Tim Harford's Blog, page 59

Why my purchase choices have the kiss of death

Steve Eisman, the investment manager made famous by Michael Lewis’s The Big Short, did a lot of homework in his quest for terrible assets to bet against. But when he was introduced to another investment manager — Wing Chau — he saw the opportunity to accelerate the decision-making process: “Whatever that guy is buying, I want to short it.”

For Mr Eisman, Wing Chau was the equivalent of a watch that is six hours off: a perfect guide, as long as you realise that you need to look at the opposite side of the deal — or the clock face.

A few years ago, four business school academics won attention for the discovery that the same logic may work for retail products. Eric Anderson, Song Lin, Duncan Simester and Catherine Tucker found what they called “harbingers of failure” — consumers who simply adored the Ford Edsel, the Betamax video format, or those squeezy bottles loaded with Heinz EZ Squirt ketchup in bright blue, green and purple, a kind of edible paint. These people thought nothing cried out “sophisticated lady” more loudly than a packet of Bic disposable knickers.

Product development teams have long prized the idea that “lead customers” could give them insight into where the mass market might be going. A celebrated example is the mountain bike, a product assembled by enthusiasts who, starting in the early 1970s, modified old bikes by adding balloon tyres and motorcycle brakes to cope with demanding off-road conditions. Fifteen years later, the mountain bike was a mainstream retail product.

Pointing to such examples, Eric von Hippel, a professor at MIT, argued that companies shouldn’t just show product ideas to focus groups made up of generic, average consumers. They should find the early adopters and the trend setters, and pay particular attention to them.

But the “harbingers of failure” study reminds us that we could equally seek customers with the opposite quality: an unerring nose for products that the mass market will despise. Perhaps it shouldn’t be a surprise that such people exist. Prof Anderson and his colleagues suggested that companies could identify harbinger customers by examining their purchase decisions, and then use them as a guide to what not to stock in future. They also concluded that these customers provided a strong signal of a product’s prospects: “The more they buy, the less likely the product will succeed.”

Recently, the plot thickened like a glob of EZ Squirt: a research paper from professors Simester and Tucker and Clair Yang reported on “The Surprising Breadth of Harbingers of Failure”. This study found that “not only are there customers who are harbingers, but there are also harbinger zip codes”.

People in these accursed neighbourhoods buy doomed products, and also niche products that nearby zip codes don’t find attractive. The tendency is broad-based: they buy unpopular products at a big-box warehouse store, but they also buy unpopular garments at a clothing retailer. This is rather convenient for market researchers — Prof Simester and colleagues argue that zip codes provide all the information needed to learn from the harbinger effect. The harbinger zip codes are even losing propositions in electoral campaigns: they are more likely to donate money to political candidates who lose, and less likely to donate to popular ones.

And then I realised: they’re talking about me. While I’d prefer not to reveal too much about my voting habits, it has been a very long time since I was on the winning side: I didn’t vote for Boris Johnson, I didn’t vote for David Cameron and I didn’t vote for Tony Blair. I was on the losing side in all the referendums, too. Politically, I am Crystal Pepsi. I am Colgate ready meals.

Come to think of it, as a student I did go through a phase of drinking the monumentally unsuccessful soft drink, Tab. I’ve never owned an iPhone and when my wife bought me an iPad, I sent it back because I couldn’t figure out how to make it work. In the pool, I wear Speedos. I am the Wing Chau of retail and politics: come study me, oh trendspotters and psephologists, for a glimpse into what the future does not hold.

All this makes me wonder: what makes a harbinger of failure, and why is our taste for the unpopular so wide-ranging? Why would someone who admires Clairol’s Touch of Yogurt shampoo feel the same way about the Liberal Democrats’ Vince Cable? Perhaps we harbingers are open-minded, happy to take a risk on something new and unusual? Perhaps; but harbingers don’t just try Frito-Lay lemonade, we swig it down and then come back for more.

