Tag Archives: Politics

What is Finding Welfare?

By Robin Hanson · February 6, 2012 4:40 pm · Comments (7)

My last post suggested that we survey economists to choose between three descriptions of what they are doing when they make policy recommendations:

  1. Morals – Entering into larger conversations on what actions are right and moral.
  2. Deals – Helping groups find mutually-beneficial deals, by suggesting deal parts.
  3. Showing Off – Doing hard things like analysis, so we can be credentialed as impressive.

Bryan agrees that #2 would be more popular, but suggests adding two more options (slightly reworded by me):

  1. Social Welfare – Identifying policies that are best for society as a whole.
  2. Partisanship – Identifying ways to advance political goals we identify with.

I agree with Bryan that #4 would now be more popular, but are these new options different concepts, or phrases popular in part because of their vagueness? The three options I presented seem more clearly conceptually distinct. Do economists seek “best” policies to help people argue about which actions are moral, to help encourage political and other group deals that include these better policies, or to show off their abilities to do clever analysis? My proposed three part question seems to me better suited for digging to this deeper level.

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Status As Strength

By Robin Hanson · February 1, 2012 11:25 pm · Comments (16)

Yesterday I offered a theory of (some) management consulting:

Firms often have big obvious misallocations of resources, where … many highest status folks in the firm resist … changes. … If a prestigious outside consulting firm weighs in, that can turn the status tide. Coalitions can often successfully block a CEO initiative, and yet not resist the further support of a prestigious outside consultant. … Good-looking kids from our most prestigious schools … are the cheapest folks you can buy with our most prestigious affiliations.

What is status? One theory is that status is a commonly-seen summary of one’s value as an ally. In places where physical strength is more useful, strength counts more for status. In places where knowing the king is more useful, knowing the king counts more. And so on. But the consulting tale I tell above seems at odds with this theory.

Imagine that status in a firm was a proxy for one’s usefulness as an ally within that firm, summarizing the threats one could credibly make, the people one could fire, the favors one could plausibly call in, etc. And imagine that the current equilibrium was that opponents of change together held more of these useful resources – they successfully blocked change.

Now imagine that the CEO hires an outside consultant who writes a report recommending change. It should be clear to everyone that this outside firm has no direct power within the firm. It cannot fire anyone, go slow on a project, etc. So if status was just a proxy for relevant local abilities, then this consultant should have little status. Thus if a consultant actually does help the CEO by lending status to the CEO’s side, status must be something else.

So I’m led to consider a sticky-feature concept of status. Long ago coalition politics was important, and foragers had to estimate how useful each person would be if they joined a coalition. So our distant ancestors considered a standard set of features, such as strength, intelligence, charisma, etc., that tended then to indicate that someone would be a useful ally. Humans evolved specialized mental modules for making such estimates, and for estimating common perceptions of such estimates.

Today we have inherited such mental modules, and often use them to estimate which side will win a contest of coalitions. And even though relevant abilities have changed somewhat, our inherited expectations about who will win a coalition contest are somewhat self-reinforcing. For example, if we expect that coalitions of taller people tend to win, then we will be reluctant to cross such a coalition, which will tend to make them win. This can be a self-reinforcing focal equilibrium of the coordination game that is coalition politics.

If the features that define status are sticky, being somewhat locked into mental models that estimate which coalitions would win contests, then outside consultants with no formal power inside a firm could still tip the balance of status by siding with a CEO. Celebrities who know little about a product could make us more willing to buy it by endorsing it, and students could gain status via past affiliation with professors who have no power in their future work world.

If students gain status by graduating from prestigious schools, and if employers hire students for the status they add to a work coalition, is school productive? Well in this situation school is privately productive, both for the student and the employer. The employer isn’t inferring a hidden ability, but buying a visible feature. So this isn’t signaling exactly. But on the other hand, it isn’t obviously globally productive. The gain an employer gets from adding status to his coalition may well come at the expense of competing coalitions.

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Who Talks Politics?

By Robin Hanson · January 26, 2012 9:10 am · Comments (8)

Using data from a nationally representative survey of registered voters conducted around the 2008 U.S. presidential election … [we find that] people discussed politics as frequently as (or more frequently than) other topics such as family, work, sports, and entertainment with frequent discussion partners. … The frequency with which a topic is discussed is strongly and positively associated with reported agreement on that topic among these same discussion partners, … because people avoid discussing politics when they anticipate disagreement. (more)

Political talk is quite different within vs. outside of families. Within families, politics talkers tend to be less conscientious, more emotionally stability, and more extraverted. Extraverted family members tend to talk politics more even when they disagree.

