Thursday, March 15, 2007


At the New York Times, John Tierney follows up on his article about the sources of laughter. This quote from Schopenhauer is some of the most turgid prose I have ever had waylay me.

“The origin of the ludicrous is always the paradoxical, and thus unexpected, subsumption of an object under a concept that is in other respects heterogeneous to it. Accordingly, the phenomenon of laughter always signifies the sudden apprehension of an incongruity between such a concept and the real object thought through it, and hence between what is abstract and what is perceptive.”

Translation: laughter requires surprise. Simply stated, and quite false. Why do we laugh at jokes we have heard before, and at Monty Python episodes which we have already seen?

Ignore the rest of the article- the best part is this joke

A blind man enters a department store, picks up his dog by its tail and begins swinging it over his head. A clerk hurries over and says, “Can I help you, sir?”
“No, thanks,” the man replies, “I’m just looking around.”

John Tierney is a strange man. He did not find the Muffin joke funny, and he does not find this one funny either.

Nothing to see here- Move on

On the day that I leave New York to return to Mumbai, this article by Tim Harford strikes a chord. One reason I so prefer Mumbai to Bangalore is that the latter is so one-dimensional. The local economy stands on one leg- Information Technology. This is not merely boring, but a dangerous strategy for a community.

Even big cities can struggle if they overspecialise. Liverpool and Manchester are examples. Birmingham, on the other hand, has always been a city bustling away making everything and nothing in particular. As the late author Jane Jacobs once pointed out, Birmingham was thought highly inefficient compared with the specialised mills of Manchester, but when the downturn came Manchester was devastated and Birmingham kept on chugging along.

Both Mumbai and New York benefit from having diverse economies- finance, tourism, movies, fashion, television.

When communities are in visible decline, why do people stay on? There are the obvious reasons- emotional attachments to familiar places and beloved people. This would be a perfectly reasonable choice- paying for those emotional benefits in the form of lower wages. Tim argues, however, that the desire to own one's home- rather than rent it- is another major cause of economic stagnation.

The British are a nation of home owners, apparently happy to pay far more for the privilege of owning their own house than they would ever pay to rent one. Other nations, happier to rent, see unemployment reduced as a result.

The economist Andrew Oswald has shown that across European countries, and across US states, high levels of home ownership are correlated with high levels of unemployment. More conventional factors such as generous welfare benefits or high levels of trade unionisation don’t explain unemployment nearly as well as the tendency to own houses.

I am having some trouble reconciling the above with the very next passage in the article.

Recent research in the Economic Journal by Jakob Munch and colleagues suggests that people who own their own homes do find jobs as quickly as those who are free to move, but do so partly by being less picky about which job to take, and by commuting further..

I would expect this to result in lower incomes- not necessarily higher unemployment. Can it be that a third factor- conservatism- explains both the economic decline and the high rates of home ownership in these regions? As the local economy declines, the more venturesome residents leave the area for greener pastures. Those who stay on tend to be more conservative and, as they consider themselves more rooted in the area, they are also more likely to purchase homes. This becomes easier to do because house prices decline along with the local economy. The last paragraph seems to suggest some such process may be in play

Even if we did all this, the US economists Ed Glaeser and Joe Gyourko argue that one serious barrier remains: houses do not walk. No matter how bad things get in Detroit or Treorchy, the houses will still be there, and if they are cheap enough people will want to live in them. The likely result is a gloomy sort of segregation: those who feel that they can find a good job in the big cities will move there and pay the higher rents. Those who are less confident of that would rather have no job in a cheap house than no job in an expensive house. Detroit will have residents for a long time to come.

Keep moving.


Move him into the sun-
Gently its touch awoke him once,
At home, whispering of fields unsown.
Always it awoke him, even in France,
Until this morning and this snow.
If anything might rouse him now
The kind old sun will know.

