Canada Post on strike

It is probably a bad idea to go on strike if the result is to convince people that your services are not very important anymore.

The right course is the same in Canada and the US. End the monopoly, privatize the organization, and toss some public money in to help with some but not all of the pension liabilities.

Play: Next Fall at Performance Network

We saw this excellent play on Friday night.

The reviews from annarbor.com and the Detroit Free Press give the substance. I am closer to the annarbor.com review in my overall view. This is one of the better productions we have seen at Performance Network over the past six years.

I do disagree with the annarbor.com reviewer on one point, and that is the wisdom of casting John Seibert, consistently one of the best actors in the PN pool, as the father. I thought he was perfect for the role and, indeed, that he gave the strongest performance in the show. But I also interpreted his character a bit differently than the two reviewers, both of whom seem to assume that he was clueless about what his son was up to. I read the father's history and dialogue in the play as indicating that he know, didn't approve, but loved his son too much to want to have it out about it.

The other actors are also very strong, particularly Andrew Huff as Adam and Barbara Coven as Arlene.

Recommended.

Gay marriage in NY

Kudos to NY for legalizing gay marriage, and doing so via the legislature rather than the courts. This is a big victory for freedom, equality and human decency.

Plus a bonus bit from the Onion (via various economist pals on FB).

Now if we could just get the government out of the marriage business entirely ...

Police misbehavior in Rochester

This story about police misbehavior in Rochester, NY nicely illustrates the broader danger associated with having so many laws, many of them mutually inconsistent, that everyone is breaking the law all the time. In that situation, whenever the authorities, at whatever level, decide to misbehave like the police in Rochester do in this story, it is easy for them to punish whomever they want to punish.

In a well-run city, all of the officers involved would already be fired. I am certain they are not.

Ezra Klein on Inside Job

I'm not usually the biggest fan of Ezra Klein, but this post on the movie Inside Job seems right on target to me.

Returns to human capital

UM graduate student Jason Kerwin on the returns to human capital investment in Malawi.

Perhaps the most stunning figure in Jason's post is the fraction of the population in Malawi with education beyond high school, which is less than one percent. And we are now more than three decades after the end of the colonial period.

Ban the job-killing ATMs

A funny video from the Media Research Center.

The only downside is that neither the MRC nor the people they ask for signatures seem to realize that the "M" in "ATM" stands for "machine", so that saying "ATM machine" over and over makes one look silly.

On Nozick

There has been a lot of blogospheric buzz about this piece, ostensibly about Robert Nozick, on Slate a few days ago. I am not sure it really worth your time to read.

In contrast, this piece by Julian Sanchez, formerly of reason, is worth your time. It is not really a rebuttal, as Julian fesses up to not having read all of the Slate piece, but it is a very thoughtful meditation on Nozick and how his views evolved over time.

I am not going to write a full rebuttal, entertaining though that would be, but would note a few things:

1. It is Metcalf, not Nozick, who confuses physical and human capital, as well as human capital and ability. Nozick presumably chose his Wilt Chamberlain example to be simple and (not unrelated) persuasive, not because he failed to note the existence of factories or joint stock companies. More broadly, Metcalf seems a bit mired in the Marxian definition of capitalism in a way that confuses his understanding of Nozick and of libertarianism more broadly.

2. Metcalf seems unaware that many, if not most, neoliberals (or classical liberals or moderate libertarians or whatever you like to call them) base their views in whole or in part on something other than the natural rights view presented in Anarchy, State and Utopia. If Metcalf understood this, he would not conflate Nozick with Hayek towards the end of the piece. Hayek's rule utilitarian liberalism would allow a much larger state than Nozick's minimal state views.

3. Metcalf does not appear to know the meaning of the word coercion, which would seem to be fundamental to the discussion. He states incredulously that "... Nozick insists that progressive taxation is coercion" when in fact everyone (but, apparently, Metcalf) defines any sort of taxation as based on coercion. If you do not pay, eventually people come to your house with guns and take either you or the money or both. It does not get much more coercive than that. Justifying the state means justifying those people with the guns.

4. Neither Nozick nor any other libertarian endorses fraud, which would seem to make Bernie Madoff a poor example of outsized compensation justified by Nozickian libertarianism. This sort of basic error should have been caught by the Slate editor (they do have editors, right?).

5. Metcalf should check out both the pay and the number of defense contracts obtained by philosophy professors. Oddly, his pop psychological argument for the genesis of Nozick's original views as propounded in Anarchy, State and Utopia depends on both of these being large.

I'll stop there. There are plenty of thoughtful arguments against hardcore libertarian views, but you won't find them in the Metcalf piece. And shame on Slate for publishing something with so many logical and factual errors.

Adventures in Madison

I was at the Institute for Research on Poverty Summer Research Workshop (which I co-organize) in Madison last week, which was the reason for the light blogging. As always, it was a lively and interesting time, with many old friends and some new ones as well.

Some notable bits from the conference:

I made my annual pilgrimage to Smokey's Club for a scandalously good (and likely scandalously unhealthy) meal of old-style relish (i.e. radishes and carrot sticks), cheese curds, salad, soup, 18 (!) ounce steak and hash browns. The dining experience itself is part of the attraction as Smokey's does not appear to have changed in any meaningful way since, say, 1963. Good fun.

The organizer / old people dinner was at Harvest. You can get steak there too (and I did, and it was really good, as was the chilled asparagus soup) but it is a very different dining experience. Harvest presents itself as upscale health food, with lots of organic bits, nods to localism, meat from cows that have been serenaded and massaged and all the rest of the things one associates with this genre of restaurant. I recommend it too.

