Tyler Cowen's Blog, page 44
February 11, 2015
Assorted links
1. No Big Bang? (speculative, obviously) And some Grexit odds.
2. $2 per comment at Tablet. Hmm…
3. The culture that is France (America).
4. Breaking: cricket players are selfish and follow economic incentives.
5. Tinder bot picks your dates for you.
6. The Republican alternative to Obamacare? A very good analysis.
Do smart sports writers actually dumb down the games they cover?
In a Ramsey model this can be true.
I went to see a Thunder-Clippers game with Kevin and Robin, and as usual parts of the live experience were rather distasteful to me, including the noise, the arena announcer, and the cheerleaders. These features of sports have, overall, become worse over time.
That said, NBA basketball largely succeeds in appealing to both high-status and low-status men. (Roller derby and pro wrestling can’t quite bridge that gap, NASCAR is doing this more than it used to. On arena strategies for making everyone feel exclusive, try this interesting piece.) Neither group goes away from the experience fully happy, but each receives something of value.
High-status men receive ancillary products related to the NBA, such as statistics and clever analytics, from say Bill Simmons or fivethirtyeight or Zach Lowe. These make the experience of watching the game more high brow and also more satisfying. In response to that improvement, some other aspects of the experience can be dumbed down, without the high-status men defecting. The stupid promotions and halftime shows, for instance, becomes less suited to what the high status men might be looking for. But you can ignore them when you’re happy to sit there and think through PER for this year’s Kevin Love, whether the Wizards should take so many long twos, or why the Atlanta Hawks were such a surprise.
And thus we have another unintended consequence: making an experience smarter, as do the clever sportswriters, can also contribute to making part of that same experience more stupid.
Addendum: Watching the game, I also learned that the Thunder have a deeper team than I had thought, and that Chris Paul is no longer a quick point guard.
February 10, 2015
“I’m sorry, Dave…” (tractor edition, agriculture average is over)
Dave asked me if there was some way to bypass a bum sensor while waiting for the repairman to show up. But fixing Dave’s sensor problem required fiddling around in the tractor’s highly proprietary computer system—the tractor’s engine control unit (tECU): the brains behind the agricultural beast.
One hour later, I hopped back out of the cab of the tractor. Defeated. I was unable to breach the wall of proprietary defenses that protected the tECU like a fortress. I couldn’t even connect to the computer. Because John Deere says I can’t.
There is more here, interesting throughout, mostly about how farmers are no longer able to fix their own tractors, which by the way may cost $100,000 or more. This part is interesting too (“model this“):
There’s a thriving grey-market for diagnostic equipment and proprietary connectors. Some farmers have even managed to get their hands on the software they need to re-calibrate and repair equipment on their own—a laptop purchased from some nameless friend-of-a-friend with the software already loaded on it. There are even ways to get around the factory passwords that block access to the tECU to effect repairs.
But under modern copyright laws, that kind of “repairing” is legally questionable.
Manufacturers have every legal right to put a password or an encryption over the tECU. Owners, on the other hand, don’t have the legal right to break the digital lock over their own equipment. The Digital Millennium Copyright Act—a 1998 copyright law designed to prevent digital piracy—classifies breaking a technological protection measure over a device’s programming as a breach of copyright. So, it’s entirely possible that changing the engine timing on his own tractor makes a farmer a criminal.
In response, there is now a community of farmers looking to encourage “open source tractors.”
If this doesn’t concern you, I can assure you that in South Korea things are even worse.
For the pointer I thank the excellent Mark Thorson.
More on the economics of dessert in decline
Parties that might have finished their dinner in a little over an hour instead linger for closer to two when they opt for dessert. And they stay the extra thirty minutes while consuming only a fraction of what they did during the first part of the meal. It would be different if people ordered drinks more often alongside cake, but they often don’t. It would change things if dessert wines were more popular, finer, and more expensive, but they aren’t, Cowen said.