Think how it wakes the seeds--
Woke, once, the clays of a cold star.
Are limbs so dear-achieved, are sides
Full-nerved,--still warm,--too hard to stir?
Was it for this the clay grew tall?
--O what made fatuous sunbeams toil
To break earth's sleep at all?
Wilfred Owen

Wednesday, March 14, 2007

Just Jokin'

I, for one, found this very funny.

So there are these two muffins baking in an oven. One of them yells, “Wow, it’s hot in here!”
And the other muffin replies: “Holy cow! A talking muffin!”

Yesterday's New York Times had a nice article on humor. It was well worth reading, even with little gems like this

“Primal laughter evolved as a signaling device to highlight readiness for friendly interaction,” Professor Panksepp says. “Sophisticated social animals such as mammals need an emotionally positive mechanism to help create social brains and to weave organisms effectively into the social fabric.”

I happened to wonder about the purpose of laughter a couple of weeks back. I was just about to open the door to the stairwell at work here when someone opened it from the other side, and we almost collided. We instinctively laughed, and I wondered at that.

There was nothing funny about what happened- someone could have got hurt- so why did we laugh? My best guess was that it had something to do with signalling that we both meant no harm- I had not been lurking in wait to pounce on that poor guy. From the article

“Laughter is an honest social signal because it’s hard to fake,” Professor Provine says. “We’re dealing with something powerful, ancient and crude. It’s a kind of behavioral fossil showing the roots that all human beings, maybe all mammals, have in common.”

If I had been lurking in wait to beat that poor man up, I would have found it very hard to laugh convincingly.

And of course, your boss' jokes are always funny.

Which brings us back to the muffin joke. It was inflicted by social psychologists at Florida State University on undergraduate women last year, during interviews for what was ostensibly a study of their spending habits. Some of the women were told the interviewer would be awarding a substantial cash prize to a few of the participants, like a boss deciding which underling deserved a bonus.

The women put in the underling position were a lot more likely to laugh at the muffin joke (and others almost as lame) than were women in the control group. But it wasn’t just because these underlings were trying to manipulate the boss, as was demonstrated in a follow-up experiment.

This time each of the women watched the muffin joke being told on videotape by a person who was ostensibly going to be working with her on a task. There was supposed to be a cash reward afterward to be allocated by a designated boss. In some cases the woman watching was designated the boss; in other cases she was the underling or a co-worker of the person on the videotape.

When the woman watching was the boss, she didn’t laugh much at the muffin joke. But when she was the underling or a co-worker, she laughed much more, even though the joke-teller wasn’t in the room to see her. When you’re low in the status hierarchy, you need all the allies you can find, so apparently you’re primed to chuckle at anything even if it doesn’t do you any immediate good.

Again, it could be that to "get" a joke, you need to be able to empathize with the other person, and we know that being in a position of power diminishes empathy.

HT: Brad DeLong

Tuesday, March 13, 2007

The neighbours are watching

From the essay "Against backsliding", in the book "Strategies of commitment and other essays" by Thomas Schelling:

S.L.A. Marsall in Men against Fire (Magnolia, Mass.: Peter Smith, rpt. 1985) discussed the phenomenon that in all armies in World War II most individual soldiers never fired their rifles- no matter how long a battle lasted, how brave they were, or what targets presented themselves- while weapons that required joint action by two or three soldiers, like feeding a belt of ammunition intop a machine gun or loading and aiming an artillery piece, were regularly fired as intended.

P.S. I later came across this- "What economists should learn from sociology"- and this seemed apt

Sociologists have a deep appreciation of imitation and conformity as a basic feature of human behavior. Economists rarely model this explicitly. If it is so important, as sociologists have shown, then economists are really missing the boat.

Thursday, March 08, 2007

Meet the Family

Jeffrey Hoover of the Illinois Natural History Survey and Scott Robinson of the University of Florida conducted an amazing experiment, which is described in the latest issue of the Economist.

