Tyler Cowen's Blog, page 197
April 13, 2014
Is there a Flynn Effect for dogs?
I would be surprised if there wasn’t:
Mr. Pilley told me, “The big lesson is to recognize that dogs are smarter than we think, and given time, patience and enough enjoyable reinforcement, we can teach them just about anything.”
It’s true that dogs everywhere are doing things that would have been unimaginable in the Alpo era. Last year, researchers at the University of Pennsylvania’s Working Dog Center trained a team of shepherds and retrievers to sniff out lab samples containing ovarian cancer. Scent hounds are also being used to forecast epileptic seizures and potentially life-threatening infections. A black Labrador from the St. Sugar Cancer-Sniffing Dog Training Center in Chiba, Japan, was accurate 98 percent of the time in picking up early-stage signs of colon cancer. As Mr. Hare, from Duke, said, “I will take a dog smelling my breath over a colonoscopy any day of the week, even if it’s just an experiment.”
From David Hochman, there is more here.
Assorted links
1. Chinese signaling in the East China Sea. Good news, sort of.
2. Kling on Krugman on Piketty.
3. A.I. remains a masterpiece and there is a new toy to prove it.
4. “Sluggish cognitive tempo” — the new disability?
5. “We just visited with the penguins,” she said. “It was very calm.”
6. The Good Judgment Project — is it outguessing national intelligence?
Three movies in which the Coase theorem does not seem to hold
Le Weekend explains why the Coase theorem does not hold in the marriages of aging British whiners. The Lunchbox, in addition to having an interesting plot (imagine a lower-tech Indian “You’ve Got Mail”), is the best movie I’ve seen on the nature of Indian micro-transactions, whether in relationships or in the workplace. Erving Goffman would be proud, and the mention of Harvard is the funniest line I’ve heard in a movie in years. Under the Skin, as I understood it, asks what kind of trades might be possible between us and one of Rilke’s angels, if the latter were to come down to earth. The movie does indeed answer that question, and the underlying connection between Rilke and Islam is discussed here. And here is a fascinating article about the most memorable actor in the movie. Maybe the best piece you will read today.
I thought all three movies were excellent, and full of social science, though none is a movie that everyone will enjoy.
When I am watching a movie I often think “why isn’t the Coase theorem holding here?” There are few movies — outside of sappy romantic comedies — in which the Coase theorem explains much of the plot.
April 12, 2014
Narva, Estonia (speculative)
Michael Ben-Gad, a professor at London’s City University who has studied the credibility of long-term promises by governments, questions whether Nato’s commitment to collective defence is absolute and asks what would happen if Russia’s border guards crossed the bridge that separates Narva from Ivangorod and took the Estonian town.
“Would the US and western Europe really go to war to defend the territorial integrity of Estonia? I think Estonia has reasons to worry. Narva is the most obvious place; it is almost completely Russian-speaking,” he says.
More than 82 per cent of Narva’s residents are ethnic Russians and 4 per cent are ethnic Estonians. More than a third have Russian citizenship.
Here is the FT article, here are photos of Narva. Here is a map of Narva:
Italy fact of the day
The Italian Tourist Board spends an astounding 98 percent of its budget on salaries, with basically nothing left for its actual job of tourism promotion.
The point of the article is that hardly anyone visits southern Italy any more, thus making it one of the world’s best arbitrage opportunities. It is one of my favorite regions.
By the way:
There are trains in the Mezzogiorno that travel at an average speed of 8.7 miles an hour.
And:
Metaponto, in the Basilicata region east of Naples, has a five-track, marble-clad rail station, paid for by $25 million in European Union funds. But the last train out is an 8:21 a.m. express to Rome. If you want to go anywhere else, you have to take a bus.
In the 1970s, Italy was the world’s #1 tourist destination but now it has slipped to number five. There has never been a better time to go.
Assorted links
1. Space-saving sink and toilet combined design.
2. “Dr. Hirotaka Osawa from Tsukuba University, in Japan, has developed a new wearable device to help us with something called “emotional labor.”" The full link is here. Recommended.
3. What is the worst kind of mistake a small German furniture store might possibly make? Note that so far fewer than ten percent of the sold cups have been returned.
4. Indian economic recovery may not be so assured after all.
5. Romantic consensus decreases as individuals get to know each other better.
6. Land, secular stagnation models, negative rates of return, and a new proposed rustication.
7. Prefiero un otro nombre del pueblo, si?
Henry Aaron and the Lucas Critique
No, not the Henry Aaron at the Brookings Institution. I mean what the ten year old Tyler Cowen would have called “the real Henry Aaron.” Nate Silver writes:
What if Aaron had never hit a home run? What if those 755 round-trippers had fallen for base hits instead? (If we’re trying to isolate the effect of his power, that seems like the fairer way to do it, instead of turning them into popups or something.) Would he still be a Hall of Famer?
If all of his homers had been singles, Aaron would still have his 3,771 hits. Instead of being the second-best home-run hitter of all time, he’d be the third-best singles hitter of all time, after Ty Cobb and Pete Rose. His RBI total would have gone way down; based on the number of runs that Aaron knocked in on home runs and singles throughout his career, I estimate that he’d have 1,232 of them rather than 2,297. But 1,232 isn’t a shabby total; it would rank Aaron 141st all time, in the general vicinity of Derek Jeter, Edgar Martinez and George Sisler. He’d still be a lifetime .305 hitter and have a .374 on-base average.
OK, here is where Lucas comes in. If Hank Aaron did not carry significant home run potential to the plate, he would have seen a lot more blazing fastballs, pitchers’ “best stuff,” and so on. Why not challenge the hitter and try to blow it by him if all you are risking is a single up the middle? As it was, pitchers often threw Aaron a variety of slower curves and off-speed junk, stuff he might grab a piece of with the bat but would have a harder time drilling straight over the fence.
And thus a homer-less version of Aaron probably would have had a harder time making contact at all. And he certainly would have had many fewer walks. But yet, with the amazing wrists he had…pitchers were afraid of him.
It is funny how the Lucas critique went from one of the most underrated ideas in economics (pre-Lucas), to one of the most overrated ideas (1980s-early 1990s), and now it is back as one of the most underrated ideas again. If we vary one policy or one element of a calculation or algorithm, other individuals will respond strategically.
Addendum: Scott Sumner adds comment.
April 11, 2014
New data on tax havens, from Gabriel Zucman
Here is the new paper (pdf):
This article shows that official statistics substantially underestimate the net foreign asset positions of rich countries because they fail to capture most of the assets held by households in offshore tax havens. Drawing on a unique Swiss data set and exploiting systematic anomalies in countries’ portfolio investment positions, I find that around 8% of the global financial wealth of households is held in tax havens, three-quarters of which goes unrecorded. On the basis of plausible assumptions, accounting for unrecorded assets turns the eurozone, officially the world’s second largest net debtor, into a net creditor. It also reduces the U.S. net debt significantly. The results shed new light on global imbalances and challenge the widespread view that after a decade of poor-to-rich capital flows, external assets are now in poor countries and debts in rich countries. I provide concrete proposals to improve international statistics.
The original pointer was from Paul Krugman. Yesterday I was at an IMF forum with Jeff Sachs and he too was placing great stress on this issue.
*A Curmudgeon’s Guide to Getting Ahead*, by Charles Murray
I enjoyed this book, and I recommend that you get it for your kid. Here is one bit of many:
Good help is hard to find. Really hard to find. Sure, there are lots of people with the right degrees and résumés, but the kind of employee we yearn for sticks out almost immediately.
You can buy the book here.
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