Perhaps the answer is that ordinary, well-adjusted people notice what other people are doing, and fit in. In contrast, we harbingers are simply oblivious. Jacket and jeans? Socks and sandals? Why not? I have yet to see a completely convincing explanation — or even to be fully persuaded that the whole idea isn’t one big statistical fluke. But if anyone in market research would like to follow me around a supermarket, get in touch.

 

Written for and first published in the Financial Times on 17 January 2020.

My book “Fifty Things That Made the Modern Economy” (UK) / “Fifty Inventions That Shaped The Modern Economy” (US) is out now in paperback – feel free to order online or through your local bookshop.

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Book of the Week 6: What We Need To Do Now

Chris Goodall’s latest book is What We Need To Do Now (For A Zero Carbon Society). I confess a temperamental kinship with Goodall: he’s a nerd, with a calm manner and an underdeveloped sense of outrage. This, I like very much. The book starts from the premise that we need to get carbon dioxide emissions down dramatically, and focuses on the UK: “the purpose of this book is to give an outline of the strategy the UK needs to adopt to address the climate threat”. 

Goodall acknowledges the progress – domestic emissions down more than 40 per cent since 1990, and down 10 per cent even after allowing for the offshoring of emissions to China and other manufacturers.

He then gets down to brass tacks. The first and most distinctive item on the agenda is to increase renewable electricity generation 20-fold. This should create a large surplus which can be used to create synthetic fuels, cover intermittency and provide for growing demands for electricity such as electric vehicles.

Other items include: mass insulation, electrifying transport, shiftying towards plant-based food, etc. A lot of this looks at the engineering but there’s plenty of discussion of the economics (and the economic instruments, such as a carbon tax) that will be needed.

There were a few surprises for me – I had no idea, for example, that there was so much carbon dioxide tied up in the fashion & clothing value chain.

Anyway: what Goodall sets out is a pretty ambitious plan. Whether you think it’s a good idea, and whether you think it’s feasible, this book is packed with analysis and refreshingly short on hysteria. I learned a lot.

UK: Blackwells – Amazon.

Possibly unavailable in the US; try here for the Kindle edition.

My book “Fifty Things That Made the Modern Economy” (UK) / “Fifty Inventions That Shaped The Modern Economy” (US) is out now in paperback – feel free to order online or through your local bookshop.

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Two cheers for the dematerialising economy

If past trends continue, the world’s gross domestic product will be about twice as big by 2040 as it is today. That’s the sort of growth rate that translates to 30-fold growth over a century, or by a factor of a thousand over two centuries. Is that miraculous, or apocalyptic? In itself, neither. GDP is a synthetic statistic, invented to help us put a measuring rod up against the ordinary business of life. It measures neither the energy and resource consumption that might worry us, nor the things that really lead to human flourishing.

That disconnection from what matters might be a problem if politicians strove to maximise GDP, but they don’t — otherwise they would have hesitated before imposing austerity in the face of a financial crisis, launching trade wars or getting Brexit done. Economic policymaking has flaws, but an obsession with GDP is not one of them.

Nevertheless the exponential expansion of GDP is indirectly important, because GDP growth is correlated with things that do matter, good and bad. Economic growth has long been associated with unsustainable activities such as carbon dioxide emissions and the consumption of metals and minerals.

But GDP growth is also correlated with the good things in life: in the short run, an economy that is creating jobs; in the long run, more important things. GDP per capita is highly correlated with indicators such as the Social Progress Index. The SPI summarises a wide range of indicators from access to food, shelter, health and education to vital freedoms of choice and from discrimination. All the leading countries in the Social Progress database are rich. All the strugglers are desperately poor.

So the prospect of a doubling of world GDP matters, not for its own sake, but for what it implies — an expansion of human flourishing, and the risk of environmental disaster. So here’s the good news: we might be able to enjoy all the good stuff while avoiding the unsustainable environmental impact. The link between economic activity and the use of material resources is not as obvious as one might think. There are several reasons for this.

