Monthly Archives: March 2011

Play Talk Still Tells

Many animals have a concept of “play.” At times and places where they feel safe, friendly associates practice important motions, like chasing or fighting, but try to avoid any big effects – they retract their claws, pull their punches, etc. Play is an important way for young animals to learn how to act like old ones. Humans retain youthful styles longer into life, and so we play all through life.

Humans also developed language, which enabled stronger social rules about forbidden behaviors. For example, not only are you not supposed to kill associates, you are supposed to punish those who do kill, and those who refuse to punish killers, etc. Language let humans tell others about rule violations, to recruit a wider circle of enforcers than just direct witnesses.

Humans also tend to have rules about what you shouldn’t say. For example, foragers not only forbid domination, at least between families, they also forbid talk that supports domination. So foragers are typically not supposed to brag, threaten, or give orders. The more ancient concept of play, however, let humans evade such rules on forbidden talk. Let me explain.

Just as there is play chasing, play fighting, or even play mating, there is also play talk. Like other kinds of play, play talk only makes sense among friendly associates, when they are in a relaxed and unthreatened mood. Play talk should take the general forms of regular talk, but with claws retracted, punches pulled, etc., and everyone acting relaxed and unthreatened. Play talk should not be directly on serious topics with large important consequences, where people get stressed or angry.

With a little indirection, however, even play talk can communicate on serious important topics. For example, while social rules might forbid directly propositioning others for sex, people often communicate an interest in sex by joking about it in the right way. As long as there are other plausible interpretations of their words and actions, it can be hard for others to accuse them of violating the social rules.

It is easier to use play talk to evade talk rules if groups develop a very local culture and language – particular words and associations that have particular meanings due to the local history. This makes it harder to clearly convince outsiders that something illicit was communicated. It can also be easier to use this trick at the expense of folks who are eager to show their loyalty to the local group – publicly accusing another group member of violating talk rules ends the play mode and risks seeming less friendly to the group, especially if the local group isn’t very vested in that particular rule. Finally, it is easier for smarter people to talk indirectly so that they understand each other, but outsiders do not (achieve common knowledge that they) understand.

Humans thus developed sophisticated capacities for using play talk to indirectly communicate on serious topics. We became very adept at and fond of playfully talking on two levels at once, especially when the more hidden level talks about or embodies rule violations. We are so fond of this sort of activity and ability, in fact, that we often consider a surplus of it the main reason we like or love someone, and a deficit of it almost a definition of being inhuman. And such rule-evading abilities were so important that we developed ginormous brains to support them.

I am talking of course about humor, and sense of humor. We cherish our friends and lovers for making us laugh, and we think inhuman robots and despots couldn’t have a good sense of humor. We not only playfully talk illicitly via humor, we also play at humor, practicing this general capacity through endless variations of stories where a hidden often-rule-violating meaning is just barely revealed to wise listeners. Homo hypocritus hones humor. This is who we are.

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Why Track Trends?

I just read my first book via phone, Tyler’s The Great Stagnation. Turned out to be a surprisingly pleasant way to read, especially while traveling.

Tyler’s thesis is that the US has slower growth than decades ago because we’ve used up the low hanging fruits of easy industry-era innovations, mass education, and cutting discrimination. The mismatch between growth expectations and realities is behind our financial and deficit crises. As solutions he suggests we lower our expectations and raise the social status of scientists.

My grad school (Caltech) didn’t teach macro, and I never took undergrad econ, so I’ve tried to avoid pontificating on macro topics. Tyler’s growth slowdown story sounds plausible, but others disagree, so I’ll stay agnostic for now.

But what I can speak to is how little such trend analysis or projection matters, at least for most economic policy. The complexities of the world often make it hard to say with great confidence which policies will increase economic welfare. Even so, given our usual way of doing economic analysis, the  question of which institutions will most increase economic welfare rarely depends much on the exact values of the sorts of parameters social scientists and the media track with such enthusiasm and concern.

Yes, knowing your budget can help you decide how much to spend, and so yes firms and governments should attend to clues about their future revenue. But in a good economic institution, it will be some folks’ job to attend to such clues and signal their conclusions to others, so that important actions can depend on such things. We economists should mainly worry about arranging the incentives, etc. for that job, and then leave it to them to figure it out the details.

Alas Tyler doesn’t even discuss what are good institutions for this job of dealing with uncertainties in future growth rates. I’d guess that huge political coalitions fighting to the death to maintain their expected government benefit increases is particularly bad at adapting to such uncertainties. With private pensions, medical plans, etc. adaptation would still be painful, but would less threaten our national stability.

