Hi all,

It’s nice to be able to start the links without some reference to sporting humiliation. Granted, this has mainly been because neither England nor Sri Lanka have been playing test cricket this week, but still: I will take what respite I get when I get it. Speaking of respite, do you follow Eric Barker? His blog is full of the worst kind of click-bait titles, the kind of thing that you see in the sponsored adverts at the bottom of bad news website (“You’ll never guess what happened three seconds after this photo was taken!”), but the content is actually very serious: he draws on proper research from across the (social) sciences to draw up actually practical advice about how to make your life better. The titles always overclaim, but these do actually seem like decent ways of making your life better. Actually, another thing that would make my life better is if the couple having the ostentatious PDA at the table next to me tone things down a  bit.

1. Last week, I suggested economists should read more from the theory of the firm, industrial organisation and the economics of contracting. This week, two excellent bits of research reinforce the point. In the first, Arthur Blouin and Rocco Macchiavello look at how dysfunctional contract enforcement can undermine inter-firm relations so badly that the gains from exposure to global markets can be lost. Essentially, they show that firms can exploit poor contract enforcement to renege on deals in the face of unexpected shocks (there are a lot of these in the real world), leading to the adoption of suboptimal inter-firm relationships and industry structure, eroding the gains from trade. Another piece of research, in India, focuses on the slowness of Indian courts, which also makes contract enforcement patchy and unreliable. The upshot is that firms restructure themselves and their input sourcing and trading relationships to protect themselves from risks, but at the cost of being less productive. The economics of firm organisation is a pathway to understanding so much of what’s wrong with an economy: every firm choice tells you something about the environment it has to swim (or sink) in.
2. Another way of becoming a better economist would be to enrol in the University of Houston, and make sure you sign up for every talk and course delivered by Dietrich Vollrath. The third part of his course on the economics of institutions is summarised here, and it is a masterclass in how to be a good economist. Dietz has absolute conceptual clarity, disambiguating the various ideas that coalesce around ‘institutions’, which makes it easy to understand his teaching and the merits and drawbacks of the research. He has paid attention to the empirical detail, so he knows what is right and wrong with the interpretation of the data, and what it can and cannot be used for. And he has a broad enough view to then put the work in its correct context. Seriously, this is how most economics should be written and taught. He also writes so well that I would read his shopping list for literary value.
3. Marginal Revolution’s online university now has a series on inspiring women in economics. I am looking forward to seeing how two dyed-in-the-wool libertarians cover Joan Robinson (who, incidentally, did not become a full Professor until a few years before her retirement, despite her canonical contributions to economic thought).
4. Branko Milanovic takes an extremely fair and even handed view of the controversy between Steven Pinker and Jason Hickel about the long term trend in global poverty. Do read it, but also make sure you read the linked post by Max Roser and Joe Hassel from Our World in Data, a website you should almost certainly be using more than you do.
5. I am almost always driven to fury by academics talking about ‘engaging with policymakers’ like we’re an undifferentiated mass of lemmings (I once sat through a presentation by a poverty scholar who repeatedly said “policymakers don’t care about causality”, turning me ever deeper shades of furious). Markus Goldstein avoids this trap in a nice blog which differentiates between different kinds of policymakers and the kind of interactions researchers are likely to have with them. I would emphasise Markus’s point that the categories are not mutually exclusive, but this is a much better starting point for understanding how to influence policy.
6. This is absolutely one of the coolest bits of research I’ve seen for a while: Eliana La Ferrara and coauthors do an amazing piece of work looking at the effect of implicit biases among schoolteachers on migrant children’s scores. Unsurprisingly, biased teachers tend to penalise migrant kids more than is justified by their actual work. What’s really fantastic, though, is that they find that if you inform these teachers of their own implicit bias scores, that penalty starts to disappear, and migrant kids are more likely to be assessed on merit. The effect seems to be driven by those teachers who don’t explicitly endorse discriminatory views, i.e. the ones who don’t think they’re biased. My erstwhile ex-blogging partner, Matthew Collin sent me another cool piece of work: Mara Revkin uses social media and other sources to map out the tax network set up by ISIS.
7. The best board game I’ve ever played is Pandemic (recommended so regularly by Tim Harford, I bought it for my niece and enjoyed it so much I bought it for myself as well). It turns out it’s not just fun, it’s pretty realistic, as this Planet Money show on disease control demonstrates (transcript).
8. I normally end the links with some happy insanity, but this definitely doesn’t count: on average, American airport security staff found 12 guns a day being taken as hand luggage onto flights there, the vast majority of which were loaded. They ‘credit’ enhanced security features for this number. I blame a completely insane culture of leaving the house strapped like Neo and the worst low-level equilibrium possible.

Have a great weekend, everyone!

R