The first is that for all our seemingly insatiable desires, sometimes enough is enough. If you live in a cold house for lack of money, a pay rise lets you take off the extra cardigan and turn up the radiators. But if you win the lottery, you are not going to celebrate by roasting yourself alive.

The second is that, while free enterprise may care little for the planet, it is always on the lookout for ways to save money. As long as energy, land and materials remain costly, we’ll develop ways to use less. Aluminium beer cans weighed 85 grammes when introduced in the late 1950s. They now weigh less than 13 grammes.

The third reason is a switch to digital products — a fact highlighted back in 1997 by Diane Coyle in her book The Weightless World [pdf]. The trend has only continued since then. My music collection used to require a wall full of shelves. It is now on a network drive the size of a large hardback book. My phone contains the equivalent of a rucksack full of equipment.

Dematerialisation is not automatic, of course. As Vaclav Smil calculates in his new book, Growth, US houses are more than twice as large today as in 1950. The US’s bestselling vehicle in 2018, the Ford F-150, weighs almost four times as much as 1908’s bestseller, the Model T. Let’s not even talk about the number of cars; Mr Smil reckons the global mass of automobiles sold has increased 2,500-fold over the past century.

Still, there is reason for hope. Chris Goodall’s research paper “Peak Stuff” concluded that, in the UK, “both the weight of goods entering the economy and the amounts finally ending up as waste probably began to fall from sometime between 2001 and 2003”. That figure includes the impact of imported goods.

In the US, Jesse Ausubel’s article “The Return of Nature” found falling consumption of commodities such as iron ore, aluminium, copper, steel, and paper and many others. Agricultural land has become so productive that some of it is being allowed to return to nature.

In the EU, carbon dioxide emissions fell 22 per cent between 1990 and 2017, despite the economy growing by 58 per cent. Only some of this fall is explained by the offshoring of production. (For a good summary of all this research, try Andrew McAfee’s book More From Less.)

Can we, then, relax? No. To pick a single obvious problem, global carbon dioxide emissions may be rising more slowly than GDP — but they are rising nevertheless, and they need to fall rapidly. Yet the fact that dematerialisation is occurring is heartening. We all know what the basic policies are that would tilt the playing field in favour of smaller, lighter, lower-emission products and activities. Adopting those policies means we might actually be able to save the planet, preserve human needs, rights and freedoms — and still have plenty of fun into the bargain.

 

Written for and first published in the Financial Times on 10 January 2020.

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Book of the Week 5: You Look Like A Thing And I Love You

What surprised me about You Look Like A Thing And I Love You is that it’s genuinely funny – laugh-out-loud-funny, read-quotes-to-your-family-over-breakfast-funny. Who would not be charmed by an AI that develops My Little Pony names and suggests “Parpy Stink” and “Starsh*tter”? Or the accidental Murderbot that was supposed to be acting as a friendly usher? Or the curiosity-driven AI that plays Pacman by going to watch the ghosts, because they’re so interesting?

It’s not just a bunch of silly-AI gags, though. There may be a My Little Pony called Raspberry Turd on every other page, but there’s also a great deal of information about how machine learning actually works and why it finds certain kinds of problem a lot more difficult than others. Janelle Shane runs through various sources of AI-weirdness: AIs being trained in simulations (because simulators are faster and safer) and then finding ways to hack the simulation; AIs being fed subtly flawed training data (such as the AI which noticed that the difference between cancerous skin and healthy skin is that there’s usually a ruler in the picture when skin cancer is involved); AIs seeing giraffes everywhere in photographs of the savannah (because people like to take photos of giraffes, it’s safest to assume there’s one in the photo).

I learned a lot and laughed a lot.

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Will the 2020s be the decade that the robots finally come for our jobs?

Will this decade finally be the one in which the machines take our jobs? Such concerns have been aired many times over the centuries and they have always been wrong. But they are not intrinsically absurd.

In 1979, the economist Wassily Leontief pointed to the fate of the horse. Horses had long been of vital economic importance, but faded in the second half of the 20th century as the internal combustion engine became the dominant source of horsepower. Horses still have a niche, but will never outcompete engines, no matter how cheap oats become.