At the other end of the gustatory scale, I learned about something called the "Super Donut" from a paper on school lunches (not yet on his web page) by Dave Ribar of UNC-Greensboro. The super donut occasioned much inquiry and mirth among the assembled academics. Further research upon my return led to this review and the surprising information that the Super Donut has ties to former Pittsburgh Steelers running back Franco Harris. Small world.

The Orpheum Theater on State Street in Madison, which I walked by each day on my way from the hotel to the conference, does not appear to be showing movies any more, but does have a restaurant in the lobby. My wife and I went to a movie there about six years ago, when I was thinking of taking a job at Madison. The theater is at least as gorgeous inside as the restored Michigan Theater in Ann Arbor, but in less good repair and worse financial shape. The Orpheum's wikipedia page has some additional history.

Finally, I learned from a paper by (very clever) sociologist Dalton Conley of NYU that a non-trivial fraction of monozygodic ("identical") twins go through life believing themselves to be dizigodic ("fraternal") twins. The paper is not yet on his web page (though there is a related working paper) but I was struck simply by this interesting sort of measurement error, which has, presumably, strong consequences in some cases for how children are treated growing up.

NBER disclosure policy

The National Bureau of Economic Research (NBER) released their new disclosure policy in an email to their affiliates. It seems sensible enough, and the FAQ on the web page is surprisingly balanced in noting that one can sell one's research soul to both private firms and to the government.

Common ground on health care?

A nice column from Greg Mankiw pointing out obvious (outside the beltway) things like the conceptual equivalence of taxing X and subsidizing not X and of "means testing" and progressive tax increases.

We disagree a bit, I think, on the "death panels". I think money that the government takes by force from taxpayers should only be spent on treatments that pass cost-benefit tests. Individuals, or insurance companies not spending government money, should, of course, be free to spend money on other things.

And there should have been some mention of the fact that really, in their hearts, everyone knows that medical care should not be tax preferred. That (with some competition from the WW2 price control legacy of having insurance run through employers) is surely the most idiotic aspect of our current setup.

Movie: Tree of Life

One could say many things about The Tree of Life, such as:

Luscious music throughout

Self-indulgent

Fine performance by Brad Pitt

In dire need of an editor

The "movie within the movie" about a 50s family in Waco is really good

Does God really look like a lava lamp?

Or one could heap praise and free passes on it, like A.O. Scott does at the NYT. Trust, in this case, the things he says about the movie within the movie. We disagree on the pretentious and somewhat incoherent shell of manufactured depth that surrounds it.

Or one could heap derision on it, like this commenter at the NYT:

If you are thinking of seeing this movie, stay home and watch 2-1/2 hours of NatGeo instead. During commercials, flip thru images of your childhood in old photo albums while whispering such deep questions as "Why do we drive?" and "What is a sandwich?" out loud. For variety, browse online images of Sean Penn until you find one of him at his most constipated looking, and stare at it while shoving large splinters under your fingernails. When it's over, take a shower and self-waterboard while banging your head repeatedly against the tiles.

It is all these things really, and to some extent of interest precisely because of that.

Sorta recommended, in part because it is, as A.O. Scott highlights, just different.

Addendum: Turns out that Brad Pitt and Matt Damon are not the same person.

Joking with the Dalai Lama on Australian TV

My sense is that the Dalai Lama would appreciate a good joke, if only he could understand it.

And what is it about Aussie accents that just sounds like fun?

Unexpected effects of college quality

A NY Post story of a woman who declared herself too well-educated to be kicked off the NY subway.

Sadly, the corresponding video has been taken down by the person who originally posted it. I blame the lawyers.

Urban farming

Ed Glaeser throws cold water (or is it cold carbon) on urban farming, whose carbon cost, in terms of reduced density, likely well exceeds any gain due to reduced transport costs.

Says Ed:

Good environmentalism is smart environmentalism that thinks through the total systemic impacts of any change.

One is tempted to say that once the "thinks through" part has started, we have crossed the heavily guarded border between environmentalism and economics, but that would be a bit snarky so I won't say that.

Aside: I went to gradual school with Ed too. When you take 9 years to get a job and 11 years to finish (don't do this at home, trained professionals only) you overlap with a lot of people.

Via, amazingly, portside.org.

Rebecca Blank

An interview with Rebecca Blank, former dean of the Ford School at UM, and apparently under consideration to replace Goolsbee at CEA.

Via Brad DeLong, who thinks Becky is not Keynesian enough or is but is toeing the administration line. A third, more prosaic, explanation is that she is famously careful with other people's money, which is why she was the perfect dean during the construction of the Ford School's new building.

Book: Living the Drama by David Harding

Harding, David. 2010. Living the Drama: Community, Conflict and Culture Among Inner-City Boys. Chicago: University of Chicago Press.

I had the good fortune to receive a free copy of this book via campus mail, courtesy of its author, my UM sociology colleague David Harding. I had the even better fortune to read it.

The book describes the results of David's ethnographic work in three Boston neighborhoods, two of them poor and one of them working class. His focus is on teenage boys, in particular how they think about choices regarding sexual activity and relationships and regarding schooling.

Like many (most? all?) ethnographies, the words of the subjects themselves are the most interesting part. Of course, getting the subjects to say interesting things depends on the skill of the interviewer at designing good questions and building up trust.

