Coronavirus is kind of all-consuming, isn’t it? It’s not
just the links that it’s swallowing whole, but my time. Luckily, now that I
barely leave the house and don’t see any of my friends I have a whole lot more
of it. I feel terrible for my friends with kids, though – if they’re lucky they
about 42 seconds to plan dinner and relax in the afternoon and fifteen minutes
to decompress while they lock themselves in the bathroom and pretend not to
hear the banging on the door. This week’s Coronalinks have a little
distraction, but also – still – a whole bunch of Covid.
- The best thing I read all week was this
superb explainer on why it’s so gosh-danged hard to model Coronavirus. It’s a long read, but I
strongly, strongly recommend everyone read it. It’s a great way to
understand why different models are coming out with such different
outcomes, and how massive the confidence intervals around any predictions
need to be. Beyond that, it’s just a really nice applied example of how
modelling is done. I’ve seen a couple of people criticise forecasters who
use large confidence intervals in their predictions for the virus, but I
find such critiques ridiculous: they are asking for people to either know
much more than can be known at the moment or to lie about how much they
don’t know. One is impossible, and the other is irresponsible. 538
have done a bunch of other great pieces: this one on the
aforementioned confidence intervals and this one on the
uncertain science of handwashing (pesky confidence intervals again!).
- There has been increasing coverage of how poor
countries should respond to Coronavirus. Given those wide confidence
intervals a wide range of possible approaches are plausible. Two pieces
urging caution in importing Western models of response to LICs that are worth
considering: Amanda Glassman, Kalipso Chalkidou and Richard Sullivan at
CGD and David
Pilling in the FT. And more from CGD’s
superb coverage of Covid and education.
- And now something to cheer you up – NPR got a ringside
seat to a company in the
automobile supply chain shifting over to ventilator production, and
it’s kind of amazing (transcript).
I commented on Twitter a while back that firms, retailers and people
are learning a vast amount about our own flexibility and how we can work
and interact. At least some of these changes are going to stick. And
while we’re being upbeat, Marta
Foresti’s Ode to Key Workers, overwhelmingly migrants (#migrantsaregoodforyoupart2,030,291,928,119)
- Now on to something completely Covidthoganal: a
research paper uses Australia’s past as a penal colony to examine the costs of masculinity in men’s
health and wellbeing. I can’t say I’m completely convinced, but the
story the authors are putting forward, that norms of masculinty lead to
sub-optimal outcomes seems plausible. As all of you can tell from these
weekly e-mails, I model myself on the John
Wayne strong and silent type and sometimes wish I was more verbose.
on Covidmacro – part 3. Just read and take notes, please.
- And ending things on a non-Covid line, if not an
optimistic one: Martin Ravallion’s most recent piece looks at the extreme
difficulty of making the last steps to zero poverty, suggesting it may
wind up taking decades even from the time when poverty declines to 3% of
- I hope everyone is staying well, and taking care of
their mental health. I’m lucky that I’m cooped up with my wife, probably
the only human being on the plane who can bear my presence for such an
extended period of time. There’s a bunch of happy stuff online to keep
you going if you don’t have as much company as you’d like, though: Dolly
Parton reading bedtime stories, Poetry
read by poets, the
Stockport Spiderman, the Llandudno goats,
and a huge amount of mutual aid.
Have a great weekend at home, despite the lure of the
I promised to try and keep the links a little oasis of
normality amidst a sea of change, but while today there will be links that have
nothing to do with Coronavirus, there’s also still a bunch of stuff that’s
Covid-focused. I’ve been keeping my eyes open and trying to read as widely as I
usually do, but almost everyone online has turned their attention from normal
pursuits to Coronaspouting. There has been a lot of good, well-informed
comment, but also an avalanche of bollocks. I’m all for people of
different disciplines pitching in here – we all know something different – but
my twitter feed has been overwhelmed by people launching into strong opinions
or analysis without any collaboration or sense-checking with others at all.
This, coupled with the complete absence of any new basketball or cricket has
put rather a dampener on my mood. Also, Wonder
Woman 1984 has been delayed, thus denying us our Gal Gadot fix. Et tu,
- A lot of what I’ve been following (and commenting on,
to the limits of my ability) has been the economic response to Coronavirus – not just what we do
about the economic cost of distancing and lockdowns, which takes up a lot of
the air in this room, but also how the policies we implemented
pre-pandemic help or hinder our adaptation and how we can use economics to
help generate a faster, fairer way of responding. On our ability to
adapt, Tim Harford has a really good primer on the
general nature of this problem: our supply chains for different things
are flexible to different degrees, and some crucial supplies – medical
professionals, for example – are difficult to ramp up quickly. These
difficulties are made worse by policies that actively hamper useful
flexibility – in the US, harsh limits on migration are going to create
artificial choke points in the food supply quite soon, as Planet Money
this show (transcript).
illustrates the same point in a very different setting – poor set up of
the World Bank’s pandemic bonds have apparently dramatically slowed payout.
