Tag Archives: Politics

Yes, Compare Nations

I called for more empirical work on the effects of liberty:

Libertarians focus too much on trying to argue abstractly that liberty would be better, and not enough on just concretely describing how liberty would be different. … From [our] vast literature we should be able to identify many concrete patterns and “stylized facts” about how government-provision and heavy-regulation tends to change products and services. (more)

David Henderson agrees:

The reality is that after Stigler’s speech, many economists did look more at the data and the data tended to show that the free market and economic freedom work better than government control. But Robin is not satisfied. There is more to be done, he says, and he’s right.  (more)

But he does have a criticism:

I do have one main criticism of Robin’s post. … It’s the West/East Germany and the South/North Korea comparisons that I want to defend. With all the variables that could affect economic growth, think about how hard it is to know what some of the most important factors are. … The stark contrast between those two pairs of countries and what that said about some economic freedom versus harsh totalitarianism.

I very much agree that those nation pairs make useful comparisons; sorry that what I wrote could mislead on that point. These comparisons do indeed suggest that “some freedom” is better than “harsh totalitarianism”, and they are good data-points on which to base stylized facts on the general effects of more liberty. Their main limitations are that they don’t say much directly about the effects of a lot more liberty than is found in West Germany or South Korea. To imagine even more liberty, we need those stylized facts.

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Policy vs. Meta-Policy

What is our main problem, bad policy or bad meta-policy? That is, do our collective choices go wrong mainly because we make a few key mistakes in choosing particular policies? Or do they go wrong mainly because we use the wrong institutions to choose these policies?

I would have thought meta-policy was the obvious answer. But CATO asked 51 scholars/pundits this question:

If you could wave a magic wand and make one or two policy or institutional changes to brighten the U.S. economy’s long-term growth prospects, what would you change and why?

And out of the 29 answers now visible, only four (or 14%) of us picked meta-policy changes:

Michael Strain says to increase fed data agency budgets:

BLS data on gross labor market flows … are not available at the state and MSA level, they do not have detailed industry breakdowns, and they do not break down by occupation or by job task. … We also need better “longitudinal” data — data that track individuals every year (or even more frequently) for a long period of time. … The major federal statistical agencies need larger budgets to collect the data we need to design policies to increase workforce participation and to strength future growth. … My second policy suggestion is to expand the … EITC.

Lee Drutman says to increase Congress staff policy budgets:

I would triple the amount the Congress spends on staff (keeping it still at just under 0.1% of the total federal budget). I’d also concentrate that spending in the policy committees. I’d give those committees the resources to be leading institutions for expertise on the issues on which they deal. I’d also give these committees the resources to hire their own experts — economists, lawyers, consultants, etc. But I’d also make sure that these committees were not explicitly partisan.

Eli Dourado says to pay Congress a bonus if the economy does well:

A performance bonus would help to overcome some of Congress’s complacency and division in the face of decades-long economic stagnation. … One good performance metric would be total factor productivity (TFP). … Fernald adjusts his TFP estimate for cyclical labor and capital utilization changes, making his series a better measure. … Members of Congress would earn a $200,000 bonus if the two-year period in which they serve averages 2 percent TFP growth. (more)

Robin Hanson says to use decisions markets to choose policies:

First, I propose that our national legislatures pass bills to define national welfare, and fund and authorize an agency to collect statistics to measure this numerical quantity after the fact. … Second, … create an open bounty system for proposing policies to increase national welfare. … Third, … create two open speculative decision markets for each official proposal, to estimate national welfare given that we do or do not adopt this proposal. … If over the decision day the average if-adopted price is higher than the average if-not-adopt price (plus average bid-ask spread), then the proposal … becomes a new law of the land.

It seems to me that Michael, Lee, and Eli feel wave pretty weak wands. Surely if they thought their wands strong enough to cast any policy or meta-policy spell, wouldn’t they pick meta-policy spells a bit stronger than these? (And why is it always more spending, not less?)

