The CSAE Blog

Hi all,

My traditional intro usually consists of some mild gloating about the weather wherever I happen to be sitting on that particular Friday (today, windy and miserable as I look out on a half-destroyed garden after overnight storms), chat about the cricket (today, the crushing realisation that Sri Lanka have consecutively lost to Afghanistan and Bangladesh by around 100 runs in the Asia Cup); and some comment about either birds or books (today, I’ve just watched a blackbird rip a slug into several pieces and leave half on my garden table). So with all my usual topics variously distressing, straight into the links.

 1.       I really wish I’d seen this last week when I was covering the latest outbreak of cash transfer navel-gazing: an excellent, measured and carefully judged piece by Andrew Zeitlin and Craig McIntosh which explains what you can and cannot conclude from the ‘cash benchmarking’ exercise USAID undertook recently. It’s worth reading in full and might change your mind about what intervention makes more sense – and the merits of comparing them directly. They point out that while neither intervention moved the needle on nutrition much, both had other positive effects, and different ones. The nutrition programme improved knowledge about health practices and savings; the cash led to lower debt and greater asset ownership. More interestingly, they point out that the kind of gains that the nutrition programme made were likely scale up (everyone having better health knowledge is a good thing); but there were signs that some of the cash gains might be reversed if the programme went to scale. It’s a great piece that highlights exactly how much nuance is lost in the headlines.  

2.       This week in ‘1980s Popular Culture Lied to Me’: apparently, Pretty in Pink is lies, lies, lies. You know how Andie and Ducky have a horrible time in their rich-kid dominated school, and James Spader’s character (the least convincing teenager in film history, surely)? Well, in a post apparently calculated to destroy a crucial part of my adolescence, Susannah Hares says that this just isn’t want happens. Apparently, forcing rich schools to accept poor kids increases social cohesion and pro-social behaviour at no cost to learning outcomes. This may be the case, but does all this positivity produce a soundtrack like this? I think not (yeah, I know, the video. It was the ‘80s).

3.       I know I link to Planet Money every week, but this one is ridiculously good: they go to a convention of US Central Bankers to ask them why traditional central bank levers like interest rate manipulations seem to have lost their bite. They get some extremely high quality evasion from the kind of people who know that their facial expressions are enough to trigger currency runs. But just when you think you’re getting nowhere, they strike gold, with John Van Reenan and Raghu Rajan spinning theories, much of which has to do with market concentration and the changing nature of the economy (transcript).

4.       The latest Commitment to Development Index is out and finds Europe dominating the top ten. A deeper dive into how trade features in the CDI here.

5.       This one would have kicked off a blogosphere explosion ten years ago, but will now be treated as confirmation of a widely-held view: a proper evaluation of the Millennium Village Project in Ghana has had very mixed results, with its technocratic approach to progress and its cost effectiveness particularly in question. It still really bothers me that proper evaluation was made so difficult from the get-go.

6.       This week in ‘that Guardian headline saying that the colour of your shoes can make you eat up to four portions more per meal is bad science’: a researcher at Cornell had thirteen papers retracted over academic malpractice. It’s actually a really sad story that has cost someone (probably several people) a job; but there’s a reason I don’t believe anything in the papers about the benefits of certain foods or diets.

7.       And finally, the first trailer for Captain Marvel has just dropped, and it is causing me enormous mixed feelings. Not about the movie: the movie is going to be awesome and Brie Larson is so likeable I literally cheered her punching a pensioner. Nope, the problem is that it comes out in March 2019, so I am now simultaneously anxious for and dreading that month.

Have a great weekend, everyone!

R

Hi all,

 There really aren’t too many downsides to spending a week in glorious sunshine in the Alentejo – a place where in a single morning you can easily spot 50-odd bird species, including so many Little Owls they were like extremely suspicious and wary pigeons, and great flocks of Azure-winged magpies. But there are some, including returning to around 1000 articles in your RSS feed, the vast majority of which you’d rather bin without further ado than read. Still, there were some real gems buried in there, so this week’s links is longer than usual; to compensate, I’ve scattered the random bits of idiocy, sports and marginalia I usually save for the final bullet throughout the e-mail today (the best one is still last, though).