Tyler also gets it wrong by suggesting we raise the status of scientists. It is engineers and business innovators more generally, whose status needs a boost. Scientists already claim too much credit for social innovation – they have little to do with most of it. Tyler also doesn’t mention over-regulation, a huge barrier to innovation. Consider this recent quote on flying cars:

The company has cleared the biggest hurdle: building a safe flying, driving and converting vehicle. But there are other obstacles ahead. Foremost, the vehicle needs regulatory clearance from an alphabet soup of agencies, including the FAA and the National Highway Traffic Safety Administration. The company says it is working closely with regulators to ensure that the aircraft meets all standards. It has won important exemptions to certain road and air rules.

But any “no” from any regulator — for being a pound overweight, or having a bumper an inch too short, or failing to have adequate airbags, or a thousand other issues — means at best delays and at worst a failed project. Weight, especially, has proven problematic for the company, Dietrich says — in part because a heavy car is a safe car, but a light plane is a safe plane, two engineering truths that are hard to square. (more)

As Bryan wisely notes, people attend too much to recent news and trends, and too little to fundamental, at least for the purpose of gaining useful insights.

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Hail Aggressive Drivers

On the surface, driving seems like a competitive activity. Yes drivers cooperate to avoid accidents, but aside from that other cars mainly seem to be in your way – if they take a road space you wanted, it will take you longer to get where you wanted.

But appearances can be deceiving. I’m a relatively aggressive driver, i.e., eager to get places fast, and overall it seems to me that other aggressive drivers are more my allies on the road than my rivals. My main opponents are slow pokes – being stuck behind them slows me way down.

So when I choose lanes I’m mainly looking to avoid lanes with slow drivers. I avoid trucks and most anything weird – those have more chance to be extra slow. Yes I might feel a bit rivalrous seeing an aggressive driver jump before me to grab a choice spot. But mostly I’m relieved to find a good person to get behind – they are unlikely to slow me down, and they tend to choose faster lanes.

This seems a decent metaphor for the rest of life. Yes when you associate with competitive aggressive folks you may have to keep on your toes more, and expect them to sometimes grab stuff you want. But overall associating with them will help you to move fast – they will tend to go places, and take you with them.

Added 9a: Folks, I’m not talking about going much faster than traffic, I’m talking about avoiding cars going much slower:

The risk of having a crash is increased both for vehicles traveling slower than the average speed, and for those traveling above the average speed. (more)

There are now 1.13 fatalities per 100 million miles driven.  At 30 miles per hour, this means a fatality every 337 years of constant driving. So if driving 1% faster gave you a 1% greater risk of death, for most folks that would be a good deal time trade.  Anyone know what the actual speed-death elasticity is?

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Boston Talk Monday

Tomorrow (Monday) I’ll talk on “Are We Homo Hypocritus?” at a Bentley University economics seminar, in Lindsey, room 28, at 2:10pm.

Added Wed: Slides here.

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Recipe: Men Exploit Fems

There are many movies and documentaries about female prostitutes. While some focus on women forced into prostitution against their will, most of the rest vaguely imply that the female prostitutes are exploited by their male customers. The message seems to be “Don’t they see that the money they gain is just not worth their loss of intimacy, self-respect, etc.?”

The ’06 documentary The Great Happiness Space (reviewed here) offers an interesting contrast. It shows the world of a certain kind of male prostitute in Japan. And it vaguely implies that male prostitutes exploit their female customers. The message seems to be “Don’t they see how much money they lose for just an illusion of intimacy, respect, etc.?” Even though many of the female customers shown are themselves prostitutes, we are expected to see them as victims.

Of course the two prostitution practices differ somewhat, according to male vs. female fantasies. Men tend more to seek simple no-strings sex and polygamy, while women more seek emotional stroking and hypergamy. But it is striking that any for-pay male-female relation portrays men as exploiters and women as victims, no matter who pays whom.

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War Is Bad

War is bad. Defending against war, that can be justified. But starting a war, well that is presumably very bad. Not that starting a war could never be justified. Just that the bar should be set really high. Not it sort of seems like war might help something. No, you, and those watching you, should really worry that you are accepting excuses to start a war for other reasons.

Among all the policy arguments I accept, the above argument against war seems among the most solid. And among all the things policy can get wrong, war seems among the worst. So for me, war policy tends to trump other considerations. I haven’t said much about how I vote on this blog, but now I’ll say: I often vote on US presidents primarily based on their war stance. I voted against Bush in ’04, and I’ll vote against Obama in ’12, because they both started wars without meeting the high standards I hold for justifiably starting a war.

I’ve argued before that the US should cut its vast military spending in half. Our spending half the world’s military budget seems to embolden us to start wars – this makes me all the more eager for that cut.

Added:  Bryan Caplan has long had a similar position.

