Tyler Cowen's Blog

May 10, 2015

Stephan F. Gohmann has a paper on this topic, here goes:

Most southern states have fewer breweries per population than the rest of the country. This paper examines why. The main outcome is that in the South, the number of breweries is negatively associated with higher campaign contributions from big breweries, the number of beer distributors per capita, and the Southern Baptist adherence rate. In the non-South, these associations are insignificant or positive. The limited number of breweries in the South follows the idea of bootleggers and Baptists where those who gain economically from limited competition—large breweries and distributors—side with groups morally opposed to alcohol to keep breweries out.

The pointer is from the excellent Kevin Lewis.

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Published on May 10, 2015 11:21 • 8,065 views

NBC: A poker showdown between professional players and an artificial intelligence program has ended with a slim victory for the humans — so slim, in fact, that the scientists running the show said it’s effectively a tie .The event began two weeks ago, as the four pros — Bjorn Li, Doug Polk, Dong Kim and Jason Les — settled down at Rivers Casino in Pittsburgh to play a total of 80,000 hands of Heads-Up, No-Limit Texas Hold ‘em with Claudico, a poker-playing bot made by Carnegie Mellon University computer science researchers.

…No actual money was being bet — the dollar amount was more of a running scoreboard, and at the end the humans were up a total of $732,713 (they will share a $100,000 purse based on their virtual winnings). That sounds like a lot, but over 80,000 hands and $170 million of virtual money being bet, three-quarters of a million bucks is pretty much a rounding error, the experimenters said, and can’t be considered a statistically significant victory.

The computer bluffed and bet against the best poker players the world has ever known and over 80,000 hands the humans were not able to discover an exploitable flaw in the computer’s strategy. Thus, a significant win for the computer. Moreover, the computers will get better at a faster pace than the humans.

In my post on opaque intelligence I said that algorithms were becoming so sophisticated that we humans can’t really understand what they are doing, quipping that “any sufficiently advanced logic is indistinguishable from stupidity.” We see hints of that here:

“There are spots where it plays well and others where I just don’t understand it,” Polk said in a Carnegie Mellon news release….”Betting $19,000 to win a $700 pot just isn’t something that a person would do,” Polk continued.

Polk’s careful wording–he doesn’t say the computer’s strategy was wrong but that it was inhuman and beyond his understanding–is a telling indicator of respect.

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Published on May 10, 2015 04:30 • 8,008 views

May 9, 2015

The University of Toronto’s commercialization office states that it is “in a class with the likes of MIT and Stanford.” But Stanford has generated $1.3-billion (U.S.) in royalties for itself and the Massachusetts Institute of Technology issued 288 U.S. patents last year alone; U of T generates annual licensed IP income of less than $3-million (Canadian) and averages eight U.S. patents a year. Statistics Canada reports that in 2009, just $10-million was netted by all Canadian universities for their licences and IP. Even when accounting for universities that have open IP policies, this is a trivial amount by global standards.

That is from Jim Balsillie, and is interesting more generally, most of all on Canada and innovation.  For the pointer I thank Scott Barlow.  My previous post on this topic is here.

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Published on May 09, 2015 23:41 • 8,018 views

It is basically statist vs. classical liberal, and it is strongly uni-dimensional.  Those are the main lessons from a new and interesting paper by Jennifer Pan and Yiqing Xu:

We offer the first large scale empirical analysis of ideology in contemporary China to determine whether individuals fall along a discernible and coherent ideological spectrum, and whether there are regional and inter-group variations in ideological orientation. Using principal component analysis (PCA) on a survey of 171,830 individuals, we identify one dominant ideological dimension in China. Individuals who are politically conservative, who emphasize the supremacy of the state and nationalism, are also likely to be economically conservative, supporting a return to socialism and state-control of the economy, and culturally conservative, supporting traditional, Confucian values. In contrast, political liberals, supportive of constitutional democracy and individual liberty, are also likely to be economic liberals who support market-oriented reform and social liberals who support modern science and values such as sexual freedom. This uni-dimensionality of ideology is robust to a wide variety of diagnostics and checks. Using post-stratification based on census data, we find a strong relationship between liberal orientation and modernization — provinces with higher levels of economic development, trade openness, urbanization are more liberal than their poor, rural counterparts, and individuals with higher levels of education and income and more liberal than their less educated and lower-income peers.