 1.       The big news of the week was the new paper from Chris Blattman and co-authors, which found that nine years after they delivered a cash grant to randomly chosen unemployed young people in Northern Uganda, they were no better off than the control group – despite racing ahead of them at the four-year mark. Berk summarises the paper with his typical pithy precision here and Dylan Matthews discusses what it means for the cash transfer brigade. I’ll add two observations. First, even the worst interpretation is not bad: cash injections helped people get better off faster, but not ‘more better off’. Anyone living in poverty would take that instantly. Secondly, this shouldn’t be all that surprising. Most places are poor because their economies are very very messed up. Because cash grants can’t be expected to solve this directly, you probably should expect small long term effects: either those things that make the economy messed up don’t go away and everyone will, on average, struggle regardless of whether they got the cash booster or not; or the economy will be reformed and everyone will get better off, in which case it’s a good thing if a randomly allocated cash grant isn’t a permanent advantage. None of this means they don’t ‘work’.

2.       Related: Vox cover USAID’s experiment with ‘cash-benchmarking’, the practice of comparing the effect of a programme to the effect of a similar amount of cash, rather than a do-nothing counterfactual. Interestingly, they cover a lot of the issues with the idea of cash as the comparator of choice, but don’t mention the possibility that it has little long-term effect.

3.       Ok, there’s a lot to think about there, so just take a moment to decompress and ponder Mark Wahlberg’s completely insane daily routine. The man gets up at 2:30am and takes a 90 minute shower. Also, maybe he wouldn’t need to spend three and half hours in the gym if he didn’t snack so much?

4.       David McKenzie discusses whether the art of the descriptive development paper is dying out, typically excellent. Scroll down to the comments to see the heavyweights sparring: Lant Pritchett, Chris Blattman and Karthik Muralidharan all show up.

5.       Appropriately, a really excellent bit of descriptive research into how women and men vary in how they negotiate pay in a very specific Argentine setting. You couldn’t extrapolate too far from this, but it’s fascinating and rings very true. And more on gender and inequality: Francine Blau went on Planet Money to explain why women continue to earn less than men, a very easy introduction to the economics of the gender wage gap; a faintly horrifying piece by Rosella Calvi looks at female negotiating power and how it affects poverty and mortality over the life cycle – and discovers that older women face much worse outcomes; and Tim Harford on inequality across multiple dimensions and how it differs.

6.       And as your faith in humanity collapses with that, read this amazing and uplifiting story about how an adopted NFL coach tracked down his birth parents; and how Joel Embiid learnt how to shoot by googling ‘white people taking three-pointers’.

7.       Not only is Dietrich Vollrath back to blogging, he’s also got a book coming out! Whet your appetite with two magisterial pieces that demonstrate his ability to make macroeconomics simple: first, he looks at the evidence for a ‘new normal’ in US growth substantially below historical norms; and secondly he explains the economics behind the finding that small farmers are more productive than larger ones – which runs counter to a lot of economic logic.

8.       How big is your file drawer? Apparently, fewer than half of the clinical trials registered with the EU ever report their findings, despite being legally mandated to do so.

9.       More from Stacey and Cardiff (Garcia!) at Planet Money – looking at some of the reasons why free university tuition might not be such a great progressive idea. This isn’t a full treatment of the issue, but read it. This is one area where becoming a better economist really changed my views.

10.   And lastly – finally! – Pitchfork rank the 200 greatest albums of the 1980s. Anyone roughly my age is going to lose a good chunk of their day to youtube after reading this. Like all lists, it’s irritating and clearly wrong at times, but it gets some of the most important stuff right: it correctly identifies Rakim as the greatest rapper of them all, reminded me of EPMD, criminally underrates Appetite for Destruction, and has Let it Be by the Replacements fully 34 places too low.

 Have a great weekend, everyone!

R.

Hi all,

This week’s links are a little longer than usual, but they’ll also be your lot until September 14th as I flit off to Portugal next Friday, where matters of economics and public policy will be far from my thoughts. Instead, I shall be turning what little concentration I have to systematically testing out the Decanter guide to Alentejo (I know, it’s a hard life), eating my way through their entire agricultural production, and copious birdwatching, with occasional breaks to read Rumpole. My only remaining problem is finding a place to watch the first few days of the Oval test…