From Roberto A. Ferdman at WaPo, there is more here. File under “Oklahoma is different.”
I would add two points. First, the rise of wait-in-line higher quality casual fast food penalizes dessert, because at say a Chipotle people don’t want to wait in line again for dessert. Second, a lot of what is consumed at Starbucks and similar outlets is “dessert in everything but name” and that is proving a more popular and durable model for injecting sweets and cream into the body, perhaps because it does not need to be paired with an expensive meal and furthermore it is ever-present in most parts of the United States.
Netflix vs. the media conglomerates
The largest conglomerates are still in the lead:
When we sum up the many networks owned by each media conglomerate, we can see how mighty these giants truly are. Netflix may be the largest “cable channel” by more than 100%, but it ranks 7th among cable television groups. Add in broadcast, and the delta is even greater. Not only is Disney more than three times as large as Netflix, but the OTT service makes up only 5% of total US video consumption per month. It may be that no single channel has the breadth of content and scale to be a serious Netflix competitor, but their parents certainly do.
That is from Liam Boluk. Here is Boluk on the economics of Youtube: “Felix Kjellberg (PewDiePie) is already more popular than scores of Hollywood TV and film celebrities.”
Assorted links
1. Update on the Thiel fellowships.
2. Not just pining for the fjords: the Philips curve in the UK (and elsewhere?). And how good are the Nordics anyway?
4. Charles C. Mann review of Harari.
5. Singapore drones deliver your food. And some notes on my Oklahoma talk.
A Price is Signal Wrapped Up in an Incentive
Here is the second rose video which goes deeper into the meaning and operation of the invisible hand. One warning, however, don’t watch this video while drinking!
All MRUniversity videos are free to use in the classroom. To that end, we have put together a short guide for teachers that suggests some ideas for using the rose videos in class and how one might continue to deepen the lessons.
How much does state population size predict state inequality?
From StatisticalIdeasBlogspot:
Of the top 10 populated states, 5 were also among the top 10 “unequal” states: CA, TX, FL, NY, IL. Of the 10 least populated states, 4 were also among the 10 least “unequal” states: VT, AK, ME, HI. So instead of 4 overlapping states, we have a significantly higher 9 (5+4) states overlapping. Additionally, there are no crossover states (e.g., a highly “unequal” less-populated state, nor a less “unequal” highly-populated state). The easy math (9>4 with no crossovers) shows something, and it’s not structural inequality.
The only common variable between the selection of the top 10 (and in the selection of the bottom 10) populated states is just population size itself!
There is also a useful map at the link.
February 9, 2015
Dani Rodrik on premature deindustrialization
Somehow this paper has not been receiving adequate notice (Ryan Avent is one meritorious exception), so here it is:
I document a significant deindustrialization trend in recent decades, that goes considerably beyond the advanced, post-industrial economies. The hump-shaped relationship between industrialization (measured by employment or output shares) and incomes has shifted downwards and moved closer to the origin. This means countries are running out of industrialization opportunities sooner and at much lower levels of income compared to the experience of early industrializers. Asian countries and manufactures exporters have been largely insulated from those trends, while Latin American countries have been especially hard hit. Advanced economies have lost considerable employment (especially of the low-skill type), but they have done surprisingly well in terms of manufacturing output shares at constant prices. While these trends are not very recent, the evidence suggests both globalization and labor-saving technological progress in manufacturing have been behind these developments. Premature deindustrialization has potentially significant economic and political ramifications, including lower economic growth and democratic failure.
I am less sympathetic to industrial policy than Dani is, but still I think there is much to this basic line of argument. Here is the NBER version of this paper.
Sentences about Russia
“Its Moscow can feel like an oligarchy in the morning and a democracy in the afternoon, a monarchy for dinner and a totalitarian state by bedtime,” he writes.
The longer FT article on Russia is here, the quotation is from Peter Pomerantsev.
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