Also quite interesting, in this case, is the interpretive framework. David relies on something called the cognitive view of culture. Essentially, basic bits of cognitive science are applied to thinking about culture. Thus, David contrasts the working class neighborhood, where there are standard "frames" or "scripts" for thinking about particular issues related to sex and to schooling, with poor neighborhoods, where multiple ways of thinking about these questions essentially compete, but also coexist, as the subjects sometimes jump from one view to another depending on the details of the issue. While the cognitive view of culture is not original to David's book, this was my first encounter with it and I found it interesting and compelling. The book contrasts, usefully I think, the cognitive view of culture with views in which culture plays little role relative to, essentially, the budget set, and to older views of the "culture of poverty" that posit different, but equally monolithic, cultures in poor and non-poor neighborhoods.

Another bit that I found interesting is David's summary of the literature on how people conceptualize their neighborhood, and its application to his own choice of neighborhoods to study. It turns out that people differ in systematic ways in their definitions of the neighborhood, in particular in how large the area is that they include. Again, this idea is not original to this book, but I had not encountered the related literature before, and enjoyed learning about it.

The part of the book most related to my own work had to do with how the subjects think about higher education. David gets much deeper than the commonplace finding that you can get poor kids to mouth normative platitudes about wanting to go to college in surveys. That is familiar and, I think, pretty much meaningless. Instead, he reveals a great deal of ignorance and confusion about both the higher education process and about the meaning of higher education in the labor market and in life more broadly. Though this is mostly implicit, the subjects do not have a strong sense of quality differences among post-secondary institutions, nor is there often much of a sense that learning more in high school beyond the bare minimum required to get admitted to some college or another might have payoffs of its own both directly and in terms of making success in college more likely. I do not know quite how one conveys these bits of information to kids living in neighborhoods with very few college graduates but it is surely worth thinking about (and will surely take more than a couple of dry presentations in 10th grade).

The writing here is clear, functional and well-organized. It is academic writing, to be sure, but not painfully so. There is some very mild jargon associated with the cognitive view of culture, but it is quickly mastered. The book is very much not a post-modern verbiage festival.

At the end of the day (or, more precisely, the end of the book) David truly won my heart with this bit, which is near the start of the final chapter:

"... the proverbial `policy chapter' that often concludes books like this one typically overreaches and underwhelms"

Having read quite a number of ethnographies in my time, I will confess that I had been nervous as I read along through the book that an otherwise fine volume would be marred by a foolish chapter of policy recommendations largely unrelated to the book's content. That is not the case. David is fully cognizant of what can and cannot be learned from the valuable ethnographic work his book summarizes.

Recommended.

The coolness of economic history

A fine piece on the recent doings of my friend Sheilagh Ogilvie, who is an economic historian at Cambridge. She and her co-authors are using property lists from two German towns to study consumption patterns - i.e. when do certain goods appear and how do they diffuse among the population - and economic growth more broadly.

And how can you not smile at the enthusiasm of this bit:

“We encountered our first coffee cup in an inventory of 1718,” said Professor Ogilvie. “After that we expected that a fashion for coffee and its associated equipment would take off, but instead there was no further mention until 1733. We have just found our third coffee cup in 1739. We know that they become common by the 1750s so we are on tenterhooks for the next couple of months while we work our way through the 1740s.”

Sheilagh came to Chicago to do an MA in economics during my early years in graduate school and was part of our little libertarian graduate student group at the time. We need to get her to Michigan for a seminar.

Aside: Wikipedia provides the story, in case you, like me, have no idea what a tenterhook might be.

Assorted links

1. Nietzsche Family Circus

2. Musings of a burned-out matchmaker.

3. xkcd exposes cloud computing.

4. New words in the 1927 Webster's dictionary.

5. Helpful hints for everyday living.

Dealing with Westboro

I am not at all a fan of the antics of the members of the Westboro Baptist Church, but frankly it worries me a lot that many people seem to think it is just fine for local police to beat them up or detain them without cause as a response to their bad behavior.

Rankin county's response is also complete and total lawsuit bait. I hope the local taxpayers are ready for a big bill.

Posting on the post

A long Business Week piece detailing the imminent financial crash of the US Postal Service.

Some postal workers, though, are still having a good time.

This is a really easy one. Everyone knows what to do. Even the Europeans have done it. All it takes is for Congress to act like an adult. Just this once.

Don't hold your breath.

Aside: Rick Geddes, a Cornell economist quoted near the end of the piece, is a friend of mine from graduate school.

The Weiner is cooked

Rep. Weiner is, at last, resigned to his fate.

Paramilitary police state on parade

Reason honors the sad occasion of the 40th anniversary of Nixon's declaration of the war on drugs. Can it be over now?

Calling on the hotline ...

The sad story of the Danish government's hotline for men "addicted" to buying sex.

Key bits:

Four ministry employees, working six-hour shifts, two days a week, received an average of 1.4 phone calls per shift. And a significant number of those callers hung-up or didn’t say a word.

The fact is that a lot of men like to buy sex – and they aren’t interested at all in the government’s programme to change that.

Approximately one in ten Danish men over the age of 18 bought sex at least once – often many times – in the last 12 months. Yet of the approximately 200,000 Danish men who bought sex from prostitutes last year, only one in one thousand called the Social Ministry’s hotline.

Moreover, a campaign the ministry ran in 2008 to inform men about human trafficking in Denmark seemed to result in slightly higher number of young Danish men going to prostitutes and massage clinics.

The social affairs minister, Benedikte Kiær, nevertheless, reported in a council meeting that the hotline was “working well”.