Outside of families, people tend to talk politics more when they see each other a few times week, as opposed to daily or weekly. The only other predictor of non-family talk is having an open personality type, and then only when political agreement is especially strong. Controlling for the above features, gender, race, age, education, and other personality factors (like agreeableness) did not predict who talked politics, neither in nor out of families.

So the main situation in which people somewhat talk through their political disagreements is extraverts within families, especially when extraverts are related (think Archie Bunker and meathead). At the other extreme, love fests of political agreement happen most when those with open personalities (who tend politically left) see each other outside of families a few times a week (think faculty lunches). Both of these extreme results fit my personal experience.

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Beware Inspiration

By Robin Hanson · December 25, 2011 11:15 am · Comments (3)

From a review of William Gavin’s book Speechwright:

Gavin became [Nixon's] speechwriter … [and] came to share [his] suspicion of stirring, soaring speechifying and his preference, instead, for what Gavin calls “working rhetoric” — plain, forceful, purposeful prose. Words that bear down instead of lift up. “The desire to be inspired,” Gavin writes in “Speechwright,” “to be uplifted, to be made to feel deeply, to be swept away, and thrilled is the mark of jaded citizens who have forgotten that the major goal of political rhetoric should be to make good arguments, clearly and honestly.” For Gavin, the original sin had been committed by John Kennedy, whose inaugural address begat “the modern cult of thrill-talk.” That speech was “magnificent,” Gavin allows, “but it wasn’t true, because it wasn’t achievable.” (more)

The reviewer disagrees:

He is mostly right that politicians should “stop trying to get us to stand up and cheer” and “start persuading us to sit down and think.” But … the basic purpose of political rhetoric is to “move men to action or alliance.” … Yes, “thrill-talk,” as Gavin insists, often gives wings to “impossible dream[s]” and “inevitable disappointment.” But the words that excite us are also the words that can change us — words that stretch our national sense of self, that make us believe we really can end Jim Crow and win a war and put a man on the moon. Not every dream is an impossible one.

Yes, inspiring idealistic far-mode talk can motivate cooperative and idealistic acts in ways that realistic near-mode desire, fear, practicality, etc. talk cannot. But know that you will let yourself believe more lies and impossibilities in that mode. You may coordinate to take more actions, but actions that are more likely than you think to be useless or even harmful.

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Excess Loyalty Signals

By Robin Hanson · December 22, 2011 10:20 am · Comments (7)

We tend to think of coalitions and conspiracies failing via betrayal. But in fact, I’d guess, they usually fail by excess loyalty signaling: members prefer to do what other members think is good for the group, rather than what private info could suggest is actually good for their group. Even in business. Karl Smith:

I see the back rooms of opposing lobbyists all the time. Here at the state level I can safely say that virtually no one has any idea what they are doing. That is, for the most part the lobbyist do not know and indeed are not particularly interested in what is in the best interest of their clients.

Further, this seems to stem from the fact that the clients are not particularly interested in what is in their best interests. What they are very interested in is whether legislation is pro them or anti them. However, if you begin to talk about the economy as a complex system full of unintended consequences where anti legislation could be in their best interests their eyes glaze over.

Moreover, a very large number of business lobbyists are not even that interested in efforts that are pro or anti their business. They are more interested in legislation that is pro-business in general and that they perceive as being fair. (more; HT Tyler)

A business group that used decision markets to estimate what would actually help them most might profit greatly thereby. But suggesting this change might signal disloyalty, at it suggests mismanagement by current group leaders.

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On School’s Function

By Robin Hanson · December 16, 2011 10:30 pm · Comments (13)

Is school more for helping students learn about the world, or more for showing and encouraging good behavior? This NYT oped by Yoram Bauman gives a hint:

When students went online to register for classes each quarter, they were asked if they wanted to donate $3 to support WashPIRG, a left-leaning activist group. Students were also asked if they wanted to donate $3 to Affordable Tuition Now (ATN), a group that lobbied for “sensible tuition rates, quality financial aid and adequate funding.” …

About 5 percent of economics majors donated to WashPIRG in a given quarter, compared with 8 percent for other arts and sciences majors. A similar divide — 10 percent versus almost 15 percent — occurred with respect to donations to ATN. … Taking economics classes [had] a significant negative effect on later giving by students who did not become economics majors. …

Our research suggests that economics education could do a better job of providing balance. Learning about the shortcomings as well as the successes of free markets is at the heart of any good economics education, and students — especially those who are not destined to major in the field — deserve to hear both sides of the story. (more)

So econ teaching should be changed because after taking econ classes students donate less to leftist political groups? Bauman does not bother to argue that econ classes teach falsehoods. He probably accepts the usual econ analysis suggesting that selfish folks might rather keep their money and hope others donate to worthy causes. No, apparently Bauman thinks it sufficient that he disapproves of the net effect of teaching truths — fewer donations go to political groups he favors. That must be stopped!

