Links round-up

Hi all,

 Well, I’m back in London and while it’s not the 30-degrees-and-the-sea-everywhere-you-turn  Salone was, there are worse places to be in the spring. Add that to a genuine surfeit of cricket (most of which I was too busy to follow in Freetown), and it’s been a pretty soft landing (well, if you exclude the fact that we conceded 450+ to Bangladesh at home). It’s been a ridiculously busy week between the travel, landing to a firestorm of deadlines and the cricket, but I did manage to read some economics and general marginalia this week – and it was a pretty good crop.

 1.       I missed this last week, and everyone with two typing fingers has already linked it, but on the principle that you can never have too much Angus Deaton, here’s his interview with Annie Lowery at the Atlantic. They discuss whether it’s worse to be poor in Bangladesh or the Mississippi Delta. Angus says “I’m not sure who would have the better life” when considering this comparison, but I’m not sure this is even the relevant issue. Making these comparisons in a framework of subjective quality of life isn’t a coherent intellectual exercise – it’s like saying “if everything was completely and totally different, and you had a totally different life history, would you feel better or worse?” It’s not useful for deciding on the global distribution of resources. Objective well-being and subjective well-being don’t have the same weight in my utility function, and I don’t think that’s unusual. The key point is that it’s possible to care about both and we’re not, collectively, limited to doing only one or trading off between them.

2.       Changing the subject completely – PETA have bought shares in Canada Goose in order to have a voice on their board, and to complain about their use of animal fur. I genuinely have no idea if this is a good idea from their perspective or not. On the one hand, I see the strategy. On the other hand, what’s the equilibrium effect (after publicity) on share prices? And is it a replicable strategy? I lean towards a sarcastic hand clap but I can be persuaded otherwise.

3.       I know some people think I read a lot. I want to introduce them all to David Evans and cower in a corner at his mind-boggling capacity to comprehend such a vast amount of information while simultaneously reading enough fiction to keep up an excellent blog on it.

4.       Ok this one is a spectacular case of research confirming my priors, but a research paper that say if people from different backgrounds just talk to each other more, we wind up building better social outcomes together is too optimistic not to link. I, like them, worry about reverse causality though (places with better social outcomes are more likely to lead to a more equal society where people engage with one another on their own merits), but unlike them am congenitally suspicious of instrumental variables.

5.       Tyler Cowen is a genuinely superb interviewer – I like Conversations with Tyler much more than Marginal Revolution. Here’s Malcolm Gladwell covering everything from the role of sport in social advancement to finding and measuring talent. It’s superb, though very long.

6.       This is fantastic, if a stretch: using speed boat races to work out under what circumstances and why women underperform relative to men. One finding is that they do worse when their gender identity is more pronounced.  Also from VoxEU – China is becoming less unequal.

7.       Lastly, and because I’m reading Oliver Sacks’ brilliant book Seeing Voices, some links about language: Rumours of the demise of dialect are greatly exaggerated (and to prove it, here’s a Korean man speaking perfect Geordie); and the Oxford comma was the deciding factor in deciding a court case on overtime pay in favour of the drivers in a company. In case you are against them, rethink after reading the following (real) sentence: “This book is dedicated to my parents, Ayn Rand and God”. I’m not sure where it’s from but I’m willing to bet Tyler Cowen wants to use it every time he writes a book.

 Have a great weekend, everyone!

 R

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Links round-up

How da bodi?

Apparently, that’s how you greet someone in Krio, the lingua franca of Freetown. Unless, of course, someone is pulling my leg, which is always somewhere between ‘likely’ and ‘certain’. I’ve been here since Sunday and since the boat trip from the airport to town it’s been fascinating. Parts of my trip have brought to mind the line a particularly perceptive colleague used to describe some programmes he’d seen offering direct support to firms: “It’s like releasing tadpoles into a toxic lake”. Still, there’s plenty to be positive about, too and it seems like an amazing place to work. Today’s links are a little threadbare, and you can blame the office here for keeping me so busy with meetings (all productive!). But I’m here till early next week, and I’ve come equipped with bird guide and binoculars and I fully intend to put them to work this weekend.