Might large numbers of human workers go the way of the horse? In 2003, the economists David Autor, Frank Levy and Richard Murnane published a study of the economics of technological change that made two influential observations.

First, they pointed out (correctly) that it is misleading to talk of robots — or any other technology — taking jobs. Instead, machines perform tasks, a narrower unit of work. Since most jobs involve many different tasks, robots do not take jobs, but they may radically reshape them. A robot accountant is not C-3PO; it’s Excel or QuickBooks. As with the horse, there is no wage at which human calculators can compete with a computer at the task of adding up a spreadsheet. Still, human accountants exist in large numbers. Their jobs simply look very different today.

Second, argued Profs Autor, Levy and Murnane, the tasks that machines took on were best described not as “skilled” or “unskilled” but as “routine” or “non-routine”. Recalculating a spreadsheet is a skilled but routine task, easily automated. Cleaning a toilet requires little skill — even I can do it — but is non-routine and therefore hard to automate.

This way of looking at the world proved very useful. It explained why technology could disrupt our jobs without destroying them. And why both the low-paid and high-paid ends of the labour market were proving robust, while the middle, packed with skilled-yet-routine tasks, was hollowed out.

But in a new book, A World Without Work, Daniel Susskind argues that the second part of the Autor-Levy-Murnane perspective is proving more questionable. He observes that the boundaries of the “routine” are blurring fast. Consider, for example, CloudCV, a system that answers open-ended questions about images. Upload an image and ask any question you like.

One photograph showed some 20-somethings sitting on a sofa with white wine and cans of Kronenbourg lager in front of them, with one fellow standing in a dramatic pose. “What are they doing?” I asked the computer. “Playing Wii,” it replied, correctly. “What are they drinking?” Probably beer, it said. “How’s the weather?” I asked of an outdoor snapshot. “Cloudy.” It was.

The system gives accurate answers to informally phrased questions about random photographs. Is that task routine? Hardly.

Neither is the performance of Alpha Zero, the game-playing algorithm developed by DeepMind, a sister company of Google. In 2017, AlphaZero trained itself in a few hours to thrash the best chess-playing engine and the best Go program, both of which easily beat the best humans. Some claim this performance is less impressive than it first appears — but 10 years ago the mere idea that a computer could beat a human at Go seemed implausible. What DeepMind’s supercomputers can do today will be achievable on laptops and phones by 2030.

In task after task, the computers are overtaking us. In the Visual Question Answering challenge that CloudCV attempts, humans score 81 per cent. The machines were at 55 per cent as recently as 2016; by the summer of 2019 they were at 75 per cent. It’s only a matter of time before they do a better job than us — just as AlphaZero does.

The Artificial Intelligence Index project, based at Stanford University, tracks a wide variety of benchmarks. The machines are making rapid progress at symbolic achievements — such as playing poker — but also at translation, speech recognition, and classifying diseases such as skin cancer (from images of moles) and diabetes (from images of retinas).

These achievements are real. And despite the fact that there are many things computers cannot do, when an algorithm does a narrow task cheaply and well, we humans end up contorting ourselves to unleash the new capability while sweeping up the tasks the software leaves behind. Just look at the self-checkout at your local supermarket.

So — will the machines take all the jobs in the coming decade? No, and that remains an unhelpful way to phrase the question. Machines encroach on tasks, and we reorganise our jobs in response, becoming more productive as a result. But there is good reason to believe that such reorganisations will be wrenching in the decade to come, and also that some people will be permanently unable to contribute economically in the way they would have hoped and expected. Above all, it is likely that our political institutions will be unable to adapt to the challenge.

 

Written for and first published in the Financial Times on 3 January 2020.

My book “Fifty Things That Made the Modern Economy” (UK) / “Fifty Inventions That Shaped The Modern Economy” (US) is out now in paperback – feel free to order online or through your local bookshop.

