Friday assorted links

1. Umbrex presents Tyler Cowen on Talent.

2. Devon Zuegel podcast with Andy Matuschak on…group message etiquette – peripheral vision – homegrown software.

3. The guys behind the Turkish drones (New Yorker).

4. Nintil review of Talent.

5. Catherine Rampell on the inflation conspiracy theory.  #TheGreatForgetting

6. Nadia on EA and idea machines.

7. Help launch meta-science with J-Pal and Heidi Williams.

Systemic Bias versus Concentrated Bias

Discrimination exists but rather than being systemic Campbell and Brauer argue it’s due to a small number of prejudiced individuals.

Discrimination has persisted in our society despite steady improvements in explicit attitudes toward marginalized social groups. The most common explanation for this apparent paradox is that due to implicit biases, most individuals behave in slightly discriminatory ways outside of their own awareness (the dispersed discrimination account). Another explanation holds that a numerical minority of individuals who are moderately or highly biased are responsible for most observed discriminatory behaviors (the concentrated discrimination account). We tested these 2 accounts against each other in a series of studies at a large, public university (total N = 16,600). In 4 large-scale surveys, students from marginalized groups reported that they generally felt welcome and respected on campus (albeit less so than nonmarginalized students) and that a numerical minority of their peers (around 20%) engage in subtle or explicit forms of discrimination. In 5 field experiments with 8 different samples, we manipulated the social group membership of trained confederates and measured the behaviors of naïve bystanders. The results showed that between 5% and 20% of the participants treated the confederates belonging to marginalized groups more negatively than nonmarginalized confederates. Our findings are inconsistent with the dispersed discrimination account but support the concentrated discrimination account. The Pareto principle states that, for many events, roughly 80% of the effects come from 20% of the causes. Our results suggest that the Pareto principle also applies to discrimination, at least at the large, public university where the studies were conducted. We discuss implications for prodiversity initiatives.

The cause of discrimination matters because as Hambrick notes writing about this paper in Scientific American:

 In recent years, the view that most people engage in discriminatory acts because of implicit biases has gained widespread public acceptance. In a 2016 presidential debate, Hillary Clinton commented that “implicit bias is a problem for everyone.” Campbell and Brauer’s findings suggest it’s still not clear the extent to which implicit biases explain discriminatory conduct. (Other work has called into question the validity of implicit bias measures for predicting real-world discrimination.) Research aimed at answering this fundamental question will inform the design of interventions that may one day meaningfully reduce levels of discrimination.

….If, for example, a small number of explicitly prejudiced people are responsible for most or all of the discrimination occurring in a company, an intervention that requires all employees to undergo implicit bias training will probably fail to address the problem. Research suggests that interventions that convey the message that nearly everyone engages in discriminatory behavior may even make the workplace atmosphere worse for marginalized employees, because after the training, nonmarginalized employees may avoid interacting with them out of fear of unwittingly discriminating.

Is Sri Lanka becoming a failed state?

The economic crisis is a result of mismanagement by the Rajapaksa administration (and its predecessors) as well as Sri Lanka’s vulnerability to external shocks. The pandemic and Russia’s invasion of Ukraine have had a devastating impact. The Rajapaksas pursued populist economic policies — including unaffordable fuel and food subsidies and printing money to finance them — that spurred inflation. The president was heavily criticized for a disastrous “100% organic” policy that aimed to reduce the strain on foreign currency reserves by banning the import of chemical fertilizers. The policy resulted in slashed agricultural output at a time when food supplies were already running low and prices were soaring.

Meanwhile, foreign tourism — a key source of jobs, economic growth, and foreign currency — fell after the 2019 Easter bombings and then collapsed during the pandemic. The spike in international commodity prices, which has been exacerbated by Russia’s invasion of Ukraine, has piled further economic pressure on Sri Lanka. The country relies heavily on imports of food, fuel, and other essential goods to feed the people and keep the lights on.