 1.       It was International Women’s Day this week (indeed it was a national holiday in Sierra Leone) so a few good links about gender to kick off. First, 538 takes stock of progress on the original issues highlighted in the first women’s strike in the US in 1970. I should point out ‘good’ links don’t necessarily mean ‘happy’ ones at this point. Second, Vox looks at the gender wage gap and the relative stagnation of progress in the 21st Century. I think it understates the challenges of occupational segregation, but hey – how many mainstream media outlets even use the phrase? Lastly, Markus Goldstein (whose Gender Innovation Lab is probably the home of my favourite research into gender and economic development in the world) posts a very nice summary of work by Oriana Bandiera and Greg Fisher (among others) on whether women respond differently to wage incentives than men. Related and brilliant: dialogue in the movies, broken down by the gender of the character.

2.       “I want a Lululemon pair of yoga pants, not the ones from Target.” I was not expecting to read Dietrich Vollrath say this in a blog about the profit share in GDP and its implications for productivity, but he does. And the article is typically excellent, another piece of forensic investigation into the economy undertaken through readily available statistics. It’s a skill too few have.

3.       One of Branko’s more personal blogs, about how he learnt economics and his relationship to Friedman and Samuelson. It’s easy to forget that we all learn in a cultural context which shapes us in many more ways than we may initially realise.

4.       Sad! Low ratings! Crooked! Fake news! Actually, this link is only about fake news, and if I was more liberal with the truth and a better headline writer I’d call it about the fake news of Fake News. But really it’s simpler than that. We notice changes much more than levels: fake news might have grown recently, but it’s still a small portion of overall news consumption and probably doesn’t affect our views very much. We don’t need extra help to remain in our echo chambers.

5.       The great Give Directly experiment on a universal basic income in Kenya gets very good coverage from Vox, and commentary from Justin Sandefur. Justin uses the phrase ‘disintermediating the state’ (that’s ‘cutting out the middleman’). I get the need to do so sometimes. But I also think it can’t be our default. It will be brilliant to eventually see the results of GD’s experiment – it’s genuinely one of the most revolutionary that the development field has put up. I hope, though, even if it’s brilliant, we don’t switch everything to this approach. The state matters for many things, even when it’s bad at most of them.

6.       And lastly, Chinese State-Owned rap videos. I have no words.

 Have a great weekend, everyone!

 R

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Links round-up

Hi all,

 These links seem often start with obituaries these days (which is probably down to nothing more than my age, and consequently the ages of my role models and intellectual heroes growing up – many of who were 30-40 years older than me). This isn’t an obituary, but it created the same kind of awful sensation in the pit of my stomach: news that Joel Embiid, after 31 games of games of pretty much unprecedented brilliance for a young player, has been ruled out of playing basketball for the rest of the NBA season. To put that in perspective, over the last 4 years, he’s played around 6 months of competitive basketball, during which time he’s managed to be so brilliant that he was chosen with the third pick in the NBA draft and it’s been suggested he may already be one of the greatest centers ever. It will absolutely suck if his career never takes off because of his brittle bones and ligaments. Sigh. Oh well, at least Eoin Morgan has just bashed a century. [And of course, as soon as I finished that sentence, he was run out].

 1.       On to a happy link first – how’s this for an awesome technology: a mosquito trap sophisticated to differentiate between different species, collecting them automatically so we can analyse the pathogens borne in the blood they’ve sucked from people they’ve bitten. It could provide information to feed into public health programmes or simply be used to analyse how diseases and disease burdens change. Amazing.

2.       There are many superb lines in this Russ Roberts blog. One is “I am answering your question, I told him. You just don’t like the answer.” Another is published and true are not synonyms”. He talks eloquently and honestly about the limits of knowledge in economics (you could apply this to many, many other disciplines, but Roberts happens to be an economist) and the reticence of many to acknowledge them. He also, as an aside, talks about the famous Autor finding about the effect of China on US manufacturing jobs, mentioning that a recent paper suggests that it overestimates this effect. The funny thing is, as Francis Teal pointed out to DFID in the keynote talk at our economics conference last year, Autor’s findings are already that most of the decline in the US is explained by non-China factors.

3. Here’s another academic disagreement that’s been getting good coverage recently: Laurence Chandy and Brina Seidel (or Gertz, I’m getting confused…) did some work suggesting that we can now just redistribute our way out of poverty. Three very good articles point out the substantial problems here. First Berk Ozler notes how hard it is to know exactly who’s poor, and how poor. Second, Chris Blattman points out how hard it is to know what changes will work at scale and maintain long term support. And lastly, an excellent piece by Maya Forstater at CGD making the additional points that the related Sumner/Hoy redistribution would wind up redistributing from the poor to the slightly poorer, driven by a fairly arbitrary poverty line. She adds in a few kicks at shoddy thinking about taxing the super-rich and tax havens, to boot.

