Conventional wisdom tends to treat President Hoover as a clueless advocate of laissez faire who refused to stimulate the economy in the dramatic downturn. Franklin Roosevelt, on the other hand, was the heroic leader who both saved the day and transformed the American economy through his promotion of the New Deal. …
There is little corroboration in the historical record for this simplistic storyline. … Most of what both Presidents did in fiscal policy had little impact on the Depression one way or another. … The consensus view is that FDR’s [main] policy success was the abandonment of the gold standard in 1933.
Though there is still a lively popular debate about the “true” cause of the Great Depression, there is nonetheless a strong expert consensus … The Fed’s focus on curbing speculation in the stock market by restricting lending—as well as its unwillingness to extend liquidity and expand the money supply in the face of a collapsing economy and a wave of bank panics in the early 1930s—deeply aggravated the severity and extent of the downturn.
That is John Nye. Read and learn.
More wisdom from Hard Facts:
Harvard Business Review has published at least three articles on incentive pay and organizational performance in the past decade. … Each makes a similar point: compensating people for only individual performance creates more problems than it solves, so rewards should emphasize organizational, not just individual, performance. … Not one of these articles refers to the prior article, because HBR precludes footnotes and … discourages references to prior work. (pp.43,44)
James March … put it “Most claims of originality are testimony to ignorance, and most claims of magic are testimony to hubris.” … Knowledge isn’t generated by lone geniuses who magically produce brilliant new ideas in their gigantic brains. This is a dangerous fiction. … Hackman was troubled because he could only find published success stories about companies that had redesigned work to be more motivating and meaningful. Yet in his experience most redesign efforts were failing. … a study found no significant performance differences between Peters and Waterman’s “excellent” companies and a representative sample of Fortune 1000 companies. (pp.46-48)
Yet more wisdom from Hard Facts:
Bloodletting was used routinely until 1836 when French physician Pierre Louis conducted one of the first clinical trials in medicine. Louis compared pneumonia patients whom he treated with aggressive bloodletting and those he treated without it. Louis found that bloodletting was linked to far more deaths. … George Washington, the first president of the United States, … died two days after a doctor treated his sore throat by draining almost five pints of blood. … A remarkably high percentage of medical decisions still reflect the often-obsolete practices that a doctor learned in medical school, the ingrained traditions of a hospital or region. (p.13) …
What she thought was a straightforward study of how leader and coworker relationships influence errors in eight nursing units. … [She was] flabbergasted when nurse questionnaires showed that the units with the best leadership and best coworker relationships reported making 10 times more errors than the worst. … Better units reported more errors because people felt psychologically safe to do so. …
Nurses whom doctors and administrators saw as most talented unwittingly caused the same mistakes to happen over and over. These “ideal” nurses quietly adjust to inadequate materials without complaint, silently correct others’ mistakes without confronting error-makers, create the impression that they never fail, and find waits to quietly do the job without questioning flawed practices. These nurses get sterling evaluations, but their silence and ability disguise and work around problems undermine orgainzational learning. (pp105,106)
Clearly most med errors are not reported, and docs reward nurses more for covering doc asses than for improving patient outcomes.