COWBIRDS, like cuckoos, are brood parasites—that is, they lay their eggs in the nests of other birds and leave those others to do the hard work of raising their changeling young. But there is a difference. A cuckoo chick usually pushes the original nestlings out, so that it can monopolise the food brought by its unwitting adoptive parents. Cowbird chicks, by contrast, seem to tolerate their nestmates.

Turns out this is a hostage situation.

The victims of the racket are prothonotary warblers. These birds do not reject cowbird eggs even though they look quite different from their own.

The experiment itself is quite marvellous.

Dr Hoover and Dr Robinson demonstrated what was going on by erecting 182 warbler nestboxes at the top of narrow, greasy poles. (The grease stopped any ground-dwelling predators getting close to the nests.)

The first phase of their study was observational. Over the course of six years, they watched 472 nests in which warblers had laid their eggs. Almost half of these were parasitised by cowbirds. But, parasitised or not, almost all—protected as they were from ground-based predators—successfully produced fledgling warblers.

Then the experiment began. In the following seasons Dr Hoover and Dr Robinson removed cowbird eggs from some of the parasitised nests. At the same time, they reduced the diameter of the entrances to some of the nest boxes, in order to deny admission to cowbirds (which are larger than warblers).

Warblers whose nests were thus protected did well, raising an average of four chicks to maturity in the absence of a cowbird parasite. Nests from which cowbird eggs had been removed, but which lacked protection, did badly. In fact, more than half of them were attacked. The eggs were pecked open and the nests themselves torn to pieces. Nests thus attacked yielded, on average, but a single fledgling, whereas those with a cowbird egg in them yielded three warbler fledglings. Paying protection money in the form of food for the cowbird nestling thus looks a good deal from the warbler's point of view, and explains why cowbirds do not need to disguise their eggs to look like those of prothonotaries.

The cowbirds' dastardly tricks do not stop at this protection racket, either, for a fifth of those warbler nests that had never had cowbird eggs in them also got destroyed. Dr Hoover and Dr Robinson ascribe this behaviour to a strategy they call “farming”. If warblers lose a clutch, they will often produce a second. If a cowbird female fails to lay in a warbler nest in time for her egg to hatch with those of the host, she can reset the clock in her favour by killing the first clutch. Even the Mafia never thought of that one.

Why do people look to the Godfather for the language to use when trying to describe these situations?

The Fog of War

This looks to be a great documentary.
Robin Hanson at Overcoming Bias quotes Robert McNamara

What makes us omniscient? Have we a record of omniscience? We are the strongest nation in the world today. I do not believe that we should ever apply that economic, political, and military power unilaterally. If we had followed that rule in Vietnam, we wouldn't have been there. None of our allies supported us. Not Japan, not Germany, not Britain or France. If we can't persuade nations with comparable values of the merit of our cause, we'd better reexamine our reasoning.

The New York Times review.
In his book "Choice and Consequence", Thomas Schelling quotes a passage from Richard Neustadt's book Presidential Power. The same passage can be read here

IN THE EARLY summer of 1952, before the heat of the campaign, President [Harry] Truman used to contemplate the problems of the general-become-President should [Dwight David] Eisenhower win the forthcoming election. "He'll sit here," Truman would remark (tapping his desk for emphasis), "and he'll say, 'Do this! Do that!' And nothing will happen. Poor Ike-it won't be a bit like the Army. He'll find it very frustrating."

Eisenhower evidently found it so. "In the face of the continuing dissidence and disunity, the President sometimes simply exploded with exasperation," wrote Robert Donovan in comment on the early months of Eisenhower's first term. "What was the use, he demanded to know, of his trying to lead the Republican Party. ..... And this reaction was not limited to early months alone, or to his party only. "The President still feels," an Eisenhower aide remarked to me in 1958, "that when he's decided something, that ought to be the end of it ... and when it bounces back undone or done wrong, he tends to react with shocked surprise."

Given that each individual in a large organization has limited information as to what is going on, and limited cognitive powers, and that even Presidents of the United States have limited powers over their subordinates, who often wish to mislead them as to the actual situation, what is the role of leadership?