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Book of the Week 4: The Body – A guide for occupants

A confession: Bill Bryson came to visit the More or Less studios, gave us a signed copy of his book and was wonderfully charming to all of us. I was well-disposed to him before I even cracked the spine.

That said: it’s a wonderful book. I used to read a lot of Bryson books (as a rambler, A Walk In The Woods had particular appeal) but it had been a while since I picked one up, and I’d forgotten just what an effortlessly engaging writer he is.

Structurally, The Body: A Guide For Occupants is simple. Bryson tells you all sorts of things about the body – your brain, your skin, your blood, your ears – and while it all seems to be bang up to date, there’s no radical reinterpretation of medical science (thank goodness). Nor is there some too-clever-by-half conceit to the way the tale is told.

Instead, Bryson is just wonderfully fun to read: there’s the perfect blend of crazy medical stories, biographical snippets about scientists, surprising facts and figures, and invitations to reflect on your own experience. A remarkable volume of information is conveyed with the easy charm of a skilled raconteur. Writing a book like this is very, very hard and Bryson makes it look very, very easy.

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Ten years of social media have left us all worse off

The last decade has had plenty of landmark moments — but one big change crept up on us slowly: our experiences in the liminal space of social media. Somewhere between Silicon Valley and our vibrating pockets, between our closest friends and some faceless trolls, our privacy, politics, economy and above all our attention were reshaped by Facebook and its outriders.

Social media existed before 2010, but not as we now know it. Few of us had smartphones in 2009. Facebook’s active user base has grown sevenfold over the past 10 years, and there simply aren’t enough people for that to happen again. Instagram and WhatsApp were both launched about a decade ago, and swiftly absorbed into the mother of all social networks. As for Twitter, let me simply note that Donald Trump only started tweeting in earnest in 2011.

What effect has all this had? It’s plausible to argue that social media enabled major events such as the Arab spring and the election of Mr Trump, although of course there is never a single explanation for such things. There have been some telling little moments, however — such as when the UK Conservative party press office took the low-rent Orwellian step of posing as an independent fact-checking organisation on Twitter. (No doubt they would describe that incident differently, while adding that Oceania has always been at war with Eastasia.)

I should not exaggerate. This isn’t 1984. Partisan news sources were popular long before we self-selected into online echo chambers. Propaganda is not new. And there are benefits from social media: it gives a platform to all sorts of people who deserve to be heard. But it is hard to make the case that social media has led to a more thoughtful, rigorous or compassionate discourse about politics. Amid the bullying, the misogyny, and the endless outrage, it’s hard to tell the bots and the people apart, largely because so many humans have lowered themselves to the level of the bots.

What about the economics? Network effects mean that social media platforms tend to spiral towards monopoly. You want to be where your friends are. It might be hard for a new search engine to displace Google, but if I am tempted by an alternative, I don’t need to persuade my friends and family to move too.

An obvious antitrust measure would be to force Facebook to divest WhatsApp and Instagram, two services that could and should be its competitors. A more radical approach is to require social networks to improve their interoperability and data portability — effectively allowing other services to piggyback, or users to flit among services. If I switch email providers or phone companies I can bring my phone number and contact database with me, or automatically forward messages sent to my old email address. It’s possible to imagine social media working more like that in future, although it would require substantial effort both technologically and legislatively.

Yet none of this solves perhaps the most basic problem. Ten years ago all we had to worry about was email overload. Now we carry around powerful and highly distracting devices. They observe our behaviour, buzz insistently to get attention, and leverage our desire to fit in, communicate and reciprocate. We did not consciously sign up for this, and each of us needs to think carefully about what we really want from social media.

Last Christmas I vowed to spend less time on my smartphone. It worked — until a couple of months ago, when I started using Twitter much more. Why? I had something to sell. That seems wretchedly appropriate. Still, another decade is starting. I cannot break Facebook up by myself, but I can plan to do something more constructive with the time and energy I often spend on social media. I hope I am not the only one.

 

Written for and first published in the Financial Times on 27 December 2019.

