Results for “no great stagnation” 495 found
Progress against HIV-AIDS hasn’t been reported enough
While an effective vaccine against HIV may still be a long way off, a new HIV prevention technique has proven remarkably effective at protecting women against the virus.
A single injection of a drug called cabotegravir every two months was so successful in preventing HIV in a clinical trial among women in sub-Saharan Africa that the study was wrapped up ahead of schedule.
The study, run by the HIV Prevention Trials Network, was looking at two forms of pre-exposure prophylaxis or (PrEP) aimed at women. PrEP is a technique of administering low doses of anti-AIDS drugs to people who are HIV negative as a way to protect them from infection. The study compared the effectiveness of the new long-acting injectable against the current form of PrEP, a daily pill of Truvada.
The findings were announced by the study’s researchers on Monday.
“This is a major, major advance,” said Dr. Anthony Fauci in a briefing. The director of the National Institute of Allergy and Infectious Diseases, which was involved in the study, Fauci has spent much of his career working on HIV/AIDS.
Here is the full NPR report, here is NYT coverage. Yes, it still needs to be easier to deliver. But how many Americans, right now, could identify what cabotegravir is? As I said earlier this morning, the great stagnation may be ending.
Is the Great Stagnation over?
– A working mRNA vaccine (first ever in humans!),
– Apple M1 chip,
– SpaceX rocket launch,
– GPT-3,
– Tons of cool companies IPO’ing and tons more getting started,
– V-shaped recovery
– Electric cars
– Crypto going mainstream
That is from a tweet by Nabeel S.Qureshi. One could add warp speed, affordable solar power, the eggplant, and distanced work to that list, the latter also implying significant rent declines and child care cost declines for many people.
Around the time The Great Stagnation came out in 2011, I predicted that it was most likely to end within the next twenty years. We are not there yet, but that claim is no longer looking so absurd.
Note that the vaccine-driven recovery will measure as a rise in labor inputs, but in reality it will be pure TFP. In 2021 (but which quarter?), true TFP will be remarkably high, maybe the highest ever?
Do beliefs cause the great stagnation to persist?
The Great Recession was a deep downturn with long-lasting effects on credit, employment, and output. While narratives about its causes abound, the persistence of gross domestic product below precrisis trends remains puzzling. We propose a simple persistence mechanism that can be quantified and combined with existing models. Our key premise is that agents do not know the true distribution of shocks but use data to estimate it nonparametrically. Then, transitory events, especially extreme ones, generate persistent changes in beliefs and macro outcomes. Embedding this mechanism in a neoclassical model, we find that it endogenously generates persistent drops in economic activity after tail events.
That is from a new piece by Julian Kozlowski, Laura Veldkamp, and Venky Venkateswaran in the new Journal of Political Economy. Here are earlier ungated copies.
Longer-run economic consequences of pandemics
How do major pandemics affect economic activity in the medium to longer term? Is it consistent with what economic theory prescribes? Since these are rare events, historical evidence over many centuries is required. We study rates of return on assets using a dataset stretching back to the 14th century, focusing on 12 major pandemics where more than 100,000 people died. In addition, we include major armed conflicts resulting in a similarly large death toll. Significant macroeconomic after-effects of the pandemics persist for about 40 years, with real rates of return substantially depressed. In contrast, we find that wars have no such effect, indeed the opposite. This is consistent with the destruction of capital that happens in wars, but not in pandemics. Using more sparse data, we find real wages somewhat elevated following pandemics. The findings are consistent with pandemics inducing labor scarcity and/or a shift to greater
precautionary savings.
That is a new paper by Òscar Jordà, Sanjay R. Singh, and Alan M. Taylor. And here is the tweet storm. It should be noted, of course, that the Spanish flu did not give rise to a comparable economic stagnation.
Via Evan Soltas.
The best available fix for real wage stagnation
That is the topic of my latest Bloomberg column, here is one excerpt:
In other words, the frontier areas for overcoming wage stagnation are several-fold. First is a greater freedom to build, so that housing supply can rise and prices can fall. That also would enable more upward mobility by easing moves to America’s more productive (but also more expensive) regions. Second are steps to lower the cost of medical care through greater competition and price transparency. Third, American higher education is hardly at its optimum point of efficiency, innovation and affordability.
If those sectors displayed some of the dynamism and innovativeness of that marks America’s tech sector, the combination of declining prices and rising quality could give living standards a boost. And since rent, health care and tuition tend to be higher shares of the incomes of poorer people, those changes would help poorer people the most.
Think of it as a rooftops piece, combined with a discussion of why wages actually have seen slow growth as of late.
