Cheap talk?
Teenagers who take virginity pledges — public
declarations to abstain from sex — are almost as likely to be infected
with a sexually transmitted disease as those who never made the pledge,
an eight-year study released yesterday found.Although young people who sign a virginity pledge
delay the initiation of sexual activity, marry at younger ages and have
fewer sexual partners, they are also less likely to use condoms and
more likely to experiment with oral and anal sex, said the researchers
from Yale and Columbia universities.
Here is the story. Here is the pledge:
"Believing that true love waits, I make a commitment to God, myself, my
family, those I date, and my future mate to be sexually pure until the
day I enter marriage."
Which skills do computers reward?
Gligoric, on the basis of his own experience, considered the optimal age of a chess player to be 33-36. But today, with the appearance of powerful computers and the Internet, chess is rapidly growing younger. There has been a revolutionary change, not only in the process of preparation, but also in chess thinking itself: now there is little sense in relying, as before, on general evaluations of the type ‘unclear’ or ‘with compensation’ – you have to think very concretely. Instead of deep reflection and philosophising at the board, what has come to the forefront is the ability to calculate intensively and to maintain extreme concentration of thought throughout the game. Computer programs help young talents to quickly acquire the necessary knowledge, since a tenacious young memory can store a great amount of information, and deficiencies in positional understanding are compensated by precise calculation and the ability to maintain the tension of the struggle.
That is from Gary Kasparov, who really does know. It counters the usual belief that the rise of computers rewards broad human intuition, which the computer cannot so easily replicate. But Kasparov sees the question more clearly. It is not how humans and computers compete in chess, but rather how they can best cooperate.
Can it be true more generally that computers reward calculating ability more than general intuition? Perhaps the Internet gets the young up to speed on the facts in a given area and then they race ahead on their superior speed and analytical abilities. What can better teach these skills than a super-fast computer, noting that you can’t use the computer in all settings to replace the human.
I am reminded of my favorite dictum about academic co-authorship: the best co-authors are those with similar skills, not radically differing skills. Let’s not also forget that it is similar countries which trade the most with each other, not radically differing countries. So maybe the people who can best "trade" with computers are…er…people who are (relatively) like computers.
By the way, Kasparov just retired; he is 41 years old.
Markets in Everything: Nein!
Markets in Everything usually deals with unusual items but today’s post is about a German website where buyers and sellers bid on labor contracts. Here’s the idea:
The
concept of jobdumping.de is simple. An employer posts a job that needs
doing, along with the maximum wage he or she is willing to pay.
Interested job seekers then compete with each other for the job by
underbidding, meaning the employer ends up with the person willing to
do the job for the least amount of money.
The system can also
work the other way, with workers entering their skills in the auction
at the minimum price they’re willing to work for, and interested
employers then push the wage up as they outbid each other.
Nothing unusual about that – freelancers as well as firms bid on contracts like this all the time. And yet in Germany, where unemployment is at a record high, this website has generated a furious response:
…some German labor market experts have had harsh words for the Internet site. Dirk Niebel of the Liberal Democratic party even went so far as to call the premise "immoral" in an interview printed in the Berliner Zeitung on Tuesday.
"I find it strange," he said. "It smacks of a slave market."
Freedom is slavery. Amazing.
Thanks to Mike Jackmin for the pointer.
How to anger Fidel Castro
Cuban President Fidel Castro has
criticized Forbes magazine for the "infamy" of listing him among the
world’s richest people, with a net worth of $550 million."Once
again, they have committed the infamy of speaking about Castro’s
fortune, placing me almost above the queen of England," Castro said in
a speech to top officials of Cuba’s ruling Communist Party, military
and police."Do they think I am (former Zairian President) Mobutu
(Sese Seko) or one of the many millionaires, those thieves and
plunderers, that the empire has suckled and protected?" he said in
reference to his capitalist archenemy, the United States…The magazine said Castro derived his fortune from a web of state-owned
companies that include retail conglomerate CIMEX, pharmaceutical
company Medicuba and a convention center near Havana.
