Friday assorted links
Rising markups, rising prices?
Sad to see this issue is still being debated so much. If you need an empirical antidote, you can find one from Christopher Conlon, Nathan H. Miller, Tsolmon Otgon, and Yi Yao in the May issue of the AER. Ungated here. Here is one bit:
Our exercise does not provide empirical support for a strong correlation between markup and price changes…
Therefore, our interpretation is that the results do not support a hypothesis that the increase in the DLEU markups is driven primarily by reductions in competition, keeping in mind that a “false negative” is possible.
DLEU stands for this well-known piece. This result would seem to lower the chance that the rising mark-ups came from diminished competition, as opposed to higher costs, better service, or other features of the market, such as changing scale elasticities.
Gender Roles and the Misallocation of Labour Across Countries
This paper asks whether the gendered division of work inside and outside the home leads to the misallocation of labor. Using personnel data of a multinational firm covering 100K employees in 101 countries over 5 years together with labor force participation data we show that women are more positively selected than men: the productivity of the average female worker is higher than that of the average male worker, and this gap is decreasing in women’s participation in the labor force. Structural estimates indicate that equalising barriers to labor force participation would increase firm productivity by 32% keeping employment and the wage bill constant.
That is from a recent paper by Nava Ashraf, Oriana Bandiera, Virginia Minni, and Víctor Quintas-Martínez.
I remain puzzled, but more are flirting with this idea…
If I truly believed the average of GDP + GDI (and I mostly do believe it) then one could reasonably describe the economy as having been in recession for some time, but a very very strange recession with strong employment gains and low unemployment–so a productivity decline.
— Jason Furman (@jasonfurman) May 25, 2023
The rise of Louise Perry
I am pleased to see Bryan Caplan reviewing the new Louis Perry book The Case Against the Sexual Revolution. He opens with this:
I read Louise Perry’s The Case Against the Sexual Revolution: A New Guide to Sex in the 21st Century in a single day. If you want a page-turner, look no further. The sentences are gripping, the anecdotes are shocking, and the thesis is eyebrow-furrowing. For pure entertainment, I honestly don’t think I can compete with this book, which strives to convert today’s young feminists to a heretical syncretic creed of sex-negative feminism and social conservatism.
On Amazon the book has a five-star average with 716 ratings, and I strongly suspect it still will be read and referenced in ten or twenty years. I disagree with much of what Bryan says on this topic, but am glad to see he recognizes the importance of the book. In my view, Bryan is insufficiently Freudian, unwilling to see both “sexual freedom” and “sexual repression” as embodying a complex bundle of options, with no unproblematic way out and with no truly stable solution. I read Perry (who is an Emergent Ventures winner, by the way) as embodying the Freudian perspective, and not denying it, but not willing to emphasize it either. She has chosen her side, and would rather tell the woman not to let the guy choke you for his own fun.
On that I can agree. I am pleased to see this book doing so well.
Thursday assorted links
1. Things we’ve changed our mind about, including New Jersey.
2. In fact I linked to this recently, it is one of my favorite videos (some very real lessons about eroticism in there), but since Tina Turner has passed away here it is again. RIP.
3. “Creators”? WTF? What is wrong with you people??
4. Ten-year gilts back up to Truss/Kwarteng levels.
5. Twelve-minute John Cochrane Bradley award acceptance speech.
6. Update on the prospects for AI regulation. And Nabeel on Waluigi, Carl Jung, and the Case for Moral AI.
7. Robert Zimmer, RIP (NYT).
My Conversation with a Nairobi urban dweller
I will be recording a Conversation with a Nairobi urban dweller, who perhaps will not be identified by name. Not a famous person, simply someone who lives in Nairobi and is willing to discuss matters frankly. What should I ask this person?
*Why Congress*
By Philip A. Wallach, of the American Enterprise Institute. Here is the book’s home page. Here is a review of the book. A very good book. As I read Phil, he is suggesting that Congress is even a wee bit underrated. You can buy it here.
How D.C. densified
DC’s relative success can be traced to a few decisions made decades ago. In the 1970s, policymakers in Arlington County made a decision to adopt what’s known as ‘transit-oriented development planning’ ahead of the opening of DC’s Metro Orange Line, which runs between Arlington and Prince George County, Maryland (via DC). Arlington policymakers identified that zoning for apartment construction in commercial areas could bring in property taxes and help balance the budget without the level of controversy of changing zoning in existing residential areas. Some nearby jurisdictions followed suit, learning from Arlington’s example, helping the DC region stay more affordable than the country’s other superstar cities.
Here is the full essay by Emily Hamilton of Mercatus, serving up a very good short economic history of Arlington. And this on the District:
The District itself has permitted extensive redevelopment of formerly industrial neighborhoods when they received new Metro stations, including Navy Yard and NoMA. In the years since the 2010 financial crisis, DC has permitted thousands of apartments each year, a high rate compared to peer cities. As in Arlington, they’ve primarily been permitted on land that previously housed industrial or low-value commercial development where there are few or no existing residents to oppose new construction.
Interesting throughout. I am pleased to live in the land of partial YIMBY.
That is all from the new and excellent issue of Works in Progress.