1. Is brilliance random, a habit, or a temporary state of being? In sports, Amos Tversky and co-authors prompted endless back and forth about whether a ‘hot hand’ exists in basketball, arguing that it’s purely an illusion created by our very human inability to recognise randomness when we see it; others have made repeated attempts to prove that hot streaks of above-average performance are real. A really thought-provoking article based on new research extends this idea to other areas of human endeavour: science, the arts, your career. It finds that there are single peaks of brilliance that aren’t random; instead people hit creative hot streaks that tend to account for a disproportionate portion of their best work. This isn’t just navel-gazing: it extends the Peter principle idea, since if you’re promoted due to your hot streak, you’ll likely never reach that height again. I have some doubts though: one is that this might not be due to a ‘hot streak’ so much as an innovation. If you come up with a brilliant idea or piece of inspiration that’s the backbone of one paper, or piece of music, it’s likely you’ll keep mining it before others leap in – creating a hot streak. There are other explanations, too. Entrepreneurs know that one brilliant success dramatically improves the quality of finance you have for your next project, but that your next failure resets you zero; in film one great movie has stars clamouring to work with you, but a dud makes you toxic. The jury remains out.
2. Philip Gourevitch pulls no punches in a profile of Kofi Annan.
3. Can football aid nation-building? This VoxDev piece argues the case for it. I have two main questions: first, is it really reasonable to say that the result of the final round of games in qualifying for the Africa Cup of Nations is ‘as-if’ random for teams with a live chance of going through or going home in the final game? And secondly, how long does sporting euphoria last? Maybe we can ask France?
4. I think Francis Fukuyama is exactly right about this (a sentence I have almost certainly not typed before): public policy education should be more about policy making, rather than policy analysis. It is substantially easier to teach or learn the latter than the former, though – so it’s really important for schools to emphasise applied work or projects.
5. Planet Money are doing a series of ‘economics beach reads’, which is apparently not an oxymoron. They discuss Diane Coyle’s book on GDP and a forthcoming book about why the modern office is a hellish productivity sink. One good point: cheaper and easier communication only improves outcomes if both sides of the communication are able to assess the costs and benefit of engaging before doing so. But actually, if the recipient feels obliged to respond and the initiator simply thinks of their own cost-benefit, you wind up with a whole load of socially sub-optimal communications.
6. I liked this more for the ancillary information than the findings on migration, but this piece on what we can learn about how and why people move from studying prostitution in 18^th Century France is really interesting.
7. How strongly do people respond to the marginal return to work? Apparently, not all that strongly at all.
8. Vijaya Ramachandran and Todd Moss have a paper categorising the different kinds of firm that suffer from unreliable energy provision in Africa; it’s based on the WB Enterprise Surveys, so there’s a swathe of firms not covered, but it’s interesting to see the different profiles that come up.
9. An finally, the marginalia: first, an irritating new study finds that any alcohol consumption at all is a bad thing – but the only benefits and costs it considers are to health. Next Saturday, when I’m knee-deep in salty, delicious Portuguese pastries and half-way down a bottle of Verdejo, I’ll be measuring my returns in happiness, not longevity. A much less annoying study from MIT considers why it’s so hard to snap spaghetti in two. And finally, if you’ve got a strong stomach: sixty international covers of Lolita, from the sublime to the ridiculous.

Have a great couple of weeks, everyone!

R

Hi all,

I have to admit: my reading took a hit yesterday after the news about Aretha Franklin broke (for all the many qualities of her music, it’s not something you can concentrate on reading to). My first memory of listening to Aretha Franklin was rewinding my copy of the Blues Brothers to watch her scene haranguing Matt Monroe with Think repeatedly (for years, my go-to move on the dancefloor was a version of that dipping, rising, jazz hands thing she moved Jake and Ellwood to). This was way pre-internet, and we had to try and decipher the lyrics to all those amazing songs through repeated listens, no great hardship in retrospect (“is she saying ‘taking care of TCP?!’”). My favourite of her songs, though, were her cover of The Weight, paired with the best slide guitar line of all time, and her version of People Get Ready. The latter, weirdly, reminds me more of Nusrat Fateh Ali Khan than any soul singer: the last minute of the song is as much a Haal as the climax to Allah Hoo Allah Hoo.