Putting aside the obvious waste of money, and the misleading informal performance evaluation by the social affairs minister, the reported fraction of men purchasing sex in Denmark is much higher than comparable numbers in the US. This likely reflects several factors. The first is simply reporting differences. Purchasing sexual services is legal in Denmark and so, presumably, survey respondents are more likely to truthfully report it conditional on having done so. Second, demand may be higher in Denmark as well, both because such purchases are legal (making it less risky both in the sense of law enforcement troubles and in the sense of being ripped off) and because Danes are a much less religious bunch than Americans, so that the average psychic cost is likely lower.

It would be interesting to write down a model of the implications of legal sex work for the marriage market. It should affect the set of marriages that form, the division of rents within marriage, sexual behavior within marriage as well as the duration of marriages.

Hat tip: Lars Skipper

Teaching MBAs

This ad for an economist to teach MBAs at the Johns Hopkins University business school features the following unusual bit:

The successful candidate(s) for this position will be subject to a pre-employment background check.

To teach MBAs? What are they checking for - bad taste in wine?

Bonus question: should be happy that my former UM colleague Mario Macis passed the background check or concerned that the check was instituted only after he got hired? :)

Hat tip: Charlie Brown

Movie: Midnight in Paris

I have not had this much sheer fun at a Woody Allen movie in a long time.

The very positive NYT review by A.O. Scott is here, but I would go into the movie, as I did, without really knowing what is coming. I think you will have more fun that way. Then read the review when you get home to find out extra bits, like the real-world identity of the tour guide at the Rodin museum.

Some knowledge of the cultural figures who hung out in Paris in the 20s is helpful but not necessary. Seeing the movie in downtown Ann Arbor with a very knowing and appreciative audience enhanced the experience.

Aside: is it me, or is the fiance dressed and made up to look as much like Scarlett Johansson as possible? Presumably Scarlett was not asked to do the part because she is not good at playing a jerk yet her presence seems to be missed. And I am not the only one who noticed!

Highly recommended.

Bush II and Juan Cole

You do not have to agree with everything (or, indeed, anything) my UM colleague Juan Cole has to say to be rather disturbed by recent stories about the Bush II administrative sending the spooks after him or trying to blackball him on the think tank circuit. The latter business is just sort of petty, and sad as well to the extent that it reflects a view that is just best not to ever hear an opinion that conflicts with one's preconceived ideas.

Of course, such antics are, sadly, in recent years a bipartisan affair. Recall that the Clinton administration used the IRS to go after its critics.

The fundamental problem, of course, is that the very sort of people who eagerly seek to work in the government are often also the sort of people who put party politics and short term political gain ahead of the law and the long run maintenance of a free society.

Oh, and I am not related to the former CIA official called "Jeffrey Smith" mentioned in this version of the Juan Cole spying story. Imagine my surprise at the existence of someone else, no relation so far as I know, with such a unique name.

Hat tip: Jon Lanning

Advice for new lawyers

Good stuff from the WSJ, much of which translates pretty easily into economics land (or even sociology land).

I would emphasize the part about liking your job and the part about being careful to get realistic evaluations of your work as you move along the tenure track (or its analogue in government or the private sector). The part about having multiple cheerleaders is good too. Don't rely on one senior faculty member to pull you through a close tenure case. Make sure you've got a whole team.

Cochrane on Krugman

Not sure why I did not run across this before, but it is still appropriate in any case. John Cochrane, who taught (really well) my first graduate macro class at Chicago, responds to Paul Krugman's attack on neoclassical economics.

Ouch!

Ann Arbor photography

Beautiful time lapse photography of various scenes from around Ann Arbor.

Modern Panopticon

This Atlantic article describes tentative steps along what strikes me in general as a very desirable path in which incarceration for non-violent offenders is replaced by electronic supervision. Public Money is saved and fewer people spend time in the dehumanizing schools for crime than many prisons have become.

The article hints at some dark concerns, but it seems to me that most of what it worries about does not have to do with the choice between monitoring and incarceration but rather with the fact that in the US too many things are illegal, such as marijuana and prostitution and that our justice system is a bit heavy-handed more broadly. That is a separate, but very real problem. The two issues are linked in the sense that some reform to laws regarding the employment of certain types of felons would aid convicts in a monitoring regime in finding gainful employment.

Genmatch

Genetic Matching for Estimating Causal Effects:

A General Multivariate Matching Method for Achieving Balance in

Observational Studies

Alexis Diamond

ŽJasjeet S. Sekhon



Abstract

This paper presents Genetic Matching, a method of multivariate matching, that uses an evolutionary search algorithm to determine the weight each covariate is given. Both propensity score matching and matching based on Mahalanobis distance are limiting cases of this method. The algorithm makes transparent certain issues that all matching methods must confront. We present simulation studies that show that the algorithm improves covariate balance, and that it may reduce conditional bias if the selection on observables assumption holds. We then present a reanalysis of a number of datasets in the LaLonde (1986) controversy.

JEL classification: C13, C14, H31

Keywords: Matching, Propensity Score, SeKeywords: Matching, Propensity Score, Selection on Observables, Genetic Optimization, Causal Inference

I happened to read this paper (for the second time) a couple of days ago. It introduces for an economist audience (the authors are political scientists) a new algorithm for the construction of estimates of causal effects based on an assumption of "selection on observed variables". Other disciplines sometimes call this assumption unconfoundedness or ignorability (and economists sometimes refer to the "conditional independence assumption"). What all this jargon means is that the researcher thinks that conditional on covariates available in the data, individuals are assigned to treatment, whether by nature, by institutions, or by their own choices, or some combination of these, in a way that is unrelated to their untreated outcomes. Essentially, one makes the case for an assumption random assignment conditional on observed characteristics, where in good papers that case consists of more than "this is all I could do" or "look at how many different variables I matched on mom!".

