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Where We Stand

There is good news and there is bad news.

Let’s start with the good news.The early results from the Pfizer vaccine are very good, 90% efficacy. That will probably fall a bit but it’s very good news not just for the Pfizer vaccine but for most of the vaccines in the pipeline which target the spike protein.

The Pfizer vaccine does require very cold storage which means it won’t work for large parts of the world. A distribution plan is in place for most of the United States and Pfizer already has 50 million doses, which can cover ~25 million people, in storage.

Many thousands of people are dying every week so Pfizer should apply for and the FDA should issue a EUA without further delay.

One issue is, given limited supply, how to distribute the vaccine. I have suggested we randomize distribution across hospitals, police and fire stations, and nursing homes (see also my piece in Bloomberg with Scott Kominers, The Case for a COVID Vaccine Lottery.) A vaccine lottery is fair, it will make distribution easier by limiting the number of vaccination locations and it will in essence create a very large clinical trial. With millions of participants we will be better able to make fine distinctions between the vaccine’s safety and efficacy in different populations and the results will come in quickly. Thus, if we randomize and collect data, limited capacity has a silver lining.

Second issue. Manufacturing capacity. Pfizer will have enough capacity to produce 1.3 billion doses in 2021 which sounds like a lot but it’s a two dose vaccine and there will be losses in distribution so maybe 500 million people vaccinated. We need to vaccinate billions.

The cost to the world economy of COVID is in the trillions so we want to vaccine a lot faster. Faster than private markets are willing to go. There are other vaccines in the pipeline but we still need to ramp up capacity. Increasing capacity is something that Michael Kremer, Susan Athey, myself and others at Accelerating Health Technologies have been working on since the beginning of the crisis. It’s not too late to do more.

Third issue is testing. Trump got it into his head that more tests means more cases when in fact a lot more tests means fewer cases. There is a Laffer curve for testing. Our failure to get ahead of the virus with tests has meant hundreds of thousands of excess deaths. We are still failing this test. Winter is coming. Infections and deaths are both rising.

Biden won’t be president until late January but there are things he can do now. In particular, Congress already allocated $25 billion to testing in April—that was far too little. We spent trillions on relief and comparatively little fighting the virus. But here is the real shocker, most of the $25 billion allocated in April hasn’t been spent. Let me say that again, most of the money allocated for testing in April has not been spent. Biden can signal today that that money and more will be spent. He can also signal, as in fact he has, that he wants rapid antigen tests approved.

Rapid antigen tests are cheap, paper strip tests that can check for infectiousness and are ideal to getting things like the schools running again.

Even if we start vaccinating this year, we won’t vaccinate a majority of the US population until well into 2021. That’s true but what’s underappreciated is that testing, masks, social distancing and vaccines are complementary. The more people are vaccinated, for example, the greater our testing capacity rises relative to the population at risk.

The pandemic is getting worse not better but we did flatten the curve, albeit imperfectly, and now if we can summon the will, we have the tools including rapid antigen tests, vaccines and monoclonal antibodies to really crush the virus.

Are body cameras effective for constraining police after all?

Controversial police use of force incidents have spurred protests across the nation and calls for reform. Body-worn cameras (BWCs) have received extensive attention as a potential key solution. I conduct the first nationwide study of the effects of BWCs in more than 1,000 agencies. I identify the causal effects by using idiosyncratic variation in adoption timing attributable to administrative hurdles and the lengthy process to the eventual adoption at different agencies. This empirical strategy addresses limitations of previous studies that evaluated BWCs within a single agency; in a single-agency setting, the control group officers are also indirectly affected by BWCs because they interact with the treatment group officers (spillover), and agencies that give researchers access may fundamentally differ from other agencies (site-selection bias). Overcoming these limitations, my multi-agency study finds that BWCs have led to a substantial drop in the use of force, both among whites and minorities. Nationwide, they reduce police-involved homicides by 43%. Surprisingly, I do not find evidence that BWCs are associated with de-policing. Examining social media usage data from Twitter as well as data on the Black Lives Matter (BLM) movement, I find that after BWC adoption, public opinion toward the police improves. These findings imply that BWCs can be an important tool for improving police accountability without sacrificing policing capabilities.

