An RCT for income-sharing agreements

Is this the first one?

We conduct a survey-based experiment with 2,776 students at a non-profit university to analyze income insurance demand in education financing. We offered students a hypothetical choice: either a federal loan with income-driven repayment or an income-share agreement (ISA), with randomized framing of downside protections. Emphasizing income insurance increased ISA uptake by 43%. We observe that students are responsive to changes in contract terms and possible student loan cancellation, which is evidence of preference adjustment or adverse selection. Our results indicate that framing specific terms can increase demand for higher education insurance to potentially address risk for students with varying outcomes.

That is from a new NBER working paper by Sidhya BalakrishnanEric BettingerMichael S. KofoedDubravka RitterDouglas A. WebberEge Aksu Jonathan S. Hartley.

Netherlands fact of the day

The country, which is a bit bigger than Maryland, not only accomplished this feat but also has become the world’s second largest exporter of agricultural products by value behind the United States. Perhaps even more significant in the face of a warming planet: It is among the largest exporters of agricultural and food technology. The Dutch have pioneered cell-cultured meat, vertical farming, seed technology and robotics in milking and harvesting — spearheading innovations that focus on decreased water usage as well as reduced carbon and methane emissions…

The country has nearly 24,000 acres — almost twice the size of Manhattan — of crops growing in greenhouses. These greenhouses, with less fertilizer and water, can grow in a single acre what would take 10 acres of traditional dirt farming to achieve. Dutch farms use only a half-gallon of water to grow about a pound of tomatoes, while the global average is more than 28 gallons.

Here is the full article, via S.  The article is interesting throughout.  However here is a more recent piece on the Dutch nitrogen revolt.

Teaching the Solow Model

The Solow model is a foundational model for understanding economic growth. Yet it’s typically not taught to principles students because it’s considered too difficult. In Modern Principles, however, Tyler and I develop a super simple version of the model that is fun to teach and accessible to students of all levels. I’ll be talking about the Super Simple Solow model in a short webinar tomorrow (Tuesday March 26) at 1pm est. Register here.

My review of Suno, AI-generated music

Try it here, click on the right on the mention of making full, two-minute songs and use the Explore tab.  To me it is remarkable the resulting AI-generated music is as good as it is.  But it still isn’t anything I would listen to, other than out of curiosity.  It is best at edm, standardized genres such as routine heavy metal, and certain ethnic musics, especially if “the affect” can be created by methods of layering.  Its weakness is an ability to generate the simple, memorable melody, a’la Sir Paul or the other Paul namely Paul Simon.  For my taste there is “not enough music in the music.”  Suno cannot yet create the ineffable something, which is what I listen to music for.

That said, it is not worse than what most people listen to.  It remains to be seen at what pace progress will be made, or whether current approaches, extrapolated to allow for further improvement, can get us to real music, rather than stuff that sounds like music.

*Who’s Afraid of Gender?*

That is the title of the new Judith Butler book, focusing mostly on trans issues.  To be clear, on most practical issues concerning trans, I side with the social conservatives.  For instance, I don’t think trans women have a right to compete in women’s weightlifting contests.  And I have not been happy with how many schools have been teaching about trans issues, due to social contagion effects that are larger than I would have expected.   And yet — when it comes to the grounds of theory I think Butler is more right than wrong.  This is a very good book, and in some critical ways a very libertarian book (again to be clear I think Butler is wrong about most other things).  But on this issue — why so insist on such a rigid male-female set of binary categories?  Why be so afraid of alternative, more flexible approaches?  Why restrict our conceptual freedoms and ultimately our life practical freedoms in such a manner?  Especially when a minority of people — admittedly a small minority but also much larger than the mere category of “trans” — will suffer greatly from such attitudes and such practices?

So I am happy to recommend this book, noting that not everyone will like it, to say the least.  My main criticism is that Butler spends too much time with what I consider to be weaker views (e.g., the Pope), and not enough time with the more difficult problems concerning real and potential harms to children.  Her neglect of the latter verges on the intellectually criminally negligent.  And yet the key is to see that it is still a good and interesting book.