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Book of the week 3: Rebel Ideas

I hesitated to read Matthew Syed’s Rebel Ideas, not because I disapproved, but because I wondered whether I would learn anything new. The territory is familiar: cognitive diversity leads to better decisions. Like attracts like, meaning that we fill our organisational toolkits with hammers and neglect to recruit the screwdrivers, hacksaws and wrenches. That’s a bad idea, no matter how good the hammers are.

But my hesitancy was a mistake: Rebel Ideas is a great book and I’ve learned plenty that’s new, as well as gaining a deeper appreciation of what I thought I already knew.

Matthew Syed does cover some territory that was familiar to me from writing Messy. He cites my book and others that I admire, including Charlan Nemeth’s No!, Sunstein and Hastie’s Wiser, Joe Heinrich’s The Secret of Our Success and Scott Page’s The Difference. If you haven’t read these books, I suggest that you do – you’re in for a treat.

But even if you have, Syed’s synthesis is impressive. His storytelling is breathtaking – he opens with a discussion of the CIA’s failure to spot the 9/11 attacks, and flits across plane crashes, the invention of the wheeled suitcase, and the rise of Silicon Valley. His discussion of a disastrous Everest expedition is particularly hard to put down. This approach – story plus science – is of course standard in the genre, but I can assure you that it’s very hard to do well, and Syed does it very well indeed.

Syed covers collective blindness, constructive dissent, innovation, echo chambers and the evolution of culture itself. My usual book-reading habit of creasing the bottom corner of a page I want to come back to has somewhat backfired – there are dozens of creases because the book is packed with good stuff.

Recommended!

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The changing face of economics

Robert Solow, the Nobel laureate economist, says he had long been “bothered” by the fact that most people — even educated people — “had no clear idea of what economics is, and what economists do”.

Solow was born in Brooklyn in 1924, to what he has described as a “lower-middle-class family”, and grew up during the Great Depression.

Although his father always had work, Solow has said that from about the age of eight onwards, he was conscious that his parents were constantly worrying, “and their worries were purely economic: what was going to happen, could they continue to make ends meet”.

This awareness would shape his thinking throughout his life. He won a scholarship to Harvard at 16 and began an academic career that would see him reach the top of his field, winning the Nobel in 1987 for his contributions to the theory of economic growth.

Yet despite such acclaim, Solow, who is now 95, felt that his subject remained frustratingly opaque to the general public.

Then, a few years ago, he was seated by chance next to the photographer Mariana Cook at a friend’s dinner party. Cook had recently completed a project photographing 92 mathematicians, ranging from Fields Medal winners to promising young men and women at the start of their careers.

Solow suggested that she embark on a similar series of portraits, but of economists — and Cook agreed.

As he writes in the introduction to the resulting book, which contains 90 black-and-white portraits shot by Cook over the course of three years: “The idle thought became a reality, and I found myself involved in many ways. Naturally, I had to ask myself: was making a book of portraits of academic economists a useful or reasonable or even a sane thing to do?”

It is a fair question. Economics remains a perplexing discipline. It is often regarded as purely the study of money. (Far from it: indeed, some critics complain that economists aren’t as interested in studying money as they should be.) It is easily caricatured as overly mathematical, full of absurdly unrealistic assumptions, elitist and corrupted by proximity to business and finance.

And, as with any caricature, there is some truth in all of these complaints.

So what actually is economics? Alfred Marshall began his enduringly influential 1890 book Principles of Economics: “Political economy or economics is a study of mankind in the ordinary business of life; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing.”

“The ordinary business of life.” It is not a bad definition, even now. But economics has changed since Marshall’s day. What is being studied has changed, and how, and even who does the studying.

Start with the “what”. It might seem obvious that economists should stick to the study of the economy — the production and consumption of goods and services that are either traded in markets or could be. They never really did stay in their lane: Thomas Robert Malthus was a proto-environmentalist and an inspiration for Charles Darwin; John Stuart Mill was a philosopher; John Maynard Keynes was intellectually promiscuous.

