It’s always hard to open the links when a Sri Lanka ODI is still at that point where we might win, if sufficient miracles occur, rather than at the point where I can simply make darkly comic jokes about the pits of human despair (a place new parents with teething children are well-acquainted). Speaking of the pits of despair, the news in the UK all week has been horrifying; the weather is doing its best to follow suit. Little sunshine comes in the links, but read them anyway.
- “In times of plenty, anyone can afford to be generous. True generosity is revealed in times of scarcity.” So begins a brilliant and cutting piece by my colleague Gyude Moore, arguing – more or less indisputably – that there has been a huge moral failure in the global pandemic response: vaccine export bans, hoarding PPE and the like showing up the hollow promises of ‘values-based’ foreign policy. But his point goes deeper than this. He argues that the distasteful war metaphors that have been so popular with a particular brand of macho world leader hinted at a better way of approaching the pandemic. Drawing on Bush’s rhetoric justifying his war on terror, Gyude points out that if the same full-throated approach was applied to saving lives as to ending them, the global response would be much fairer, much more coordinated and much more effective. Really highly recommended.
- I googled hubris today, to check I was using the word correctly, and discovered that Google’s go to definition is basically ‘that thing that economists are prone to’. Dani Rodrik largely concurs, and this really excellent piece looks at both the abandon with which economists march into other scholars’ domains and to hold forth and the limitations that the economic conception of causality imposes upon their insights. He argues that forward causality (when I change X, this happens to Y) has more limited value for many disciplines than reverse causal inference (Y changed and it was caused by X, Y, and Z). It’s a lively and interesting discussion, but perhaps incomplete. I read The Book of Why by Judea Pearl and Dana Mackenzie recently, and the discussion of reverse causal inference there was much richer than I’ve seen in general in economics, and provides a bridge from our discipline to the world.
- Penny Goldberg and co-authors summarise their new paper using modelling and data on firms and workers to look at the effects of trade openness on both the formal and informal sectors. The whole thing is worth reading, but one point that I found particularly compelling is that while trade openness can lead to an increase in inequality in the tradable sector (due to the diverging fortunes of exporters and non-exporters), it may result in an overall decrease in inequality because it also leads to increased incomes in the informal sector. The mechanism seems to essentially be the Balassa-Samuelson effect, which fits so neatly on my priors it looks like a new winter coat.
- I really enjoyed John Cochrane’s turn on Conversations with Tyler; for all that he holds very different views to me, I always find that I learn something reading him. His description of his childhood dinner table conversations are very familiar to me (not because I had dinner with his family, because they sound very much like mine), and I laughed out loud at this section: “my wife, Beth Fama, did the same thing at age 12. Looked up at that dinner table full of finance people and said, ‘Dad, what’s arbitrage?’”
- Maggie Koerth at 538 is my favourite science writer by a long distance, and this piece on the pandemic and cognitive load is extremely relatable: the constant pressure of decisions that have no clear right answer, the thousands of small and large choices you have to make where the unknowns swamp the knowns, and yet the stakes remain resolutely- on aggregate at least – high. It’s brilliant, personal and universal.
- One for the techies: two takes on study designs. First David McKenzie talks through what makes him relatively more confidence in a difference-in-difference design; and then Andrew Gelman explains how he would approach a discontinuity design. And at the end of both of these I thank my lucky stars I’m not working on one right now.
- So while Sri Lanka hurtle to yet another humiliation (miracles stubbornly not forthcoming), I’ll leave you with yet more Muppet content: did it ever occur to you that there was someone picking out outfits for every muppet in every scene? The muppet costume designer explains why it was easy to make Kermit look good and why Gonzo was a disaster. And if that doesn’t set you right for the weekend, my son’s favourite song right now: the Muppets do Jungle Boogie.
Have a great weekend, everyone!