Thursday, April 30, 2009

Barry Eichengreen

Barry Eichengreen (who thinks I'm in the worst class ever of Berkeley grad students) has written a fantastic essay on the culture of economics research and the cultural origins of the financial crisis. I've noticed lately that most of the questions from non-economists that I get upon their finding out my field of study have switched from "so what's up with the economy?" do "so how is your profession going to change so it stops getting us into these messes?" to which I reply* as nicely as possible about how the culture of economics research has evolved from qualitative, un-micro-founded guidelines to an orgy of hard theory for the last few decades to a new renaissance of empirical and behavioral work. This essay makes similar (and many other points) and so should be read widely even among non-economists. It's very interesting.

*All the while thinking this question is almost as silly as asking physicists how they got us into this mess when the sun begins to shed its outer atmospheric layers and we fry.

Wednesday, April 29, 2009

marketing environmentalism

It's been years since I watched nature and science documentaries like Nova, but my ecologist friend has gotten me hooked on BBC's "Planet Earth" 11 part series. I've never seen such amazing nature footage in my life; I suspect they took the best shots of every nature video ever produced and condensed them into a few episodes. The first few are available on youtube; the rest can be tracked down elsewhere on the web or I can give you a copy.

In any case, this got me thinking about the marketing aspect of environmentalism. I, and most other humans, am hardwired to respond with the "omg look how cute" instinct at the clumsy wide-eyed leopard cubs. And hardwired to shudder at buckets of writhing eels. It's no wonder so many resources and so much publicity is devoted to the plight of large furry mammals, and none to kelp, even if many un-cuddly species are vastly more crucial links in the food chain than panda bears.

The dilemma is, how do we harness these emotions in favor of the goodwill of nature, without making things worse via insidious unintended consequences? I think clearly the instinct should be used to garner interest more than donations: baby polar bears get people interested in seal populations which get people interested in the breakup of the ice caps, and now you have relatively more educated activists calling for climate change legislation rather than an expedition of scientists to rescue a few specimens and breed them in captivity. And if you don't want to wait for smarter people to come around, just use the large mammals as poster children for fundamental conservation efforts, not as direct objects of focus.

As Lawrence Lessig says "Never underestimate the power of naivete in launching critical political reform." I love his enthusiasm and agree in principle but the case of environmentalism demonstrates just how incredibly careful you have to be with unintended consequences when naivete is the foundation of your movement.

Friday, April 24, 2009


First of all, congratulations to Emmanuel Saez, of UC Berkeley, on winning this year's John Bates Clark medal for best Economist under the age of 40. That is the highest honor in the field except for the Nobel Prize (and the two are highly correlated.)

Judging by the sudden increase in people I know who use Twitter, and the sudden increase in news commentary about Twitter, and Facebook's redesign to mimic Twitter, this movement of white noise, brevity and a high percentage of banality, has reached some kind of cultural tipping point. I feel compelled to protest, however futilely.

Don't get me wrong, I do enjoy Twitter myself. I am naturally quite solitary, and Twitter provides at least an illusion that I'm still in touch with the world. I also compulsively write things down. I have this public nonpersonal blog, another personal blog, and twitter for inane one-liners that don't fit either place. These two aspects are important enough to me that I will certainly not abandon Twitter any time soon.

But as a cultural movement, I fear this is the next thing catering to the intellectual lowest common denominator. The fact that serious news and analysis is trying to adapt to the 140 character format is downright disturbing. There is no room for anything but a headline, no discussion, no elaboration, no nuance, and not even aesthetically pleasing wording. It's too easy to produce and too easy to consume. Call me old-fashioned, but I think things worth doing generally require effort.

All of the recent praise for Twitter reeks of mendacity. The best argument they can come up with is that Twitter encourages brevity. There's certainly nothing wrong with brevity, but there's an enormous difference between writing headlines and writing a story complete with every interesting, challenging nuance with appropriately concise language. People who like their information in bite-sized pieces are trying to elevate a ridiculous fad in moral status, and they aren't doing it very convincingly. The other argument is in favor of so-called "ambient awareness". I already admitted to enjoying this aspect, but I also have no delusions that this is more than an entertaining illusory semi-addicting way to simulate true human connection. Neither television characters nor twitter followers are substitutes for deep friendships. Everyone knows this, but ease and novelty pulls a welcomed veil over the truth.

So can we please admit that while Twitter is indeed useful for quick contact, feedback, staying somewhat in touch with people you wouldn't otherwise often see, and maybe even following unfolding news, it is not the future of high-quality journalism?

Wednesday, April 22, 2009

wal-mart and starbucks

I love Wal-mart, and hate coffee. I guess I should move back to Oklahoma. Certainly not stick around California. The nearest 24-hour Supercenter to me is 31 miles away.