To see what makes the method outlined in this paper (and in more technical detail in other papers available on Jas Sekhon's webpage, including some co-authored with my UM political science colleague Walter Mebane) it helps to think about what a randomized experiment does. Statistically, random assignment of individuals into treatment and control groups balances the distributions of both observed and unobserved covariates between the treated and control units. When samples are small, this balance may be imperfect in particular realizations, but as the sample gets larger, the balance, statistically speaking, becomes better and better.

What Genmatch does is to choose untreated units to match to the treated units in an observational study based solely on a criterion of post-match balance. This contrasts with the usual approach in economics of using something like nearest neighbor matching or kernel matching on estimated propensity scores (probabilities of treatment) in an iterative process in which balance is tested at each iteration and the propensity score model is made more flexible by adding additional terms until some desired level of balance is achieved.

The paper includes two Monte Carlo analyses as well as an application to the much-abused data from LaLonde's (1986) seminal work on the National Supported Work Demonstration. The NSW application is well done and sensibly interpreted. One of the Monte Carlo analyses, drawn from the literature on matching outside of economics, has the bizarre feature that it includes matching on instruments, that is, on variables that affect participation in treatment but do not otherwise affect outcomes. As Jay Bhattacharya explains at length, you should not do this.

Readers interested in Genmatch will also likely be interested in inverse probability tilting, which has the same spirit of building balance maximization into the estimation but in the context of weighting estimators rather than matching estimators.

Interviews with Heckman graduate students

On pages 10-11 of the Spring-Summer 2011 issue of Dialogo, the magazine (on line but for one print issue per year) that the Division of the Social Sciences at Chicago produces for its alumni, you can find interviews with three Heckman students.

I don't know how the particular students interviewed for the piece were selected but they do a good job of giving a sense of the intensity of the enterprise.

Hat tip to Nina Herbst at Chicago for putting this on line so that I could blog about it.

Inside the tabloid press

I enjoyed this Atlantic profile of one of the middlemen who facilitates the tabloid press.

I am not quite sure how I feel about all the hand-wringing in the article about paid sources. It strikes me that there is a big difference between paying for documentary evidence versus simply paying for unverified (or even unverifiable) statements by interested parties. I am not worried about the former but am worried about the latter. Of course, hiding the latter behind the former, or providing payment in kind rather than in cash, as it appears that some more "reputable" media outlets do, does not really make things better.

Journal Spam II?

Consider the following email:

From: Michael Taylor

Date: June 13, 2011 1:29:47 AM EDT

To: undisclosed-recipients:;

Subject: reviewing request from the Applied Economics Research Bulletin

The Applied Economics Research Bulletin, which is a non-commercial alternative to Economics Letters, has received the two attached manuscripts for possible publication as a Peer-Reviewed Working Paper. Compared to Regular Papers, the working series is only lightly reviewed since the main focus is on quick and wide dissemination. We were wondering if you could give us your thoughts on both manuscripts. If you are very busy and don't have the time to give a detailed assessment, we would appreciate just a thumbs up or thumbs down indication regarding the manuscripts.

Thank you and best regards,

Mike

--

Michael Taylor

Applied Economics Research Bulletin

http://berkeleymath.com/BerkeleyJournal.aspx

questions@BerkeleyMath.com

The web page for this new journal appears here and it appears to be a serious enterprise, if I may define serious as "having a bunch of my friends on the editorial board". I also like the idea of a lightly refereed working paper series. This has the potential to fill a real need for graduate students and other scholars who are not members of one of the organizations, such as the IZA or the NBER, with widely-circulated working paper series. At the moment, such scholars have no good way of establishing "property rights" to their work by circulating it with an authenticated date.

My one concern about the new journal is that they seem to be finding their referees by simply sending out papers to graduate students at top departments without checking overmuch to see whether the papers really fit the student's research interests. I say this because (at least) two different Michigan economics graduate students received the above email. One of them is a micro development economist and the other an economist of education. They received the same two papers to review, one on foreign direct investment and one on an applied econometrics topic.

So, not journal spam, but maybe some refinement in the process for selecting referees is in order?

Addendum: I have now confirmed that a third Michigan economics graduate student, this one a macro-economist, also received the same email and the same two papers.

Hat tip: anonymous UM economics grad student

Hi, I'm Tressel

My colleague Charlie Brown suggests an audit pair study for the young men (and women) named Tressel down there in Ohio-land, the better to determine the treatment effect associated with this now unfortunate moniker.

The problem is that N = 20 is a bit low if one sticks to the actual Tressels, though of course one could train auditors to pretend to be Tressels for the sake of science.

Macy's feels the Heat

This is a marketing department's nightmare.

Hat tip: Dann Millimet

What's up with Bob Townsend?

A nice summary of some of Robert Townsend's recent research in development economics.

His departure to MIT was a big loss for Chicago.

Via: MR

Hitchens on Pakistan's government

A fine rant from Christopher Hitchens. The executive summary: he doesn't much like it.

Al Burleson

A feel-good story from Husky football: Former cornerback Al Burleson, who played right around the time my father started taking me to games when his usual companion was out of town on business, gets his degree at age 56.