But it was Gary Becker and his followers who systematically applied the methodological tools of economics to social issues such as racial discrimination, the family and addiction.

Some of the ideas Becker championed — notably the use of education to improve “human capital” — became so mainstream as to be a cliché. Others remain controversial.

But nobody bats an eyelid when the economist Emily Oster publishes books of advice on pregnancy and parenting, when Steven “Freakonomics” Levitt opines on when to rob a bank, or even when the Financial Times publishes a column using economics to give tips on dating and etiquette. Economic imperialism is here to stay.

The “how” is also changing. Twenty years ago, the economist Ed Lazear published a paper, “Economic Imperialism”, with Becker at its centre.

Lazear argued that economic imperialism had been a success because “economics stresses three factors that distinguish it from other social sciences. Economists use the construct of rational individuals who engage in maximising behaviour. Economic models adhere strictly to the importance of equilibrium as part of any theory. Finally, a focus on efficiency leads economists to ask questions that other social sciences ignore.”

This is, I think, a fair summary of the state of play in 1999. But two decades on, economics is no longer quite so taken with the assumption of rationality. With Nobel memorial prizes for behavioural economics going to Daniel Kahneman (2002), Robert Shiller (2013) and Richard Thaler (2017), it has now become perfectly acceptable to publish economics papers with an alternative view of human decision-making.

That is not the only change in the toolkit of economics. The first modern randomised clinical trial was run by a man trained in economics, Austin Bradford Hill, in the late 1940s — but the methodology did not become widespread in economics until the 21st century.

The randomistas — most prominently the 2019 Nobel laureates Abhijit Banerjee, Esther Duflo and Michael Kremer — put the experimental results centre stage; the considerations that Lazear highlighted are not forgotten, but they are left in the wings.

Other economists are broadening the tools of economics by taking advantage of huge datasets and operating on the fringes of computer science. Two prominent examples are Susan Athey — the first female winner of the John Bates Clark Medal — and Raj Chetty, who won the same prize at the tender age of 33. Among the sources of this new data rush are internet traffic, cell-phone metadata, satellite imagery and the ballooning administrative datasets used by large organisations to run their businesses.

If the “how” is changing quickly, the “who” is stubbornly resistant to change. Economists used to be white and male. Now they are mainly white or Asian, and male.

Of course, there are some spectacular exceptions: in 2005, when I began writing my column for the FT, there was no female winner of the Nobel memorial prize in economics. There are now two.

Even more perplexingly — given that the award is for younger researchers — there was no female winner of the John Bates Clark Medal. There are now four, which is progress. Women such as Elinor Ostrom, Claudia Goldin and Janet Yellen have reached the very top of the profession, as did the late Alice Rivlin.

But economics still lacks the diversity it needs to reach its full potential. The Royal Economic Society has launched a “Discover Economics” campaign to address this, but it will take more than a recruitment drive: a 2014 study, “Women in Academic Science”, concluded that while other academic disciplines had been levelling the playing field, economics was an exception. We need to do better.

Economics is a controversial discipline, and that is not likely to change. Whereas scientists only occasionally have to dip their toes into political waters such as climate change or vaccination, most of what economists study — from inequality to immigration, trade to taxation — lies squarely in the middle of the political battlefield.

Still, some of us are doing our best, and all of us are human, as these portraits show. It is nice to be reminded of that.

Mariana Cook’s book is “Economists“.

Written for and first published in the Financial Times on 21 December 2019.

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‘Salvator Mundi’ and the limits of certainty

Mona Lisa may be famously inscrutable, but “Salvator Mundi” has surely replaced her as Leonardo da Vinci’s most enigmatic work. It has been two years since it was reported that the long-lost painting had been sold to a Saudi prince as a gift to the Louvre Abu Dhabi, for an astonishing $450m — two and a half times the previous record for any painting sold at auction.

Since then the unveiling has been postponed without explanation, and the painting’s whereabouts are unknown: on a yacht, says one report; in secure storage in Switzerland, says another.