40-year-old tractors are now a hot commodity
Tractors manufactured in the late 1970s and 1980s are some of the hottest items in farm auctions across the Midwest these days — and it’s not because they’re antiques.
Cost-conscious farmers are looking for bargains, and tractors from that era are well-built and totally functional, and aren’t as complicated or expensive to repair as more recent models that run on sophisticated software.
“There’s an affinity factor if you grew up around these tractors, but it goes way beyond that,” Peterson said. “These things, they’re basically bulletproof. You can put 15,000 hours on it and if something breaks you can just replace it.”
BigIron Auctions, a Nebraska-based dealer that auctioned 3,300 pieces of farm equipment online in two days last month, sold 27 John Deere 4440 tractors through 2019.
The model, which Deere built between 1977 and 1982 at a factory in Waterloo, Iowa, was the most popular of the company’s “Iron Horse” series of tractors, which used stronger and heavier internal components to support engines with greater horsepower. The tractors featured big, safe cabins, advancing a design first seen in the 1960s that is now standard.
A sale of one of those tractors in good condition with low hours of use — the tractors typically last for 12,000 to 15,000 hours — will start a bidding war today. A 1980 John Deere 4440 with 2,147 hours on it sold for $43,500 at a farm estate auction in Lake City in April. A 1979 John Deere 4640 with only 826 hours on it sold for $61,000 at an auction in Bingham Lake in August.
Maybe there is a great tractor stagnation or in some cases even retrogression? Here is more from Adam Belz, via Naju Mancheril.
*First Man* and the great stagnation
I enjoyed this movie, although I would not describe it as a must-see. It is best for showing the rickety and claustrophobic nature of the moon landing program.
Three points struck me in particular, both concerning progress. First, the space shots in this movie are not better than those of Stanley Kubrick in his 1968 film 2001: A Space Odyssey. There are even several Kubrick homage shots, and they don’t look any better than the originals, and arguably somewhat worse. Perhaps most cinematic progress has come in shooting or better yet constructing dense scenes, but that does not apply to space.
Second, I walked to my (non-fancy) car and turned on the ignition right after watching the movie. It was immediately striking how much better and more reliable was the software in my car than in the whole well-funded moon program. In this sense technological progress has been immense. That said, most cars in operation today are not that much better than cars from 1969, and they perform more or less the same functions, albeit more safely. Improving car manufacture is not that hard, but improving the usefulness of cars in our daily lives is where the problem lies. So this supports the “the consumer space is already filled out” interpretation of the great stagnation.
Third, perhaps it is the very absence of the internet and advanced information technology that made the moon program possible. When Armstrong arrives at the moon, you realize it is pretty boring and it has not so much to offer, either in 1969 or today. Would they have gone to such trouble if there had been better problems to work on? Well before the end of the movie, I found myself wanting to check my email and refresh my Twitter feed.
By the way, this movie has bombed at the box office, perhaps not a good sign for the revival of adventure in contemporary culture.
My Conversation with Bruno Maçães
Here is the audio and transcript, here is the opening summary:
Political scientist Bruno Maçães has built a career out of crossing the globe teaching, advising, writing, and talking to people. His recent book, born out of a six-month journey across Eurasia, is one of Tyler’s favorites.
So how does it feel to face Tyler’s rat-a-tat curiosity about your life’s work? For Bruno, the experience was “like you are a politician under attack and your portfolio is the whole of physical and metaphysical reality.”
Read on to discover how well Bruno defended that expansive portfolio, including what’s missing from liberalism, Obama’s conceptual foreign policy mistake, what economists are most wrong about, how to fall in love with Djibouti, stagnation in Europe, the diversity of Central Asia, Hitchcock’s perfect movie, China as an ever-growing global force, the book everyone under 25 should read, the creativity of Washington, D.C versus Silicon Valley, and more.
Here is one bit:
MAÇÃES: This raises deep philosophical questions and political questions. If you want Turkey to become like Europe, then you have to project European power across Turkey. If Europe no longer has that ability, then you shouldn’t be surprised that Turkey looks elsewhere.
It’s very simple. I think I say in the book that in order to be loved, you also have to be feared. This idea that you find in Europe now, that without projecting any kind of power, other countries will be attracted to the European model, that’s a form of utopianism. I just cannot see that happen.
COWEN: So Europe lacks the spirit of adventure.
MAÇÃES: That is certainly the case. I think you see that. One of the areas where the spirit of adventure today is more relevant and important is technology. You see in Europe the idea that technology’s against us, and we should resist this rather than embrace it. A very negative spirit, which I think is a good example of how adventure has disappeared from the European psyche.