By focusing on policy instead of meta-policy, it seems to me that the other 25 writers show either an unjustified faith in existing policy institutions, or a lack of imagination on possible alternatives. Both of which are somewhat surprising for 51 scholars chosen by CATO.

Added Dec3:  3 of the 25 remaining proposals were in the meta-policy direction:

Susan Dudley:

[Regulatory] agencies should be required to present evidence that they have identified a material failure of competitive markets or public institutions that requires a federal regulatory solution, and provide an objective evaluation of alternatives.

Michael Mandel:

The Regulatory Improvement Commission … would have a limited period of time to come up with a package of regulations to be eliminated or fixed, drawing on public suggestions. The package would then be sent to Congress for an up-or-down vote, and then onto the President for signing.

Megan McArdle:

Instead of analyzing whether the [cost-benefit] calculations in a regulatory ledger sum to a positive or a negative number, we need to set a level of [regulatory] complexity that we’re willing to live with, and then decide which positive sum regulations we’re willing to discard in order to stay within that budget. … Crude rules which might well serve, like capping the number of laws and regulations, allowing a new one to be implemented only if an older one is repealed.

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Conservative vs. Liberal Jobs

My last post got me thinking about the liberal vs. conservative slant of different jobs. Here are two sources of data.

Consider some jobs that lean conservative: soldier, police, doctor, religious worker, insurance broker. These seem to be jobs where there are rare big bad things that can go wrong, and you want workers who can help keep them from happening. That explanation can also makes some sense of these other conservative jobs: grader & sorter, electrical contractor, car dealer, trucker, coal miner, construction worker, gas service station worker, non-professor scientist. Conservatives are more focused on fear of bad things, and protecting against them.

Now consider some jobs that lean liberal: professor, journalist, artist, musician, author. Here you might see these jobs as having rare but big upsides. Maybe the focus is on small chances that a worker will cause a rare huge success. This is plausibly the opposite of a conservative focus on rare big losses.

But consider these other liberal jobs: psychiatrist, lawyer, teacher. Here the focus may just be on people who talk well. And that can also make sense of many of the previous list of liberal jobs. It might also makes sense of another big liberal job: civil servant.

I’m not suggesting these are the only factors that influence which jobs are liberal vs. conservative, but they do seem worth exploring.

Added 20Nov: This post was quoted in full at Marginal Revolution, and commenters pointed to two related data sources.

Added 3Dec: A new article with data.

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The Puzzle Of Persistent Praise

We often praise and criticize people for the things they do. And while we have many kinds of praise, one very common type (which I focus on in this post) seems to send the message “what you did was good, and it would be good if more of that sort of thing were done.” (Substitute “bad” for “good” to get the matching critical message.)

Now if it would be good to have more of some act, then that act is a good candidate for something to subsidize more. And if most people agreed that this sort of act deserved more subsidy, then politicians should be tempted to run for office on the platform that they will increase the actual subsidy given to that kind of act. After all, if we want more of some kind of acts, why don’t we try to better reward those acts? And so good acts shouldn’t long remain with an insufficient subsidy. Or bad acts without an insufficient tax.

But in fact we seem to have big categories of acts which we consistently praise for being good, and where this situation persists for decades or centuries. Think charity, innovation, or artistic or sport achievement. Our political systems do not generate much political pressure to increase the subsidies for such things. Subsidy-increasing proposals are not even common issues in elections. Similarly, large categories of acts are consistently criticized, yet few politicians run on platforms proposing to increase taxes on such acts.

My best interpretation of this situation is that while our words of praise give the impression that we think that most people would agree that the acts we praise are good, and should be more common, we don’t really believe this. Either we think that the acts signal impressive or praise-worthy features, but shouldn’t be more common, or we think such acts should be more common, but we also see large opposing political coalitions who disagree with our assessment.

