Causal claims in economics
From a new and very interesting web site on that topic:
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Significant Increase in Causal Claims: The average proportion of causal claims in papers rose significantly from approximately 5% in 1990 to around 28% in 2020, reflecting the impact of the credibility revolution in economics.
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Growth in Causal Inference Methods and decline in Theoretical and Simulation Methods…
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Intricate Causal Narratives Enhance Publication and Citation Impact: Papers featuring intricate and interconnected causal narratives are more likely to be published in top-tier journals, particularly the top 5 journals, and receive more citations, especially within those journals.
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Key Measures of Causal Narrative Complexity: Increases in the number of unique paths and the longest path length in causal knowledge graphs are positively associated with both publication in leading economics journals and higher citation counts. This highlights the value placed on depth and complexity in causal narratives.
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Depth Over Quantity in Causal Claims: While the overall number of claims made is positively correlated with top journal publications, the number of causal edges alone does not show the same positive association with publication outcomes or citation counts. This suggests that depth over breadth in causal claims is valued...
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Novel Causal Relationships Enhance Publication but Not Citation Impact: Papers introducing novel causal relationships that have not been previously documented are more likely to be published in top 5 journals, indicating a premium on originality for publication success. However, this does not necessarily translate into higher citation counts once published.
Here is an associated tweet storm,
Obviously it can be argued either way, but I see these results as more negative for the causality revolution than positive? It seems there is too much emphasis on generating a defensible results from a hitherto unused data set. I understand the signaling value here, but the social value is not always obvious. I am struck by how often I meet economics graduate students who can reason about programming more effectively than they can reason about the real world.
Monday assorted links
Specialization trends in economics
This article conducts a comprehensive analysis of specialization trends within and across fields of economics research. We collect data on 24,273 articles published between 1970 and 2016 in general research economics outlets and employ machine learning techniques to enrich the collected data. Results indicate that theory and econometric methods papers are becoming increasingly specialized, with a narrowing scope and steady or declining citations from outside economics and from other fields of economics research. Conversely, applied papers are covering a broader range of topics, receiving more extramural citations from fields like medicine, and psychology. Trends in applied theory articles are unclear.
That is from a new paper by Sebastian Galiani, Ramiro H. Gálvez, and Ian Nachman, via Robin Hanson.
Does the internet limit immigrant assimilation?
This paper documents the effects of new communication technologies on immigrants’ socio-economic integration, spatial and job segregation, and networking behavior. Combining data on home-country Internet expansion shocks with data on immigrants’ linguistic skill, naturalization, location choice, and employment in the US, I find that home-country Internet slows down immigrants’ social and economic integration. The effect is driven by lower-skilled and younger immigrants. On the other hand, home-country Internet decreases spatial and job segregation with co-nationals, and increases immigrants’ subjective well-being. For the mechanisms, I use the American Time Use Survey data to show that home-country Internet changes networking behavior of immigrants. I also explore the role of (i) return intentions, (ii) international phone calls, and (iii) Facebook usage. The evidence is consistent with a simple Roy model, augmented with a choice between destination- and origin-country ties. Overall, this paper shows how new ICTs transform the links between immigration, diversity, and social cohesion.
That is from the job market paper of Alexander Yarkin from Brown University.
Sunday assorted links
1. Profile of Donald Harris and his economic thought (New Yorker…note I knew of Donald long before I knew of Kamala, and definitely though of him as a Marxist).
2. Final James C. Scott book is coming.
3. Economic effects of Evangelical Christianity.
Local Labor Market Effects of Amazon
Does the entry of a large employer to a local labor market increase welfare for residents? To answer this question, I analyze the local effects of the dramatic expansion of Amazon’s fulfillment center (FC) network from 2010 onward. I exploit the staggered roll-out of FCs across large U.S. metros in a difference-in-difference framework. I find Amazon’s entry in a metro increases the total employment rate by 1.0 percentage point and average wages by 0.7 percent. The composition of employment shifts from retail and wholesale trade to warehousing and tradeable services, primarily driven by younger workers. Employment gains are concentrated among non-college workers. Rents increase by 1.1 percent, utility costs increase by 6.0 percent, and home values increase by 5.6 percent. I interpret these results through the lens of a static spatial equilibrium model. I find a net increase in aggregate welfare: the average worker is willing to pay $329 per year (0.8 percent of income) to live in a large city with Amazon. The welfare gains are primarily driven by rising home values; the increase in employment, wages, and sectoral shifts account for only one-tenth of the increase. These positive impacts are partially offset by rising local costs of living and the declining value of non-wage amenities in large cities. Government subsidies have a negligible effect on welfare as they are a small share of state and local budgets.