And:
COWEN: Russia. Why is Russia as a world power currently underrated?
MAÇÃES: The most impressive thing about Russia is, in fact, something that you might not think at first: the power of organization. We have this image of Russia as a failed state in many respects.
But in order to keep that empire, in order to keep it together throughout the centuries, in order to develop it to some extent, in order to bring together so many ethnicities, so many religions . . . it’s fair to say that Russia has done a better job of integrating its Muslim population, which is close to 15 percent, than any other country, I would argue — certainly any other major country.
The power of the Russian state, the ability to organize, to dispose, to connect, is one of the great political stories of mankind — to see how the Russian state was able to grow and to extend itself. And that’s still there.
Original and highly recommended. Again, here is Bruno’s book The Dawn of Eurasia: On the Trail of the New World Order.
Technology in Kubrick’s *2001: A Space Odyssey*
This post serves up some spoilers of detail, though no major spoilers of plot until the penultimate “you must go see it” paragraph. Upon a re-viewing of this movie, I found the following striking:
1. There is a Skype-like service for phone calls, but it never occurs to anyone that something like sending an email might be possible or even desirable. A lot of major and even apparently simple technological advances just aren’t that self-evident. The cameras in the movie also remained quite primitive and clunky, even by pre-smart phone standards. Maybe people expected a great stagnation in cameras back then.
2. At the time, Kubrick apparently thought it plausible that the audience would buy into common, widespread and indeed commercially viable space travel by 1992. The film was released in 1968.
3. Pan American flies people into outer space, and apparently used this new market to avoid total bankruptcy. Their stewardesses still have silly hats and costumes, and they act in a vaguely self-demeaning manner.
4. The film shows some signs of recognizing that Moore’s Law might happen. Hal for instance is advanced AI, but he is not huge in size. And the portrait of voice recognition technology is quite realistic.
5. Stars do not twinkle in outer space, however.
6. Hal 9000 would be less creepy with a female voice, and indeed Apple and Amazon figured that out some while ago. Note to my tech friends: do not program your personal assistant bots with a resentful, quivering, paranoid, passive-aggressive male voice.
7. The movie seems to suggest that chess-playing computers are a major achievement, when in fact this was mastered relatively easily, compared to many other AI problems. The movie shows this chess game, with Hal as Black. It is the kind of game you might expect a strong computer to play against a human, namely with a finish based on visually counterintuitive tactics.
8. It is a truly dystopic vision to think that Howard Johnson’s will be serving us food in space.
9. The first time I saw the movie, which I believe was in the mid-1970s, I was more stunned by seeing Americans talking to Russians “as if they were normal people” than by any of the technology.
Here is a good Wikipedia page on technologies in the movie. Now a few spoilers:
The movie, which I had not seen in many years, I found quite stunning. It took so many chances, and with so much self-confidence that the originality could be pulled off. Imagine opening a film with minutes of discordant Gyorgy Ligeti music, played against a dark screen, with no signal that this is even part of the movie. Then you see a long scene with apes, no dialogue to speak of, and no explanation of how this might fit into a commercially viable product. Finally the Solow residual is explained! There is not only no love story, the film arguably has no characters, Hal aside. Kubrick often expects ballet music to keep you interested, and various movements in space are stretched out to interminable length, yet almost always with striking aesthetic success. You could generously describe the ending as “underexplained.” Hardly anything happens in the movie, and yet at the same time it encapsulates the entire history of humanity with extra material on both sides, beginning and end, and a nod in the Hegelian direction.
Go see it on the large screen if you can — I can’t think of any film that is so much worse (or simply different) on TV as this one. It is one of the better movies ever made, and it dates from a time near Hollywood’s peak. It is sad that nearly two generations of Americans now do not know this creation as it was intended to be seen, and indeed must be seen. On 7 p.m. on a Saturday night, the theatre had no more than twenty people in attendance. When it comes to culture, salience usually matters more than you might think.
Might tech super-firms mean the Great Stagnation is over?
I am now giving this a chance of somewhat over 50 (!) percent, and that is the topic of my latest Bloomberg column. Here is one bit:
Gross domestic product growth for the last two quarters was over 3 percent, even in light of hurricane damage in August and September, and middle-class income growth has resumed. You might think that would mean high price inflation from credit growth and “overheating,” but the 12-month change in core prices for personal consumption expenditures has fallen to 1.3 percent.