4.       Via Adam, a new VoxEU article on the effect of migrants at firm level in France. Here’s a spoiler: it’s good. First, it’s associated with an increase in firm-level productivity. Secondly, it’s associated with an increase in capital investment. Thirdly, it’s associated with an increase in exports. And lastly, it’s associated with an increase in the wages of their native-born colleagues. Good thing migration is so popular all the world round, right?

5.       This is definitely one for the economists only: Noah Smith on the virtues of structural econometrics and quasi-experimental econometrics. I really strongly recommend that all economists read it, though – I don’t think most people quite appreciate some of the points he makes about the limitations of experimental econometrics, though those of econometrics based on big (often crazy) models are rather better rehearsed.

6.       In which Alex Tabarrok discovers that development is complicated.

7.       And to close it out, this is a special brand of crazy that I find almost endearing: an American man has taken out a full page ad in The Times essentially declaring that he is the King of England. Well, I suppose whatever Idi Amin can do

 I’m traveling next week, so the links might be a little late or threadbare next Friday. Apologies.

 Have a great weekend, everyone!

 R

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Links round-up

Hi all,

 So it seems like every week these e-mails start with an obit or some cricketing insanity. This week we’ve got both: first India’s continuing attempt to re-popularise binary coding outside of the computing field (just look at all the 0s and 1s in this scorecard), and secondly the passing of Kenneth Arrow (significantly closer to a century  at 95 than any of the Indian batsmen). Tim Harford has a nice, short appreciation here. Arrow was such a foundational figure in modern economics it’s almost a surprise to realise he wasn’t long-dead already. It’s a sign of how relatively young modern economics is that the co-author of the First and Second Fundamental Theorems of Welfare Economics (all capitalised, of course, because very econ student learns the FTWEs) could also be a co-author of a ground-breaking letter stating the economic risks posed by climate change. Arrow was a remarkable economist and inspired further remarkable economics: Amartya Sen made his name extending and critiquing Arrow’s Impossibility Theorem, already a canonical finding in economics 45 years ago.

 1.       You don’t need to be remarkable economist to recognise the mismanagement of the Venezuelan economy or be outraged at the consequences of it. Vox’s reporting of the numbers is a bit bizarre (“three quarters of respondents report losing an average of…” – wtf?), but it seems that the latest national surveying shows that most of the population has lost, on average, 19 pounds in body weight over the period of the crisis. This amounts to a crime against humanity, frankly; and I can’t believe this isn’t a bigger deal around the world. What’s worse is that the political leadership responds to this stark evidence with increasing certainty in their own capabilities. I’d say it couldn’t happen anywhere else, but events across Western Europe and in the US prove me wrong. This is what scares me the most: we feel that if things turn bad, people will recognise their mistakes and change course. No: they may well just double down on what caused the damage in the first place.

2.       Speaking of economic mismanagement, you know your new currency isn’t taken seriously when it trends on ebay as a collector’s item. That doesn’t exactly speak of market confidence that it’s going to last long, does it? However, since each bond note is selling for more than its dollar value in Zimbabwe, maybe the Reserve Bank should just cut out the middleman and start selling the notes as a novelty gift to foreigners? (thanks to Adam Lyons for pointing me to that one).

3.       Let’s pile on some more bad news, while I’m still frothing with outrage: apparently, we’re all at risk – banking crises in other countries can cause domestic banking crises even in the absence of direct financial ties or trade relationships. That bodes well for the next five years.

4.       To cheer us up a little, I thought the James Martin memorial lecture given by David Miliband recently was excellent. He mounts a sturdy defence of DFID and singles our new Economic Development Strategy and our work on the Jordan Compacts for particular praise; and he inches towards an approach to reconcile global and local politics.

5.       There’s hope, too, in this excellent New Yorker piece on behavioural science and its role in policy making in the US, using the example of Flint, Michigan. We constantly make little movements of progress that help us build a better world. The shocks that push us back are more visible, but the war will be won by the creeping tides of progress.

6.       There are echoes of this in this Tim Harford piece about setting rules and targets – we’ve made a lot of progress in identifying patterns, which has left us open to new mistakes – and we keep working out ways to get around them.