More wisdom from Hard Facts:
Merit pay for teachers is an idea that is almost 100 years old ahd has been subject to much research. In one study conducted in 1918, “48 percent of U.S. school districts sampled used compensation systerms that they called merit pay.” … The evidence shows that merit-pay plans seldom last longer than five years and that merit pay consistently failes to improve student performance. … [Researchers] also showed that cheating [by teachers] was quite sensitive to the size of the incentives provided for enhancing student scores. … The same problems emerged when merit-pay systems were implemented in the 1980s. … “It is like policy makers suffer from amnesia.” (pp.22-24) …
The evidence strongly suggests that students learn better when they are not graded and certainly not when they are graded on a curve. … When drill instructors were tricked into believing that certain randomly selected soldiers would achieve superior performance, those soldiers subsequently performacned far better on tasks like firing weapons and reading maps. (p.38)
Ending social promotion harms students and schools, and the strongest negative effects are found in the best, most rigorous studies. At least 55 studies show that when flunked students are compared to socially promoted students, flunked students perform worse and drop out of school at higher rates. One of the most careful studies found that, after controlling for numberous alternative explanations indlucing race, gender, family income, and school characteristics, students held back one grade were 70 percent more likely to drop out of high school. (p.51)
Back in December Nancy Lebovitz commented here that the book Hard Facts, Dangerous Half-Truths And Total Nonsense: Profiting From Evidence-Based Management “may be may be of interest to any contrarian” She is quite right. So much so that I will do a series of posts quoting from it. Here is Hard Facts on mergers:
Study after study shows that most mergers – some estimates are 70 percent or more – fail to deliver their intended benefits and destroy economic value in the process. A recent analysis of 93 studies covering more than 200,000 mergers published in peer-reviewed journals showed that, on average, the negative effects of a merger on shareholder value become evident less than a month after a merger is announced and persist thereafter. …
More thoughtful leaders might do what Cisco Systems has done – figure out the factors associated with successful and unsuccessful mergers and then actually use those insights to guide behavior. … A Fortune article on bad mergers noted that “infrastructure giant Cisco has digested 57 companies without heartburn.” … Cisco figured out that mergers between similar sized companies rarely work, as there are frequently struggles about which team will control the combined entity. … Cisco’s leaders also determined that mergers work best when companies are geographically proximate, making integration and collaboration much easier. … and they also uncovered the importance of organizational cultural compatibility for merger success. …
You might think that companies would learn from all this experience … you would be wrong. Business decisions … are frequently based on hope or fear, what others seem to be doing, what senior leaders have done and believe has worked in the past, and their dearly held ideologies – in short on lots of things other than the facts. (pp. 4,5)
The probability of being sentenced to death is much greater if a defendant kills a white or Hispanic victim who is married with a clean criminal record and a college degree, as opposed to a black or Asian victim who is single with a prior criminal record and no college degree. …
“Irrelevant social facts also shape the ultimate state sanction” Phillips says. “In the capital of capital punishment, death is more apt to be sought and imposed on behalf of high status victims. Some victims matter more than others.”
Phillips research is based on 504 death penalty cases that occurred in Harris County, Texas between 1992 and 1999. Drawing on the same data, Phillips’s previous research demonstrated that black defendants were more likely to be sentenced to death than white defendants in Houston. The racial disparities revealed in the prior paper become even more acute after accounting for victim social status – black defendants were more apt to be sentenced to death despite being less apt to kill high status victims.
More here (HT naz). I expect such patterns to be found in most legal jurisdictions, not just Harris County Texas. You will find it hard to find any lawyer, judge, or law professor who will go on the record saying these are officially accepted as legitimate considerations in legal sentencing. Most will say the law “tries” to ignore such considerations. And yet such patterns have long existed, have long been widely known to exist.
These are motivated biases, not just random accidents of a system trying to be fair but failing to because of limited human mental capacity. These errors are far more likely to persist than the opposite error. If the opposite errors were suddenly to become common, enormous concern would be expressed, great resources would be spent, and we’d be willing to consider large institutional changes to eliminate them.
The place such errors enter is of course via “judgment.” We recoil in horror at the thought of a simple legal system where judges or juries could make any decision they wanted in each case they considered. But we also recoil at the thought of a legal system with explicit rules which had to be followed exactly in each case. We instead prefer a legal system with lots of specific rules, where in the end “reasonable” people are allowed to exercise “judgment” about how to “interpret” the rules. It sure looks like what we want is the appearance of constraining ourselves to follow rules, combined with the practice of arbitrary choice.