Monday, March 05, 2007

Minority Report v0.1

The BPS Research Digest reports

Researchers have shown they can read a person's intentions from the patterns of activity in the front of their brain.

The experiment is quite remarkable

Eight participants decided privately whether to add or subtract two numbers that appeared between 2.7 and 10.8 seconds after they had made their decision. Shortly after that, a response screen appeared, featuring the two possible answers, plus two other numbers, in randomly-arranged positions.

The participants had to press a button corresponding to the number on the response screen that matched the act of subtraction or addition they had previously decided to make (thus revealing what their prior intention had been).

This is a nice touch because

Crucially, because the answers and distractors were arranged randomly on the response screen, the participants could not start preparing the specific button press response they would need to make until the response screen appeared. This helped ensure relevant brain activity reflected the participants' chosen intention rather than motor preparation.

The researchers found patterns of activity in several regions of the prefrontal cortex predicted whether the participants' had chosen to add or subtract. In particular, decoding the spatial distribution of activity in the medial prefrontal cortex was able to predict the participants' intention with 70 per cent accuracy. There was no difference in overall levels of activity between the addition and subtraction decisions.

An important question for future research is whether “the medial prefrontal cortex is generally involved in encoding specific tasks during intentional choices or whether encoding in this region is specific for tasks such as the preparation of addition and subtraction”, the researchers said.

Just deserts

In this post, Chris Dillow links to an older blog entry - a favorite of mine.
The great virtues of a market economy are that it respects individual freedom and fosters dynamism. Too many people who root for the free market, however, believe that markets also consistently reward virtuous behavior, so that people who succeed in a marketplace do so because they are better at spotting what people want, are better at working with other people, and work harder. Free markets probably encourage such behavior, in that being a successful businessman in a sufficiently competititive marketplace requires you to practice the bourgeois virtues. However, Chris quotes Hayek as arguing that this is no argument for Capitalism:

[The function of the price system] is not so much to reward people for what they have done as to tell them what in their own as well as in general interest they ought to do. …To hold out a sufficient incentive for those movements which are required to maintain a market order, it will often be necessary that the return to people’s efforts do not correspond to recognizable merit…In a spontaneous order the question of whether or not someone has done the ‘right’ thing cannot always be a matter of merit.

And many people who worship Hayek as the prophet of free markets would suffer apoplexy if they read this by him

There is no reason why in a free society government should not assure to all protection against severe deprivation in the form of an assured minimum income, or a floor below which nobody need to descend. To enter into such an insurance against extreme misfortune may well be in the interest of all.

Just consider the recent boom in the market for programmers in India. This was triggered by a whole host of developments, mostly in the United States: mainly the introduction of the (publicly provided) internet in the late 1990s and the dotcom boom. None of these could have been foreseen by those high-school kids in India who chose to study programming in the 1990s, and yet they were the major beneficiaries of these developments. These were not necessarily the best engineers- the brightest and most hard working- of their cohort. It so happens that this particular field is easy to join, and so those engineers who studied other subjects did not face too much of a barrier if they wished to become computer programmers.
The price mechanism did its job of reallocating resources- now the best brains in India are more likely to become software engineers. In case of a software "bust", caused by some as yet unanticipated development- they would find it hard to get out.
A well-designed system of social insurance- like Chris' old favorite, the Citizens' Basic Income -would actually increase the dynamism of the free market by subsidizing experimentation- mitigating the risk of launching a new business, or of trying an unusual career.


Tim Harford has a superb article in Forbes on what factors may be holding back African-Americans in the United States.
Some of the work he describes is familar- for example, Sendhil Mullainathan's work demonstrating the existence of discrimination in the job market.

Economists Marianne Bertrand and Sendhil Mullainathan recently conducted a large study along these lines in the U.S., mailing out nearly 5,000 résumés after randomly assigning them black-sounding names like Jamal or Ebony or white-sounding names like Kristen or Brendan.