*Star Maker*, by Olaf Stapledon

Now though it was generally assumed in intellectual circles that the best was yet to be, Bvalltu and his friends were convinced that the crest of the wave had already occurred many centuries ago.  To most men, if course, the decade before the war had seemed better and more civilized than any earlier age.  In their view civilization and mechanization were almost identical, and never before had there been such a triumph of mechanization.  The benefits of a scientific civilization were obvious.  For the fortunate class there was more comfort, better health, increased stature, a prolongation of youth, and a system of technical knowledge so vast and intricate that no man coul dknow more than its outline or some tiny corner of its detail.  Moreoever, increased communications had brought all the peoples into contact.  Local idiosyncrasies were fading out before the radio, the cinema, and the gramophone.  In comparison with these hopeful signs it was easily overlooked that the human constitution, through strengthened by improved conditions, was intrinsically less stable than formerly.  Certain disintegrative diseases were slowly but surely increasing.  In particular, diseases of the nervous system were becoming more common and more pernicious.  Cynics used to say that the mental hospitals would soon outnumber even the churches.

Here is a recent short essay on Starmaker, first published in 1937.

Applying to Emergent Ventures, and how to get Britain moving again

From the TxP Progress Prize:

But then Tyler asked us, twice in a row, ‘what is your signature product?’ Being honest, we realised even if our pitch was strong at a high level, we’d essentially just submitted a laundry list of ideas for what we wanted to deliver, without much focus. We knew we had to go back to the drawing board.

Then:

The blog prize was designed to advocate solutions, amplify frontier tech, and offer a clear, tractable proposal. We particularly wanted punchy takes that pulled the debate outside the norm and we encouraged people to publish online to prompt discussion. We also rewarded good writing and pointed to pieces we’d been inspired by.

That is from Andrew Bennett and Tom Westgarth.  The theme was “Britain is Stuck: How Can We Get It Moving Again?”  The winners (EV had no role in this selection) were:

Winner (£5000)

Rian Whitton: Firm Power can reduce Britain’s electricity prices

Runner up (£1000)

Alec Thompson: Open Source the Law

Shortlisted (£750)

Ashna Ahmad: Chilean Telexes and the Allocation Problem

Ben Hopkinson: Britain’s Second Cities are Stuck: Let’s Get Them Moving Again

Daniel Timms: The Case for a New City

At the link you will find further commendable mentions.

*Revolusi*

The subtitle is Indonesia and the Birth of the Modern World, and the author is David van Reybrouck.  An excellent book, and I found two points of particular interest in it.  First, just how weak and incomplete was the Dutch colonization of Indonesia for centuries.  Second, just how complicated and rapidly changing was the postwar transition from Japanese rule to independence.  Excerpt:

In total no fewer than 120,000 Dutch conscripts would depart between 1946 and 1949, an enormous number that approached the general mobilization before World War II (150,000).  Six thousand recruits who were examined and judged ‘fit for the tropics’ refused to embark.  Many of these were tracked down and hauled out of beds to the military police.  This hunt for deserters went on until 1958!  Strict sentences were passed on 2,565 war resisters.  Almost three-quarters received custodial sentences of up to two years, the rest remain in jail even longer.  Altogether a total of fifteen centuries of prison sentences were pronounced, a remarkably large amount compared to the complete immunity granted to later war criminals.  The conclusion was clear: those who refused to kill were locked up, those who murdered without reason went free.

Recommended, there should of course be more such books on Indonesia.

Saturday assorted links

1. 101 things Leila would tell her past self.

2. “The colonel was then carried to the Dotonbori river and tossed into the murky water.

3. Leadership lessons from Shakespeare’s Henriad.

4. Good thread on the Apple case.

5. Where do the major African economies stand? And fellowship in Tanzania.

6. U.S. life expectancy is rising again.

7. First flight of the Boom Supersonic jet.

In Defense of Plagiarism

Google plagiarism and you will find definitions like “stealing someone else’s ideas” or “literary theft.” Here the emphasis is on the stealing–it’s the original author who is being harmed. I prefer the definition of plagiarism given by Wikipedia, plagiarism is the *fraudulent* use of other people’s words or ideas. Fraudulent emphasizes that it’s the reader who is being cheated, not the original creator. You can use someone else’s words without being fraudulent. We all do this. If you copy a definition or description of a technical procedure from a textbook or manual you are using someone else’s words but it’s not fraudulent because the reader doesn’t assume that you are trying to take credit for the ideas.