Economists in WW2

Some interesting history of the role that economists played in the US war effort in WW2 from Economic Principals.

And, distantly related, some well justified bashing of Richard Shelby and the rest of the red team for promoting ignorance and incompetence by keeping Peter Diamond off of the Federal Reserve Board of Governors.

Scott Walker: not the beer-drinker's friend

Wisconsin governor Scott Walker sells out to MillerCoors, and makes life harder for Wisconsin's craft brewers, for a paltry $23K or so.

One take from the left side and one take from the (classical) liberal side.

It is an onogoing mystery, both in the literature and in my head, why politicians can be bought for so little.

And, of course, this is another reminder that politicians on the red team are not really different from politicians on the blue team.

Freakonomics radio on parenting

A group of economists, some of whom I know, get together with Dubner to talk about both research on raising children and about their own choices on Freakonomics radio.

The research suggests that parents matter only modestly to educational and earnings outcomes, and that much of the guilt-induced investment of time and money by striving middle and upper-middle class parents is likely a waste unless it also yields a current utility payoff. What, it seems, that parents can do is affect their children's socialization, which is to say, how well they play with others in the broad sense.

At the same time, many of the economists on the show don't follow the research and still over-invest. What can you do?

The transcript is here; I could not find the audio but maybe you can.

Aside: I'm still trying to picture Bruce Sacerdote as a hedge fund manager.

Hat tip: Tanya Byker, parent and economist-in-training

Movie: Kung Fu Panda 2

We took one for the team, or rather for the kid, on this one, though she herself was remarkably fidgety throughout.

Reading the NYT review, which finds it too dark and not as much fun as the original, made me wonder how they choose which reviewer at the NYT reviews each movie, and why A.O. Scott ended up reviewing this one.

Probably better suited to older, male children.

Rob McKenna for Governor ?!?!

My friend Rob McKenna is running for governor of Washington State. He is presently attorney general.

Rob was student body president at the University of Washington when I was an undergrad there, and I got to know him (as I recall), through my friend Ken Troske, who knew him from high school. The three of us all ended up at the University of Chicago for graduate school, with Ken and me in economics and Rob in the law school. Indeed, in the fall of 2005, five of us - Rob and Ken were married then but I was not - had a fine adventure when we drove together, in two cars, from Seattle to Chicago, stopping along the way to see Mount Rushmore.

Make no mistake, Rob is a politician through and through, but conditional on that, he is a good guy. Maybe even unconditional on that. :)

The idea that he is some sort of extreme right-winger, put forth by this democrat website, is utterly ridiculous. Indeed, based on the discussions we had back in the day, I was always a bit surprised that he ended up as a Republican. My take was always that he was smart, organized, ambitious and much more a manager and a technocrat than an ideologue.

I don't endorse politicians on the blog, but I wish Rob the best of luck in his campaign.

Hat tip: Ken Troske

Movie: The Double Hour

The Double Hour is great fun, in a dark, mysterious sort of way, whether or not you follow all the plot twists. I agree wholeheartedly with the NYT review.

Children's stories

Via those portside.org emails that I continue to receive comes Marian Wright Edelman, boss of the Children's Defense Fund, defending Head Start.

My primary concern today is not whether or not Head Start should be cut, it is with how Edelman makes her argument. In particular, Edelman offers two sorts of evidence. The first consists of a moving anecdote about someone called Angelica Salazar:

The colors were brighter than any she had seen before. Shapes, letters, and lots and lots of colors adorned the walls. Around the room, children worked together building high rises with colored blocks and "reading" colorful picture books.

"I had never seen so much color," Angelica Salazar recalls of her first days as a Head Start preschooler in Duarte, California. She remembers her discovery of library books and spending hours curled up on the reading rug. Head Start provided her first formal English instruction. Her parents, who spoke mostly Spanish, enrolled her in the program knowing that their little girl would need to master English to succeed in school.

Anecdotes play a surprisingly large role in policymaking but they are, of course, entirely irrelevant. Anecdotes typically confuse outcomes (Y1 in the usual notation) with impacts (Y1-Y0, or the difference between the outcome with the program and the outcome without it). Put differently, anecdotes ignore the counterfactual of what would have happened in the world without the program. In the case of Angelica, her parents might have found another program, or maybe she would have done just as well with just K-12 education. The difference between outcomes and impacts is remarkably hard for people to grasp. Even in the face of experimental evidence of ineffectiveness, program operators will often insist that they know a program works because of the outcomes they have observed among participants.

The second sort of evidence offered up by Edelman consists of a brief reference to a completely different program:

Early childhood programs significantly increase a child's chances of avoiding the prison pipeline that Angie now studies as a policy expert, and investments in quality early education can produce a rate of return to society significantly higher than returns on most stock market investments or traditional economic development projects.

Edelman does not say what this program might be, but it is presumably Perry Preschool. Jim Heckman and some of his recent students have thoroughly reanalyzed the Perry data, bringing to the discussion a level of rigor and seriousness unfortunately often missing from the advocacy research of the program's developers. When they are done, Perry does indeed pass cost-benefit tests and have a positive rate of return. But Perry is not Head Start. Perry was much more expensive than Head Start, featured different sorts of instructors, served a different and more disadvantaged (particularly cognitively) population and included interventions with parents. There are also important unanswered questions about the extent to which it could be effectively scaled up. Perry is not irrelevant to Head Start, but Edelman is being dishonest by writing as though they are the same thing while ignoring the evaluation record on Head Start itself. On their own, the Perry findings certainly support expenditures on research; any relevance to Head Start funding is speculative.