Here is the full story.
Markets in bunny lives?
Here is the gruesome side of the Coase Theorem:
Toby is the cutest little bunny on the planet. Unfortunately, he will DIE on June 30th, 2005 if you don’t help. I rescued him several months ago. I found him under my porch, soaking wet, injured from what appeared to be an attack from an alley cat. I took him in, thinking he had no chance to live from his injuries, but miraculously, he recovered. I have since spent several months nursing him to health. Toby is a fighter, that’s for sure.
Unfortunately, on June 30th, 2005, Toby will die. I am going to eat him. I am going to take Toby to a butcher to have him slaughter this cute bunny. I will then prepare Toby for a midsummer feast. I have several recipes under consideration, which can be seen, with some pretty graphic images, under the recipe section.
I don’t want to eat Toby, he is my friend, and he has always been the most loving, adorable pet. However, God as my witness, I will devour this little guy unless I receive 50,000$ USD into my account from donations or purchase of merchandise. You can help this poor, helpless bunny’s cause by making donations through my verified PayPal account by clicking on any of the Donate buttons on this site, or by purchasing merchandise at the Savetoby.com online store.
So far the guy claims (it appears to be verified but who knows?) to have received over $18,000, here is the site. My advice, by the way, is not to send the guy a cent. Here is the guy’s hate mail. Here is the Washington Post coverage. And while you might be appalled (or is that the point?), keep in mind that most of you do in your versions of Toby without offering a reservation price at all.
Thanks to Mitch Berkson for the pointer.
Addendum: Here is an argument that the site is a hoax.
13 scientific puzzles
Read them here. My favorite:
Several times a day, for several days, you induce pain in someone [children: do not try this at home]. You control the pain with morphine until the final day of the experiment, when you replace the morphine with saline solution. Guess what? The saline takes the pain away.
This is the placebo effect: somehow, sometimes, a whole lot of nothing can be very powerful. Except it’s not quite nothing. When Fabrizio Benedetti of the University of Turin in Italy carried out the above experiment, he added a final twist by adding naloxone, a drug that blocks the effects of morphine, to the saline. The shocking result? The pain-relieving power of saline solution disappeared.
So what is going on? Doctors have known about the placebo effect for decades, and the naloxone result seems to show that the placebo effect is somehow biochemical. But apart from that, we simply don’t know.
Here is one more puzzle on string theory, courtesy of Craig Newmark. Or try this one, on what it is like to be watched by a robot.
Post for capital theory geeks
Bryan’s central argument is the following:
In the modern world, the typical person gets richer in the typical year. Once again, this gives even perfectly patient people a reason to increase their demand for current consumption. Imagine you are going to inherit $1,000,000 next year. According to the law of diminishing marginal utility, you would want to increase your consumption now when the marginal utility is high, and pay for it by cutting back your consumption in the future when the marginal utility is low. No time preference story need apply.
I would put it differently. The argument for positive interest rates does not require "pure time preference," but it does require assumptions about the intertemporal substitutability of consumption. Diminishing marginal utility, in the classic sense, is defined at a single point in time. But how do differing marginal utilities of consumption vary across time? How does my two millionth dollar next year compare to my one millionth dollar today (Steve Miller asks the same)? This variable is distinct from either classic time preference or classic diminishing marginal utility. For Caplan’s argument to work, we must assume that consumption tomorrow is a relatively close substitute for consumption today.
So the Austrians are correct that we must consider "preferences across time" as a broad category behind the phenomenon of interest. That being said, the intertemporal substitutability of consumption is closer to Irving Fisher’s notion of time preference as a marginal allocation than it is to Mises.
Why does all this matter? There is no quick, easily bloggable explanation. But to race ahead to the conclusion, this extra dimension of preferences offers us some hope in explaining apparent anomalies in equity returns and market pricing of debt securities (though here is one critique). And here are some implications for the conduct of monetary policy.