That is, my best guess is that when we look like we are praising acts for promoting a commonly accepted good, we are usually really praising impressiveness, or we are joining in a partisan battle on what should be seen as good.

Because my explanation is cynical, many people count it as “extraordinary”, and think powerful extraordinary evidence must be mustered before one can reasonably suggest that it is plausible. In contrast, the usual self-serving idealistic explanations people give for their behavior are ordinary, and therefore can be accepted on face value without much evidence at all being offered in their defense. People get mad at me for even suggesting cynical theories in short blog posts, where large masses of extraordinary evidences have not been mustered. I greatly disagree with this common stacking of the deck against cynical theories.

Even so, let us consider some seven other possible explanations of this puzzle of persistent praise (and criticism). And in the process make what could have been a short blog post considerably longer. Continue reading "The Puzzle Of Persistent Praise" »

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Pretty Smart Healthy Privilege

In our social world, people who are prettier (or hotter) can wear a wider range of clothing and still be seen as socially acceptable. For example, when less pretty people wear especially form-fitting or revealing clothes, they are likely to face social disapproval. They can’t “pull it off.”

Similarly, people who are smarter (or wittier) can talk in conversation about a wider range of topics. If you are not clever or witty, and you bring up a sensitive topic, you are likely to seem awkward and inappropriate, and induce social disapproval. But if you are clever or witty, you can often bring up such subjects in a way that makes people around you laugh and approve.

People who are healthier also have a wider range of socially acceptable activities. People who try to join a group hike or club dance, but who don’t have the energy or coordination to keep up with others, are often frowned upon.

These are three examples of privilege based on familiar kinds of inequality. Not only are these sorts of privilege quite widely accepted, rarely causing much embarrassment or guilt, but we often go out of our way to celebrate and revel in them. In fashion runways, lecture halls, and sporting events we select the most pretty smart healthy people we have, and give them extra attention and approval, thereby increasing social inequality resulting from differences in these features.

An even more dramatic example is inequality based on species. Humans today are gaining huge advantages relative to other species. And most people seem quite okay with celebrating and encouraging these advantages.

When you hear concerns expressed about privilege or inequality, you don’t usually hear these features mentioned. Instead the focus is more often on inequalities tied to income, parental wealth, dominant vs. marginal cultures and ethnicities, rich vs. poor nations, or dominant vs. marginal gender or sexual preferences and styles. Many people seem to find it quite easy to get worked up over privilege and inequality tied to those features.

Now while I can sorta empathize with such resentment and indignation, they don’t feel much more compelling to me that related feelings about the privileges of pretty, smart, or healthy people. Or even humans relative to other species. So while I could sort get behind efforts to mildly reduce the worst extremes caused by all forms of privilege and inequality (or by total inequality, weighing all things), I can’t get behind efforts to focus much more on some forms relative to others.

I have tried to make sense of why people treat these things differently. For example, people seem more concerned about the kinds of inequality that concerned their distant forager ancestors. People seem more eager to express indignation about kinds if inequality would more support more easy grabbing. And people seem more suspicious of inequality resulting from more opaque larger-scale social processes (like labor markets), rather than from more transparent biological and smaller-scale social processes.

But none of these explanations seem to me good reasons to actually worry much more about these kinds of privilege and inequality. Yes disapproved processes like wars, slavery, and theft have contributed substantially to some cultures or sexual styles becoming dominant in our world. But disapproved processes also contribute substantially to some people becoming prettier, smarter, or healthier in our world. And in neither case am I willing to conclude that disapproved processes are the overwhelming cause of such inequality.

As things are counted in today’s political calculus, this apparently makes me a “conservative,” in that I’m less concerned about the sorts of inequalities that greatly concern “liberals.” But I see this less as taking a political position than as remaining uncertain – until I see a good reason to care differently about different kinds of inequality, I’m going to consider them as similar. I see this as like being agnostic about religion. Some people consider a religious agonistic as taking a strong position against religion, and as being almost the same as an atheist. But I think it is worth distinguishing people who take a position against a common view, from people who are uncertain about that view.