1. Aretha wasn’t even the only cultural giant who died last week: we also lost the rather complicated figure of V.S. Naipaul. By all accounts he was a pretty unpleasant man, as this excellent retrospective by Gabrielle Bellot on LitHub remarks; I remember Diana Athill, his editor, used to combat depression by reminding herself ‘at least I’m not married to Vidia’. He wasn’t even my favourite writing Naipaul (I preferred his less misanthropic – or rather, more evenly misanthropic – younger brother Shiva). However, if you were concerned with displacement, belonging, the migrant experience and the sense of dislocation that comes from being an outsider anywhere he was one of the great writers of the last century.
2. And speaking of migrants, Christopher Parsons and Pierre-Louis Vezina use the allocation of Vietnamese boat people around the US as a natural experiment and generate estimates for the causal impact of migration on trade at different stages of the US-Vietnamese trading relationship. If you’ve been paying attention to the evidence here, the results will not surprise you: the effect is large and positive.  
3. I once gave a presentation about the gender wage gap that made reference to that ill-judged Australian poster declaring how great an arbitrage opportunity the undervaluation of female workers was (really, click that link; it is spectacular). This article about the ‘stereotype tax’ in poker reminded me of it: men tend to find it hard to separate gender from the game and wind up behaving in systematic ways when playing women that good poker players can exploit – the similarity being that both imply that the underlying problem can just be competed away without much trouble. If only.
4. Branko Milanovic on the third globalization: the formatting is a bit funny on my computer at least, but it is worth struggling through – politics, history and economics brought together by a true polymath.
5. This is brilliant: A Morning Consult poll asked people how trustworthy they felt an article would be based only on the headlines, rather than the text. The twist is that they randomly put the headline under the logo of different newspapers, and found that perceptions of trustworthiness varied massively depending on the respondents political orientation and that of the news source. The same headline is assessed very differently depending on whether it falls under a CNN or Fox logo, but the direction of the difference depends on whether the respondent is a Democrat or a Republican.
6. I never need an excuse to link to Tim Harford, but this is particularly excellent, because it’s Planet Money: Stacey and Cardiff (Garcia!) get Tim to play overrated/underrated and he panders to my priors gloriously, deeming messy desks underrated and throwing shade at the iPhone. Transcript here. And, if that’s not enough Harford (and Tim Harford is one of the only commodities that defies the law of diminishing marginal utility), here he is discussing research that supports the Peter Principle. Note to my seniors in both DFID and BSG: do not kill, or demote, the messenger!
7. And lastly, because it’s Friday and there’s a bottle of Grüner Veltliner with my name on it waiting for my Kirsten Wiig impression, here’s the FT giving credit where it’s due and attributing humanity’s success to moderate boozing. I’ll be honest, some of the research seems more than a bit dodgy (how on earth is the ‘local boozer’ thing not massively endogenous to close community relationships?!), but they’re my priors and pander to them if I like. ‘hic.

Have a great weekend, everyone!

R

Hi all,

Of course it happens. In a summer where we’ve had roughly 25% of the average rainfall a British summer is used to, all the rain we’re due has been concentrated on a small oval of land in Marylebone, thereby completely ruining the largest congregation of offensive jackets and catatonic elderly men in the UK: the marquee Lord’s summer test. We’ve had about 20 deliveries and a comical run-out and it continues to chuck down at a rate that makes my prediction of a drawn test less brave by the second. Honestly. Any country suffering a drought should just organise a cricket match and invite me. Guaranteed thunderstorms.

1. While we’re on the subject of cricket, let’s ease into development slowly with this phenomenal profile of Pakistan’s new Prime Minister, Imran Khan, by Osman Samiuddin. Samiuddin is one of the best writers I’ve come across, and this in-depth study of Imran is essential for those of us who only know him for his run-up and cornered tigers speech. He builds from cricket to politics, drawing the threads of the various personas Imran has presented to the public, and their drawbacks – ones which matter rather more for a politician than a cricketer. More concretely, CGD have also put together a quick economic cheat sheet for the new PM, setting out the key challenges he faces.
2. Did you know that in Caracas it is considered an act of terrorism to calculate the true exchange rate between the Venezuelan Bolivar and the US Dollar? Here’s the thing about catastrophic economic mismanagement: it quickly spirals. Venezuela is a great example of this. Economic mismanagement and the unwillingness of the state to admit to failure and reverse course have immiserated a large chunk of the population, while simultaneously giving those with connections the opportunity to make a vast amount of money off the back of this misery. Planet Money’s investigation into the political economy of Venezuelan currency controls is brilliant and rather harrowing when you think about it (transcript).
3. This week in research that goes entirely against my priors: apparently hospital waiting time targets have led to health improvements. I had assumed they rewarded the most sophisticated gaming of the system, and this might still be the case, but this paper certainly suggests otherwise.
4. Arvind Subramanian and co on the potentially devastating effects of climate change on Indian agriculture. What makes this such a good read is the unusually good section setting out policy implications, notably the importance of expanding irrigation systems.
5. Another brilliant long read: Adair Turner on automation and the future of work and the economy (transcript). It is deeply thought-provoking, though you won’t agree with everything in it. One thing I really do agree with: GDP is, for richer countries, less and less useful as an indication of human welfare. It also prompted a discussion among friends of whether or not he has the right spin on William Baumol’s cost disease work, giving me the chance to link to this excellent piece by Dietrich Vollrath again.
6. Tim Harford on the quiet methodological revolutions powering the next generation of economic insights. Tim has made an article about economists using tax data interesting and non-techy. The man deserves a statue.
7. Lastly, in news that seems almost certain to culminate in a movie starring The Rock, NASA is apparently firing a rocket into the sun in the name of science and human safety. Vox cover the mission here, and FiveThirtyEight some of the science underlying it here. I can’t offer any scientific advice to NASA, but I do have this: if at the moment this rocket reaches the sun’s surface, the soundsystem is playing anything other than 11:59 by Blondie, they will have let humanity down.