Here is more from GZero.

How to make talent scouts work for you

With Daniel Gross, here is a (very much) shortened bit from Talent: How to Identify Energizers, Creators, and Winners Around the World, published at a16z, excerpt from the chapter on when to use talent scouts:

It is worth thinking about why the scouting model works in this context [finding supermodels]. First, the relevant talent could come from many different parts of the world, and the number of people to be scouted is very large. It is hard to imagine a centralized process getting the job done. Second, many of the scouts plausibly have a decent sense of who might make a good model. Looks are hardly the only factor behind modeling success, but they are a kind of “first stop,” and expecting the scouts to judge looks well from first impressions is more plausible than expecting the scouts to use first impressions to judge talent well for skill in, say, quantum mechanics. Third, a follow-up investigation to judge the modeling talent of the chosen candidates is not extremely costly. You can have them in for a photo shoot and see how popular they prove in the market without having to invest millions of dollars right away…

Scouting is also becoming more important as the options for self-education are rising. With more people trying their hand at various avocations than ever before, that places more and more burden on talent search. We need to be more open to the accomplishments of self-taught individuals without traditional training, and that holds all the more true for the tech world, where many of the most important founders have eschewed the institutions of traditional education.

There is much more at the link, we also consider when scouting models fail relative to centralized evaluation, and which kinds of incentives should be given to scouts.

Thursday assorted links

1. Megyn Kelly interviews me, after about half an hour we get to Talent; the earlier inflation material will not be new to MR readers.

2. Rene Saenz: “What Cowenism Is,” a short essay.

3. Switzerland pondering whether Liechenstein is really very different, or not.

4. Kevin Kelly on Vanishing Asia.

5. New Vitalik/Glen paper, Puja Ohlhaver too.

6. The new project of Bloomberg UK (NYT).

7. Why are NSF applications down?

Some blurbs for *Talent*, with Daniel Gross

“Talent” is what happens when two brilliant and profoundly iconoclastic minds apply their imagination to one of the hardest of all business problems: the search for good people. I loved it.”

–Malcolm Gladwell

“Talent is everything―whether in investing and building startups, or in other creative endeavors. Between product, market, and people, I’ve always bet on the last one as the biggest predictor of success. But while talent may be everywhere, it’s unevenly distributed, and hard to ‘find.’ So how do we better discover, filter, and match the best talent with the best opportunities? This book shares how, based on both scientific research and the authors’ own experiences. The future depends on this know-how.”

―Marc Andreessen, co-founder of Netscape and Andreessen Horowitz

“The most important job of any leader is to find individuals with a ‘creative spark,’ and the potential to discover, invent and build the future. If you want to learn the art and science of spotting and empowering exceptional people, Talent is brimming with fresh insights and actionable advice.”

―Eric Schmidt, co-founder of Schmidt Futures and former CEO of Google

“I do not know of any skills more worth developing than the ability to find exceptional undeveloped talent. I have spent many years trying to get good at that, and I was still astonished by how much I learned reading this book.”

Sam Altman, CEO of OpenAI, formerly of YCombinator

“Two of the premier talent spotters working today, Cowen and Gross have written the definitive history of identifying talent. Anyone who is interested in innovation, entrepreneurship, or the roots of America’s start-up economy must read this book.”Christina Cacioppo is CEO and co-founder of Vanta

You can order here on Amazon or here on Barnes & Noble.

Recommended!

Saudi fact of the day

Saudi Aramco has overtaken Apple as the world’s most valuable company after higher oil prices pushed shares of the world’s biggest crude exporter to record levels while a broader tech stock sell-off weighed on the iPhone maker.

The Saudi Arabian oil company’s market capitalisation on Wednesday was $2.426tn, exceeding Apple’s $2.415tn by just over $10bn. It is the first time that Saudi Aramco has regained the top spot since 2020 and follows a broader sell-off in technology stocks since the start of the year.