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Do Economists Care?

Art Carden:

Heavy traffic is a problem every economist in the world knows how to solve: price road access, and charge high prices during rush hour. With technologies like E-ZPass and mobile apps, it’s easier than ever. That we don’t pick this low-hanging fruit is a pretty serious indictment of public policy. If we can’t address what is literally a principles-level textbook example of a negative spillover with a fairly easy fix, what hope do we have for effective public policy on other margins? (more)

Yes! If economists actually cared about influencing real policy, they would:

  1. Identify a few strong candidate policies that are a) widely endorsed by economists, b) based on relatively simple clean analysis, c) not much adopted in the wider world, and d) should bring big gains.
  2. Try to engage other intellectuals in detail on one or a few of these, seeking to either gain their endorsement, or to understand better the barriers that block them. If possible, do this as a group, and using all our status levers to make them respond in detail. If we succeed in persuading intellectuals, then join with them to try to persuade policy-makers, again either succeeding or better understanding barriers.
  3. Once we better understand barriers, focus our economic research on doing what it takes to overcome them.

By not doing this, we basically say that while we think we know how to make a better world, we don’t much care if that happens; our priorities are elsewhere.

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Why Do We So Seek Synch?

We economists are known for being “imperial” in trying to apply economics to almost everything. And that’s a goal I can get behind, in the sense of trying to find an integrated view of the social world, where all social phenomena have a place and some candidate explanations within a common framework. Of course many parts of this integrated view may start first in fields outside economics.

In pursuit of such an integrated view, I’ve been making a special effort to learn more about social phenomena that economists don’t talk much about. And since a lot of these phenomena are often associated with the words “play” and “ritual”, and it is sociologists who most seem to write about these things, I’ve been reading a lot of sociology.

Sixteen months ago I posted about an intriguing summary of Randall Collins’ book Interaction Ritual Chains:

Any physical gathering … turns into a ritual when those physically present focus their attention on specific people, objects, or symbols, and are thereby constituted as a distinct group with more or less clear boundaries. …

A ritual, for Collins, is basically an amplifier of emotion. … A successful ritual generates and amplifies motivating emotions. … Perhaps Collins’ most controversial claim is the idea that we are basically emotional energy “seekers”: much of our social activity can be understood as a largely unconscious “flow” along the gradient of maximal emotional energy charge for us, given our particular material resources and positions within the … set of ritual situations available to us. Our primary “motivation” is the search for motivation. … Motivation is simply a result of emotional amplification in ritual situations. …

Emotional charge or motivational energy is built up from entrainment: the micro-coordination of gesture, voice, and attention in rhythmic activity, down to tiny fractions of a second. Think of how in an engrossing conversation the partners are wholly attuned to one another, laughing and exhibiting emotional reactions simultaneously, keeping eye contact, taking turns at precisely the right moments, mirroring each other’s reactions. … Or consider sexual acts, to which Collins devotes a long and very interesting chapter. (more)

I’ve now read this book carefully, twice. Here is my report. Continue reading "Why Do We So Seek Synch?" »

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Part Of Something Big

A hero is someone who has given his or her life to something bigger than oneself. Joseph Campbell

Most Twitter talk reminds me of the movie Ridicule, wherein courtiers compete to show cruel wit and cynicism. This makes me crave a simple direct conversation on something that matters.

So I pick this: being part of something larger than yourself. This is a commonly expressed wish. But what does it mean?

Here are some clues: Judging from Google-found quotes, common satisfactory “things” include religions, militaries, political parties, and charities. For most people “the universe” seems too big and “my immediate family” seems too small. And neither seem idealistic enough. “All utilitarians” is idealistic enough, but seems insufficiently coherent as a group. The words “part” and “thing” here are suspiciously vague, suggesting that there are several elements here, some of which people are more willing to admit than others.