7.       And lastly, because the first half of this e-mail was a total downer, let’s end on a joyous note: Boogie Cousins has just signed to play alongside Anthony Davis in New Orleans, which means they’ve finally found an on-court combo cool enough to overcome the tragedy of being called ‘the Pelicans’ (seriously, I love birds but when they were selecting names did they just ignore the teams called things like Thunder, Rockets, Bulls, and all those other awesome things to pick that?!) And if you’re not enough of a basketball tragic to be excited by that, here’s Giannis Antetokuoumnpo (it’s pronounced exactly how it’s spelled) dunking the soul right out of Steph Curry. It’s only 28 seconds and watch it for the look on DeAndre Jordan’s face at 0:20s.

 Have a great weekend, everyone!

 R

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Links round-up

Hi all,

 Days when Sri Lanka win a last-ball victory against Australia and Lasith Malinga gets through four overs without accidentally breaking his bowling arm in the process of sitting down are good days. We should savour them when they come, rare as they are. My first thought, seeing the headline was ‘oh God, fake news has come to cricket’, but no, it’s verifiable. As opposed to certifiable, which is the adjective that runs to my head when I see most accusations of fake news. Sad!

 1.       Chris Blattman loved this piece by Dani Rodrik entitled Global Citizens, National Shirkers. Rodrik argues that the internationalist values that until fairly recently seemed to have won control of the political discourse have brought with them neglect of domestic problems and the failure to persuasively argue the case for the domestic benefits of internationalist policy. I may be arraying myself against two much heavier hitters with this opinion but I really disagree with a lot of what Rodrik writes, and by extension Blattman’s praise. An internationalist, outward facing discourse does not have to come at the expense of a progressive, thoughtful discussion about domestic problems and historically hasn’t. While it’s true that the last ten or so years have seen an increasingly global policy agenda coupled with the relative neglect of domestic redistribution and alleviation of deprivation, that’s a recent phenomenon. We have had extended periods when we cared about both and worked for both – both here in the UK and abroad. Putting them in opposition to one another is, as Owen Barder recently put it, a classic trick: to pit two progressive causes against each other; and it distracts us from the real problems.

2.       Speaking of distractions, I mourned the death of Hans Rosling last week, but he himself might have seen the attention I paid him as a distraction from what really matters. I was sent this brilliant tribute to Rosling by a colleague, and it argues that to really honour him would be to have made him unnecessary. “So how do we let Hans Rosling rest in peace?… by remembering that mothers in Bangladesh no longer give birth to five children on average, nor four, but TWO POINT TWO children “. Remember less of him and more of his message.

3.       As a quick fillip after a couple of down-notes, it may be hard to see right now, but some polling shows that America is getting more tolerant of religious minorities over time. It certainly doesn’t look like it right now, but it always pays to look deeper. Underlying currents and the short term movement are often at odds.

4.       Imagine you wrote a blog critical of a Nobel winner and he showed up to leave a long and detailed comment – agreeing with you. Sounds fanciful? Incredibly, it actually happened this week, with Daniel Kahnemann showing up on this blog to explain why he agrees that he was wrong (noting with bitter irony that he fell for a cognitive bias he a Tversky first identified in the 1970s). What a hero he is.

5.       I loved this piece by Tim Harford, about how giving workers control of their working environment can increase their productivity. I’m not going to make any pointed comments about clear desk policies or the restriction on me putting my world map up on the wall, but I’ll just leave you with the thought that if I was allowed to supplement my geographically-challenged brain with the map, I’d save about 20 minutes a day googling ‘where the heck is the Gambia?’

6.       I’ve got to draw this one to a close, as I’m running ridiculously late but here’s my favourite piece of randomness I read this week – Jack Slack on how to defend yourself against multiple attackers: “so far there is only one proven method: run, swing like a mad man when you need to, and run some more.”  Read it for the gifs. They’re hilarious…

 Have a great weekend, everyone!

 R

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Links round-up

Hi all,

 “If I say one in ten girls doesn’t go to school, or one in seven girls doesn’t go to school – I’m not talking about statistics. I’m talking about girls. There’s this idea that numbers are something else. No, this is reality.” Hans Rosling died this week, and if you weren’t upset about it, you probably haven’t seen enough of him. A few things were circulating on social media, with many people posting his Ted talk about the miracle of the washing machine, but my favourite is this interview on what appears to be a Danish Newsnight. What’s brilliant is not just the clear commitment to social justice and building a better world, it’s his anger at misrepresentation and willingness to fight back. People like this are rare, and needed very much now. The reach of those willing to lie and obfuscate for their agenda is wide and deep, and it takes a lot of people with a lot of fire to fight that.