In contrast, a student who passes an essay off as their own when it was written by someone else is engaging in a kind of fraud but the “crime” has little to do with harming the original author. A student who uses AI to write an essay is engaging in fraud, for example, but the problem is obviously not theft from OpenAI. Indeed, in another context the same use of AI would not be fraudulent. If I use AI to help write this post, it’s not fraudulent because the primary purpose of this post is not, as it is with a student essay, to warrant the abilities of the author but rather to convey ideas to the reader. How those ideas came to be expressed in words is secondary and sometimes even irrelevant. 

Indeed, using some else’s words and ideas is often how the world progresses. Plagiarism is a type of intellectual property law and I have long argued that IP law has grown too strong. Patents, for example, are often too broad and copyright is too long. Similarly, I was very much in support of Ed Sheeran in the ridiculous copyright case that ate of years of his life. Sheeran used ideas that had previously been used by many others but even if he had sampled, sampling is not a terrible crime. If I write, ‘he went on a wild goose chase’ or ‘it’s a brave new world’ need I credit the author? If an economics professor says ‘a price is a signal wrapped up in an incentive’, well a little credit to Cowen and Tabarrok would be nice, but sooner or later might this phrase not enter the vernacular? Crediting authors of unique wordplay should have a time limit, after which such wordplay becomes part of the common pool of expressions available for all. Crediting authors of boilerplate shouldn’t even be required.

The reason plagiarism has come to be defined more by “literary theft” than by the “fraudulent use of other’s people’s ideas and words” is that it’s much easier to prove when someone else’s words have been copied than it is to prove fraudulent use. A computer can scan the text of millions of documents to discover “plagiarism” but the computer has a harder time saying what is fraudulent. I argued earlier, that if I used AI to write this post it wouldn’t be fraudulent. But what if Marginal Revolution won a Pulitzer for twenty years of high quality writing and this post were give as an example? Well, its a judgement call.

In short, the focus of any charge of plagiarism should not be on whether someone else’s words have been used. The use of other’s people’s words is a necessary condition for plagiarism but it’s not sufficient. The focus should be on whether readers have been harmed by a fraudulent use of other people’s ideas and words. Focusing on the latter will dispense with many charges of plagiarism.

How credible is the Milei plan?

Here is a good Substack essay by Nicolas Cachanosky, excerpt:

Inflation expectations depend on what is expected to happen to the budget in the months to come. It is natural, then, to ask whether the observed surpluses are sustainable in the months ahead.

Answering this question requires looking at two things. First, how was the fiscal surplus achieved in January? Second, what is the expected behavior of revenues and expenditures?

The information for the first question is included in the table below, which shows its values in constant terms (February 2024). In real and accumulated terms, fiscal revenues decreased 2.5%, while expenses collapsed by 38%. Where is spending being cut the most? Numbers show that 57% of the adjustment falls on the shoulders of the private sector, while the remaining 43% falls on the government. Contrary to Milei’s repeated statements, most of the austerity is being borne by households and the private sector, whose patience limit is unknown.1 Some of these spending cuts are achieved by postponing transfers and payments to a future month…

Is this sustainable? Can Milei and Caputo continue to put this level of pressure on the already suffering households? There is no data yet for January, but just in December, real salaries in the (registered) private sector fell by -11.5% and 3.7% contraction in the monthly economic activity estimator. A report by IDESA shows that retirement income levels are as low as they were during the 2001 crisis. Worrisome, Empiria Consultores shows that the average salary is now below the poverty rate (figure below). Of course, I’m not saying all of this is Milei’s fault, who received a destroyed economy, but this is the economic and social situation upon which he is adding even more pressure.

Here is Martin Kenenguiser on Milei’s progress.  Here is Ciara Nugent in the FT on Milei and state companies.  Here is Mary Anastasia O’Grady in the WSJ: “A fiscal balance achieved in January isn’t sustainable, the economy is in recession, and inflation expectations by market participants at over 200% for the year are nothing to brag about. A $9 billion increase in international reserves isn’t a surge in confidence. It’s the result of printing pesos to buy the dollars and then issuing debt at high interest rates to sop up those pesos.”  I do not blame Milei, but it is still far from obvious that the current plan is going to work.