I would like to see data on this

by  Tyler Cowen in

…a principal reason for greater income volatility is both simple and benign–motherhood.  In the 1970s, a minority of mothers were in the workforce and their pay was relatively low.  By the 1990s, a majority of mothers were in the workforce and their pay was much higher.  Because women today have a much more prominent role in the economy, their movements in and out of the workforce to take care of children are having bigger impacts on income volatility.  When mothers re-enter the workforce, family incomes increase.  This also counts as income volatility.

That is from The New Rules Economy.  Have any of you seen more on the topic?

Game theory and the American-Israel relationship

by  Tyler Cowen in

Here are a few views:

1. Economizing hand motions is the key, so just leave it "as is" when done.  It might be needed in that same position again.

2. Such matters should be arranged to please your wife.  It is signaling and a symbolic recognition of her value.  The only question is what you get in return, but if you get anything at all it is worth it.

3. Avoiding midnight surprises is the key, which means always leave it down.

4. Many women don’t like the idea that guests could show up and see the insides of their toilet bowls. 

#2-4 all point in the same direction, and I don’t give a damn about #1.  But somehow I, like many other men, fail to optimize on this question.  The more interesting question is why this remains a issue.  Here goes:

1. Women keep it an issue, rather than delivering decisive argumentation, to test their men and their sense of commitment.

2. Men cannot help but rebel against the female ethic of caring, especially when it concerns something so infantile as a toilet seat.

3. Existential freedom.  I once had a European roommate, and it drove me crazy that he closed all the doors around the apartment. Perhaps an occasional open seat is a quixotic demand that our universe show true randomness and openness.

4. Men prefer to focus more intensely on a smaller number of issues and this isn’t one of them.  But obviously that explanation can no longer apply to me.

Addendum: Mikhail directs my attention to this paper.

Unhooked

by  Tyler Cowen in

The subtitle says it all: How Young Women Pursue Sex, Delay Love and Lose at Both.

My reading of such books follows a formula.  Pick up said charge that voluntary individual behavior is leading to a crisis.  Sort author’s mush into a rational choice model with either social externalities or imperfections within the self.  Evaluate said model using evidence, in particular whether the other implied predictions are plausible.

So why might young women choose too much casual sex?

1. Their discount rates are too high.

2. There is an "arms race": the looseness of one woman makes the "putting out"  requirements more extreme for other women, but no single woman takes this effect into account.

3. Obsession with school work is the real problem.  Casual sex takes less time than a boyfriend, but girls overvalue how much good grades matter and underinvest in serious relationships.

4. Women are bad at estimating what will make them happy, a’la Daniel Gilbert.

5. Women underestimate the strength of their own addiction to causal sex.

6. Matters are efficient, but men are earning all the surplus.  Easy birth control allows men to use "loose women" as a threat point in the bargaining game.  (But hey, these *are* the loose women!)

7. We pursue the feeling of "being in control," even when it does not benefit us.  Women want to feel they are in control of their sex lives, and to feel they are not bound by social convention, although this is an illusory gain.

#1 and #4 are true but not essential to the question at hand.  #2 and #5 seem  inconsistent with the evidence — found in this book — of women pushing for a loosening of general standards.  The women are not supporting a local cartel of tighter sexual standards, quite the contrary.  #3 seems efficient to me, not a mistake.  I can see truth in #7, a quintessentially Cowenian theme.

Overall on this matter I am a Coasian who sees a Nash bargaining solution at work.  In other words, don’t worry.

Which doesn’t mean I am going to show this book to Yana.

Which is perhaps more evidence for #7.

Here is one insightful look at the book.  Note also that the author never adds up the welfare gains of the young men involved…

Wise words from John Quiggin

by  Tyler Cowen in

Suppose you wanted to establish whether children’s height increased with age, but you couldn’t measure height directly.

One way to respond to this problem
would be to interview groups of children in different classes at
school, and asked them the question Don suggests “On a scale of 1 to
10, how tall are you?”. My guess is that the data would look pretty
much like reported data on the relationship between happiness and
income.

That is, within the groups, you’d find that kids who
were old relative to their classmates tended to be report higher
numbers than those who were young relative to their classmates (for the
obvious reason that, on average, the older ones would in fact be taller
than their classmates).