Intertemporal consumption involves local complements, not substitutes, when habit formation (this link is for Bryan) is sufficiently strong. If you would like a fun exercise, try to figure out what this implies for the term structure of interest rates in a world with zero time preference…
And if you don’t already understand what this post is about, don’t bother trying to learn.
Markets in everything
How many times have you had a deer head ready to go and then realize it had a pair of feet to go with it? Well now, with Van Dyke’s freeze dried deer feet you can always have a few on hand and ready to go. Keep a few mounted on a panel in your show room and make a little extra income without all the work. These beautiful whitetail feet come ready to go. Simply install a piece of 1/4" threaded rod and attach to any panel. Available in three sizes, these will certainly be a real timesaver and moneymaker for your shop!
Here is the link, with photo, and thanks to Elizabeth Childs for the pointer. Try this one too.
Eggbeaters
If the transformation of eggs by heat seems remarkable, consider what beating can do! Physical agitation normally breaks down and destroys structure. but beat eggs and you create structure. Begin with a single dense, sticky egg white, work it with a whisk, and in a few minutes you have a cupful of snowy white foam, a cohesive structure that clings to the bowl when you turn it upside down, and holds its o wn when mixed and cooked. Thanks to egg whites we’re able to harvest the air, and make it an integral part of meringues and mousses, gin fizzes and souffles and sabayons.
The full foaming power of egg white seems to have burst forth in the early 17th century. Cooks had noticed the egg’s readiness to foam long before then, and by Renaissance times were exploiting it in two fanciful dishes: imitation snow and the confectioner’s miniature loaves and biscuits. But in those days the fork was still a novelty, and twigs, shreds of dried fruits, and sponges could deliver only a coarse froth at best. Sometime around 1650, cooks began to use more efficient whisks of bundled straw, and meringues and souffles start to appear in cookbooks.
That is from Harold McGee’s superb On Food and Cooking: The Science and Lore of the Kitchen. Imagine the writing and expository skills of a Richard Dawkins, but applied to applied chemistry in the kitchen, and maintained at a consistent and gripping level for 809 pages. The only problem with this book is that the magnitude of the quantity and quality is simply overwhelming.
Dan Klein and I used to have a saying: "You so much learn the whole book." In marked contrast is Roger Penrose’s The Road to Reality: A Complete Guide to the Laws of the Universe. Penrose remains a brilliant scientist and writer. But never before have I seen a book that so clearly consists of material that I either a) already know, or b) will never know.
Musical protectionism
The French police are arresting symphony orchestra musicians from Eastern Europe. Why?
The reason for importing musicians
from the east to play in countries like France is simple: money. "The
tour would’ve been too expensive with French musicians, so there
wouldn’t have been a tour at all," Mr. Miller argues. While a company
like the one conducted by Mr. Miller might charge about €15,000
($20,055) for a show, a French orchestra would probably cost three
times that amount, Mr. Miller reckons–pricing them out of the 300- to
800-seat venues they were playing, typically in towns of less than
100,000 people. "I don’t feel at all that I’m taking work away from a
French musician," Mr. Miller told me. Musicians like the Bulgarians he
was conducting, meanwhile, "need the work, they don’t hold out for very
high fees and they play well." "Artistically," he added, "the tour was
a great success."
Not all the musicians have their papers:
A German conductor, Volker
Hartung, whose Cologne New Philharmonic was also employing some East
European musicians, was arrested as he came out for an encore following
a performance of Ravel’s "Bolero" and Bizet’s "Carmen." After also
being held for two days, Mr. Hartung was released with a warning but,
according to the Guardian newspaper, has been banned from performing in
France "until further notice." This was, according to Gerald Mertens,
director of Deutsche Orchestervereinigung, or the German orchestra
union, the second time Mr. Hartung was arrested in France for
underpaying his musicians and not obtaining proper authorization for
them to perform in France.
After deep reflection and debate, the French musicians’ unions have decided to side with the French police, and not with the Muse. In fact, some of the arrested musicians blame the unions themselves for the crackdown.