That is from a new paper by Taeho Kim, on the job market from the University of Chicago, a Steve Levitt student.  The piece has a revise and resubmit from ReStat.

Rising Ethnic Diversity in the United States Accompanies Shifts Toward an Individualistic Culture

This is consistent with some claims by Bryan Caplan, and perhaps contra what used to be called the new Democratic demographic strategy:

We investigate the relationship between ethnic diversity and the rise of individualism in the United States during the 20th and 21st centuries. Tests of the historical rates of ethnic diversity alongside individualistic relational structures (e.g., adults living alone, single-/multi-child families) from the years 1950 to 2018 reveal that societal and regional rates of ethnic diversity accompanied individualistic relational structures. These effects hold above and beyond time-series trends in each variable. Further evidence from experimental studies (N = 707) suggests that the presence of, and contact with, ethnically diverse others contributes to greater individualistic values (e.g., the importance of uniqueness and personal achievement). Converging evidence across societal-, regional-, and individual-level analyses suggests a systematic link between ethnic diversity and individualism. We discuss the implications of these findings for sociocultural livelihood in light of the rising rates of ethnic diversity across the globe.

That is from a new paper by Alex C. Huynh and Igor Grossman.  Via the excellent Kevin Lewis.

When will vaccine tourism come?

That is the topic of my Bloomberg column, here is one excerpt:

It is now possible to have a decent sense of which nation is winning the vaccine race, and it is not the U.S. A Chinese vaccine is being distributed now, and so far it seems to be safe and modestly effective. The data are not sufficiently clear that you ought to get one now, but it is easy to imagine that in another month or two the Chinese vaccine will be a plausible option.

And no, you probably won’t have to go to China for the jab. The Chinese vaccines are being distributed on a global basis, and are already in extensive tests in the United Arab Emirates. The timing is uncertain, but with delays on the U.S. side it is entirely possible that come January you will be able to get a “good enough” vaccine in Dubai but not in Dallas.

So would you get on that plane?

And:

You might think there will be complicated allocation rules limiting your ability, as a foreigner, to have access to these vaccines. That is likely true, but there is also going to be slippage. Say you are a front-line nurse overseas, and you already had Covid back in March. The private clinic you work for will be able to order a vaccine on your behalf, but then turn around and sell it to a visiting foreigner for, say, $20,000.

There is much more at the link.

The Nobel Prize: Milgrom and Wilson

The 2020 Nobel Prize in Economics goes to Paul Milgrom and Robert Wilson for auction theory and the improvement of auction designs. The Nobel Committee has a popular introduction and good scientific overview of auction theory. Billions of dollars of spectrum and other natural resources have been allocated using auctions designed by Milgrom and Wilson and their co-authors.

The money won’t mean much to these winners, who have made plenty of money advising firms about how to bid in the auctions that they designed. Milgrom’s firm Auctionomics advertises its service and Milgrom notes:

Milgrom has advised bidders in radio spectrum auctions, power auctions, and bankruptcy auctions. One advisee, Comcast and its consortium, SpectrumCo, followed the advice of a Milgrom’s team in FCC Auction 66 to achieve the most exceptional performance in US spectrum auction history. SpectrumCo saved nearly $1.2 billion on its spectrum license purchases compared to the prices paid by other large bidders – such as T-Mobile and Verizon – for comparable spectrum acquired at the same time in the same auction. SpectrumCo’s tactics included a $750 million jump bid – the largest in the history of US spectrum auctions and a move that prompted the FCC to change the auction rules.

You can figure that Milgrom got a percentage of those savings! Milgrom also advised Yahoo and Google, among other tech firms, on their advertising auctions.