1.       Keeping with that theme, some Trump to start us off: Francis Fukuyama doesn’t like Trump, and like many other observers, is wondering how well the American institutional structure will stand up to the pressures his Presidency may put it under. Unlike Daron Acemoglu, however, Fukuyama is an optimist. Indeed, he even believes that the institutional structure has too many checks and balances, even in the current context and makes the case for removing them here. I don’t pretend to know nearly enough about this to arbitrate this heavyweight debate. I can, however, offer a pithy one-liner stolen and repurposed from Keynes’ attack on Clemenceau in The Economic Consequences of the Peace: Trump appears to ‘have one illusion – himself – and one disillusion – mankind’. If Trump does try and isolate the US, though, China may well be waiting to step into their role.

2.       The most stunning thing about this Vox article, entitled What Donald Trump doesn’t Understand about Trade is how short it is. The main point it makes is that trade is not a zero sum game, one Tim Harford makes better here.

3.       Even better is this excellent double-whammy from CGD. First, Michael Clemens and Hannah Postel report on work they did on a guest worker scheme in the US which demonstrated that it was a great development intervention, it did not steal any ‘native born’ jobs (the jobs already existed and were unfilled), and added around $4000 per worker to the US economy. Charles Kenny then elaborates in one of the best pieces of the week; protecting US workers from trade and from immigration isn’t likely to get them any more jobs – it will just accelerate the pace of mechanisation.

4.       Returning to the topic of fighting with the truth, an excellent article by Michael Faye, Paul Niehaus and Joanna Macrae about cash transfers, following recent negative headlines in the UK.

5.       Ever since Chris Woodruff and Michel Fafchamps’ paper ‘Identifying Gazelles’ pointed out how hard it is to identify which firms we should concentrate our efforts on if we want to encourage growth, other researchers have tried to find ways of either circumventing this problem or getting better at gazelle-spotting. Two pieces this week report progress, first David McKenzie on targeting informal firms to focus on the ones most likely to formalise; and secondly, Ramana Nanda on using trial-and-error experimentation to round up lots of firms and let the non-gazelles out quickly.

6.       If, like me, you want to know more about the Congo – this WaPo blog is a good start, though it’s not going to cheer you up.

7.       Ok, I’ve depressed you all enough. Two things that make me happy to close (I have no idea what makes you all happy, so you’ll have to make do with this). First, a confluence of two of my favourite things: Planet Money econogeekery and birds (transcript). And second, an epic long read about Anthony Bourdain eating around the world and appreciating all the cultural diversity it has to offer. It also talks about my favourite of his essays, My Aim is True. And if none of that cheers you up, here’s Taylor Swift dancing at the Grammys (you can stop complaining now, Danny).

 Have a great weekend, everyone!

 R

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Links round-up

Hi all,

 I’m on leave tomorrow, so the links come early. Normally this intro would be where I make a token Taylor Swift joke and a glum mention of the latest cricketing disasters (seriously  – 8 wickets in 19 balls? Were they worried they’d be late to check in at the airport?). But I’ve been slightly uneasy all week at what I’ve been reading in the news and what I’ve been hearing from my friends, so here is something serious instead: on my 8th birthday I remember watching the news and seeing people climbing the Berlin Wall as it was made obsolete by the East and West German Governments (of course I didn’t understand what was happening, only that my parents’ reaction showed it was important). On my 35th I watched the votes pour in for a President whose main promise was to build new ones. I am deeply worried that those of us who are trying to use evidence and statistics to argue against policies we feel are wrong and counterproductive are misjudging both the objectives and the appeal of these policies (and polling suggests they are more popular than not there). I don’t know exactly what to do about that, beyond feeling that an alternative, positive vision is needed, not just a repudiation.

 1.       Before moving off the topic altogether, another consideration of the effects of trade. I said recently that trade was not really about competition between countries so much as a way of organising production and consumption across borders. This investigation of US-Mexico trade makes the point again, pointing out that “most US imports from Mexico are intermediate and investment goods… A tariff on Mexican goods is more likely to raise costs for US businesses … than to lead people to substitute American-made goods for Mexican ones.” Still, that might not stop anti-trade policies running – apparently, one of Trump’s economic advisers wants to dismantle cross-border value chains. I’m predicting that will either be forced into a stall or will end very badly indeed.

2.       Another thing I said last week is that the typical middle-aged worker is unlikely to simply retrain if his job dies out in a more competitive global economy. Plane Money seemed to hear me, because they went off and ran a piece on a long-standing US assistance programme which has the explicit aim of getting these workers reskilled and into new jobs. It’s fascinating – well worth a listen: the best laid plans can run aground against the messiness of the real world.