Here is some NYT coverage of the piece.  Here is some good Foreign Policy coverage.  Currently this is the most downloaded piece on SSRN.

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Published on May 09, 2015 22:50 • 8,006 views

The Vangardist, a German men’s magazine, is printing an entire issue using HIV-infected blood in a quest to educate the public and eliminate misconceptions about HIV and AIDS.

Of course, there’s also the issue of taking this approach to raise the magazine’s literary and commercial value. The Vangardist‘s May issue is already being considered a collector’s item since just 3,000 copies featuring the HIV-positive ink blood have been printed.

There is further information here.

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Published on May 09, 2015 13:35 • 8,037 views

That is the recent book by Mohamedou Ould Slahi, who has been held at Guantánamo for many years.  This is a classic of prison literature, and I will teach it next year in my Law and Literature class.  Almost every page is interesting:

It is just amazing that the FBI trusts the Jordanians more than the other American intelligence agencies.


I don’t know any other language that writes Colonel and pronounces it Kernel.

His written English is quite good.  Definitely recommended, and the heavily redacted nature of the text enhances the reading experience rather than detracting from it.  Here is a good review from The Guardian.

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Published on May 09, 2015 09:33 • 8,020 views

1. “3 Ways to be a Socially Conscious Nail Salon Customer.”  I have a more radical proposal for what you should do.

2. Ten science fiction writers try to predict the next ten years, Jo Walton with a poem.

3. Should you move to a better county?

4. Ancestry matters (this work will likely lead to some impressive results).

5. New JEP issue on-line.

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Published on May 09, 2015 07:21 • 8,036 views

May 8, 2015

I am late to covering this excellent piece by David Leonhardt, but it is worth your attention.  The core result is this:

Low-income children who grow up in Manhattan make less money as adults than similar low-income children who grow up elsewhere…It’s just that affluent Manhattan children don’t grow up to be quite as affluent as affluent children elsewhere.

To make the case of the affluent child concrete, if the Manhattan parents earn 400k a year, the child at age 26 averages 50k a year, compared to an average of 55k for comparable non-Manhattan kids at that same age.  David considers a few hypotheses:

1. That effect is possibly diminishing as Manhattan improves, but the changes doesn’t yet show up in the data.

2. Perhaps Manhattan parents, or Manhattan itself, teach that money is not so important.  For one thing, you get interested in culture there.

3. People who grew up in Manhattan are less likely to be married at a particular age.

4. Manhattan schools are less than perfect.

I would add a few hypotheses (not claims) of my own:

5. Manhattan is a selection of the most ambitious, highest-achieving individuals from elsewhere, and thus if you grow up there ambition and achievement seem to be especially forbidding prospects.  Better not to try too hard.  Recall David Hume on the “posts of honour” appearing to be filled?

6. Manhattan is a bad place, and bad things happen in bad places.

7. Manhattan families are more likely to spoil their children, create problems of moral hazard by promising or implying future support, and have less of an internal aspirational culture.

8. If you grow up there, Manhattan appears to be the center of the known universe and you are less likely to leave it in pursuit of higher earnings.  Fewer people from New Jersey feel this same way, and so they end up in the region with the highest potential earnings for them; that is sometimes but not always New York City.  (This mechanism also means Manhattan children are more likely to remain near your parents, see #7.)

9. A lot of Manhattan wealth is linked to finance and entertainment, and other superstar markets, which are maybe “less heritable” in terms of income than that small Midwestern furniture factory.

What else?

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Published on May 08, 2015 22:17 • 8,049 views

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