My post Mechanism Design for Grandma written for the Hurwicz, Maskin and Myerson Nobel, has some background on auctions.

Auction theory and auction practice arose together–this is not a case of theory being rediscovered decades later by practitioners but of the demands by practitioners leading to new theory and new theory leading to new institutions. The Nobel committee notes:

In the early 1990s, an explosion of the demand for mobile communication made the U.S. federal government decide to use an auction for allocating radio-spectrum licenses among telecommunication firms. Previously, the U.S. Federal Communications Commission (FCC) had only been allowed to rely either on administrative procedures—commonly referred to as “beauty contests”—or on lotteries. These methods had notably failed in a number of complex settings, at the expense of both taxpayers and end-users…The obvious alternative is to adopt an auction to as-sign licenses. In fact, as early as in the 1950s, the 1991 Laureate Ronald H. Coase argued that the basic principle should be to allocate objects, such as broadcasting licenses, to the firms who will make the most efficient use of them, and the best way to identify these firms is to assign the objects through a competitive price mechanism (Coase, 1959).

…Following the FCC policy shift, multi-object auctions turned from an esoteric topic at the fringe of microeconomic theory to a hot research topic almost overnight.

…For the 1994 FCC auction, the final version of the newly designed auction was the Simultaneous Multiple Round Auction (SMRA)…[which] raised some $20 billion for the U.S. federal government, twice the forecasted amount. This outcome attracted considerable media attention and led other governments to set up their own auctions. The U.K. 3G spectrum auction that concluded in 2000 raised about $34 billion for the British government (Binmore and Klemperer, 2002). The SMRA auction format became the dominant design for spectrum sales worldwide, and versions of it have been used in Canada, Finland, Germany, India, Norway, Poland, Spain, Sweden, theU.K., and the U.S. These auctions have generated hundreds of billions of dollars for governments worldwide.

Perhaps the most impressive culmination of this work was the 2017 incentive auctions which “simultaneously” bought licenses from over-the air broadcast television stations and resold them to modern cellular phone bidders while respecting constraints so that over-the-air frequencies could be repackaged in ways such that they would not interfere with one another. The auction bought licenses for $10 billion, sold them for $20 billion, generating $10 billion in profit and generating an even larger increase in consumer surplus.

The first is a reverse auction that determines a price at which the remaining over-the-air broadcasters voluntarily relinquish their existing spectrum-usage rights. The second is a forward auction of the freed-up spectrum. In 2017, the reverse auction removed 14 channels from broadcast use, at a cost of $10.1 billion. The forward auction sold 70 MHz of wireless internet licenses for $19.8 billion, and created 14 MHz of surplus spectrum. The two stages of the incentive auction thus generated just below $10 billion to U.S. taxpayers, freed up considerable spectrum for future use, and presumably raised the expected surpluses of sellers as well as buyers.

These auctions also brought home that economics is now tied to computer science. The complexity of the allocation process was so high that new algorithms had to be devised. In particular, repackaging of the frequencies involved solving hundreds of thousands of graph-coloring problems, an NP-hard problem. Computer scientist Kevin Leyton-Brown was brought in to design and optimize the necessary algorithms. At the same time, Milgrom and Segal had to prove that their auction could be characterized in such a way that it could be solved in reasonable time by known algorithms.

Computer scientist Tim Roughgarden has an excellent video lecture on how implementing the incentive auction required a combination of cutting-edge economics and computer science. More generally, mechanism design in the real world, including auction design, Uber’s supply and demand mechanism, blockchains like bitcoin and many other examples, requires both economists and computer scientists to devise institutions and algorithms that incentivize socially beneficial behavior and that can also be solved in real time for real populations.

See Tyler’s post on Milgrom and on Tyler’s post on Wilson for much more, going well beyond their contributions to auction theory.