But, for all groups, I suspect you’d
find that the median response was something like 7. Even though average
age is higher for higher classes, average reported height would not
change (or not change much).

So you’d reach the conclusion
that height was a subjective construct depending on relative, rather
than absolute, age. If you wanted, you could establish some sort of
metaphorical link between being old relative to your classmates and
being “looked up to”.

But in reality, height does increase
with (absolute) age and the problem is with the scaling of the
question. A question of this kind can only give relative answers.

Here is the link.

Addendum: Here is Will Wilkinson on same.

Cultural imperialism?

by  Tyler Cowen in

My column from today offers my latest thoughts on globalization and culture, drawing on the very interesting work of Omar Lizardo, a sociologist at Notre Dame.  We are often interested in culture for its symbolic value, and its ability to signal where we stand in local hierarchies.  The more egalitarian a society, the less important this signaling function becomes.  Here is one bit:

Hollywood movies are popular in Europe in part because of the successes
of European welfare states and of European economic integration. 
Western Europe has become more equal in its treatment of citizens, it
has moved away from an aristocratic class society, and it has strong
global connections.  All those factors favor an interest in American and
global popular culture; Hollywood movies often capture 70 percent or
more of a typical European cinematic market.  Social democracy, which
the Europeans often hold up in opposition to the American model, in
fact aided this cultural invasion by making Europe more egalitarian.

Here is Omar’s home page.  Here is Omar’s essay which I drew upon.  Here is one further bit:

…the data supplied by Professor Lizardo show that the poorer a country,
the more likely it will buy and listen to its own domestic music.  This
makes sense given that music is a form of social networking and the
relevant networks are primarily local.

Funes the Memorius

by  Tyler Cowen in

MyLifeBits:

MyLifeBits has also provided Bell with a new suite of tools for capturing his interactions with other people and machines.  The system records his telephone calls and the programs playing on radio and television.  When he is working at his PC, MyLifeBits automatically stores a copy of every Web page he visits and a transcript of every instant message he sends or receives.  It also records the files he opens, the songs he plays and the searches he performs.  The system even monitors which windows are in the foreground of his screen at any time and how much mouse and keyboard activity is going on.  When Bell is on the go, MyLifeBits continually uploads his location from a portable Global Positioning System device, wirelessly transmitting the information to his archive.  This geographic tracking allows the software to automatically assign locations to Bell’s photographs, based on the time each is taken.

To obtain a visual record of his day, Bell wears the SenseCam, a camera developed by Microsoft Research that automatically takes pictures when its sensors indicate that the user might want a photograph.  For example, if the SenseCam’s passive infrared sensor detects a warm body nearby, it photographs the person.  If the light level changes significantly–a sign that the user has probably moved in or out of a room and entered a new setting–the camera takes another snapshot.  A recent study led by researchers at Addenbrooke’s Hospital in Cambridge, England, showed that a memory-impaired patient who reviewed SenseCam images every night was able to retain memories for more than two months.

How many of you would want this?  I wouldn’t.  I prefer the memories I choose to keep, and the ones I make up, over the ones I really had.  Thanks to Robin Hanson for the pointer.

Four new economics journals

by  Tyler Cowen in

Mario Rizzo directs my attention to Andrew Oswald’s 2007 paper (Economica) "An Examination of the Reliability of Prestigious Scholarly Journals: Evidence and Implications for Decision-Makers", here is the abstract: 

Scientific-funding bodies are increasingly under pressure to use journal rankings to measure research quality.  Hiring and promotion committees routinely hear an equivalent argument: ‘this is important work because it is to be published in prestigious journal X’.  But how persuasive is such an argument?  This paper examines data on citations to articles published 25 years ago.  It finds that it is better to write the best article published in an issue of a medium quality journal such as the OBES than all four of the worst four articles published in an issue of an elite journal like the AER.  Decision-makers need to understand this.

Zing!

by  Alex Tabarrok in

I love it when Greg Mankiw gets nasty.