- There has also been quite a lot of good discussion of
the measures being taken in different places to limit the economic fallout
of the pandemic. To properly understand how bad things might get, and
for whom, we require quite a sophisticated understanding of how economic
relationships are structured, as Dietz Vollrath continues to
elaborate. I also quite liked these two Project Syndicate pieces, one
by Willem Buiter which does a pretty good job of explaining
how the monetary and fiscal responses made in the UK are coordinated,
and one by Mohamed El-Erian pointing out the need for economic
circuit breakers: making sure that failures or downturns in one
part of the economy do not create a vicious cycle. And for a dose of
well-informed economic optimism, VoxEU on why
Corona is not like the 2008 crisis, and with good policy we should
expect a quite different resolution. For poor countries, CGD’s call is
what it takes.
- And now, a brief interruption of normality as we return
to a regular series in the links: Why humans are absolutely the worst,
no-good, terriblest creatures, part 2,392,011 of a continuing series.
Research into assimilation of European migrants in America demonstrates
and acceptance were spurred by the entry of African-Americans into the
neighbourhoods. The mechanism appears to be that the appearance of
dark-skinned people made everyone else look at each other and say “well,
at least you’re white”. So reassuring when the mechanism fits your
worst expectations of the human race.
- Back on to Covid: this is a difficult thing to talk
about at the moment, but Amelia Thomson-DeVeaux takes on the tricky
subject of how
we value a human life, and how we decide whether the cost of saving it
is worth incurring. I hugely recommend this one, if you’re not familiar
with this topic – she covers a lot of ground and also discusses how the
‘value’ of a life varies with the income status of a country in a
sensitive way. For less sensitivity, but a brutal and blunt
discussion, here is Milton
Friedman eviscerating a student on the topic.
- I always find Markus Goldstein so reassuring to read. This
piece with Florence Kondylis is excellent, about how researchers should
respond to Covid. Related, I have been extremely impressed with the CGD
coverage of Covid and Education. Another good piece here.
- Penultimately, and again retreating to links-as-usual: social
scientists replicate their own highly-cited study and retract the findings
– via David McKenzie’s amazing World Bank links, a piece of good
practice that deserves more attention than it will get these days.
- How to close, when so much pop culture has been
cancelled? I could just link to videos to make you
happy (it’s not distancing-compatible – Jaan pehchan ho means ‘let
there be familiarity’)? Or more book
recommendations? Tips for housebound birdwatching (UK,
India wins)? Or The Ringer,
still producing basketball content? Whatever gets you through, be
safe and be home.
Have a great weekend at home, everyone!
I’m going to try and avoid turning the links into the
Coronagloom Weekly, but inevitably the virus will be a part of these emails
going forward. I will not focus on ranting about bulk buying (beyond this: wtf,
people: bog roll does not prevent you from getting it, and Covid doesn’t give
you the runs, so please calm down!) or speculating on the best course of action
from my position of solid epidemiological ignorance, but I’ll try and link to
some reasoned and intelligent analysis that will help us understand what’s
going on better. It is also incredibly important to take care of our own mental
health, especially as social distancing needs to be adhered to. I wrote a
thread on twitter (yes, I’m on twitter now, see link 2) with my best
suggestions for social distancing reading; and NBA
League Pass has opened its doors to everyone for free for the next 30 days.
The last link has a few more things to get you through.
- I’ll start with something that really irritated me: Arvind
Subramanian immediately reaches for the foreign aid budget in response
to our under-preparation for this kind of global event. I have many objections,
but here are a few. First, part of his justification is that the effect of
aid on growth is not that large, but this has always been a massive red
herring. Aid does lots of things, and not all of it (in fact, probably a
minority) is actually aimed at stimulating growth in any meaningfully
short time frame (i.e. a few years). So even if aid has no impact on
growth (and the final word on this should go to the
Clemens’ et al award-winning paper, not Subramanian’s older work with
Raghu Rajan), this does not mean that aid has a low opportunity cost –
quite the opposite as we have superb evidence from many fields that a lot
of aid-funded interventions do have large and meaningful effects. Even
if we focus only on loans, a few successful loans (given credit
constraints) are likely to have outsize effects. Thinking of aid more
like VC changes perspectives. And secondly, the economic costs of
pandemic prevention will be largest in the places with most to lose;
surely they should then bear the brunt of funding preparedness?
- A side effect of the crisis has been to move a lot of
academic activity online: teaching and also presenting research. The
CSAE conference has moved online this year, using the hashtag #DIYCSAE,
and I was an early adopter, attempting to tell the story of my
paper on decision-making in the civil service in an 8 minute video;
teaser is here. And in order to participate in the conference, I’ve
joined twitter, @scepticalranil.