Friday assorted links

1. Were the experts too slow to embrace travel restrictions? (NYT)  And the Covid culture that is German (short video).

2. Does personality drive moral judgement?: Polite deontologists and curious consequentialists.

3. My rewrite of this thread: doctors hate highly beneficial but somewhat inaccurate testing methods that lower their status and good feelings about themselves.

4. Further results on “dry tinder” in the Nordics: “My results show that a large share of the excess mortality in Sweden in April 2020 may be partially explained by a vulnerable, elderly population due to very mild flu seasons in 18/19 and 19/20 as well as very few deaths during the 2019 summer compared to earlier years and compared to other Nordic countries.”

5. John Cochrane on political diversity in the AEA.

6. NASA tests new $23M titanium space toilet.

7. Do we find herd immunity in the NYC data?

Wednesday assorted links

1. Russian billionaire wants to buy cancelled Confederate statues.

2. “Nursing homes have new COVID-19 tests that are fast and cheap. So why won’t N.J. allow them to be used?

3. Where are the missing right-wing firms?  And Arnold.

4. The vaccine protocols.

5. The world forager elite.

6. An evidence-based return to work plan.

7. The nasal spray, which will be entering clinical trials.

8. On the Abraham Accords.

Unintended Consequences of Criminalizing Sex Work

We examine the impact of criminalizing sex work, exploiting an event in which local officials unexpectedly criminalized sex work in one district in East Java, Indonesia, but not in neighboring districts. We collect data from female sex workers and their clients before and after the change. We find that criminalization increases sexually transmitted infections among female sex workers by 58 percent, measured by biological tests. This is driven by decreased condom access and use. We also find evidence that criminalization decreases earnings among women who left sex work due to criminalization, and decreases their ability to meet their children’s school expenses while increasing the likelihood that children begin working to supplement household income. While criminalization has the potential to improve population STI outcomes if the market shrinks permanently, we show that five years post-criminalization the market has rebounded and the probability of STI transmission within the general population is likely to have increased.

That is from a new NBER working paper by Lisa Cameron, Jennifer Seager, and Manisha Shah.

America, meet India

Tata group has received approval from the Drug Controller General of India (DCGI) for the commercial launch of the country’s first CRISPR (Clustered Regularly Interspaced Short Palindromic Repeats) coronavirus test ‘Feluda’, the Council of Scientific and Industrial Research (CSIR) said on Saturday. This test uses an indigenously developed, cutting-edge CRISPR technology for detection of the genomic sequence of SARS-CoV-2 virus, CSIR said in a statement.

The Tata CRISPR test achieves accuracy levels of traditional RT-PCR tests with quicker turnaround time, less expensive equipment and better ease of use.

Here is the full story, via Alex HR.

Our Antibodies, Our Selves

In 2013 I wrote, Our DNA, Our Selves, arguing against the FDA’s crackdown on genetic readouts from firms like 23andMe. The FDA, however, proved succesful in its crackdown and that is why rapid at-home antigen tests are not available today and why tens of thousands of people are dying from COVID unnecessarily. Regulations have unintended consequences.

Let’s recap:

Consider, I swab the inside of my cheek and send the sample to a firm. The idea that the FDA can rule on what the firm can and cannot tell me about my own genes is absurd–it’s no different than the FDA trying to regulate what my doctor can tell me after a physical examination or what my optometrist can tell me after an eye examination (Please read the first line. “G T A C C A…”).

The idea that the FDA can regulate and control what individuals may learn about their own bodies is deeply offensive and, in my view, plainly unconstitutional.

Let me be clear, I am not offended by all regulation of genetic tests. Indeed, genetic tests are already regulated. To be precise, the labs that perform genetic tests are regulated by the Clinical Laboratory Improvement Amendments (CLIA) as overseen by the CMS (here is an excellent primer). The CLIA requires all labs, including the labs used by 23andMe, to be inspected for quality control, record keeping and the qualifications of their personnel. The goal is to ensure that the tests are accurate, reliable, timely, confidential and not risky to patients. I am not offended when the goal of regulation is to help consumers buy the product that they have contracted to buy.