Have a great weekend, everyone!

R

Hi all,

Ah, the Great British Summer: a time of intermittent thunderstorms, complaints about the cold/rain/heat (depending on which of the seasons the day most resembles) and abject England batting collapses. John Cleese provided an insight into the English cricket fan’s mentality in his movie Clockwise: “It’s not the despair, Laura. I can take the despair. It’s the hope I can’t stand.” After taking a first innings lead off a superb bowling performance, England have once again played Lucy to a nation of Charlie Browns: as I write, they’re 100-7 and doing their best to increase that final digit. Bah.

1. Let’s start with something controversial: Gregory Clark and Neil Cummins use data on surnames in pre-industrialisation England and Wales and subsequent census data to argue that the North-South divide is an artefact of the migration of ‘high-ability Northerners’ to the South. They conclude from this that any attempts to mitigate the North-South divide is good money after bad and a dead loss. Their argument is that those ancestral Northerners who move to the South are very high-achieving, while Southerners who move North are not; there’s more in this vein too. I’m a bit dubious. For one, regardless of whether their research really does show that ability is the only difference between North and South, I’m not sure the argument for investing in the North is simply about maximising GDP. It’s about parts of a country being left behind and disconnected; this might have further economic or political ramifications, anyway. I’m also unconvinced by this ‘northern names’ strategy – but I need to think about that more.
2. “If I didn’t have the use of email, internet search and a mobile phone, I would need to employ someone as a personal assistant. But I have had these tools for a long time, so I have never had a secretary.” Is this technological job destruction? Tim Harford being sensible about technological change and its economic effects. The first test to apply to someone who claims that it will be different this time is to make sure they understand how it happened last time.
3. Paul Krugman, explaining macroeconomics on a rollercoaster. Like Tabarrok, I am not convinced this is the best gimmick to apply to economic teaching. How about explaining economics during a game of dodgeball? (PS – England are doing the hope thing again. Curran has made a half-century).
4. Joan Hicks and co-authors make me seriously question my priors (and reinforce link 1). They argue that the productivity gain apparent in rural-urban migration  is  in large part down to individual productivity, rather than urban work being more productive. I’m not sure this research really closes the book on this, though. There’s a second question too: if productivity differences are explained by individual characteristics, why do the most productivity people systematically move?
5. David Evans is so well read I am fairly sure he bleeds printing ink, and here he reviews Mary Kay Gurgety and Dean Karlan’s book on evidence for the Social Sector. The gist of the book is that there is a lot of valuable stuff you can do that isn’t quite an impact evaluation, a fact too often neglected. I agree entirely, and think that most organisations (ourselves included) invest too little in basic monitoring data.
6. Branko on decomposing inequality into the inequality generated by the market and that generated by the fiscal system, summarising new research with co-authors. As with everything he writes on inequality, just read it. You will become better informed.
7. And finally, this week’s marginalia: can statistics recognise whether Lennon or McCartney wrote a song? It appears so, and it judges In My Life to be a Lennon song. On that note, the Paul McCartney Carpool Karaoke was brilliant – though it’s hard not to be with those songs. And The Ringer ranks the best 100 TV episodes of the century so far. Incredibly, Pine Barrens isn’t number 1, and neither is Mister Wu.

Have a great weekend, everyone!