Others have also done cool threads, not least Paul Clist
- A host of good Coronareading: Branko Milanovic
argues that the
biggest risk is of social breakdown at Foreign Affairs; 538 show
polling from the US that suggests that contrary to popular narratives, younger
people are not taking Covid less seriously; Planet Money deep dive
tests are run and manufactured (transcript); CGD
critique the UK
communications strategy and transparency, and investigate the uneven
gender burden of the disease in poor countries and much more; and Raghu
Rajan goes into how
the pandemic will test our economic resilience. He also says that
“Covid 19 has been quick to expose amateurism and incompetence”. Quite.
- There has also been a couple of pieces focusing on how
Covid interacts will precarity. This is extremely important: we have
allowed the economic model in much of the west to outsource risk,
uncertainty and insecurity to labour through changes in firm structure and
inter-relationships. This may have allowed greater expansion in the
economy and stimulated innovation but it has not been matched by
innovation in social protection or support for the vulnerable, and if
Covid is a stress test, this is the area I fear we are going to fail most
miserably. It is totally unacceptable that this is what we – myself
included – have predicated our comfortable, flexible lives on. 538 look at
the most precarious are in the US; Berk Ozler at how
we can quickly support the vulnerable in poor countries.
- Worthy of its own link – Dietrich Vollrath cuts no
corners and shows us how
to think more carefully about the systemic effects of the virus using
input-output tables. Again, macro matters a lot, and reading Dietz
can help you understand it better.
- Two wonderful non-Covid links. First, Sam Bowles and
Wendy Carlin talk about how we
can and should dramatically revise how economics is taught to undergrads.
I teach econ to public policy Masters students, many of whom have no
background in the subject, and I think the course convenors (I’m not one
of them!) have done an amazing job of getting people into complex and
interesting questions early. Consider this an advert for the MPP programme
at BSG. Also, as an aside, if I could turn Sam Bowles’ brain into some
kind of drug, I would mainline it directly into my veins. He is one of
the most interesting thinkers in the world. Secondly, David McKenzie on
learning from how
tech companies use experimentation.
- Lastly, some more stuff to get you through the long
hours of indoor life.
First, and best: LitHub rewrites the first
lines of classic novels for a social distancing world; The Ringer on how
to get the most out of the
newly-free NBA League Pass; more lithub: their
book recommendations to complement my thread in the intro; and the
link to Grim Fandango, remastered on Steam – hours to pass away with
the greatest game ever made.
Now, to borrow from Dietz: wash your hands and stay the
I’ve had a few text messages in the last week using some
formulation of the phrase: “is it time to panic yet?” For avoidance of
doubt, the answer to this question is always no: panic is inherently unhelpful,
this is just baked into the definition
of the word. I was working at home yesterday and went to the shops at
lunchtime to get a snack and some things for dinner and the local Sainsbury’s
was like a scene from an
old Spencer Tracy movie: people carrying enough toiletries to last a year,
bushels of lentils, peas, beans and dried pasta (the side effects of such a
diet don’t bear thinking about). I feel relatively certain I’m preaching to the
choir with this email, but please do not panic buy – any shortages we
experience at this point are much, much, much more likely to be the
self-fulfilling result of panic buying itself than the underlying supply
chains. One supply chain that has definitely broken, causing enormous welfare
loss (primarily concentrated in the population of cricket-obsessed basketball
fanatics) is the simultaneous supply of near-Playoff basketball (just
as LeBron was beginning to snap his fingers) and the forthcoming England
tour of Sri Lanka which, free of any fear of looking like a fool, I will now
suggest was heading for a whitewash by the glorious might of Karunaratne and
- I will leave speculation about the best course of
action in response to the Coronavirus itself to the many people better
equipped to deal with such questions than me; others have both more
information and more expertise than I do. I have been keeping an eye on some
of the best writing on mitigating or navigating the economic shocks of the
pandemic, however. Richard Baldwin, on VoxEU, has a good piece setting
out the many points in the economy that a disruption may be expected,
and the effects in different places. Kaushik
Basu, unsurprisingly, has noted implications that have escaped the
attention of many others, and in particular highlights the impact
of a novel and unexpected event like this on contracts, and the special
implications a spate of broken contracts can have. If you’re
interested in the effects on LICs (and if you’re reading this, you
probably are), Dave
Evans and Mead Over have you covered. Unfortunately, even a virus
can be politicised, and in the US, opinion
over the virus is split firmly on party lines (though a wise friend
has pointed out that these polls come from before Trump’s recent speech).
- In the US, many people who will need treatment will be
paying for this out of pocket, either in the form of insurance co-payments
or because they are uninsured. This Planet
Money podcast with Anne Case (transcript) should be
a reminder to pick up Deaths of Despair, her book with Angus Deaton about
the human impact of this kind of system; but you should also listen to it
to understand the deep indirect costs the US system involves. And there
is a truly mad statistic buried in here: pharma companies spend more on
advertising than they do on R&D.