The evolution of biblical translation
In the newly revised, more accessible edition of the New International Version of the Bible, “stoned” has been changed to “stoned to death” for fear that modern readers may get the impression that the reward for adultery is a big spliff.
Here is the source (other passages are discussed), and thanks to Chris at CrookedTimber.org for the pointer.
Steve Levitt’s Freakonomics
What five terms in a housing ad correlate with higher prices?
1. Granite
2. State-of-the-Art
3. Corian [read here, I didn’t know what it was either…]
4. Maple
5. Gourmet
And what correlates with lower prices?
1. Fantastic
2. Spacious
3. !
4. Charming
5. Great neighborhood
In economics language, it is the costly signals which carry real value. You use general words when you have nothing better to say, and remember that for next Valentine’s Day.
The list is from the new Freakonomics: A Rogue Economist Explores the Hidden Side of Everything [you can pre-order, Amazon lists May 1 but it hits the stores April 12], by Steve Levitt and Steven Dubner. Imagine the best of Levitt put into readable form by an excellent journalist. When it comes to the popular exposition of contemporary economic research, this book is a milestone. Why do drug dealers still live with their moms? How do we know that sumo wrestlers cheat? Here is Alex’s previous post on Levitt and names and race. Here is my previous post on Levitt and teacher cheating.
The bottom line in one sentence: "People lie, numbers don’t."
Public Finance and Public Policy
Public Finance and Public Policy, the new textbook by Jonathan Gruber, is not only the best public finance textbooks I’ve ever read it is one of the best textbooks I’ve read in any field. Gruber and Worth Publishers have clearly put a huge amount of money and effort into this book – the content is superb and so is the presentation (graphs, organization, supplementary material – e.g. check out these cool powerpoint presentations.).
Gruber is especially good at discussing empirical research. What is the effect, for example, of social security on private savings, on the living standards of the elderly, on the incentive to retire? What do we learn from the international evidence?
(Quick answers: Social security crowds out about 35 cents of private savings for every social security dollar. As a result, social security has reduced the eldery poverty rate although not quite as much as naive trends would suggest. Social security does reduce the labor force participation rates of the elderly but less so in the United States than in most European countries where there are huge disincentives for working beyond the normal retirement age. (Get the book or this powerpoint presentation for more details – note you need to view the PP in SlideShow mode to get the full effect.)
Gruber covers all the major programs – education, social security, unemployment insurance, Medicaid and Medicare, the tax system etc. – and in each case he carefully explains the institutional details and then he evaulates the empirical evidence focusing on the most telling pieces of evidence (rather than trying to cover everything that has ever been written as in a review paper).
Gruber is so good on the empirical research that this book would be a useful supplement to an applied econometrics class. Just flipping through it and reading the boxed Empirical Evidence sections gives a good feel for what the cutting edge questions and techniques are in empirical research.
Congratulations to Gruber on a tour de force!
The Benefits of Contingency Fees II
I am in Miami for a few days. My guidebook has this to say:
Miami restaurants are notorious for slow, arrogant service, by the time you finally get your cutting-edge dish of pan-roasted, pan-seared whatever, the trend that created it may well be long over.
I can verify, last night I walked out of two restaurants. A little while later the guidebook also notes:
…many restaurants top up the bill with a 15-18 percent gratuity …
Also true, as in Europe Miami restaurants tack-on the "gratuity" automatically. What the guidebook falls to mention is that the latter fact explains the former.
New Econoblog on WSJ.com
Max Sawicky and I square off on taxes and spending, here is the link. Here is one short bit from Max:
The other connotation of "surrender" here is surrender to the market, or to the fates. It is surrender to amorality, since market outcomes have no positive ethical qualities. Choices are determined by endowments, and endowments — the wealth and social status resulting from the accident of birth — are a matter of pure luck.
Addendum: Sawicky says impossible, Greenspan says inevitable.
Addendum II: here is the WSJ.com forever permalink, the one above expires in thirty days.