But seriously, the study that this is based on is fairly interesting. Market share in the area around where a business originally opened is persistently higher for many years. Of course, Starbucks and Wal-mart aren't the best examples, I would imagine: poor people disproportionately like Wal-mart, and live disproportionately in the middle of the country. Rich people love expensive coffee, and live on the coasts. But the phenomenon holds for things like Heinz ketchup and Miller beer as well.

Not exactly surprising, however. Of course higher familiarity leads to higher market share, and businesses try to start up where they are most desired.

Sunday, April 19, 2009

risky globalization

Two conflicting ideas hold independent great appeal to me. Division of labor and general exploitation of comparative advantages leads to huge gains from trade for all parties in an unequivocally utilitarian outcome that is hard to argue with (ignoring short term transitional pains.) But self-sufficiency, small local independent units of society/government/economy, appeals to my deeply ingrained and vehemently held modus operandi of "watch your own back and don't ever put yourself in a situation of dependence". Seeing as how that attitude causes me to make certain other decisions that most economists would find insane (I will never put my life savings in anything riskier than a savings account. I don't believe in free money, even from US government bonds.) I have tended to suppress the latter idea when forming opinions about such things as free trade, "buy local" movements, protectionism, government subsidies, etc.

But there's a legitimate point that can unify these lines of argument and leads me to be more sympathetic towards local-economy movements, no matter how misguided the actual propaganda is (Save the environment! Buy local produce, which happened to be produced with massive government agricultural and water subsidies which are indirectly destroying the environment in the rest of the country!) International division of labor is like putting your eggs all in one basket, or picking up nickels in front of a steamroller, as goes one of my favorite financial metaphors. If all the wheat comes from Russia, one bad season or one crazy political move screws over the rest of the world. Gains from trade (nickels) don't seem so important when a housing bubble bursting in one country sends the entire world into depression (steamroller).

It's the same reason government should be localized whenever possible. A disastrous educational policy, or healthcare policy, or free speech infringement, or whatever, is pretty terrible when it occurs in one county, and a natural impulse is to govern nationally so as to prevent localized tyranny. I admit myself I'd love to see a national constitutional amendment defining marriage without regard to gender. But national governments are also prone to tyranny, and when that happens, it's a lot harder to move to Canada than it is to move from Manhattan to Jersey City.

This almost feels too obvious to bother writing down. But I think it's worth pointing out that gains from trade in situations with comparative advantage, in the real world, are only probabilistic outcomes. Risk and reward should be weighed.

Friday, April 17, 2009


Memories of My Melancholy Whores, by Gabriel Garcia Marquez: I loved this book, in every possible way. It's really that simple. But I'll elaborate anyway, since I think very few people would say the same thing. It is a story of a 90 year old man who awakes on his birthday and decides to hire a 14 year old virgin prostitute. Simply watching her sleep for the next year, he falls in love. You can tell what the common objection or source of uneasiness is with this book. But that's just not the point. John Updike put it best in describing the book as a "love letter to the dying light." Marquez is a magician; he transforms a taboo subject and bluntly graphic description into a whole that feels only sweet and pure and leaves you with a sense of complete contentment and fulfillment when you turn the last page.

I also loved One Hundred Years of Solitude, but this book is crucially different in a few ways. There is less of the blatantly mystical (no flying carpets.) And there isn't a stretch of 50 years of war and depression and violence that made the middle third of 100 Years one of the more depressing books I've read. Memories is solely a love story, and those were the best sub-plots in 100 Years as well.

Desert Solitaire, by Edward Abbey. I had a lucky spring break bookwise. First Marquez and then another of the best books I've ever read. This book was a eulogy of the southern Utah desert country (also just about my favorite part of the country, although I haven't had the chance to explore it a millionth as thoroughly as Abbey. And never will, of course, in the same undeveloped state.) The only thing that could have made this book better was a fault that the author himself admits (unapologetically) - fewer laundry lists and more philosophical unification would have been desirable. Any nature lover should definitely read this book.

Nudge, by Richard Thaler and Cass Sunstein. First I'll be brutally honest and then attempt objectivity once its out of my system. Steven Levitt's high praise of this book got my hopes up, and I was completely disappointed. This was one of the most boring, dry, unrevelatory, badly organized, and unnecessarily long-winded books I've ever read. Very little is more soporific than reading about details of 401Ks, mortgage contracts, health insurance contracts, personal finance, asset backed security contracts, etc, and discussing ad nauseum all of these avenues of financial tedium in the light of one or two nice new ideas from behavioral economics does not make it any more interesting.

Then there's the theme of "libertarian paternalism", the new catch-phrase the authors are trying to sell throughout the book, which makes my blood curdle every time I read it. First of all, both of those words are incredibly loaded with connotation and should be avoided at all costs if you want to sell a new idea on its own merits without the wolves immediately ignoring you and going off on a rant about their pre-conceived notions and jumped-to conclusions. Second of all, casting the whole book in this light is cheap pandering to the masses who crave political interpretation of every economic idea. The applications of the idea are blindingly obvious; they should not be the main theme of the book.