What the FDA wants to do is categorically different. The FDA wants to regulate genetic tests as a high-risk medical device that cannot be sold until and unless the FDA permits it be sold.

Moreover, the FDA wants to judge not the analytic validity of the tests, whether the tests accurately read the genetic code as the firms promise (already regulated under the CLIA) but the clinical validity, whether particular identified alleles are causal for conditions or disease. The latter requirement is the death-knell for the products because of the expense and time it takes to prove specific genes are causal for diseases. Moreover, it means that firms like 23andMe will not be able to tell consumers about their own DNA but instead will only be allowed to offer a peek at the sections of code that the FDA has deemed it ok for consumers to see.

Ten years later we now need rapid antigen tests but the issue, as Michael Mina points out in an excellent interview with Malcolm Gladwell, is that we have medicalized all tests and readouts. Instead of thinking about the individual as having a right to know about their own body, we treated every test or readout as if the only user were a physician. Thus, instead of thinking about the value of these tests for individuals and for public health, the FDA failed to approve rapid antigen tests because it regarded them as inferior to PCR tests, for a physician diagnosing disease.

Here’s Mina (roughly transcribed and lightly edited)

The only pathway that we have to evaluate tests like this are medical diagnostic pathways, pathways designed specifically to ensure that a physician like a detective is getting all the information they need to diagnose a sick person… We have so devalued and defunded public health…that we don’t have a regulatory pathway to approve a test whose primary objective is stopping an epidemic versus diagnosing a sick person. And that has held everything up. All the companies that could be producing these rapid tests in the millions and millions, they have been sitting on these tests trying to hone them so they can pass FDA standards as a medical diagnostic.

It’s not just slowing down their approval it’s actually bottle necking the companies into creating tests that are not going to be as scalable as they are having to use more expensive reagents and packing the tests with instruments so they can pass FDA review when in reality they are just these little pieces of papers. If we can do the cheap version they can be made very fast but the just won’t get through the FDA.

Gladwell: I find your explanation unconvincing. How dumb is the FDA?…If you make the exact argument you made to me…the FDA is not going to see your logic?

It’s not that they are not smart it’s that this is a regulatory body, they just don’t have a pathway. You can’t apply for approval for a public health test tool…In our country the medical establishment is extremely strong, you can’t go to get a cholesterol test without getting a prescription from your doctor. Why can’t we know that? It’s all through this very heavy medical lens and changing that, getting that big ship to turn is turning out to be a very, very difficult task but leading to potentially tens or hundreds or thousands of deaths that don’t need to be happening.

How is Defunding the Police Going in Minneapolis?

Not well.

MPR News: The meeting was slated as a Minneapolis City Council study session on police reform.

But for much of the two-hour meeting, council members told police Chief Medaria Arradondo that their constituents are seeing and hearing street racing which sometimes results in crashes, brazen daylight carjackings, robberies, assaults and shootings. And they asked Arradondo what the department is doing about it.

…Just months after leading an effort that would have defunded the police department, City Council members at Tuesday’s work session pushed chief Medaria Arradondo to tell them how the department is responding to the violence…More people have been killed in the city in the first nine months of 2020 than were slain in all of last year. Property crimes, like burglaries and auto thefts, are also up. Incidents of arson have increased 55 percent over the total at this point in 2019.

Bear in mind this is coming after just a few months of reduced policing, due in part to extra demands and difficulty and probably in part due to police pulling back either out of fear or reluctance (blue flu) as also happened in Baltimore after the Freddie Gray killing and consequent protests and riots.

A few true believers still remain:

Cunningham also criticized some of his colleagues for seeming to waver on the promises they made earlier this year to transform the city’s public safety system.

“What I am sort of flabbergasted by right now is colleagues, who a very short time ago were calling for abolition, are now suggesting we should be putting more resources and funding into MPD,” Cunningham said.