- This has been a pretty depressing start to the links,
so something that makes me (and probably most economists) smile: a
randomised trial provides evidence for something most of us take as an
article of faith, but is surprisingly hard to prove: competition
works beautifully, reducing prices and increasing quality for
consumers. Obviously, not always, not everywhere, and not from every
starting point but… this matters.
- A very nice post by Florence Kondylis and John Loesser
questions that you are likely to encounter in almost any academic seminar.
For the policymaker, this doubles as a really good list of questions
you should ask of a paper as part of your process for assessing the
quality of evidence it provides. Related: Marc Bellemare, my new
econometrics crush, on the merits of Peter Kennedy and Judea Pearl for thinking about
evidence based on data. Read to the end.
- So with some time on his hands as his university works
out its response to Covid, Dietz Vollrath writes up the latest in thinking
about economy-wide productivity and profit mark-ups. Reading him is
still one of the best things you can do to keep your macro sharp.
- While we’re talking macro, I can’t quite remember why
but earlier this week I dug out the famous 1981 Sargent and Wallace
Unpleasant Monetary Arithmetic’, and I cannot recommend reading it
enough. It’s old enough (almost exactly my age) that many economists
these days will have never read it, but the power of the logic and the
clarity of thinking in the paper is a superb model for any aspiring
economist. Not only that, but it feels like the paper still has a lot to
contribute to current macroeconomic problems.
- Let’s close on things that (should) make us happy. Michael
Schur is writing a book, which in my head is titled “Don’t be a
shirtbag, for fork’s sake”; Tove Jansson’s love
letters to her partner are being published and they are very moving
(and Moomin); even if there isn’t any new basketball, there is nothing to
stop us watching
videos of Shawn Kemp and Gary Payton reminding us that Lonzo Ball and
Zion Williamson have a long way to go; and Sir Isaac Vivian
your hands, everyone!
No sooner than I speculated on what a self-quarantine period
might look like than I received actual data – a friend of mine has had to
self-isolate her entire family on their return from a holiday. In what will no
doubt be shocking news for you all, it turns out locking two very small
children into a small London dwelling with two increasingly stir-crazy adults
turns out to be rather stressful. Blissfully ignorant of the demands of
parenthood, I suggested she had 14 days of yoga, boxsets and depleting her accumulated
hoard of wine (especially if
you’re following the cricket); judging by the tone of her response, it’s
probably a good thing she has another 10 days to cool off before she can escape
and give a well-deserved thump. For the rest of you: wash your hands, stop
hoarding things like face masks and take solace in the data, if you can. This
week’s links include a slight dose of econometrics, so some self-isolation
with wine may be recommended.
- Should we get the econometrics out first? Two things, both of
which I would use to hammer home the message: no matter how clever your
measurement or your study design, you must always think through the model
you’re testing. First, Marc Bellemare, whose blog I have been enjoying
more and more as I dig deeper and deeper into it, considers the SUTVA.
Thought it sounds a little bit like non-violent
resistance, it’s not (and indeed, SUTVA violations have been known to
induce acts of violence against Stata); rather it’s an assumption that is
made in econometrics when you want to infer causality. Essentially, the
assumption (which is stronger than most people seem to think) requires
that there are no spillovers from a change in the causal variable for me
on either anyone else, or for me over time. This is actually a really
difficult thing to prove to be true, so most of the time, we have to
assume it or just argue that we think it holds. The problem is, very
often, studies don’t manage to make this case very carefully, and thus
report effects that are either stronger or not as strong as they should.
And related: David McKenzie reports on a
way to infer the long-term results of a short-term study. The best bit
is at the end, where he describes a case where the approach may break
down. Without really thinking through the ‘why’ of your result it can
be difficult to even know the ‘what’ that you think you’re finding. I
remind you of my
advice from earlier.
- Something lighter, if not less important: a
really nice piece from CGD setting out how they went about selecting
programmes that have made a dent in learning programmes at large scale.
One programme from DFID makes the cut, along with a bunch from USAID, with
none run primarily by Governments. It’s well written and thoughtful and
comes highly recommended.
- I really liked this
paper from Stefano Caria. He digs into Ethiopia’s push towards
industrialisation and documents that its cost advantage in labour is more
than offset by lower productivity vs. important peers. He does a bunch
of digging into this and argues that a big chunk of this may be driven by
worse management practices, and especially worse labour management.
Really good diagnostic work like this is rarer than it should be.
- VoxEU have produced a new e-book looking at the
position of women in
including minority women (summary here).
Meanwhile, Marginal Revolution have produced a
video about Janet Yellen, part of their own women in economics series.