On the substantive question, the literature on Head Start is mixed at best. Michael Baker of Toronto gave a very nice talk at the Canadian Economic Association meetings last weekend that reviewed the serious literature on early childhood interventions. If you are willing to wait awhile, the talk will be published in article form in the Canadian Journal of Economics. In the meantime, the experimental evaluation of "early Head Start", helpfully summarized at the Institute of Education Sciences' What Works Clearinghouse is a good place to start.

In sum, Edelman's piece has value mainly as an example of an attempt to distort evidence and mislead readers. Her closing appeal to "values", like appeals to "fairness" in similar contexts, is the last refuge of an evidence-avoiding scoundrel. And what of portside.org? Evidently scientific socialism, as they used to call it, has been tossed overboard for the simpler pleasures of sentimental socialism, in which reason and evidence are replaced by heartwarming bedtime stories. Sigh.

Hitchens on Weinergate

Our man Hitchens elevates the discussion of the soon-to-be-back-in-private life Congressman Weinder by ratcheting up the vocabulary and telling stories about Oxford. And even the title is a pun. Who could ask for more?

Weiner, Brokaw and Rickles

OK, these are completely juvenile and full of double entendres. But I laughed and laughed and laughed when I watched them. If you are short on time, just watch the third one.

Here is the first segment:

The Daily Show - Circumcision 2011 - Between a C*#k and a Hard Place
Tags: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

Here is the second segment:

The Daily Show - Circumcision 2011 - Between a C*#k and a Hard Place - Weiner Investigation
Tags: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

Here is the third segment:

The Daily Show - The Big Wang Theory
Tags: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

My favorite bit was the competition between Tom Brokaw and Don Rickles, which actually does a nice job of caputuring the odd line that Jon Stewart tries to straddle by being a truth-telling comedian.

Finally, of course, the confession and, not long from now, the resignation.

Appropriate bus attire

You have to pull your pants up on buses in Fort Worth,Texas these days, lest some passenger be offended by the sight of your boxers.

Yes, to be sure, the saggy trouser "look" looks pretty stupid - more like a failure to reach the bathroom in time than a style statement - but that is hardly sufficient reason to ban it. Big earrings from the 70s look stupid too and, oftentimes, those spandex pants are a big (pun intended) sartorial mistake as well. Part of being a grown up in public spaces is putting up with the misguided style choices of others.

Surely the people who manage the transit system in Fort Worth have something more useful, and less racially tinged, to do with their time?

Hat tip: Charlie Brown

The internet, education and bubbles

This piece on education and the internet has something to it, despite being a bit overly triumphal, even after taking account of the caveats at the end.

First, the overstatement. The internet is, in relation to this topic, not all that different from a library. Before, you could get books in the library, now you can get them on the internet. I include lectures here, because a lecture without interaction is really not very different from a book. Some people prefer to listen rather than read, so having both is good for them, but I do not see the great big leap forward here. Both are unidirectional means for transferring information.

Second, the good bits. What I think is worth thinking about is what aspects of the university experience (and I am going to focus on that here) are and are not easily duplicated over the internet. Lecturing is easily duplicated and I think that we will come to see some faculty lectures, particularly for introductory courses that are heavily textbook based and have fairly standardized material - think of introductory economics - replaced with recorded lectures given by the textbook author. This would mean that students would hear from Greg Mankiw himself rather than a live faculty member. Given the wide variation in the quality of lecturers, I think it makes good sense to have more specialization than we do, so that everyone benefits from the best lecturers. This would not mean the end of local faculty, but they would then devote all of their time to the aspects of the course other than unidirectional information transfer. This means, for example, interactive sessions in which students can ask questions and discuss issues raised in the text and the recorded lecture. In some contexts, it may also mean grading, though for many introductory courses multiple choice questions with automated grading are already used.

Many aspects of a university education besides just problem sessions cannot easily be put on the internet. First, universities select peers for the students. Student learn a lot from their peers, not only in group projects but in informal study sessions and in the broader social project of "finding oneself" that takes place during the university years. Universities also, essentially, act as dating services via their selection procedures, and having a highly selected pool of potential partners to choose from is a non-trivial part of the value of attending a top school.

Second, universities can afford to purchase the physical capital required to effectively learn many disciplines such as chemistry or medicine, in part because they can spread the cost over many students and via the joint production of teaching, research and health care. There is no substitute for actually participating in research if one wants to learn how to do research.

Third, universities can provide direct interaction with faculty. Students, particularly undergraduates, make too little use of this aspect of university. For gradual students it is absolutely critical. In learning to give seminars, you need to give seminars to audiences that understand the data and methods being used and the background literature. Similarly, to learn how to write papers you need not just readers, but expert readers who, ideally, have produced their own papers and can give informed feedback.

So, no revolution yet, but I think still some internet-based change is coming down the pike in the teaching part of academia.

Addendum: Peter Thiel simply does not know what he is talking about in terms of the numbers. Perhaps he should read the literature. It's on the internet. The issue with the numbers is more the thoughtless extrapolation of positive (and broadly compelling) estimates of the impact of "treatment on the treated" to the presently untreated. Also, the numbers are about averages, and there are surely individuals for whom higher education does not have a big financial payoff (and maybe even not a big utility payoff, which is the relevant metric for decision-making). There is likely progress to be made in figuring out more effective ways to identify such individuals ex ante.