I’m a supporter of unbundling the police and improving policing but the idea that we can defund the police and crime will just melt away is a fantasy. As with bail reform the defunders risk a backlash. Let’s start by decriminalizing more victimless crimes, as we have done in many states with marijuana laws. Let’s work on creating bureaus of road safety. But one of the reasons we do these things is so that we can increase the number of police on the street. The United States is underpoliced and the consequences of underpolicing, as well as overpolicing, fall on minority communities. As I have argued before, we need better policing so that we can all be comfortable with more policing. Getting there, however, will take time.

The Beginning of the End?

It’s taken far too long and it’s still not FDA approved for at-home use or for asymptomatic individuals but the new $5,15-minute, easy to use, Abbott test and the Trump administration’s promise to purchase 150 million of them is a big deal. Abbott has been building capacity for months according to their lead scientist interviewed in the Atlantic by Alex Madrigal and in a few weeks will be producing 50 million tests a month:

Madrigal: Fifty million tests a month is a huge number. That’s more than twice the number of tests the U.S. completes in a month. How did you ramp up production so massively?

Hackett: This was the challenge of this program. We needed some sort of reliable testing that could be affordable and that doesn’t require instrumentation. You need scale. The more frequently you could test people, frankly, even tests with lower sensitivity would be very effective at identifying people quickly and slowing the spread. As we were developing the test, there were people working in parallel looking at supply chain and logistics. Abbott took a lot of risk—hundreds of millions of dollars were spent building two new manufacturing facilities focused solely on those tests. We hoped we could come to a solution that would be where we needed it from an overall accuracy perspective, but if you weren’t building capability simultaneously, there was no way it could be the answer.

The US has performed about 80 million tests since the pandemic began, so an additional 50 million tests a month is a big increase in capacity. As noted, the test is not approved for at-home use but it’s a CLIA-waived test which means that a doctor’s office, a CVS or Walmart clinic, even a school nurse could qualify for a waiver and perform the tests. The test is not approved for asymptomatic individuals but I suspect that won’t mean much in practice, it can be prescribed off-label although the fact that a prescription is required is limiting. I hope the necessity for a prescription will be lifted as we get more experience with these tests. False positives (~1.5%) are low and by taking the strain off the PCR system we can improve triage and afford to do more double checks. False positives will be more of an issue as we wipe out the virus but that will take time.

I hope these tests will open up air travel within a month or two. I also hope to see more of these types of tests approved. Derek Lowe has more technical details.

It won’t be all smooth sailing, Abbott may not be able to produce as much or as quickly as they say they can and quality in the field may fall. The government may distribute the tests poorly. The virus could pickup in the fall, as in 1918. I expect more problems and challenges but we now have a chance to get ahead of the virus which is very welcome news.

Addendum: This type of public-private partnership with private firms building capacity in advance of approval for tests and vaccines on the foundation of government push and pull funding is exactly the structure that the Accelerating Health Technologies team has been recommending both to the US government and to governments around the world.

The generalizability crisis

Most theories and hypotheses in psychology are verbal in nature, yet their evaluation overwhelmingly relies on inferential statistical procedures. The validity of the move from qualitative to quantitative analysis depends on the verbal and statistical expressions of a hypothesis being closely aligned—that is,that the two must refer to roughly the same set of hypothetical observations. Here I argue that most inferential statistical tests in psychology fail to meet this basic condition. I demonstrate how foundational assumptions of the “random effects” model used pervasively in psychology impose far stronger constraints on the generalizability of results than most researchers appreciate. Ignoring these constraints dramatically inflates false positive rates and routinely leads researchers to draw sweeping verbal generalizations that lack any meaningful connection to the statistical quantities they are putatively based on. I argue that failure to consider generalizability from a statistical perspective lies at the root of many of psychology’s ongoing problems (e.g.,the replication crisis), and conclude with a discussion of several potential avenues for improvement.

That is from a recent paper by Tal Yarkoni.