Robert
Reich says that, as a requirement for free trade deals, we should tell
developing countries to "set a minimum wage that’s half their median wage." The
proposal raises two questions in my mind:

1. Does Reich pay his nanny,
cleaning person, and gardener more than half the median wage of members of his
family?

2. If not, should I refuse to buy his books?

Shades of Pierre Menard

by  Tyler Cowen in

The riveting music story of the moment is the Joyce Hatto hoax. Gramophone…has revealed that several recordings attributed to the late, cultishly admired British pianist are identical to discs previously issued on other labels – including, remarkably, Yefim Bronfman and Esa-Pekka Salonen’s well-regarded 1990 recording of the Rachmaninov Third Piano Concerto.  The Gracenote database on iTunes exposed the fraud.  The possibility arises that many or most of Hatto’s hundred-odd releases on her husband’s Concert Artist label are stolen property.  Not having heard any Hatto discs, I can’t begin to judge what’s real and what’s not, but it’s a safe guess that anything conducted by the elusive René Köhler (scroll down this page for Concert Artist’s unverified biography) is a fake; in one case he’s Salonen, in another he’s Bernard Haitink…Jessica Duchen links to an internet discussion where one piano expert is quoted as saying that Minoru Nojima’s Liszt playing is "too clinical" and expressing a preference for Hatto – not aware that he’s discussing the same performance!

Here is the link, which includes further references, and also this account.  It should be noted that Hatto’s discs had no real chance of making money and in fact cost some money to put out; her husband created an independent label for the music.  In any case, I have heard Ms. Hatto play (albeit under different names), and the results were very impressive.  She can play just about anything, and she has mastered many styles.  Here is an earlier and indeed glowing review of Ms. Hatto’s work.  She was sadly unable to play in public, citing an unpredictable illness.

Addendum: I’ve been told by credible sources that an economist once submitted a paper to the QJE which the journal already had published, albeit by the real author.  The journal at least had the good sense to accept and publish the work again.

Are Parliamentary systems better?

by  Tyler Cowen in

Matt Yglesias writes:

As a general matter, I tend to think parliamentary systems as seen in Britain or Canada are superior to our method of government.  A system like that puts less formal restraint on the head of government in terms of his ability to act, but also makes it much easier to dump a head of government whose policies have failed and whose leadership is widely considered inept.

Totally maybe.  Parliamentary systems do work better for small countries with well-educated populations.  Accountability is higher, and voters enforce some discipline upon government.  The openness of the economy imposes other constraints.  See this paper.

But when the country is large and diverse, I see more reason to favor the American Constitution or in general a more pluralistic system.  Why trust voters as the major source of constraint, and what do "the voters" want in any case?  Furthermore the American system offers a decent chance of divided government and thus greater limits on the executive.  Parliamentary systems often allow the Prime Minister and cabinet to manipulate the legislature by offering intra-party perks and promotions.  There is plenty of gerrymandering, and bringing down a government is an extreme option which is not very easy to exercise in political equilibrium.  If nothing else the rebelling party faces the danger of many of its members — including the rebels — being kicked out in a new election.  Elections can be called at strategic times, and so on.  The Prime Minister is hardly a captive of the voters or the legislature.

Federalism is another issue.  If so much of policy is decided in decentralized fashion, as it must be in a large nation, maybe the federal/national part of those policies should be decided on grounds in rough concordance with a federalistic system.  That will mean a division of powers.  I also worry that as the nation becomes big enough, and states matter more, that there is not enough party unity to sustain a Parliamentary system.

When the executive and legislature are unified, as under a Parliamentary system, the Supreme Court, or its equivalent, will be weaker.  No one will trust a hand-picked court, with no major obstacles to confirmation, with so much power.  Yet weakening judicial review in America would worry me; it also also one step toward eliminating a written constitution altogether.

A final question is whether the USA — the country most likely to use nuclear weapons — needs a President with a certain amount of autonomy and secrecy for a fixed time period.  In general I favor a constrained executive, but that one is harder to call.  Can you imagine a Parliament debating nuclear strategy?

Organ Donation in Israel

by  Alex Tabarrok in

Israel may begin something like a no-give, no-take rule for organ donation.  Under a new proposal someone who had previously signed their organ donor card would be given points helping them to move up the waiting list should they one day need a transplant organ.  See here for more on the no-give, no take rule.   

Thanks to the ever-entrepreneurial Dave Undis for the pointer.