R

Hi all,

This has been one of the strangest summers I can remember. Not only is England swelteringly hot and sunny, but Sri Lanka beat South Africa in both tests. Not just beat them – hammered­ them, in the manner of Thor returning to earth looking for a fight, though our Thor is small, round and bears more than a passing resemblance to Mr. Potato Head. Scroll down to the bottom and you’ll find a monk calling someone ‘an uneducated ****’. It can’t last. I fully assume that by August it will be snowing and Sri Lanka will be staring at an innings defeat to Ireland, so let’s enjoy it while it lasts.

1. How often do you read a letter signed by three Nobel-winners and find yourself in full face-palm after two sentences? Sentence two of this letter arguing against the fetishisation of aid effectiveness reads “Global poverty remains intractable: more than 4 billion people live on less than the equivalent of $5 (£3.80) a day…”. Seriously – I have some sympathy for the argument they’re making, but are we really going to just ignore the absolutely staggering decline in global poverty over the last few decades? This is exactly the kind of crap Hans Rosling would lay the smack down on you for, and it’s really not a good look when you’re trying to argue against a form prioritising action that is explicitly about extremely careful measurement and fidelity to the evidence, whatever its faults.
2. Two pieces on tax evasion that show what a tricky topic it is. First, Maya Forstater looks at the new proposed indicator of tax evasion, pointing out that it fails to do the work it sets out to, penalising the only company she looks at which was actually awarded ‘fair tax mark’ more than any other. However, the general intuition behind the indicator does seem to show evidence of a systematic issue: Gabriel Zucman and co use a similar idea to show that in tax havens, foreign firms report astronomically high profits relative to the employees they have in that country (far more than local firms), while the opposite is true in non-haven economies. So zoom out and this indicator shows that something is going on; but you can’t use it to reliably zoom in.
3. David McKenzie investigates recent research on ‘experimenter demand effects’ (part two here) – the possibility that people tell you what they think you want to hear, thereby biasing your research results. It appears to be an overblown fear, at least in the settings so far studied. That sound you just heard was a massive sigh of relief from about 304,391 social scientists.
4. Firm productivity across Europe is really widely dispersed, even accounting for the industry of the firm; a nice piece of research summarised in VoxEU investigates why. It finds that remaining limits to labour mobility, institutional convergence, and rules and regulation explain a very large portion of this dispersion. This really matters: fixing these things can make a large difference to GDP and dramatically strengthen these economies by selecting for the best, most efficient firms. They don’t go there, but if Brexit allows more convergence in Europe, it might not all be doom and gloom for them.
5. In an apparent exception to the law of diminishing marginal returns, economics papers are getting longer and longer. I get why: papers written 50 years ago had far less econometrics and data work (partly because computing was so much more expensive and time consuming), and so focused much more on exposition of the argument. Does this make papers better or worse? I’m not sure, but I can comfortably read a 1970s paper by Oliver Williamson before bed. If I tried that with structural modelling I’d have nightmares.
6. When the GPS goes down, we’re all doomed.
7. For the love of words: A long read about the global spread of English, I had not known that it has turned from being a net importer of words (a very happy state to be in, adding a richness and diversity we could never achieve on our own) to a net exporter. And ten great words that have no direct English translation (they leave out iktsuarpok, somehow). And one final piece of marginalia: when monks attack.

Have a great weekend, everyone!

R

Hi all,

It’s hard to lead off the links with anything other than the resolution last week of one of the most interesting sporting events of the year, one full of surprises. I am, of course, talking about the England-India One-Day series which culminated in England absolutely hammering India through stylish batting and devilish legspin – a turn-up for the books if ever there was one. With Sri Lanka also doing their best impression of a competent cricket team, it’s been a pretty good week.

