and they’re damned if they
want to give their prize to a guy who is a wife stabber and as sour and
bitter as I am, and I don’t think I can blame them," he said.

I believe that Mailer has become a quite underrated writer, especially his Harlot’s Ghost.  But wife-stabbing is not the main reason why he has failed to win the prize.

Here is the link and article, which focuses on Gunther Grass, another tricky self-deprecator.

What accounts for reading speed?

by  Tyler Cowen in

Clever tests are being run:

To knock out sentence context, they changed word order (e.g.
“Contribute others. The of Reading measured”). To knock out whole word
recognition, they alternated capital and lower case (e.g. “ThIs tExT
AlTeRnAtEs iN CaSe”). And to knock out letter-by-letter decoding, they
substituted letters in such a way that word shape was maintained (e.g.
“Reading” becomes “Pcedirg”).

Letter decoding was found to
account for 62 per cent of reading speed; whole word recognition 16 per
cent; and sentence context 22 per cent.

I wasn’t there for the tests, but I believe that is measuring reading speed at margins other than what we find on the printed page.  "Knowing what is coming" is in my view most important for reading fast.  (I like to say "It took me 45 years to read that book."  If you think you "just started" the book in your hands right now, you are failing to understand the proper marginal unit.)

I find that when I try to read graphic novels, I am not a very fast reader at all.  My eyes get confused from not knowing where the next block of text will appear. 

I am also struck by an incidental remark toward the end of the article; we are getting closer to the truth:

…among the faster readers, predicting words from sentence context made a
bigger contribution to reading speed than among the slower readers.

Addendum: Here is my previous post on reading speed.

The dangers of compulsory education

by  Alex Tabarrok in

‘Attendance is now compulsory for every young witch and wizard,’ he replied.   ‘That was announced yesterday.  It’s a change because it was never obligatory before.  Of course, nearly every witch and wizard in Britain has been educated at Hogwarts, but their parents had the right teach them at home or send them abroad if they preferred.  This way, Voldemort will have the whole wizarding population under his eye from a young age.’

Damn, that Voldemort is eeeeevil.