Then there's the lack of organization. Let me publicly plead with all pop-science authors to please follow the example of Preston McAfee in his book Competitive Solutions: The Strategist's Toolkit: Start or end each chapter with a brief outline of the ideas covered (in actual outline format, not a summary paragraph). And organize your book by idea, not by example! After going through one exhaustive example that demonstrates all of the points you make in the book, I have no interest in reading 10 more chapters of the same.

Ok, I'm calm now. And can say that, while the ideas in the book are bone-headedly obvious to me, they fall in the category of things that are most critically subject to the curse of knowledge (once you know something, it's hard to remember what it's like not to.) As a social scientist, and specifically as a behavioral economist, I've already been exposed to most of the ideas in the book, and thus yawned most of the way through it. But I'm sure it would be very interesting, if not profoundly revelatory, for those who haven't.

Monday, April 13, 2009

aggravating blogs

I read, start reading, and abandon reading, a fair number of blogs. The turnover is due sometimes to a set of qualities (other than content, obviously) that has become somewhat predictable.
  1. Over prolificacy: I'd rather read two great posts a week than 20 two-sentence tidbits a day. I only lasted about two weeks with Lifehacker, despite the extreme usefulness of many of their posts. ESPN's NFL news feed is the same way, but I put up with it because just glancing at the headlines is enough to stay up to date. MarginalRevolution and Freakonomics are really pushing the boundary, but have enough must-see posts to get away with it.
  2. Too many links, not enough substance: If I wanted to read every blog, I would. If you're going to re-post lots of other blog posts, they had better be excellent. A combination of this, #1, and the anonymity of posts is why I finally gave up on FreeExchange. MarginalRevolution should be applauded for their rare-enough link posts, sans comment, with a high percentage of legitimately interesting outside material.
  3. Too much personal info / self-congratulation: Cafe Hayek is killed by this, and the Austrian Economists isn't great either. Greg Mankiw can be pretty bad too but at least he's more intentional/overt about it and labels the textbook ads as ads. Pharyngula is so cynical and hilarious that he gets away with it. Note: unnecessary self-immolation is just as bad as unnecessary self-congratulation.
  4. Too much repetition: I'm almost getting tired of hearing about kidney exchange on Market Design. And after eight years or so I definitely have Slate fatigue, but occasionally a brilliant article makes up for the tedium. One week of Zen Habits was enough to learn every lesson they've ever tried to teach on there.
  5. Aesthetics and style: For some reason I cannot get over the large font size of the Austrian Economists feed. It just screams "a child wrote this in block letters", no matter how interesting the post is. I can't read Paul Krugman for his unbelievably disdainful writing style. Brad DeLong fails on counts 1, 3, 4, AND 5. I haven't read Robert Reich for very long, but I suspect the grandiosity and so-slightly disdainful tone will get to me soon, as great as he is at speaking. (But I'm trying to push through for the sake of subscribing to more stereotypically liberal economists...)
But here's where I'm confused. Many of these blogs (Krugman, Delong, Zen Habits, Free Exchange, Lifehacker) are immensely popular. A few, like Marginal Revolution and Freakonomics, are very popular and also don't seriously have these problems. Some, with none of the above problems, are not widely read at all except by those with a serious interest in the subject (Willem Buiter, Scott Sumner.) Is it just me? And why, when there is free entry and zero cost (except time) to blogging, aren't there better substitutes for things like ESPN, Lifehacker, and Slate?

Sunday, April 12, 2009

"Well I'm not sure that God is Kim Jong-Il but..."

Happy Easter! I will be celebrating by going to Thai Buddhist picnic in the park (a true celebration of new life) and probably making deviled eggs. And playing a youtube recording of the Widor Toccata since actually tracking down a church that will have it in Berkeley seems to be much more difficult than it was in New York City. And neither of the Unitarian churches have pipe organs or acknowledge that it's Easter in the first place. And my mom plays it better anyway.

And, re-playing this and re-laughing my butt off, and ordering this guy's book:

Wednesday, April 8, 2009

take responsibility

This sentence well sums up my queasiness with respect to heart-bleeding paternalism (you can replace "feminists" with "people"): "The current love affair with understanding stops feminists from calling victims on taking responsibility for their own well-being."

From this slate article asking why women stay in abusive relationships.

Maybe it's possible to empathize with self-destructiveness, to make excuses for self-defeatingness, to blame your mental makeup (which is, after all, the fault of the environment you grew up in, not yourself) as the amorphous impediment to your success. I feel for you, really. But readily accepting these explanations is a guarantee you won't get where you're trying to go, and a society that readily accepts these explanations is doomed to a stasis of naval-gazing ineffectiveness.

Tuesday, April 7, 2009


Maps make me giddy. So you can imagine my reaction to The Map Scroll.

In particular, a map of the future of gay marriage in the US, from the creater of,

and a map of environmentally sensitive areas of the American West (requires Google Earth, which I don't currently have installed, but it looks really fascinating...)