Bonus gender link: also from VoxEU, research that shows that men
benefit more from larger venture capital boards than women do. They
find the result is not obviously (first order) discrimination, but that
men seem much more likely to reach out to and contact members of the VC
board than women. Once again, the findings suggest that gaps stem from
- I’ve said in other settings that the mystery of this
world is not that there is so much migration, but rather that there is so
Germany provides an interesting case study here. There remain substantial
wage gaps between the East and West, even once you account for the cost
and quality of living. Why do East Germans not simply move over until
wages are equalised? If I were speculating on this blindly, I might have
guessed that productivity is just higher in the West, but absorptive
capacity not sufficient to eliminate this difference through arbitrage. This
piece suggests it’s much simpler than that: people like home, and
moving away from it requires a premium.
- If you’ve been following Coronavirus in the UK, you
cannot have escaped Chris
Whitty, illustrious alumnus of DFID. He has very much been at the
public face of advice on the new virus, and the evidence suggests this
is rather a good thing. In the US, at least, trust in politicians is so
low that any intervention that makes use of them, even well-intentioned,
is likely to have the perverse effect of leading
more people to ignore their advice.
- And lastly, this week has been a bit low on frivolity
for me, but I did rather love these tweets pointing out exactly how
unsanitary most pop music wants us to be. Sweet Caroline:
vector of disease.
Have a great weekend, everyone!
I was thinking about a minor aspect of the Coronavirus
outbreak today. What would you do if you had a 14-day self-quarantine period
(don’t worry, anyone I’ve seen in recent days – I don’t, this is a pure
hypothetical)? I can imagine myself going mad as I fall further and further
down a youtube rabbit hole, discovering videos of obscure cricketers, jackdaws chattering and long-lost performances of
country songs, having already spent hours online reading econ blogs. It’s
almost disturbing how much this resembles my normal recreation. Maybe I need to
reconsider my hobbies? While I think about that, on to this week’s selection of
economic marginalia and random youtube videos.
- One of my friends has complained that he can’t listen
to Tyler Cowen’s podcasts: he finds him far too annoying to tolerate. Even
so, I think it’s worth listening to (or reading, in my case) at least the
first half of his
conversation with Garrett Jones, author of 10% less Democracy. It’s
fascinating. You may not agree with everything here, but I think people
take institutional forms for granted far too much and there is great merit
in questioning them. Some of these questions are obvious (clearly, the
incentives that are generated by having elected public prosecutors are
slightly mad) but others are less so, and rewarding to think about. I
find myself very sympathetic to the idea that expertise and technocracy is
undervalued at the moment (and that popular sentiment is overvalued almost
all the time), which probably puts me at odds with some rather
- On the subject of democracy, I liked this
piece by Nic Cheeseman and co on Kenya’s political bargain, which they
argue is much less driven by ethnicity and much more driven by protecting
the privileges of the rich than is typically understood.
- In what will be news to absolutely no-one I’ve spent more
than fifteen minutes with in the last few years, I like a good argument. I
also think arguing is one of the most efficient ways of improving my
ideas, just so long as your mode of arguing isn’t to dig a trench and then
die defending it rather than engaging constructively. Almost all of my
favourite places to work have been ones where people are comfortable
disagreeing with each other, and I’m happy to see that the evidence
goes my way on this. Feel free to disagree.
- Of course, even an incorrigible arguer like me likes
having their priors confirmed, so it’s with great pleasure I tell you that
Piper and Dave Evans at CGD have crunched the numbers and find that giving
teachers support without forcing them to follow a script seems to be the
best way of getting the best out of them.
- Two migration links: first, migrants
are good for the economy, part 23,453,129 – Dany Bahar and
co-authors find that migrants not only bring new innovations with them,
but they do so in fields in which the local economy has failed to innovate
successfully in the past. And secondly, depending
on unstable visas can be extremely stressful and creates pressure for
migrant workers to keep quiet when they disagree with their bosses. If
link 3 has any merit, this is not likely to be to the benefit of their
- I really liked this: Berk Ozler at the World Bank has
been recruiting economists, and has
written a post detailing the gender breakdown of the applicants and
interviewees for the jobs he’s recruiting for. This kind of
transparency is rare, and really admirable.
- Lastly, in work that must surely win the Nobel prize
(or at least the Ig Nobel), researchers from Georgia Tech have codified
the astonishing physics of making the perfect fried rice, a task that has always
eluded me. Watching videos of Hong Kong chefs it occurs to me that part of
my problem isn’t my technique, but the fact that I’m not cooking on what
appears to be an upturned jet engine. These guys must have serious
stamina to survive those conditions.
Have a great weekend, everyone!
Imagine how it must feel to get robbed twice, on national TV
no less. Yet this is what Aaron Gordon must live with: the knowledge that this
was not sufficient to win the dunk contest; a mere two years after he somehow failed to win for
this dunk, which is the athletic equivalent of digging up Isaac Newton,
slapping him awake, piling up all of the citations and kudos he earned for his
theory of gravity and then burning
them one-by-one like Chow Yun-Fat. Are we really comfortable with a notion
of justice that denies Aaron Gordon? For shame. (Other sad things happened this
week, too: most importantly, the passing of the man without whom we would all
be approximately 90% less productive, the
inventor of the cut and paste command).
