Some weeks the intro just writes itself. I’m sure virtually every reader of the links has learnt a great deal about the micro-political economy of the United States in the last week; I’ve got friends in Hong Kong texting me with back-of-the-envelope calculations of the number of votes remaining in Maricopa County, and despite not knowing if London is in an English county (is it in Middlesex? I always leave the county line blank when making online purchases), I now know which US county Las Vegas and Pittsburgh each belong to. I’ve never even been to the US. One friend pointed out a strange feature about the experience of watching this election unfold: though we experience an ebb-and-flow of fortunes over time as one candidate or another gains in the latest batch of votes to be counted, in a very real sense, the election result itself has not evolved at all since Tuesday when the ballots closed. The votes being counted have already been cast: the result is unchanging. All that changes is our own perspective or position in relation to this unchanging result. Of course, if you want to go full universe brain, this is pretty much exactly how space-time works (click here if you want the Marvel explanation).
- Once again, the polls have taken a battering in the press as a result of the “early” election results; and once again, the truth seems a little more complicated than that. In defence of the polls, the results in almost every state have more or less fallen within the margin of error of the polling averages; what’s more, they are mainly moving towards the central estimate as more vote counts are released. On the other hand, the actual results definitely demonstrate a systematic bias from the expected results based on polls. Andrew Gelman describes the failings of the polls here (a more technical look at the results, with his R code is here) and with more interesting graphs here. It’s important to distinguish between the polls and the forecasts, which are modelled estimates of the electoral result based on polls. It’s kind of OK for the polls not to be great as long as we know how they’re flawed so we can correct for them in the forecasts. Nate Silver took a lot of flak for some odd adjustments he made to the 538 model, but in retrospect it looks like they helped mitigate the polling errors and brought their model closer to the result. I was asked this week is if the polls are good enough to be useful ahead of time anymore, if they so often seem to miss. My take is that they still are valuable – but perhaps this is ceasing to be true.
- It wasn’t only the Presidency up for grabs, of course – one of the more eye-opening results was that Oregon voted to legalise basically every class A street drug. This is going to be fascinating, and I foresee a slew of difference-in-difference papers in a few years’ time. Bunny Colvin would be proud – Hamsterdam in America.
- I can see a theme on state capacity emerging over the links. Tim Harford assesses the case for both the zero-Covid and the lockdown sceptics take on coronavirus strategy and instead argues that the most essential component of public policy in response to the pandemic is just to get the absolute basics right. Make sure standard services work; make sure contact tracing if effective; and make sure basic public health is effective. “Just stop bungling the basics. It is not much of a slogan. But it might just be a solution.” Quite.
- And still on the theme of state effectiveness, Planet Money had a good show on the origins of the Mafia in Sicily (transcript) – born of extremely weak state capacity, the Mafia emerges once a domestic product that is both valuable and easy to steal emerges, in this case those glorious Sicilian lemons. With the state incapable of protecting producers who need to make large up front investments in lemon production, credible contracts with the Mafia become preferable to dealing with the tax-funded services being so poorly applied, like policing. And related: a nice write up in VoxDev of research that shows how organised crime can hamper economic development, this time in El Salvador.
- Two good things on firms: first, an IZA paper by Charles Ackah and co-authors on why female entrepreneurs export less than their male counterparts in Ghana; and a study by David McKenzie and Diego Ubfal on the optimal pricing for business training (spoiler: it’s not free).
- Two nice pieces on Amartya Sen: first his sometime co-author Jean Dreze on his vast intellectual legacy, a foreword to the new book How to Read Amartya Sen. It’s striking that Sen has written so much that some of his seminal contributions (I always remember his papers on Arrow’s Impossibility Theorem as particularly mind-expanding) don’t even make it into a book about how to read his work! And secondly, Branko using his On Economic Inequality as a launchpad for his own musings on the philosophical underpinnings to understanding inequality.
- I’m going to sign off the links now: I know most of you will be skim-reading between pressing ctrl-R to find out the latest from Clark County or Alleghany. But if it’s distractions you need, I got you: via Anna Karing, this adorable thread on how baby animals are weighed (porcupettes for the win!). If cute animals don’t do you, I have a backup – the sober Halloween tradition in Taiwan, where people dress up as mildly awkward day-to-day events. Larry David would be the king of this.
Have a great weekend, everyone!