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Missing Coordination

The main justification offered for government is coordination – that governments help us to coordinate. Yes, many suspect that governments exist primarily to perpetuate and enrich themselves and their controllers at the expense of others. But defenders counter that governments are uniquely able to produce net benefits via coordination, and have historically often realized this potential.

This dispute can be illuminated by considering missing coordinations: the many possible coordinations that seemingly offer large gains, yet receive little government attention:

  • Zoning – There are often high gains to coordinating how neighboring lands are used. Cities use this to justify zoning regulations, but these regulations often inefficiently push growth and the poor away to other regions. Larger scale governments could coordinate to discourage such inefficiencies, but they rarely do.
  • Language – Since it is much easier to interact and trade with folks who speak the same language, there are huge gains to coordinating to speak the same language. National governments once devoted large efforts to internal coordination, but there is little effort to coordinate languages across nations.
  • Innovation – Since innovators personally gain only a small fraction of the social returns to their innovation, the world could gain from subsidizing innovation. Many nations and subunits invoke this rationale and pay directly for research. But there is little effort to coordinate research spending or innovation subsidies on larger scales.
  • Migration Huge gains are possible via moving willing labor from places where wages are low to where wages are high. The attempts to realize these games across nations seem remarkably weak compared to the possible gains.
  • Move South – The locations of our major cities once made sense in terms of major transportation routes and nearby resources, but those reasons are far weaker today. Since air conditioning has made southern climes much more attractive, northern city residents could benefit by coordinating to all move south together. This isn’t done.
  • Genre Sharing – The more folks who like a genre of music, the more examples of that genre they can each enjoy. This suggests coordination gains from acclimating folks to like the same few genres of music. Similar gains seem possible whenever there are divergent genres, and tastes can be influenced by what folks are exposed to. Yet governments rarely attempt such coordination.
  • Future Creatures – Familiar interest rates say we can give huge gains to distant future folks, if only there were things they could do for us. Yet we fail to enforce most terms in wills, and won’t let parents charge kids for creating them.
  • Aliens – By allowing anyone who wants to send signals to aliens, we risk hostile aliens destroying us all. Yet even though the cost to discourage such signals seems trivial, we show little interest in doing so. We also show little interest in coordinating to prevent asteroid strikes.

Now we might not always expect to see successful coordination in these areas.  But we might at least expect to see many attempts at such coordination. If governments exist to coordinate, why do they show so little interest in attempting to realize such gains?

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What The Eyes Say

Compared to other primates, human muscles are rather weak. In hand to hand combat with a chimp, humans don’t stand a chance. It seems that because we are so good at using tools, we could avoid paying for expensive muscles. Similarly, compared to other animals, language lets humans talk more precisely, and talk about things not in our immediate view. So you might expect we’d get worse at non-language communication. You’d be wrong:

Humans are known to have the largest and most visible sclera – the “whites” of the eyes – of any species. This fact intrigues scientists, because it would seem actually to be a considerable hindrance: imagine, for example, the classic war movie scene where the soldier dresses in camouflage and smears his face with green and brown pigment – but can do nothing about this conspicuously white sclera, beaming bright against the jungle. There must be some reasons humans developed it, despite its obvious costs. In fact, the advantage of visible sclera – so goes the “cooperative eye hypothesis” – is precisely that it enables humans to see clearly, and from a distance, which direction other humans are looking. … Chimpanzees, gorillas, and bonobos – our nearest cousins – follow the direction of each other’s heads, whereas human infants follow the direction of each other’s eyes. (The Most Human Human, p. 39).

Note that most of what we learn via looking at each other’s eyes is hard to verifiably say via language. You might feel he is laughing at you with his eyes, but it will be hard to make that laugh the basis of a group response – others probably didn’t see his eyes at the right moment, or might interpret what they saw differently.

Language was a big innovation, but my homo hypocrites hypothesis is that we humans are now actually post-language in important ways. Language let us express and enforce social norms, but we’ve since developed powerful capacities to coordinate outside the scope of language, to evade those norms. The whites of our eyes seem a key part of that norm-evading capacity.