- The big news this week was that
World Bank working paper that’s been getting all the press. In case you missed it,
the paper looks at bank accounts in tax havens linked to aid-recipient
countries and notes that when disbursements from the World Bank come in,
there tends to be a spike in deposits made in tax havens. The newspapers
have picked up on this – largely on the back of what appears to be a
speculative link in The Economist to this paper being held back at the
Bank and Penny Goldberg’s departure – and reported that a huge chunk of
aid is being leaked out to tax havens. Normally I’d blame the media for
this (and I do blame Ian Birrell for his basically mendacious insinuation
that because one impact evaluation of Jeff Sachs’ Millennium Village
Project finds it doesn’t work, aid in toto doesn’t work) but in this case,
the paper itself makes some ridiculously strong claims given the strength
of the evidence it presents. For starters, read Matt
Collin’s excellent thread picking out inconsistencies; for those with
the time, I’d encourage a close read of the working paper itself – there
is a lot to question here. I’m not linking to the media coverage because
we shouldn’t encourage them.
- This whole episode made me incredibly annoyed, so rather
than go straight into the next bit of geekery, let’s have a happier
digression first: noted polymath and object of the Links’ hero-worship LeBron
James has published a children’s book.
- I may be an incorrigible luddite, but I’m not generally
a fan of online purchases: I like to hold something in my hands before I buy it.
I may be one of the last people in the world with a ‘CD collection’.
No doubt I’ll be donating it to the British Museum soon. So it’s no
surprise that I reacted with Bruce
Lee-level horror when I discovered some people order mattresses
online, and even worse, are allowed to return them after they’ve been
were just as horrified as I was and did some digging, and as usual you
can learn something about the economy in the process.
- This week in gender: first, women’s representation in politics isn’t just
intrinsically important; it
also changes the kinds of services available and increases welfare for
other women, which given their starting level of underrepresentation seems
like a win. And David Yanagizawa-Drott has a nice
video summary of his cool work on norms and female labour force
participation in Saudi Arabia. Related: Markus
Goldstein summarises (in typically engaging and accessible style) a paper
looking at how information and a self-efficacy intervention affect labour
force participation in India. An interesting finding: the most
effective way of getting women into work is the use of peer testimonials
for both women (other women who have taken jobs) and their husbands (the
husbands of these working women).
- Oriana Bandiera presented this at DFID about a year
ago: her paper with a number of co-authors using data from BRAC’s
livelihoods interventions to demonstrate
the existence of poverty trap effects that a single, one-time
investment can help overcome.
Prisoner’s Dilemma has just turned seventy (which means that the
original participants must be just about to qualify for parole). Tim
Harford breaks it down to consider why it’s so rich with insight for human
behaviour. Interestingly I’m currently reading Akerlof and Kranton’s
Economics, and if you take their work seriously (and I think you
should), you might gain a new, more sceptical, perspective on the value of
- Did you ever wonder what the standard deviation of
mullet length was? Did you ever think you might be able to instrument
for institutional quality by the
hair size of the ruling coalition? Well, the firs stage in all of
this is now available. The
Pudding has run a quantitative analysis of Big Hair in the US, and
made all of its data and code available. This is not the first time they have
answered the call of the curious. It’s ridiculous and hilarious, and makes
me want to grow a mullet.
Have a great weekend, everyone!
The All-Star Weekend is upon us. For the uninitiated, every
year the NBA breaks for a few days to have a massive jolly, with
semi-competitive games, prize-giving, and absurd skills tasks – basically, it’s
a village fete, attended by some of the most speular and well-paid athletes in
the world. It’s completely pointless, but serves as an inflection point in the
season and occasionally provides a moment to savour – like Vince Carter’s dunk contest
win in 2000, quite possibly the greatest physical feat the human race has
achieved to date. Increasingly, I feel like real life should mimic the NBA more:
economists need something like the All-Star Weekend. Maybe we can repurpose the
AEA Annual Meetings? In lieu of a dunk contest (though it might provide its own
– very different – amusements) we can have people to compete over who can write
the most unrealistic model in 90 seconds? However it works, economists need
some time out from all the crazy we have to attend to these days. (If you need
some immediate relief, go straight to the end for the Clueless reference).
- Maybe we’re the cause of the crazy, though? Paul
Romer thinks we may well be part of the problem (dropping Alan
Greenspan with a pretty strong one-two on the way) in this piece about the
influence of economists in public policy. He focuses on the US, but
I’ve heard similar arguments made about the UK many times. It’s
well-written and worth reading but I disagree with Romer’s take on two
grounds. First, he seems to conflate the condition of ‘being an
economist’ with that of ‘being a free-marker idealogue’; this is far
from the truth. Economists cover a diversity of views, opinions and takes
on the evidence. That a group of economists had the ear of a set of policy
makers for a time says as much about policy makers and politics as it does
about economics. Secondly, Romer argues that economists have started to
talk too much about what ‘should’ be done, rather than the impact of
different possible policies. Again, I’m a dissenter (more controversially
here): I think economics has a lot to say about what a better world
might look like. We just need to be clearer in dividing thinking about
what from how.