No doubt the mystery of its whereabouts will be resolved. The mystery of its provenance is deeper. In 2005, “Salvator Mundi” was bought for about $1,000 at an auction in New Orleans by two art dealers, Alexander Parish and Robert Simon. (Mr Parish later told Vulture that they had been willing to go as high as $10,000, but it proved unnecessary.)

On the surface, the painting was worth little: it was in very bad shape. But Messrs Parish and Simon thought it might be by a disciple of Leonardo; in which case it might easily be worth several hundred thousand dollars — a gamble worth taking. As a painting by Leonardo’s studio, with a touch or two by the master himself, it might have been worth $20m.

So what is it? Ben Lewis, author of The Last Leonardo, notes that the debate rages “over whether it belongs in the first division autograph Leonardo category or the second division Leonardo+Workshop category”. Apparently that is a $430m distinction. And the desire for clarity is not merely financial. When we gaze at a painting on a gallery wall, we like to know.

It is hard, too, to disentangle the time-scarred original work from its substantial restoration by Dianne Modestini — which, in turn, was influenced by the close inspection of known works by Leonardo.

Yet as the criminologist Federico Varese points out, it is curious that we insist on a binary distinction. We feel powerfully that the painting is either an autograph Leonardo, or it is not. As a matter of logic that may be true, but as a matter of practicality we do not know and we will never know. There is some evidence of Leonardo’s involvement, but the evidence is circumstantial. We are relying heavily on intuition — albeit the intuition of people with deep expertise. Regrettably but unsurprisingly, the experts differ.

This is partly a problem of knowledge: we cannot travel back in time to see who painted what. But it is also a problem of definition. Philosophers might recognise the “bald man paradox” here. Plucking out a single hair from a full head of hair does not produce a bald man. Keep going, however, and baldness will result. And yet it seems absurd to identify any particular hair as the crucial one that made the difference between baldness and non-baldness. Similarly with “Salvator Mundi”: how many brushstrokes from Leonardo does it take to distinguish a workshop piece from an autograph work?

So “Salvator Mundi” is the Schrödinger’s cat of paintings — perhaps one thing, perhaps another. We can’t know.

Schrödinger’s cat discomfited the Austrian physicist Ernst Schrödinger, for good reason. But to a statistician or a social scientist, this sort of irresolvable uncertainty is part of life.

I just tossed a coin. Did it come up heads or tails? One or the other, clearly. But even after the fact, if you haven’t seen the result it is not absurd to say that there is a 50 per cent chance of either outcome. And if I then put the coin back in my pocket without checking, 50-50 is the closest we will ever get to knowing.

We should be able to live with such fuzziness. When asking a question such as “who is the greatest ever Formula 1 driver?”, we know that we can have a fun argument — Lewis Hamilton, Michael Schumacher, Ayrton Senna, Juan Fangio? And we also know that the argument cannot be resolved.

But we forget this in other parts of life. Who would be the better UK prime minister, for example, Jeremy Corbyn or Boris Johnson? Which Democratic candidate would be most likely to defeat US president Donald Trump in the 2020 elections? Is it Joe Biden, Elizabeth Warren, Bernie Sanders or Pete Buttigieg? How serious a threat is climate change, and how drastic a change is required to deal with it?

The answers matter far more than the question of how much Leonardo contributed to “Salvator Mundi”, if he contributed at all. But we will never know for sure what the answers are.

One approach to all this fuzziness is to demand sharpness. I have often written admiringly about the work of Philip Tetlock, who has examined the problem of forecasting — a field dominated by vague prognostications — by asking forecasters to make verifiable predictions with deadlines.

But there are limits. The world defies our attempts to confine it with neat definitions.

It is not wrong to debate these vast questions of policy and politics. Indeed, it is vital that we do. But it is futile to expect a certain answer.

Written for and first published in the Financial Times on 6 December 2019.

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For more on the joys of ambiguity, try my book, Messy. 

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