(Free market shortcomings are beside the point here. Most econ classes talk plenty about those, and they aren’t very relevant to the private vs. social value of donations.)

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Talk Rules Are Classist

By Robin Hanson · December 14, 2011 5:17 pm · Comments (24)

Our society claims to be concerned about less-favored races, religions, genders, sexual preferences, etc. But our most visible and well-enforced policies for showing such concern are rules about what folks may not say. And these rules are heavily classist, imposing much larger burdens on lower classes. Let me explain.

Humans have complex coalition politics, wherein we jockey for allies, test potential allies for weaknesses, and try to undermine rivals. We often communicate at several levels at once, with overt talk that better withstands outside scrutiny, and covert talk that is more free.

Lower “working” class cultures tend to talk more overtly. Insults are more direct and cutting, friends and co-workers often tease each other about their weaknesses. Nicknames often express weakness – a fat man might be nicknamed “slim.”

Upper class culture, in contrast, tends more to emphasize politeness and indirect communication. This helps to signal intelligence and social awareness, and distinguishes upper from lower classes. Upper class folks can be just as cruel, but their words have more plausible deniability.

The enforcement of laws against racist, sexist, etc. expressions is limited by the ability of courts and related observers to agree on the intent of what was said. Observers will not have access to all the local context and history that local folks use to interpret each others’ words. Now since official observers like judges tend to be upper class, they do tend to be better able to interpret the intent of upper class words. But this advantage seems insufficient compensate for the much greater indirection and politeness of upper class talk.

So when an upper and a lower class person both express disfavor with a certain race, religion, gender, sexual preference, etc., the lower class expression is more likely to be legally and socially verifiable as racist, sexist, etc. If we add in the general reluctance of legal and social systems to punish upper class folks relative to lower class folks, we see that the burden of such policies mostly falls on the lower classes.

Could it be that advantaged folks are especially eager to support policies to help the disadvantaged when the cost of such policies are mainly borne by someone else?

(Idea stolen from a conversation with Katja Grace.)

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Offended By Bets

By Robin Hanson · December 13, 2011 12:00 pm · Comments (27)

U.S. presidential candidate Mitt Romney recently offered a $10,000 bet to competing candidate Rick Perry, regarding what Romney said in his book. Pundits say this hurt Romney’s image:

The $10,000 bet … reinforces a narrative already swirling in the political world: that his wealth makes him out of touch with the economic concerns of average folks. …

No matter what the Romney people say, offering a $10,000 bet is, at best, somewhat odd. (You generally either bet someone $1 or $1 million dollars; anywhere in between seems weird and raises eyebrows.) …

“It seems pretty outrageous and out of touch. People around here don’t have that kind of money.” … Critics attacked Romney — a multimillionaire venture capitalist — for tossing out the $10,000 figure like Monopoly money. … “When I talk to my neighbor and want to make a bet, it’s 10 bucks.” (more; HT Maxim Lott)

The idea that a presidential candidate couldn’t afford a $10,000 bet is crazy, as is the idea that ordinary folks don’t know this fact. Candidates pay for TV commercials, which cost lots more than $10,000, and they fly all around the nation in planes, which gets expensive.

So clearly we have moved high up into belief meta-levels here. “Yes, most people know Romney can afford $10,000, but some aren’t sure that most others know this, and so this shows that Romney doesn’t know about such folks.” Or “It is rude to point out that you are rich, even when everyone knows you are rich. Yes wearing nice suits shows he’s rich, but not wearing suits is socially unacceptable. Offering smaller bets is acceptable, however, so offering a big bet could be interpreted as bragging about wealth. Not that I’d interpret it that way, but someone might, and this shows Romney doesn’t realize that.”

Geez it must be a pain to be a presidential candidate. This all shows how much we care about social savvy and signaling in such folks. We don’t much care if they understand supply and demand, but they damn well better know who might try hard to be offended by what.

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City By Combo Auction

By Robin Hanson · November 30, 2011 9:00 pm · Comments (12)

I recently heard talks by Ryan Avent, author of “The Gated City”; and Matt Yglesias, author of “The Rent Is Too Damn High.” Both agreed that the inefficiency of urban land use has increased greatly in the last few decades, at least in the biggest US cities like New York. Most of the infrastructure that makes such cities great was made during the era of political machines, when a dominant party had great power to coordinate activities city wide.