State of the Art Lecture from the Canadian Economic Association Meetings

The slides from my "State of the Art" lecture entitled "Putting the Evidence in Evidence-Based Policy" that I gave at the Canadian Economic Association meetings in Ottawa this past Friday are now available on my web page.

I was flattered to be invited and really enjoyed it, though as usual I tried to talk about too much in the time allowed. I was delighted to be introduced by my friend Barbara Glover, who is one of those rare government bureaucrats who is both successful in government and "gets" academics and what they have to offer to the policy process.

One message that I hope got across in my talk is that Canada is way behind the Nordic and Germanic countries in Europe in terms of the data available for policy design and evaluation. This is also true in the US, but the US partially makes up for it by doing randomized social experiments, at least in the areas of labor market policy, education policy and criminal justice policy, while Canada does not.

My talk at the CEAs is a modified version of a talk I gave in Oz two years ago. The associated paper, which covers many of the same issues in textual form (and provides full citations) is on my web page here.

Bill Cosby on comedy

I read this piece about Bill Cosby yesterday in the metrocar on the way home from the airport.

I particularly liked this bit:

“Not until maybe 1970, when Richard Pryor broke, then later when George Carlin came along and clubs opened up, comedians were allowed, and encouraged, to curse,” Cosby asserts in that oh-so-familiar baritone. “Like Bart Simpson turns 40. Profanity is a security blanket, because you know the audience is going to laugh when they hear profanity. If I take profanity away from you, you will feel like you don’t have anything to say. You have to have style, you have to have material, and that’s not good for someone who just has timing. So you listen to a lot of these guys, they will pretend they have some material that has a subject.

“Recite to me, from childhood days, the poem ‘There was a Crooked Man,’ ” he suddenly requests. “Now I’m going to show you how, just using profanity, you can make people laugh. I will read the poem, and I will replace the word ‘crooked’ with ‘m-----f-----g.’ ‘There was a m-----f-----g man, who walked a m-----f-----g mile…’ You see what I mean? You will have people on the floor.

“I can out-curse every one of these people. Cursing means nothing to me. But I don’t need it, man. Because I can m-----f-----g write!”

And it is because of my sympathy for this view that I did not like Jon Stewart's pizza routine as much as Chris Blattman did. This is also part of why I have always liked the comedy of Ellen DeGeneres.

Assorted links

1. The Winklevoses really need to get lives.

2. The frustrating but remunerative lives of Natalie Portman's body doubles (not safe for extremely prudish workplaces). Really, of course, the article is just an excuse for the Daily Mail to print the pictures.

3. In Ann Arbor, teachers walking around naked would be a bold educational innovation designed to teach children about appearances and perceptions. Not so, apparently, in Georgia.

4. Zingerman's chef wins James Beard Award. James Beard's books, by the way, are great fun.

5. Drug war follies in Buncombe [sic] County.

6. Gradual student crime-fighters at U of Michigan.

Grading grades

Graded children – evidence of longrun consequences of school grades from a nationwide reform

By Anna Sjogren, IFAU

Abstract of Working paper 2010:7

Swedish elementary school children stopped receiving written end of year report cards following a grading reform in 1982. Gradual implementation of the reform creates an opportunity to investigate the effects of being graded on adult educational attainments and earnings for children in the cohorts born 1954–1974, using a differ­ence-in-differences strategy. Accounting for municipal time trends and tracing out reform dynamics, there is some evidence that being graded increases girls’ years of schooling, but has no significant average effect on boys. Analysis of effects by fam­ily background suggests that getting grades increases the probability of high school graduation for boys and girls with compulsory school educated parents. Sons of uni­versity graduates, however, earn less and are less likely to get a university degree if they were graded in elementary school.

Keywords: school policy, grades, educational attainment, adult earnings, family background, difference-in-differences.

JEL-codes: I21, I28, J13, J24

I have been meaning to highlight this paper on the blog for some time. I read it last fall in preparation for a trip to Sweden. It presents some surprising and compelling evidence on the effects of having grades in primary school on later outcomes.

The paper reminded me of a talk that Dan Hamermesh gave over lunch at the Society of Labor Economists meetings a few years ago when they were in Austin, Texas. The theme of the talk was (I paraphrase here) it is good that other countries exist because they will try crazy policies that we [i.e. Americans] would never try, and those crazy policies provide very useful information about policy effects. I think Dan is largely correct about this, but as I recall my friends from Canada that I was sitting next to at the lunch were less enthused about this line of reasoning.

TAA and free trade

The red team and the blue team are having a bit of a spat about passing three free trade agreements. The blue team wants the red team to agree to renew the Trade Adjustment Assistance Act in exchange for approving the free trade agreements.

Mathematica Policy Research is at the tail end of a non-experimental econometric evaluation of TAA on behalf of the U.S. Department of Labor, but my guess is that the results will become public just a bit too late to influence this round of the policy discussion. The design of the non-experimental evaluation is about the best one can do given the nature of the program and the available data, and will provide valuable information about the program when it is released, but it is by no means ideal.

My thought is that the red team should make the following deal: reauthorize TAA for another five years at roughly the same budget level, but demand that, say, $40 million of the budget be devoted a serious experimental evaluation of TAA and another $10 million should be devoted to the not unrelated task of improving the administrative data systems associated with the program. Then, next time TAA bubbles up to the top of the policy agenda, there will be really compelling evidence available to guide those rare (but not nonexistent) congresscritters at the margin who actually pay attention to such things.

Full disclosure: I am a consultant to MPR on the TAA evaluation.

Dental students at play

I think this outdoes the economics skit night videos for sheer geekiness.