*The Lost Album of the Beatles*
The author is Daniel Rachel, and the subtitle is What if The Beatles Hadn’t Split Up? This is perfectly fine as a music book (for Beatle fans, it won’t convince the unconverted), but I couldn’t stop thinking of the Lucas critique.
For the author, the Beatles “final last album” is a double album of the best cuts from Beatle early solo careers, and that is an impressive assemblage indeed. McCartney’s “Back Seat of My Car,” for instance, was written in 1968, or at least started in that year, so surely it would have ended up on the last album. Or would it have? It didn’t end up on Let It Be or Abbey Road, so who knows? As long as the end of The Beatles was in sight, perhaps each Beatle would have hoarded his best potential solo material. Or maybe the other Beatles would have vetoed some of those songs, just as Paul in 1968 had decided that George’s “Isn’t a Pity?” wasn’t suitable as a Beatles song. Or maybe John and Paul would have had to give more songs to George and Ringo, to keep the group together, but arguably to the detriment of the final album. Most of the songs on All Things Must Pass are very good, but best suited to their own little walled garden.
In contrast, this economist believes that an additional album would have fallen somewhere between Let It Be and The White Album, with an overall sound somewhat akin to “Free as a Bird,” or perhaps also Ringo’s “I’m the Greatest,” penned by John and cut with George as well. Good stuff, but I’m still glad they split. Get that Q up, especially given that market power was present!
And don’t assume that Beatle behavior remains invariant across different policy regimes. Lucas truly was a universal economist.
Wednesday assorted links
1. There are now some direct flights from NYC to the Faroe Islands.
2. Ezra Klein with Lisa Damour on teenage mental health (NYT).
3. Dwarkesh podcasts with Richard Rhodes. Martin Amis on Richard Rhodes. Is he the man with the highest variance of quality across different books? Or is it all good?
4. The economics of rental housing in Vienna (NYT).
5. NBA signaling game theory, Kyrie Irving edition.
Sri Lanka information bleg
I am well aware of the power blackouts and food problems of recent times. But how is it being in the country right now? How inconvenient is it to be there? What are the biggest practical problems for a tourist on a daily basis? I thank you all for the information.
*The Soul of Civility*
The subtitle is Timeless Principles to Heal Society and Ourselves, and the author is the still-on-the-rise Alexandra Hudson. Most of all this is a sane and healthy book! And it indicates a direction for the future evolution of classical liberalism. Here is one short excerpt:
In Rituals of Dinner, Margaret Visser notes the dark side to hospitality. she argues that hosting others can be a power play. The host has the opportunity to be the guest of honor, the center of all praise and attention in the comfort of their own home. Guests must fawn and thank them whether or not the hospitality or food is any good, and often feel obligated to reciprocate whether they want to or not. While cynical, I’ve come to see some wisdom in her insight.
I am very glad this book now exists, you can pre-order it here.
ChatGPT as marketing triumph
That is the topic of my latest Bloomberg column, here is one excerpt:
Consider the name itself, ChatGPT. Many successful tech products have happy, shiny, memorable names: Instagram, Roblox, TikTok. Someone comes up with the name, perhaps in a brainstorming session, and then it is taken to the broader world. With luck, it will prove sticky and continue to invoke a warm glow.
ChatGPT, as a name, does not have a comparably simple history. Originally the service was GPT-2, then GPT-3. GPT-3.5 was then released, and ChatGPT was announced in November 2022. ChatGPT-3.5 was cumbersome, and by that point it was running the risk of becoming obsolete numerically. So ChatGPT became the popular moniker. When GPT-4 was released in March, there was the chance to switch to just GPT-4 and treat ChatGPT as a kind of interim brand, connected with the 3.5 edition, but no — ChatGPT it is.
I still prefer to call it GPT-4, to make it clear which version of the service I am using. GPT-3.5 remains available for free and is widely used, and so my inner persnickety nag feels the two should not be confused. But they are confused, and almost everyone (present company excluded) just says ChatGPT. Again, this is not textbook marketing, but users seem fine with it.
At this point, you might be wondering what that GPT stands for. It is “Generative Pre-Trained Transformer.” How many of its users could tell you that? How many of its users could explain what it means? I can imagine a marketing team sitting around a conference table insisting that GPT is too opaque and just won’t do.
But at OpenAI, software engineers and neural net experts are the dominant influences. So Americans get a name that has not been heavily market-tested and does not necessarily fit well into an advertising slogan. Maybe they like it, especially if they are sick of more and more of the economy being run by marketers.
There is more at the link. The part of GPT-4 that comes across as “focus group tested” — the neutering of Sydney and the like — is also the part that is not entirely popular, even if it is politically wise.
Tuesday assorted links
1. Adding world models to language models.
2. The new post-rationalist movement?
3. Katherine Dee visits Saudi Arabia.
4. The new Bernanke and Blanchard study of recent inflation (WSJ), paper should be coming out at some point today.
5. Jolly Swagman 4.5 hour podcast with former Australian Treasury Secretary Ken Henry.
6. Excerpt from “Stranger Love,” the new six-hour opera showing in Los Angeles. Here is NYT coverage.