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Solar Savior

Averaged over 30 years, the trend is for an annual 7 percent reduction in the dollars per watt of solar photovoltaic cells. … In the lab, researchers have achieved solar efficiencies of as high as 41 percent, an unheard of efficiency 30 years ago. Inexpensive thin-film methods have achieved laboratory efficiencies as high as 20 percent, still twice as high as most of the solar systems in deployment today. … Historically, the cost of PV modules (what we’ve been using above) is about half the total installed cost of systems. The rest of the cost is installation. Fortunately, installation costs have also dropped at a similar pace to module costs. …

The cost of solar, in the average location in the U.S., will cross the current average retail electricity price of 12 cents per kilowatt hour in around 2020, or 9 years from now. In fact, given that retail electricity prices are currently rising by a few percent per year, prices will probably cross earlier, around 2018 for the country as a whole, and as early as 2015 for the sunniest parts of America. 10 years later, in 2030, solar electricity is likely to cost half what coal electricity does today. (more)

This should be fantastic news for folks worried about carbon emissions or running out of oil. After all, projecting that a thirty year trend will continue for another ten years seems pretty safe. This isn’t some mere speculation. Why don’t we hear more about this?  Do people not like hearing good news about the future?

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Are Dictators The Future?

How many governments around the world would use force to try to put down a rebellion? Pretty much all of them. So why does “my” country say it is invading Libya, which is using force to put down a rebellion? Mainly because Libya is not a democracy:

Threatening the use of force against a brutal tyrant, in the name of democracy and human rights, to advance US national security interests and cloaking it in the flag of the United Nations and regional stability—it does sound familiar. (more)

This campaign against non-democracies also fuels the hyperbolic hate and fear of China. How, how, people cry, could a non-democracy out-grow most democracies, when everyone knows that democracy is the future and non-democracies are failed hold-outs of the past?

Actually, non-democracies seem more our future than democracies, because while the two groups have the same average economic growth rates, non-democracy rates vary more, and high rates dominate. Let me explain.

First, democracies tend to play it safe – avoiding risks that lead to both really stupid bad outcomes and really great spectacular outcomes. (See this post by Bryan Caplan.) So, as most folks know, the worst basket-case nations tend to be non-democracies. However, it is less well known that the fastest growing nations, like Ethiopia or Qatar, also tend to be non-democracies.

In the short run, the democratic play-it-safe approach is good for citizens, who tend to be risk-averse. But in the long run, democracy’s descendants fall behind. Whenever you have a portfolio of items with different (log) growth rates, your portfolio’s long run average return is dominated by the portfolio items with the highest average rates. The few items that tend to grow the fastest eventually overwhelm all the rest, even if in the short run their growth rates are all over the map.

So in the long run, the world’s wealth should end up being dominated by the types of nations with the highest average stable growth rates. Even if those nations start out small, or have large year-to-year growth rate variations. And the nations with the highest stable growth rates over relatively long time periods tend to be non-democracies. This suggests that non-democracies will eventually dominate world wealth.

Of course if non-democracies tended to naturally transition into democracies when they got rich, and almost never switched back, then even if most wealth was made within non-democracies, most nations could end up as democracies. This democracy-as-attractor vision seems to be the main hope of democracy fans, and over the last two centuries we have indeed seen lots of movement toward democracy, and much less movement away. This drift to democracy can also be understood as a natural result of farmers who feel more like foragers as they get rich, since forager governance tended to be more democratic.

But this recent drift to democracy need not reflect a fundamental long term law. It might, for example, just be fashion – since the first rich nations chose democracy, maybe other nations wanted to look similar in order to appear high status. So now if non-democracies like China become the richest nations, maybe other nations will try to emulate them instead.

Also, the trend toward higher per-capita wealth may well reverse if, as I anticipate, we get dramatic new techs that can quickly create many human substitutes. This could take the steam out of a rich-folks-feeling-like-foragers push for democracy. Also, high payoffs for reacting quickly in a transition era may also favor a high tail of flexibility, also probably dominated by non-democracies.

So how would futarchy do by this measure? Yes a futarchy might grow faster than a simple democracy or a simple autocracy. But if low democratic growth variance is mainly due to voters wanting to avoid risk, then vote-on-values-bet-on-belief systems would still tend to fall behind king-sets-values-bet-on-belief systems. And in fact, autocrats are probably more likely to take a chance and try a bet-on-belief system.

Futarchy can’t save risk-averse voters from themselves, if they don’t want to be saved. While humans today don’t care much about the future, random human and institutional variation will make some places care more than others. The future will be owned by the high tail of that distribution of caring, which favors any factors that increase caring variance. Non-democracy is one such factor.

Added 9p: The paper Bryan cited clearly shows that democracies have less than half of the (residual) growth variance of non-democracies even after controlling for these factors: GDP per capita, black market premium, terms of trade shock, investment, fertility, life expectancy, govt consumption, govt school investment, male schooling, female schooling, OECD dummy, democracy, democracy squared. This result is not being driven by democracies being closer to the feasible frontier!

Added 8a: The ratio of dictator lifespans to economic doubling times should continue to rise, increasing the timescale over which dictator growth rates correlate.

Added 30Mar: Easterly notes that this might just be because dictators have bad growth statistics.

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