3.       Changing the subject – a great blog by Berk Ozler on the long run effects of an unconditional and a conditional cash transfer programme. Long story short: it’s complicated. Few of the short term effects of the unconditional transfer persist in the long run, while the conditional transfer may not have the full range of short term benefits, but a larger long term effect in some dimensions. Very interesting, and I recommend reading it all.

4.       I mentioned this paper recently, but am only now finding time to read it: Chris Blattman on the political effects of an income generation programme. It’s only one piece of evidence, so we need to be cautious about extrapolating the results, but it’s very interesting. He finds that the programme increases political opposition, and speculates that this may be because it frees participants from the need to survive through patronage from the state.  It would be amazing if more programmes asked these questions – it’s important data to understand social contracts and politics.

5.       For someone who gets his unredacted thoughts and brainfades published online every week, this is pretty scary: you can never be sure your data is truly gone when you want it gone. Thought that being the case it can’t hurt to ask: when my last laptop died, I lost a note I wrote about the Copenhagen Consensus Centre and some of its research – has anyone got a copy?

6.       Long-time readers will be aware that I think Kareem Abdul-Jabbar is the man. How many Hall of Fame Centres are also successful writers and cultural commentators? His New York Times book review of two recent books about Islam and identity is brilliant and timely. In it, he quotes Norman Vincent Peale: “The trouble with most of us is that we would rather be ruined by praise than saved by criticism.”

 Have a great weekend, everyone!

 R

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Hi all,

Strange things are happening in the world these days. Rafa and Roger are about to contest an Australian Open final, causing me to check my calendar; England thumped India in a Twenty20, causing me to dig a deep hole in the garden for signs that hell has frozen over; this Sixers are awesome while the Cavs suddenly suck. What the heck is going on? Increasingly, I’m starting to wonder whether we actually are all just in a big computer simulation, and the computer’s running out of RAM. If these links are all just repeats, I blame the RAM. That’s my new mantra: blame the RAM.

1.       We’re about a week into Trumperica now, and what have we learnt? And importantly, what does it look like he’s learnt? Let’s start with Mexico. All through the election, his promise to make Mexico pay for his wall seemed outlandish – how could he do this without significantly damaging the US economy? His first idea, quickly rowed back on, was a tax on Mexican imports – a tariff that would both hit American consumers and American producers hard. But he could hurt Mexico in other ways, too even if they wouldn’t raise much money – Mexico’s economic fortunes are tied to the US by an umbilical cord made up of both trade and remittances. In a way it doesn’t matter whether or not he actually does get the money for the wall this way – politically, he may only need to sell it like that. Similarly, the fact that net jobs created are a tiny proportion of gross jobs created and destroyed in a month probably won’t stop someone, at some point, just citing the stat that looks best. I’ll come back to this point, so bear with me.

2.       But in the interests of questioning my own prior convictions – is there something valid to Trump’s instinctive hatred of trade deals? Dani Rodrik has always been more circumspect than most economists in his approach here, and his analysis of NAFTA is required reading for everyone who thinks that free trade is the obvious answer. I accept his points here, but they beg further questions: if sections of the economy need protections in order to survive, in the answer to offer these protections up and create rents for exploitation? And if so for how long? And do we do it for all sectors or just some? Or do we phase them out slowly and really work at remodelling the economy? I lean towards the last, as do most economists, but I’m realistic enough to know that the average 45 year old isn’t just going to reskill and become a computer engineer. There are real costs, and we need a proper plan for dealing with them.

3.       Relatedly, Rodrik has been busy this month, with a further paper on structural transformation here. Interestingly, his co-authors use a separate paper on which Rodrik is not co-author to refute his argument of premature de-industrialisation.

4.       Recently, I’ve seen a few people asking for evidence of a prior belief they hold (“I think poverty is rising because of neoliberalism, can someone send me proof of this?”), rather than asking a neutral question and seeing what the evidence says (“what’s the best evidence about recent trends in poverty and their causes?”). It’s worrying if this is creeping into actual calls for research proposals though – even if it is only in an advocacy organisation or two for now.

5.       I mentioned the passing of Thomas Schelling in a recent links, focusing on his work on nuclear non-proliferation. Tim Harford considers the insights from his work for Brexit negotiations, concluding that they resemble a game of chicken with similar possible outcomes.