1. How valuable – or costly – is having a ‘very stable genius’ in charge of your country? It’s hard to assess this kind of question, since we have only one of each country, and can’t exactly randomise the President (though the election in 2000 was pretty much a coin toss, given that the presidency was decided by the sturdiness of a few sheets of card in Florida). To get around that problem, and to estimate the Trump effect on the US economy, four researchers constructed a ‘synthetic US’ made up of a weighted average of similar economies, and assess how the real US economy has fared compared to the synthetic one since Trump was elected (a similar exercise for the UK finds our GDP 2% lower than it would have been but for you-know-what). They find … no effect. Trump has neither benefited nor cost the US economy anything so far, though to be fair, the results of his trade wars will take time to show. This shouldn’t surprise you – the US President has always had relatively little impact on the economy.
2. Under normal circumstances, I’d be hesitant to try and sell you guys an increasingly techy blog about baseline surveys, but it’s really, really well-written. Alaka Holla opens with a tale of Catholic guilt and scavenged pencils in Haiti and somehow gets from there to a link to some Matlab code. More than that, though, she demonstrates how research is a series of choices and trade-offs under uncertainty, and how difficult it can be to know what the best option is.
3. Sanjeev Gupta at CGD makes the obvious but extremely important point that simply raising tax revenues is not an outcome to celebrate if the proceeds are spent poorly. He focuses on the efficiency of spending, which is a clear margin for improvement, but there’s also a strong case that the choice of what to spend on is pretty shoddily structured in many developing (and developed) countries.
4. “…it’s cost us life-changing amounts of money… It’s cost us take your hand off my leg, you creepy boss money. It’s cost us this relationship was fantastic when it started, but now you’re ignoring me money…” Women invest their savings at a far lower rate than men do. In a world where the returns to capital are higher than the returns to labour, this is a big deal – it means that the gender gap is built to keep getting wider, even as incomes become more equal. Planet Money investigate (transcript).
5. It’s typical to ask why so many people migrate, even when it appears so costly; but actually, when you consider how large the returns to migration are, the real question is why so few do. Research into rural-urban migration in India suggests that part of the problem is informal social insurance – people can’t move freely when the only mitigation to income shocks that actually works depends on their presence.
6. Interesting long read from the Guardian on Somaliland’s struggle to be recognised.
7. And finally, the football-related marginalia: first, I ignored the World Cup final in the intro, but if you want to find a footballer who isn’t nauseating, N’Golo Kante seems like a good bet – this video of him being too shy to ask to hold the World Cup himself is kind of moving. Also an article from the Atlantic that channels Tim Harford’s book Messy to argue that less structure is better for football talent development, rather than more. And finally, I’m just old enough to have been introduced to basketball via Magic Johnson and football via Maradona; watching the latter warm up before a semi-final is one of the most amazing displays of sporting skill I’ve ever seen. Turn the sound up. He’s in rhythm with the music!

Have a great weekend, everyone!

R

Hi all,

It’s a lovely, sunny day in London which is, against my better judgement, putting me in rather a good mood. It’s a good day for a walk, if you’re so inclined – there’s a pretty popular one trending on social media for London-based readers. In any case, the weather is doing its best to placate put-upon Brits, be they Federer fans, cricket fans, or football fans (fans of the greatest athlete alive should be happy, at least). Anyway, if the sunshine isn’t helping you, maybe the links will (although, poor you if this is your last chance to greet the weekend in a good mood: economics is rarely cheerful these days).

1. To break a habit, let’s start with something positive (and no, I’m not referring to Sri Lanka’s performance against South Africa). Markus Goldstein writes up a detailed but extremely accessible summary of a new paper by Alesina and co-authors about migration. They use a clever survey experiment to investigate views about migration and redistribution and how they are affected by information. Unsurprisingly, most people dramatically overestimate the number of migrants in their country, and are pretty poorly informed as to the dominant countries of origin and religions among them. Also unsurprising: those respondents randomly selected to answer questions about migration before answering an (incentive compatible) redistribution question are less generous in redistributing. So far, so depressing. There is a ray of light, however: information on the true number of migrants in the population, coupled with a story about how hard migrants work lead to more support for both migration and redistribution. Positive economics, which simultaneously achieves the near-impossible: it makes me hate the Daily Mail even more.
2. Ok, the first link was (kind of) positive, so I feel like I should balance it out with some depressing research. This will not exactly stun the mothers on this list, but this VoxEU piece finds that women bear almost all of the labour market costs of childbearing, which come from time off work, movement into more flexible work (flexibility being traded off against income), and other labour market margins. What’s more, this is barely changing over time. It seems to be worst for those mothers whose parents also adhered to this gendered view of work, with their own mothers making career sacrifices.
3. Tim Harford is a genius of exposition. He explains convergence, conditional convergence and the effect of globalised competition and supply chains thereon in about 500 words, and illustrates it with a football example. Especially for the non-economists, this.
4. Dietrich Vollrath discusses Mariana Mazzucato’s new book, The Value of Everything. I’ve long been of the opinion that economics degrees spend far too little time covering the history of economic thought, with the result that economists tend to be self-reflective in only a fairly narrow sense. Debates about different kinds of evidence or the merits of RCTs are valuable, but within economics there are too few debates about the fundamental concepts we use, and whether they’re the right ones for a science of social welfare. Vollrath argues that Mazzucato’s questions are genuinely thought-provoking in this fashion, but bemoans the lack of an alternative that does better.
5. This interview with Betsey Stevenson is very US-centric but is worth reading to see how a top class labour economist thinks (transcript). She also puts into words a vague discomfort I’ve had when hearing about ‘skills mismatch’ in labour markets, largely rejecting them as a major issue (in developed countries). She points out that the unspoken clause to the sentence “we can’t find skilled workers” is “at the wage we offered” and offers the not-unreasonable solution of raising wages.
6. Finally, given that the links have been longer and more serious than usual this week, a piece of idiocy for the weekend: The Rock is in a new movie where the bad guy appears to be a building he needs to lay the smack down on. Remarkably, this is not even the dumbest movie he’s been in, and The Ringer provides a handy guide to creating your own hypothetical Dwayne Johnson movie.