Here’s my interpretation: We want to be part of a strong group that has our back, and we want to support and promote ideals. But these preferences aren’t independent, to be satisfied separately. We especially want to combine them, and be a valued part of a group that supports good ideals.

So we simultaneously want all these things:

  1. We are associated with an actual group of people.
  2. These people concretely relate to each other.
  3. This group is credibly seen as really supporting some ideals.
  4. We embrace those ideals, and find them worth our sacrifice.
  5. Our help to this group’s ideals would be noticed, appreciated.
  6. If outsiders resist our help, the group will have our back.
  7. The group is strong enough to have substantial help to give.
  8. The group does’t do wrongs that outweigh their ideals support.
  9. Both the group and its ideals are big in the scheme of things.

Since this is a lot of constraints, the actual groups that exist are unlikely to satisfy them all. So we compromise. Some people see most all big coherent groups as easily corrupted, and so only accept small groups. For some, group bonding is so important they’ll compromise on the ideals, or accept weak evidence that the group actually supports its ideals. If group strength is important enough to them, they may not require any ideals. For others, the ideal is everything, and they’ll accept a weak group defined abstractly as “everyone who truly supports this ideal.” Finally, for some being appreciated is so important that they’ll take the thing the world seems to most appreciate about them and accept a group and ideal defined around that.

If this is right then just talking about what are the best ideals and how to achieve them somewhat misses the point. Also somewhat missing the point is talk about how to make strong well-bonded groups. If people typically want the two of these things together, then the actual design problem is how to achieve good ideals via a strong well-bonded group.

Which isn’t a design problem I hear people talk about much. Some presume that if they can design a good enough ideal, a good group will naturally collect around it. Others presume that if they can design a good enough way for groups to coordinate, groups will naturally coordinate to achieve good ideals. But how reasonable are these assumptions?

If we focus on explaining this preference instead of satisfying it, a homo hypocritus framework fits reasonably well. Coalition politics is central to what we really want, but if cheap we’d rather appear to focus on supporting ideals, and only incidentally pick groups to help us in that quest.

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Trustworthy Telepresence

In a recent Ipsos/Reuters poll, which questioned 11,383 people in 24 countries, about half believed that they would be at a disadvantage in earning promotions because of the lack of face-to-face contact. Previous research suggests part-time telecommuters do not communicate less frequently with managers. … After four years of experience, the average male telecommuter will earn about 6.9% less than a non-telecommuter. (more)

Telecommuting requires the use of various types of media to communicate, such as the telephone and email. Emails have a time lag that does not allow for immediate feedback; telephone conversations make it harder to decipher the emotions of the person or team on the phone; and both of these forms of communication do not allow one to see the other person. Typical organization communication patterns are thus altered in telecommuting. For instance, teams using computer-mediated communication with computer conferencing take longer to make group decisions than face-to-face groups. (more)

Decades ago many futurists predicted that many workers would soon telecommute, and empty out cities. Their argument seemed persuasive: workers who work mainly on computers, or who don’t have to move much physical product, seem able to achieve enough coordination to do their jobs via phone, email, and infrequent in-person meetings. And huge cost savings could come from avoiding central city offices, homes near them, and commuting between the two. (For example, five firms might share the same offices, with each firm using them one day per week.)

But it hasn’t remotely happened that way. And the big question is: why?

Some say telecommuters would shirk and not work as much, but it is hard to see that would remain much of a problem with a constant video feed watching them. Bryan Caplan favors a signaling explain, that we show up in person to show our commitment to the firm. But a firm should prefer employees who show devotion via more total work, instead of wasting hours on the road. Yes inefficient signaling equilibria can exist, but firms have many ways to push for this alternate equilibrium.