Our income tax system gives each of us a stake in the work of others – the more money others make, the more we each get via taxes. In principle we could use this fact to justify a great deal of intervention in everyone’s work lives. For example, one might argue: why should we let folks choose fulfilling but poorly paid jobs like social worker, veterinarian, or forestry agent, if they are capable of becoming an lawyer, doctor, or engineer? Or why should we let folks work part time to focus on a music or acting hobby, or choose to live anywhere but the city where their skills are worth the most?
To most folks such regulations seem intolerably intrusive. But when people are asked to justify our common and extensive regulations and subsidies of medicine and education, they often mention exactly this issue – that such interventions make sense because we all have a stake in the work of others via the income taxes those folks pay. Why the asymmetry? Why do folks think these arguments make sense regarding medicine and education, but not regarding choice of career or location?
My guess: humans inherited intuitions that the community should have more say in and contribute more to medicine and education. This is the way our distant ancestors did things in their small nomadic forager bands, and we intuit we should act similarly today. The stuff about managing our cut of others’ income is just a rationalization.
A few months ago I had a nice long talk with a smart high-ranking, well-published (ex-) military officer who focuses on soldier psychological issues. He said most war movies aren’t at all realistic. When I pressed him for a realistic film, he offered Catch-22, at least for emotional realism. This doesn’t appear on any of the four lists of most realistic war films I found in a quick search (here, here, here, here), which agree only modestly with each other.
The supposedly realistic Hurt Locker is favored to win Best Picture tomorrow, but some complain about its realism:
Many in the military say “Hurt Locker” is plagued by unforgivable inaccuracies that make the most critically acclaimed Iraq war film to date more a Hollywood fantasy than the searingly realistic rendition that civilians take it for. … To those who were there, Iraq is real life. And they’re very sensitive — some would say overly so — when their war is portrayed via a central character who is a reckless rogue. … “When he puts a hood on like Eminem and starts roving outside the wire, it’s ridiculous.”
Is it even possible to make and sell a realistic war movie? The experience of war varies enormously across wars, battles, roles, moments, etc., and most of that is insufferably slow and boring. Since war is so powerfully symbolic, and so many care about those symbols, it seems many would complain about most any emotionally compelling war film, even if exactly accurate on a particular event.
What exactly could it mean for a film to be “realistic”? Since few are entertained by watching random samples of real life, entertaining films must select strongly from the space of actual and possible events. One might allow a movie any initial setting, no matter how strange, and call it realistic if events depicted that were typical conditional on that setting. But then how long does the movie get to “set the scene,” after which we start to evaluate its realism? And for how many settings could realistic behavior given that setting be entertaining?
Tell pretty women they are smart, and smart women they are pretty. saying
We prefer to be liked, vs. disliked, but we also care about which features others most like about us. For example, we might prefer to be liked for our sense of humor, rather than our looks. But it seems to me that we most prefer that people who like us not know why exactly they like us.
It is of course a bad sign about someone’s opinion of you if they can’t think of any positive features of you. It is also a good sign about their devotion if they sometimes try to make sure you know that you have good features. But we would be disappointed and even disturbed to learn that someone knew that how much they liked us was captured by a particular known formula referring to objectively measurable features, no matter what those features were.
Someone who knew exactly where you and other folks ranked on their quality scale, and who could easily track how those rankings changed with time will know how much they like you more or less as your features changed. Even if you are their favorite person at this moment, the odds are that someone else will soon outrank you.
In contrast, consider someone who has had a lot of contact with you, and who knows mainly that they like you, but not why exactly they like you. This person will have more trouble finding someone else that they like more than you. In this case you are more of an experience good, that has to be experienced to be evaluated. If it is expensive to experience other folks enough to know their attractiveness, you have more confidence that you will continue to be one of their favorite people.
(From a conversation with Amanda Budny.)
My January talk at Foresight 2010, Economics of Nanotech and AI, is now available: video, slides. Seems I had a habit of messing my hair while talking. Silly me.
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