That is from the job market paper of Evan R. Cunningham, of the University of Minnesota.
Increasing the Supply of Very High-IQ Workers
I have argued that there are on the order of just 164 thousand very high-IQ workers in the United States. How do we get more? Ian Calaway on the job market from Stanford has an interesting paper arguing that early math mentors can be a force multiplier for students with superior math abilities. Calaway estimates that having a math mentor at a school, someone who runs a math club and organizes entry into top math competitions, increases the number of students earning PhDs and pursing careers as scientists and professors. Not every school has such a math mentor but Calaway estimates (after taking into account underlying abilities, he’s not naive) that over 27 years, math mentors identified 9,092 American Math Competitions students (the cream of the crop) but there were 11,168 missing students of very high ability.
These 11,168 additional students represent the missing exceptional math talents who would have participated in the AMC and been identified as exceptional if they had access to a mentor…these mentors would have increased the number of these students attending selective universities (3,017 students), majoring in STEM (3,465 students), earning PhDs (1,652 students), and pursuing careers as scientists and professors (1,850 students) during this twenty-seven year period.
11,168 missing students of very high ability over 27 years may not sound like much but we are talking about the very top talent level. A footnote illustrates:
Sergey Brin (Google), Mark Zuckerberg (Meta), Peter Thiel (PayPal), and Sam Altman (OpenAI) were all top AMC scorers (Committee on the American Mathematics
Competitions, 1980–2023)
High-IQ individuals don’t simply vanish without mentorship; they likely still have decent careers. However, even if you are skeptical about the social value of earning a PhD, the number of mentored individuals who go on to start firms or earn patents appears substantial. Just as athletic talent can wither without guidance, it seems that intellectual talent may also be underutilized without proper mentorship, with many high-IQ individuals failing to reach their full potential.
Spinoza is ten years old today
Happy Birthday Spinoza!
Emergent Ventures winners, 38th cohort
Sandro Luna, Austin, easier ways of getting blood pressure readings.
Divyan Bavan, Ontario, 17, machine learning for biology.
Michael Domarkas, 17, Surrey, UK, general career support for the biosciences.
Saras Agrawal, 17, Alberta, AI to monitor heart attack risk.
Charmaine Lee, NYC, music composition and performance.
Jodi Ettenberg, Ottawa, podcast on how to deal with adversity.
Jiya Singhal, Stavanger, Norway, high school, AI to detect skin cancer.
Janine Leger, Texas, for building full-time communities around the globe.
Rishi Mehta, Toronto, a device to limit falls of the elderly.
Ivan Lin, Sydney, 16, travel grant to the Bay Area.
Fearghal Desmond and Ryan Morrissey, Cork and Limerick, Induct, and a travel grant to SF.
Filip Cerny, 18, Prague, general career support, building out entrepreneurship in Czechia.
James Vitali, London, to write a book about the political future of the UK, general career support.
Harry Law, Cambridge, UK, historian of science, to write a history of AI.
Joshua Muthu, Warwick, UK, economic models of cities and building.
Kyla Scanlon, Venice, CA, to produce content on economics, including a new documentary, and also for travel support.
Pieter Garicano, WDC and Europe, general career support, writing on Europe, progress, and technology.
Ukraine cohort:
Nazar Drugov, Cambridge, MA, and MIT, and Ukraine, 17, to make Khanmigo fully functional in Ukrainian.
Aleksandra Peeva, Berlin, to study Russian sanctions.
Maria Marinichenko, physics and math instruction in Ukrainian for Ukrainians.