Not only did the "black" résumés get fewer callbacks, but employers didn't even seem to notice whether the résumés were any good or not. They just stopped reading at "Jamal."

Similar studies

have uncovered British discrimination against immigrants from Asia, the West Indies and Africa--but far less evidence of discrimination against white immigrants from France and Australia.

He also discusses the distinction between taste-based discrimination and statistical discrimination.

Economists distinguish between "taste-based" discrimination, where racist employers refuse to give minorities a job because they don't like minorities, and "statistical" discrimination. When an employer considers an applicant's race as a marker for his or her ability, that's statistical discrimination

In an environment where a particular minority is discriminated against in the job market, even though they are just as capable as others in the marketplace, their wages would be below the wages of others in the same line of work but their output would be just as good. Businesses can gain an advantage by hiring these minorities. Hence taste-based discrimination should be purged from the marketplace as bigoted businesses are outcompeted by relatively open minded businesses. I once discussed this.
On the other hand, if certain minorities are truly less capable on average than the rest of the population, businesses can gain an advantage by taking this fact into consideration- just as insurance companies charge young men more for a drivers' license- even though some young men are probably very safe drivers. (Personally, I would expect this to apply only for people just entering the job market. As people gain experience, employees will be able to judge their true abilities.)

Harford's point, though, is more subtle- he describes research which shows that statistical discrimination could easily become a self-fulfilling prophesy.

Fryer and two colleagues, Jacob Goeree and Charles Holt, showed how statistical discrimination could easily lead to a vicious circle. They used computer-based classroom games that assigned students the role of employers, "purple" workers and "green" workers. Students in the role of employers quickly jumped to the mistaken conclusion that purple workers were uneducated, and that view became self-fulfilling, as purple workers abandoned hope of getting hired and stopped paying for education. Once the downward spiral set in, a color-blind employer would actually lose money.

"I was amazed," recalls Fryer. "The kids were really angry. The purple workers would say, 'I'm not investing [in an education] because you won't hire me', and the employers would respond 'I didn't hire you because you weren't investing.' The initial asymmetries came about because of chance, but people would hang onto them and wouldn't let them go."

So, members of minorities which are discriminated against tend to stop investing in skills which could help them in the marketplace. Fryer also conducted research which indicates that that they also tend to become increasingly insular.

Harvard's Roland Fryer, is attracting attention for his study of "acting white," where black kids who work hard at school are said to be ostracized by their peers. Despite a lot of talk about the problem--Barack Obama raised it in his famous speech to the Democratic National Convention--some academic researchers weren't convinced that it existed. Their surveys showed that kids who were doing well at school, whether black or white, had lots of friends.

Fryer argued that asking a teenager how many friends he had wasn't any more likely to produce the truth than asking him whether he was a virgin. Instead, he sifted through a database of the social connections of 90,000 teens, judging a teen's popularity based not on their own claims but on whether other teens named them as a friend. His conclusion was that hardworking black and Hispanic children, unlike non-Hispanic white kids, lost friends if they studied hard.

Fryer has an economic explanation of why white nerds get an easier ride from their peers. Members of minority groups often face a choice between learning something that the minority group values (say, street slang) or learning something that is more widely valued (say, accountancy). Someone who chooses the minority activity is making a commitment to the group--hence it's natural for him to enjoy more trust. And Fryer points to similar behavior by Italian immigrants in 1950s Boston; by the Burakumin in Japan, who are descendants of what was traditionally a low caste; and even in some traditional Amish communities.

Previous posts on discrimination here, here, here, here, and here.

HT: Marginal Revolution

Friday, March 02, 2007

Nice one

Millions long for eternal life who do not know what to do with themselves on a rainy Sunday afternoon

I wonder if this is actually true. We fear death, and hope for a long life, but surely eternal life would be intolerably boring?

HT: Jane Galt