6.       This might have been my favourite article of the week – a book review that digs into the phenomenon of India’s criminal-politicians, suggesting that in the absence of a functioning state, it becomes a stable and rational equilibrium for voters to prefer crooks to the honest men, as it increases their chances of getting services delivered. Meanwhile it also removes the incentive to improve state functioning on the part of the criminal-politicians as their viability depends on their role as deal-makers, and thus in turn on the absence of a rule-based system.

7.       I promised to return to the issue of Trump’s relationship with data (or, more baldly, the truth). Via Tim Harford, I came across this article suggesting that the deep psychology of lying may mean that his approach is not just a good strategy, it will gradually win us all over, even the fact-checkers among us. I don’t buy it, not really. It misses the point that there are very different kinds of untruth and very different ways we respond to them. There’s the vague and difficult to verify ones (“This plan will create millions of jobs, jobs we’ve been losing”) and the concrete and relatable ones (“you’re better off today than you were four years ago”). At the moment, we’re still in the realm of the first kind; but soon, when policies are supposed to turn into reality, the second kind will come into play. Ambiguity will delay realisation; but ambiguity is unlikely to last for ever, or even for very long.

8.        Meanwhile – there’s always satire: “Cake shall henceforth be known as ‘alternative celery.’”: a poem of alternative facts.

 Have a great weekend, everyone!

R

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Hi all,

 I’m going to file the motion that it is physically and psychologically impossible to dislike Joel Embiid (yes, I’m aware about 4 readers have any idea who he is – the Philadelphia 76ers centre). How can you dislike a man who dances like this in a lurid red jacket? Capable of this array of skills? It doesn’t hurt that he’s historically good – and this after losing the first two years of his career to injury. Though if we’re talking returns from adversity, the week’s winner is definitely Yuvraj Singh, whose journey back from cancer culminated in a sensational knock of 150 off 127 balls against England yesterday.

 1.       Nothing else is happening today, right? No historic handovers of power or anything like that, right? As Trump takes over the White House, FiveThirtyEight launch a series looking at both how the media reported the election and what is going on in the country that led to this result. On the former, Nate Silver is justifiably harsh on print journalists who went in for an extended session of confirmation bias in covering the election and then turned around and blamed the numbers for their interpretation. He hints at exploring the behavioural biases that warped the analysis in future articles, too. A companion piece focuses on the demographic and political changes that at once made the democrats more popular nationally, less coherent as an ideological movement and less efficient as an electoral one. I love the fact that the article has an author (Claire Malone) and a lead analyst (Harry Enten). The future of journalism?

2.       You may need to sign in for this, but a very interesting look at the UK’s depreciation post-Brexit. GCSE economics teaches you that a depreciation makes exports cheaper and imports more expensive and  should result in a better trade balance as you export more and buy fewer foreign goods, but it’s a little more complicated than that. Firstly, exporters  haven’t actually been lowering their prices much – instead, they’ve been selling at only slightly lower prices and pocketing the difference from roughly the same sales – which they can do until new firms enter the market to undercut them. But investment requires certainty, which the market has not been offered yet. What’s more, it seems like we’re not importing any less either. In fact, we’re importing more despite price rises, mainly because we can’t substitute what we import with domestic equivalents – there aren’t any. Again, investment is the missing piece of the puzzle. It could still happen, long term. But it might not, too.

3.       On the other hand, when markets are given a much bigger injection of certainty, investment just rockets and if you want evidence, go to California and buy some weed. Once marijuana was legalised, firms invested large amounts of money on bigger plantations, better machinery and new technology, simply because they were protected by the certainty that legal commercial operations tend to enjoy in the developed world – and prices have fallen massively as a result. There’s a lesson here for fragile states. It’s not exactly investment that they lack, it’s certainty. No-one likes unexpected intrusions.

4.       Speaking of money flows, Maya Forstater puts the boot into some seriously shoddy analysis from the Guardian which suggested that illicit financial flows were 24 times the size of aid flows to development countries. It’s worth reading in full, just to get a sense of exactly how many liberties had to be taken with the data and common sense to get to this number.

5.       And speaking of illicit flows, what happens when you clamp down on corruption in a developing country? Well, to start with, the civil service gets in a massive huff as the experience of Nigeria suggests. This chimes with research Clement Imbert presented at DFID the other day, dealing with India.

6.       I found this interesting but not convincing: when Esther Duflo’s address to the American Economic Association demanded that economists become more like plumbers was she calling for economics to return to its roots as something more like a craft than a science? While I think this would be a good thing, I don’t think this is what she really meant. The idea that most economic relationships are always and everywhere true is hard to defend for anyone with more than a passing interest in history, and if that was what Duflo was railing against I’d be quite happy. But actually, I think her aim was a bit more prosaic. It was about implementation. To use the metaphor from the article, in this vision economists are still engineers, using the laws of the world to produce specific outcomes; but they must also learn how to fit their machines in an imperfect space – society, Government, wherever.