- Just to ram home the point about the diversity of
worldviews and approaches that economics can comfortably house, here’s
Brank Milanovic’s latest, on the
concept of wealth and its application to power. Branko points out
wealth is not at all an obvious concept once you start thinking about it
carefully, and then discusses how the manifestation of wealth as power
varies dramatically with different political systems. I do think that
economists can sometimes take concepts for granted, and one of my
favourite things about reading Branko is that he never does.
- I found this really interesting and thoughtful: an
African student at the LSE on how
the discourse around Africa in international development feels to her.
Related: Tim Besley, Thiemo Fetzer and Hannes Mueller argue that a
negative skew in media coverage can have macroeconomic implications as
well as just painting a false picture of the world.
Oqubay lays the smack down on the UK Visa system and it’s treatment of
- Tim Harford is pretty much my favourite economics
writer out there (edging out Michael Lewis on the grounds of being more
prolific) – and this
podcast with Tyler Cowen is a pretty good insight into his ideas and
how he thinks and writes. He – like me – is fascinated by the role of
mistakes and errors in progress (and obligatory reminder: please send
any stories of things you’ve changed your mind on – I am collecting them
for a note on the topic). Related, but more research focused, Ben Olken on some of his epic
failures – a great read for any mildly depressed DPhil student (or,
more parsimoniously, any DPhil student).
- Seema Jayachandran on what
we know about supporting microenterprises, carefully evidence-based. Anyone with money to
spend in the private sector development area should definitely read this.
- Unusually for an economics-obsessed uber-geek who
spends his spare time mainlining cricket statistics and watching
basketball highlights, I’m not much of one for Valentine’s Day. It’s an
excuse for restaurants to juice the mark-up on Prosecco and set menus, and
for terrible movies to debut at the cinema. So I’m fully on-board with
The Ringer using today to launch its list of the
50 greatest break-up songs of all time. A few quibbles: did they
just forget Caitlin
Rose’s Own Side, or are they actually tin-eared? And, in a similar
vein, that scraping sound you hear is David Ruffin turning in his grave,
because HOW DID THEY
LEAVE THIS OUT?! And if you’re going to see a film tonight, remember:
the book is always better. It’s
now proven. (Except
for Clueless. Clueless is way, way better than Emma).
Have a great weekend, everyone!
You know, for all the pearl-clutching about how AI is coming
for all our skills – beating Grandmasters in chess, solving Go – I can’t really
find it in myself to worry when I see the results of all of Amazon’s snooping
into my computer summarised as a list of reading recommendations. It includes
two cookbooks (neither tempting), a series of airport thrillers, and a number
of romance novels followed by a slightly desperate appeal to ‘help make our
recommendations better’. The last one included a travel guide for Easter
Island (this must be one of the shortest Lonely Planets ever) and an
instruction manual for a computer programme I do not own. The computers may be
coming, but probably slightly more slowly and less effectively than we think.
- I’ve been collecting stories about learning from
mistakes and recognising mistaken beliefs over the last few weeks (if
you have any reflections that you’d like to share – please do!). It
feels important when you work in a field where findings are constantly
challenged and evidence questioned, the challenge being working out when
it’s right to change your beliefs in the face of new evidence – very often
the right answer is to entertain more doubt, but maybe not switch sides
too quickly. That’s how I’m processing this
VoxDev piece, which goes right against my priors by arguing that the
institution of a steadily increasing minimum wage in a developing setting
– Brazil – not only reduced overall inequality substantially but also had
next to no negative effects on job creation or firm dynamism. In fact,
they argue the minimum wage helped redistribute resources to the most
productive firms. One to dig deeper on.
- This is fantastic: IPA have done a video going ‘behind the scenes’ on one
of their research projects in Sierra Leone, to show
us the practicalities of collecting data in poor places. It’s a nice
way to show appreciation for the crucial and difficult work that is
usually glossed over with a paragraph on survey response rates in a final
paper. It’s also important because most people who work with data don’t
collect it themselves. That distance can be dangerous: understanding your
data is more than running a few tables in Stata.
- Even Tim Harford’s asides are good: “Economic
policymaking has flaws, but an obsession with GDP is not one of them”,
he says, giving voice to one of my pet peeves by pointing out that a huge
amount of economic policy over the last few years has been in
contradiction to consensus opinions of how to maximise GDP growth. But it
is an aside, to a much more interesting discussion about how
GDP growth is increasingly being decoupled from the production of physical
stuff, and the implications this has for our efforts to achieve some
sort of environmental balance without huge reductions in living standards.