We dismantled political machines out of revulsion for unchecked power. But now our cities fail to coordinate. Local zoning boards may often coordination to benefit local interests, but they also often fail to coordinate with distant boards to achieve city-wide gains. For example, when each area limits density to keep out poor folks, such as via lot size and height rules, the city fails to provide a place for needed poor workers. How can cities better coordinate, without the vast corruptible discretion of political machines?

Imagine for simplicity that we are starting a new city, or at least a new city area, from scratch. Some developers are thinking about building various types of housing, targeted at various types of residents. National chains are considering locating stores and food outlets. Employers and private schools are thinking of locating there as well. The question is: who will build where, and what utilities such as roads, power, water, sewer, internet will be built where to supply this new area?

One solution is to have a single developer initially own the entire area, and negotiate directly with all these parties. Political machines once filled a similar role. Today politicians and boards for zoning and utilities try to fill such roles. But there are other options. Yesterday I explained the concept of a combinatorial auction, using the example of assigning offices when moving to a new office building. Today I’d like to elaborate on how such a mechanism could be used to coordinate urban land use and utilities.

It would look a lot like the scenario I outlined yesterday for allocating offices. Just on a bigger scale. Each party would submit bids describing their willingness to pay for various combinations of land features. Bids could specify:

  1. Land area, soil type, topography.
  2. Views (or not) of mountains, ocean, factories, etc.
  3. Distance (meters or road time) from residents, shopping, jobs, schools, parks.
  4. Local limits on ambient sound, smells, light, etc.
  5. Limits on nearby resident demographics, and the “class” of shops.
  6. Limits you are willing to supply for own sound, smell, demographics, class.
  7. Utility services (e.g., power, water, internet, trash) required, at what prices.

A computer could then search for a max value set of mutually compatible bids. The winning assignment might specify:

  1. Which parties get what land for which uses.
  2. Local limits on building heights and appearances.
  3. What land is used for utilities such as roads, power generation, etc.
  4. What utility capacity is supplied at each place, and related price limits.
  5. Local policies limiting local behavior making sound, smell, light, etc.

Revenue from winning bids could help pay for city services. The cost of utility services could be included either via a cost model, or via bids from competing service suppliers. Adjustments might be made for an expected underbidding for shared resources. Bidding assistants and iterative bidding might keep bid elaboration efforts manageable. Calculation of max value bid sets might even be farmed out to competing calculators (who keep bids secret).

Now of course real cities are not usually built all at once, so we’d need to adapt the above process to incremental city change. Bids for each new time period could request options for similar future use at the same price, and specify a compensation due if that option is revoked. Futures markets estimating future winning bids might help determine the opportunity cost of awarding such commitments.

Yes there might still be opportunities for corruption and favoritism in this system, such as by leaking secret bids, and biasing the auction rules. But this still seems far less corruptible than today’s system. And we might use futarchy to take away even more opportunities for corruption.

Yes, it would be very hard to get agreement to change to this system from today’s system of property rights and regulatory restrictions. I despair of it happening in our comfortable and change-averse cities. So we might have to wait until a big disruption creates lots of other change. More about that tomorrow.

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The Protection Exception

By Robin Hanson · November 29, 2011 3:50 pm · Comments (55)

We have many regulations, justified in many ways. One common type of regulation prevents people from making and enforcing certain voluntary agreements, and one common justification for such regulation is that we protect people from hurting themselves via such agreements. For example:

Chief Justice Robert Bauman ruled in favour of the section of the [Canadian] Criminal Code outlawing polygamous unions. … Bauman said while the law does infringe on religious freedom, it is justified given the harm polygamy causes to children, women and society. (more)

However, almost every such protection comes with one huge loophole, big enough to drive many a truck through: we let people emigrate to other countries. For example, we protect you and your kids from the harms of voluntary polygamy agreements, except that you and your kids may move to a nation that allows polygamy. The same applies to pretty much any other regulatory protection we offer, such as protections against buying unsafe products, hiring unlicensed professionals, paying for sex, or selling yourself into slavery. You are allowed to do any of these things as long as you first move to another nation that allows it.

This raises an obvious question: why do we allow this huge hole in the “protections” we maintain? It would seem to me more consistent to either:

  1. Prevent people from moving to nations that do not preserve the protections we think important, or
  2. Let locals make voluntary agreements that violate our basic protections, as long they plausibly demonstrate that they are so committed to such arrangements that they’d consider leaving the nation to get them.

Its seems pointless to consistently let people leave the nation to evade our “protections,” since after they leave, they aren’t protected. What gives?

Added 11p: Some responses to comments: Continue reading "The Protection Exception" »

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