7.       Lastly, let’s leave in a good mood, even today. I said a couple of weeks ago that the world is, on most metrics a much better place than it has pretty much ever been. Tim Harford agrees. And if that doesn’t cheer you up, here’s the Bill Evans trio playing Israel. And if even that doesn’t work, go back to the intro and watch Joel Embiid dancing in his red jacket.

Have a great weekend, everyone!

 R

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links round-up

Hi all,

Let it never be said that I don’t admit to my errors (or error, as this might be the first one yet). Last week I suggested that 2016 might not have been especially fatal for celebrities and linked to a pretty middling bit of analysis to back it up. Well, it turns out a slightly deeper look at the numbers doesn’t quite back that up. It’s always good to revisit ones errors and correct the mistakes that lead to them, something that someone needs to urgently communicate to the Sri Lankan cricket team, knee-deep in yet another pathetic capitulation to the less-than-terrifying pace of a second string South African attack. It seems that a Sri Lanka tour abroad these days serves no other purpose than to aggravate me.

1.       Trump has got some perverse ideas (clean your minds, I’m not referring to any unverified dossiers here). His peculiar vision of ‘winning’ at trade involves importing less and exporting more. This assumes that there are some bad, terrible people who import and must be discouraged, and some lovely, shining ones who export and are our great heroes. It turns out, to coin a phrase, it’s a little bit more complicated than that. The major exporting firms are also, mostly, the ones who do most of the importing, and vice versa. Trade isn’t a fight where one side can win and the other loses. It’s a way of organising production and consumption across borders.  That doesn’t mean that everyone gets better off, or that there are no people or firms harmed. It just means that whatever type or level of trade we have (including none), some people will get better off and some will get harmed, and we need to decide which option is the best socially and how to mitigate the distributional effects. Related – what does the economics of golf tell us about who the winners of Trump will be?

2.       Staying on trade for a moment: one of my favourite papers of the last few years, the Atkin et. al. experiment that shows how exporting helps firms become more profitable, more productive and produce higher quality products gets a great, easy explainer from Markus Goldstein here. The innovation of the paper is to generate causal information on the effects of exporting, and then to use logical argument and additional data gathering to prove the causal mechanism through which exporting helps firms get better. This is why Nick keeps going on about why it’s important that we help developing countries develop their export capacities (but doesn’t say they have to restrict imports to do so).

3.       I’m not sure how much weight I’d put on this, but a very clever bit of research used chess analysis to test the hypothesis that women do worse than men in competitive environments. It turns out women don’t do worse in competition but do suffer when they play men, a finding not explainable by their ability. Part of the issue may be that they feel they need to do even better given negative stereotypes. But a really interesting finding is that men in losing positions resign the game later if they’re playing a woman than a man. The piece is decorated with a few spectacularly sexist quotes.

4.       I’m coming late to this piece, but Max Roser’s plea that we stop saying that 2016 was the worst year ever is absolutely brilliant and full of good insights. One of his thought experiments: what would the news headlines be if we had fifty years between them? Probably not the current shrill ‘TERRIBLE THING HAPPENED YESTERDAY AND WE WANT TO SPARK OUTRAGE ABOUT IT’ that typifies our dailies, but something more like “Humanity vastly better fed, in better health and better educated than ever before. Hooray!”. Read the whole thing.

5.       Thomas Piketty on productivity in Europe, the US and the UK. Apparently we have to work longer to achieve as much. Maybe we should spend less time reading blogs?

6.       I love this. Vox interview Obama about the Affordable Care Act. His grasp of policy detail is just amazing.

7.       And lastly, this one is different to the usual closing dose of Taylor Swift – the collateral damage of Meryl Streep’s attack on Trump at the Golden Globes included Mixed Martial Arts, which she essentially denounced as a white male phenomenon without beauty. I feel compelled to defend it, given the massive racial and national diversity of its participants. As Jack Slack writes here, whether you follow Georgina O’Keefe (art is ‘filling a space in a beautiful way’) or Andre Gide (‘Art begins with resistance’), MMA fits the bill. It’s genuinely internationalist, learning from Thailand, Brazil and Japan, for starters. So yeah, I disagree with her.

 Have a great weekend, everyone!

 R

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