Have a great weekend, everyone!

R

Hi all,

I had plans for a scintillatingly witty and complex intro paragraph (I know, first time for everything, right?) but a fire alarm in the building and an impending train departure requires that I go for speed over wit. So I’m just going to do a round of my usual intro subjects: the weather (sustained glorious weather in England, a sign of the impending apocalypse – some suggest July 13 for some reason); the cricket (Bangladesh trying very hard to be as bad as any team can manage); and LeBron James (now a Laker, and even more amazingly, playing with a man who once blew into his ear in an attempt to distract him – watch it, it’s even better than it sounds).

1. The first shots have finally been fired in the Trade War on Everyone; it’s going to take months or even years to tell who loses (spoiler: everyone), but it’s a very good time to talk about what the global economy looks like right now. Planet Money do it beautifully by taking an iconic product: the American Flag (transcript). You can guess where this is going. All those flags you see being waved at the MAGA rallies? Made in China. The MAGA hats? Made in China. The guy who runs the factory making them? Bought a car manufactured in the US, designed in Germany. Trade wars in a global economy that looks like this are like getting your friends, families and acquaintances together for a barbecue, filling the sprinkler system with hydrochloric acid and then turning it on. At some point, everyone is going to get hurt.
2. So, an apology in advance. This week’s links involve me bigging up two friends, but I should stress: they deserve it. First up is Dan Honig, who came and spoke at DFID recently. Duncan Green writes up a glowing review of his new book Navigation by Judgement. Dan’s research is important because he’s one of a relatively small group of people doing rigourous work that looks at how bureaucracies can perform difficult functions better. The answers are not necessarily the way we’re moving, either.
3. Secondly, one I missed last week: Young 1ove, an NGO co-founded by another friend Noam Angrist, showing what it means to take evidence seriously (parts one and two). They agreed a plan with donors and partner Governments which set out what evidence would be considered robust and rigourous enough to scale up their HIV-reduction intervention nationally, and then ran a strong RCT to see how well it met those tests. It fell short, so all the parties involved agreed that it shouldn’t go to scale in that form; instead they’ve gone back to their theory of change to work out what went wrong and why. It’s hard to stress what a great example this is. The key was the early commitment by all parties as to what ‘success’ should look like.
4. One of the clearest signs of FiveThirtyEight’s enormous superiority to most other media outlets is the fact that they have a ‘File Under: Meta-Science’ category on their website. This week, their brilliant lead science writer Christie Aschwanden looks at the liberal skew of psychology. It’s kind of incredible: only 6% (out of 500 surveyed) identify as conservative, and more than one-third expressed a willingness to discriminate against conservative colleagues in hiring decisions. That’s incredibly worrying.
5. Tim Harford on a genuinely intriguing and radical idea: using auction markets and complete asset listings to both equate demand and supply more closely and tax wealth. Think about it for a few minutes and you’ll start seeing problems, but it’s a genuinely innovative idea.
6. Is this the best paper title ever? I haven’t read it, but Alex Evans pointed this out to me and it has to be in contention: “’A Diamond is Forever’ and Other Fairy Tales: The Relationship Between Wedding Expenses and Marriage Duration”. It still doesn’t beat this one (Figure 2 is the best thing that the internet has ever produced, btw), but it’s up there.
7. Lastly, three pieces of marginalia: natural justice in action (lions eat poachers edition); FiveThirtyEight dig into which teams waste the most time in the World Cup (for all the borderline xenophobia in the British press, England are fifth, and Brazil actually play faster once they’ve taken a lead rather than waste time); and using Pareto efficiency to choose the optimal Mario Kart character.

Have a great weekend, everyone!

R