And:
Low rates of inflation, however, reflect productivity gains that already are here. The tech giants — Google, Amazon.com Inc., Facebook Inc. and Apple Inc. — have become major managers of our information, our businesses and our lives. They’re meeting political resistance, but whatever you think of those complaints, they are signs the major tech companies are having transformative effects. I used to say that we are overrating what tech has done for us to date, and underrating what it will do in the future. Perhaps reality has caught up with that prognostication.
And:
The major tech companies are growing their platforms quickly, supporting low prices with scale, product diversity, data ownership and superior service. Hardly anyone today worries about the eventual disappearance of competition and monopoly prices from Amazon or the other major tech companies. Do you really think Amazon is going to double book prices five years from now?…The tech companies have shown that their radical model of low price, high market share, high quality rapid expansion will keep them profitable for a long time to come.
Big if true, as they say…do read the whole thing. The still-remaining negative possibility, of course, is that the current positive wave is like 1995-1998, and we will sink back to less positive economic times, as we did back then.
Why men are not earning more
“And it all starts at age 25,” Mr. Guvenen said. The decline in lifetime earnings is largely a result of lower incomes at younger ages rather than at older ages, he said, and “that was very surprising to us.”
Most younger men ended up with less because they started out earning less than their counterparts in previous years, and saw little growth in their early years. They entered the work force with lower wages and never caught up.
That is from a very good NYT piece by Patricia Cohen. And note that in spite of all the recent very good economic news, for men the basic story really hasn’t changed, namely that of stagnation as a class.
I wonder sometimes if a Malthusian/Marxian story might be at work here. At relevant margins, perhaps it is always easier to talk/pay a woman to do a quality hour’s additional work than to talk/pay a man to do the same. And so as the demand for such additional hours opens up, the gains go to women, not men. That is at least for the lower income brackets, and perhaps the very most for younger earners. In other words, especially at young ages, women might be serving as a kind of “reserve army of the underemployed.”
Is the great wage stagnation over?
Possibly so, though some more good years would be nice, to say the least. To some extent this could be noise, or delayed catch-up growth. Still, there seems to be a break in the previous trend:
In 2015, median household incomes rose by 5.2 percent. That was the fastest surge in percentage terms since the Census Bureau began keeping records in the 1960s. Women living alone saw their incomes rise by 8.7 percent. Median incomes for Hispanics rose by 6.1 percent. Immigrants’ incomes, excluding naturalized citizens, jumped by over 10 percent.
The news was especially good for the poor. The share of overall income that went to the poorest fifth increased by 3 percent, while the share that went to the affluent groups did not change. In that year, the poverty rate fell by 1.2 percentage points, the steepest decline since 1999.
…The numbers for 2016 have just been released by the Census Bureau, and the trends are pretty much the same. Median household income rose another 3.2 percent, after inflation, to its highest level ever. The poverty rate fell some more. The share of national income going to labor is now rising, while the share going to capital is falling.
That is from the new David Brooks column.
Is the Great Chocolate Stagnation over?
I say no, but some disagree:
There hasn’t been an innovation in the world of chocolate since the white variant was introduced in 1930, which is fine because — in the immortal words of Cogsworth in “Beauty and the Beast” — if ain’t baroque, don’t fix it.
But still, we’d never turn away a new kind of creamy, chocolate-y thing to munch on while we binge-watch Netflix.
And thanks to some Swiss chocolate scientists over at Barry Callebaut — the world’s leading manufacturer of the good stuff, producing 1.8 million tons of cocoa every year and with a revenue of almost $10 billion — that’s exactly what we’re getting. A brand new chocolate flavor called Ruby, developed from the Ruby Cocoa bean, colored a pleasingly millennial pink hue and that tastes like sweet, sweet berries despite having no added color or flavoring.
“Ruby chocolate is the fourth type of chocolate [after milk, white and dark] and is an intense sensorial delight,” a spokesperson for Barry Callebaut said after launching the chocolate to a panel of experts in China.
Here is the (noisy) link, via the excellent Samir Varma.
The Great Stagnation has been worse than you think
The value of household services was equal to about 37% of GDP in 1965, but is currently equal to about 23% of GDP.
That is from Timothy Taylor.
Might The Great Stagnation end with The Great Medication?
That is the topic of my latest Bloomberg column, here is the last bit:
I don’t mean to say that technological stagnation is a good thing. But sometimes the biggest advances lead to more tragedy than comfort, especially in the short run, before we learn how to adjust to their challenges. To paraphrase Peter Thiel, they promised us flying cars, and what we got was a bunch of stoned characters, and more than 140 of them. Beware the end of the productivity slowdown.
Do read the whole thing.