The standard proximate cause, described in the quote above, is that workers and their bosses get a lot of detailed emotional info via frequent in-person meetings. Such detailed emotional info can help to build stronger feelings of mutual trust and affiliation. But the key question is, why are firms willing to pay so much for that? How does it help firm productivity enough to pay for its huge costs?

My guess: frequent detailed emotional info helps political coalitions, even if not firms. Being able to read detailed loyalty signals is central to maintaining political coalitions. The strongest coalitions take over firms and push policies that help them resist their rivals. If a firm part adopted local policies that weakened the abilities of locals to play politics, that part would be taken over by coalitions from other parts of the firm, who would then push for policies that help them. A lack of telecommuting is only one of a long list of examples of inefficient firm policies than can be reasonably be attributed to coalition politics.

Some people hope that very high resolution telepresence could finally give enough detailed emotional info to make telecommuting workable. And that might indeed give enough info to build strong mutual trust and loyalty. But it is hard to make very high resolution telepresence feel natural, and we still far from having enough bandwidth to cheaply send that much info.

Furthermore, by the time we do we may also have powerful robust ways to fake that info. That is, we might have software that takes outgoing video and audio feeds and edits them to remove signs of disloyalty, to make people seem more trusting and trustworthy than they actually are. And if we all know this is possible, we won’t trust what we see in telepresence.

So, for telepresence to actually foster enough loyalty and trust to make telecommuting viable, not only does it need to feel comfortable and natural and give very high bandwidth info, but the process would need to be controlled by some trusted party, who ensures that people aren’t faking their appearances in ways that make it hard to read real feelings. Setting up a system like that would be much more challenging that just distributing something like Skype software.

Of course eventually humans might have chips under their skin to manipulate their sight and sound in real physical meetings. And then they might want ways to assure others aren’t using those. But that is probably much further off. (And of course ems might always “fake” their physical appearance.)

Again, I have hopes, but only weak hopes, for telepresence allowing for mass human telecommuting.

Added 3July: Perhaps I could have been clearer. The individual telecommuter could clearly be at a political disadvantage by not being part of informal gossip and political conversation. He would have fewer useful allies, and they would thus prefer that he or she not telecommute.

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Why We Can’t Have Nice Things

The world has many problems and some of them are global. That is, some problems like war, global warming, and promoting innovation can benefit substantially from large scale coordination to address them. To judge from my Facebook feed, many think the main thing we need to solve such problems is more preaching – if only more folks would rail against the immorality of those who opposed their favored solutions. Another widely held view, expressed in a great many inspirational TED talks, is that we need more smart emphatic activists and inventors. But the following take is a more expert and believable:

Addressing Global Environmental Externalities: Transaction Costs Considerations. Is there a way to understand why some global environmental externalities are addressed effectively whereas others are not? … Property rights are supplied by international agreements that specify resource access and use, assign costs and benefits including outlining the size and duration of compensating transfer payments and determining who will pay and who will receive them. Four factors raise the transaction costs [and hence the difficulty] of assigning property rights: (i) scientific uncertainty regarding mitigation benefits and costs; (ii) varying preferences and perceptions across heterogeneous populations; (iii) asymmetric information; and (iv) the extent of compliance and new entry. (more)

While this paper doesn’t discuss it, another big issue is the strength and capacity of our institutions of global governance. For example, a lot of these problems would get solved a lot better with a high capacity world government. Such a government could better reduce uncertainty and secrets, enforce compliance, and promote compromises between conflicting interests.

If just you want to show off your moral outrage that problems aren’t being solved, by all means continue to preach that we must do better. But if you actually want to solve these problems, you should focus on identifying and dealing with their fundamental causes. Especially including the development of better mechanisms of global governance, and working to better understand what limits their deployment.

Btw, I tend to think that we hear the most preaching not about the problems that cause the most damage, but about those that best fit our schemas for moral outrage. For example, I tend to agree with Matt Ridley that global warming is a relatively minor problem, compared with for example overfishing and innovation promotion.

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