Anastasiya Dobrobabenko, STEM education for a school near Kyiv.
Saturday assorted links
1. “Using spatial regression discontinuity and instrumental variable designs, we find that areas with greater historical exposure to homesteading are poorer and more rural today.” From Harvard job market candidate Ross Mattheis.
2. Steve Mariotti, RIP (NYT).
3. Costco hearing aids as loss leader (WSJ).
4. Interview with Cynthia Haven.
5. The new trench warfare in Ukraine (NYT).
6. How macro works if people think about the economy in only a “shallow” fashion.
The Immigration Rap Battle
From the team that brought you Hayek v. Keynes we have the immigration rap battle featuring “George Borjas,” “Garett Jones” and “Stephen Miller” on team build the wall and “Bryan Caplan” and “Alex Nowrasteh” on open the border. I wouldn’t say the actors (AI?), look very much like their real world counterparts but much respect to the author of the rap lyrics who has brilliantly captured the essence of the ideas economically and thematically.
Germany fact of the day, the work culture that is German
Workers missed an average of 19.4 days because of illness in 2023, according to Techniker Krankenkasse, the country’s largest public health insurance provider.
Preliminary figures suggest the trend is on course to continue its upward trajectory, TK told the Financial Times, exacerbating challenges for an economy that many expect to contract for the second year running in 2024.
While it is notoriously difficult to compare data from country to country, Christopher Prinz, an expert on employment at the OECD, said Germany was “definitely among the higher countries” when it came to sick leave.
study published in January by the German Association of Research-Based Pharmaceutical Companies (VFA), an industry body, found that were it not for the country’s above-average number of sick days, the German economy would have grown 0.5 per cent last year, rather than shrinking 0.3 per cent.
Here is more from Laura Pitel at the Financial Times. Via Roland Stephen.
Should Notre Dame charge admission?
That is the topic of my latest Bloomberg column, as the Cathedral is reopening in December. The government wants to charge visitors five euros, but the Church is opposed. Here is part of my proffered solution:
First, charge a fee — but make it €10 rather than €5. If seeing Notre Dame is worth only €7 or €8 to someone, I don’t mind excluding them, for the benefit of those who really want to see the place. The crowds should diminish — and if they don’t, just raise the admission fee. St. Paul’s in London, by the way, charges £25 for adult admission, and Saint-Denis in Paris charges €11. Anyone who can afford to visit Paris can afford to pay more than €5 to see Notre Dame.
Second, assign a priest, nun or other religious counsel to the church, to service any religiously minded visitor who might require assistance in matters of the soul. If need be, that person can walk the God-searching visitor to a nearby church where visits are free. Admission fees will help fund this service, which would be symbolically important even if little used.
Third, set aside further time for Notre Dame to be a quiet and more religious place. Maybe make admission free for one day per week — but only for residents of Paris. Since most visitors stay in Paris for more than a day, the determined tourist still should be able to see the church.
And note this:
The commercialization of churches has some major downsides — but an admission fee can be a partial antidote to commercialization, not its apogee.
And this:
To put it another way: Extreme crowding is a fee of another sort, even if its nominal price remains at zero.
Let’s hope they do it.
Friday assorted links
1. The gender gap in apologies. Marshall Mo is on the job market from Stanford, and has a very interesting broader portfolio.
2. Haitian zombie show at Quai Branly in Paris (NYT).
3. Is dark energy from black holes? And axions as dark matter? (NYT)
4. The Rational Optimist Society.
6. Hungary enters its second recession in two years.
7. Short documentary about network states.
8. Botswana is somewhat ailing (FT).
Instructor value-added in higher education
On average, moving to a 1 standard deviation better instructor would increase a student’s next semester GPA by 0.13 points, and earnings six years after college entry by 17%. Strikingly, value-added is only weakly correlated with student evaluations. An instructor retention policy based on value-added would result in 2.7% higher earnings for students attending Texas universities.
That is from a new job market paper by Merrill Warnick, Jacob Light, and Anthony Yim from Stanford. Here is Warnick’s job market portfolio.