Apple became the first company to hit a $3tn market cap in early January, although its shares have suffered in recent months as investors reassess lofty valuations in the tech sector in light of a reversal in monetary policy and worries that inflation will weaken consumers’ spending habits.

Here is more from the FT.  It will be interesting to see what a world with higher real interest rates looks like…

Wednesday assorted links

1. “The telltale sign of a successful intellectual life is weirdness – weird in the best possible way.”  Short essay on my approach to things, a good piece I thought.

2. How much did slavery and cotton accelerate U.S. economic growth?

3. Will China build a dam with an army of robots and 3-D printers?  (Would not take entirely at face value this one.)

4. “The New York Times has apologised after the word “fetus” was included as the solution to the day’s Wordle challenge for some players.”

5. Are these really Werner Herzog’s favorite eight films?

6. Who measures prices to determine inflation rates? (WSJ)

When were U.S. home prices at their worst?

That of course is only one metric, and it focuses on flows rather than homes as an asset.  It nonetheless puts a number of matters in perspective.  Here it is in words:

1981 was the most unaffordable year for those who need a mortgage, with annual payments consuming a whopping 52% of their income. For comparison, in 2022 mortgage payments require 27% and the absolute lowest point is back in 1963 when only 18% was required. In 2006 (at the peak of the housing bubble), families would need 30% of their income. Thus we can confidently say that 2022 is so far not the worst year in history for those who can’t afford to buy a house without a loan.

Canada and New Zealand seem to be the truly scary places.  Here is the full essay by Nikita Sokolsky.

How big a deal would a nuclear explosion be?

I am no longer so sure, as I outlined in my recent Bloomberg column:

Until recently, my view was that any actual use of a nuclear weapon, no matter the scale, would dramatically change everything. Nuclear use would no longer be considered taboo, and the world would enter a state of collective shock and trauma. Other countries around the world would start frantically preparing for war, or the possibility of war.

But recent events have nudged me away from that viewpoint. For instance, I have seen a pandemic that arguably has caused about 15 million deaths worldwide, yet many countries, including the U.S. haven’t made major changes in their pandemic preparation policies. That tells me we are more able to respond to a major catastrophe with collective numbness than I would have thought possible.

Of course I am referring to a smaller tactical nuclear weapon, as might be used against Ukraine.  India by the way lost five or so million people during the pandemic and they didn’t even fire their health minister.  And:

I also have seen Trumpian politics operate through the social media cycle. Former President Donald Trump did and said outrageous things on a regular basis (even if you agree with some of them, the relevant point is that his opponents sincerely found them outrageous). Yet the rapidity of the social media news cycle meant that most of those actions failed to stick as major failings. Each outrage would be followed by another that would blot out the memory of the preceding one. The notion of “Trump as villain” became increasingly salient, but the details of Trumpian provocations mattered less and less.

Might the detonation of a tactical nuclear weapon follow a similar pattern? Everyone would opine on it on Twitter for a few weeks before moving on to the next terrible event. “Putin as villain” would become all the more entrenched, but dropping a tactical nuclear weapon probably wouldn’t be the last bad thing he would do.

To cite the terminology of venture capitalist Marc Andreessen, the tactical nuclear weapon might stay “the Current Thing” for a relatively short period of time.

Let’s hope we don’t find out.

GDPR and the Lost Generation of Innovative Apps

Using data on 4.1 million apps at the Google Play Store from 2016 to 2019, we document that GDPR induced the exit of about a third of available apps; and in the quarters following implementation, entry of new apps fell by half. We estimate a structural model of demand and entry in the app market. Comparing long-run equilibria with and without GDPR, we find that GDPR reduces consumer surplus and aggregate app usage by about a third. Whatever the privacy benefits of GDPR, they come at substantial costs in foregone innovation.

That is from a new NBER working paper by Rebecca Janßen, Reinhold Kesler, Michael E. Kummer & Joel Waldfogel.