- I’m occasionally accused of being something of a downer
in these links (it wasn’t always thus, the world changed with the
links), so here’s something happy – specifically that research on
happiness suggests two peaks: youth and old age. If you’re reading this
the odds are you’re somewhere between those poles, so Danny
Blanchflower is here to tell you that it will get better. He
attributes this to aspirations becoming real – things you once thought of
becoming things you experience. As he says “And you know, life
- David Evans turns
development into a choose-your-own adventure when he talks to students,
and wants to know what others do. It’s been a while for me, but for
younger students I’ve tried to take the Hans Rosling/Max Roser approach
of realistic optimism, by giving them a few facts about the world and then
tasking them with creating their own ’50-year-newspaper’ front page,
reporting only the biggest stories of that time period, then talk through
how economics and development work might have played a role.
- Kaushik Basu writes so well that his warning
about impending global economic apocalypse is almost a fun read.
- I finally managed to bring myself to watch the last
episode of the Good Place this week. I don’t think I’m giving anything away by saying that
you’d better be prepared to rehydrate afterwards. I’m a hopeless softy,
but it was a tough one. But let’s remember it in happier times,
specifically this: 666
seconds of Ted Danson’s evil laugh at the end of Series 1 – one of
the great moments in TV history.
Have a great weekend, everyone!
Normally this intro paragraph is the hardest thing to write
each week, but today there’s almost too much to say. The 2010s took a whole
load of my cultural touchstones away – there was a two or three year period in
which we lost Bowie, Prince, Chris Cornell and Lois Lane for goodness’ sake –
and the 2020s have started in similar fashion. Last Sunday, it was Kobe
Bryant, who for most of my life was the most inescapable basketball player
on the planet, and not without some seriously troubling aspects anyone thinking
about his life needs to confront; and tonight begins the really long goodbye –
also troubling, also complicated, with much left to confront still. It’s all
quite grey around here. Even preposterous highlights from
Zion Williamson’s first few NBA games aren’t cheering me up.
- Regular readers will know that I think inequality is a
serious problem, most likely a growing one, and one which lends itself to really
good twitter putdowns. Still, this
piece on Duncan Green’s blog sticks in my craw: essentially, the
authors (not Duncan) are arguing that because inequality is important,
being careful about the evidence we use and the data underlying our
approach is of secondary importance. Worse, they describe those that do
care about these things as engaged in a phony war, implying that the
purpose is to deflect attention from inequality. This is, not to put
too fine a point on it, pretty irritating. It does matter that we
measure these things correctly, and that we know exactly what we’re
measuring and what the idiosyncrasies of our measures are because they
will ultimately inform the policies we pursue. For example, what’s the
right level for the top rate of income tax? Or a wealth tax? You might say
that the answer is ‘obviously higher than it is now’, but even if that’s
true, it’s not exactly the basis for setting policy carefully, is it? Being
accurate is not a side-issue to policy advocacy – it is of central
- Now that my rant is over, let me hand over to Justin
Sandefur and Charles Kenny. They
take aim at the World Bank’s Doing Business Survey again, this time
pointing out how much of an outlier it is in the way it treats tax:
much the same way Thor
treats Thanos, so without much temperance, subtlety or concern for
- 538 are at it again, this time with a brilliant look at
the US electoral system penalises women, and how some states are going
backwards, not forwards. Their whole series on When Women Run
is fantastic, as befits what remains my favourite source of proper data
journalism. Related: Planet
Money play Ms. Monopoly, an attempt to make a version of Monopoly that
reflects the reality of how gender and the economy interact (transcript). Two
problems: first, Monopoly sucks. And second, Ms. Monopoly still seems
pretty sexist, which chance cards that include women having to hide on the
fire escape to get out of a bad date.
- I desperately needed this post two years ago, but I’ll
take it late:
Florence Kondylis and John Loeser on doing
power calculations quick and dirty.
- A really cool
new paper uses data from past experiments to investigate what exactly
is going on when investments in women’s businesses seem to have no effect
on productivity. It turns out that women often choose to invest that
money in the most profitable household business they have access to –
which is often the one the husband runs. This isn’t a failure of the
intervention, it’s a case of the recipient being smart enough to realise
what is best for them.
- One for the organisational theory geeks (again, this
should be many more of us): Tyler
Cowen’s reading list for the Industrial Organisation course he teaches
at GMU. It’s rammed with great papers, and worth a look for anyone
interested in firms, markets and organisations.
- Finally, one last goodbye we’re having to make this
week: The Good Place is coming to an end this week. I’m not sure I
can cope with three endings so soon after each other, so I’ll be watching
the last episode next week, but The Ringer have chosen to celebrate the
show appropriately: with the only form of news in hell, the
online listicle. And for those of you who care about such things:
538 have built an algorithm to predict J-Lo’s
first song at the Super Bowl. But it doesn’t matter, because nothing will ever match
Have a great weekend, everyone!