Tyler Cowen's Blog, page 62
January 7, 2015
Quantifying confidence
Angeletos, Collard, and Dellas serve up another important entry (NBER gate) in the growing literature on the importance of the risk premium for macroeconomic fluctuations:
We enrich workhorse macroeconomic models with a mechanism that proxies strategic uncertainty and that manifests itself as waves of optimism and pessimism about the short-term economic outlook. We interpret this mechanism as variation in confidence and show that it helps account for many salient features of the data; it drives a significant fraction of the volatility in estimated models that allow for multiple structural shocks; it captures a type of fluctuations in aggregate demand that does not rest on nominal rigidities; and it calls into question existing interpretations of the observed recessions. We complement these findings with evidence that most of the business cycle in the data is captured by an empirical factor which is unlike certain structural forces that are popular in the literature but similar to the one we formalize here.
There are ungated versions here. The funny thing is, these theories are in some key regards more true to the spirit of John Maynard Keynes than many theories which are called “Keynesian.”
Robert Tombs, *The English and Their History*
I ordered this book through the UK, as it does yet have a U.S. publication date on Amazon. It has a fascinating 891 pp. of text (and an excellent annotated bibliography), virtually all of which are worth reading. In just about any year it is one of the top five non-fiction books of that year. I found it especially strong on English-French relations, and early modern times, and perhaps a bit weak on post-1970 developments, which are in any case harder to cover.
It is not an easy book to excerpt but here is one short bit on Shakespeare:
…at deeper levels he is astonishingly not the product of his times, which is an evident reason for the continuing power of his work. Most obviously, he is not dogmatic; he displays a wide variety of cultural and religious influences, but is not defined by the religious conflict that shaped his time — hence continuing modern debate about his personal beliefs. He pays little respect to social and gender hierarchy. He writes of a ‘deep England’, beyond London and the court. Women are always important and often dominant in his plays, and women came in large numbers to see them, scandalizing foreign visitors. It is often said that he conceals his opinions; it seems rather that the ideas he explores transcend the limits of contemporary polemics.
Definitely recommended, I quickly became addicted to this book. Do any of you know when it will have a formal release on this side of the Atlantic?
Is the Great Stagnation soon over?
The method, which extracts drugs from bacteria that live in dirt, has yielded a powerful new antibiotic, researchers reported in the journal Nature on Wednesday. The new drug, teixobactin, was tested in mice and easily cured severe infections, with no side effects.
Better still, the researchers said, the drug works in a way that makes it very unlikely that bacteria will become resistant to it. And the method developed to produce the drug has the potential to unlock a trove of natural compounds to fight infections and cancer — molecules that were previously beyond scientists’ reach because the microbes that produce them could not be grown in the laboratory.
Studies on people will start in about two years, the NYT article is here. Here is the underlying Nature article.
Alternatively, here is a claim that James Harden is the future of basketball.
I thank numerous MR readers for related pointers.
Markets in everything
The tables have turned on zoo-goers in China — where people are paying to be locked in cages while hungry lions and tigers stalk their every move.
The Lehe Ledu Wildlife Zoo in Chongqing city is giving people the hair-raising chance to learn what it’s like to come face to face with an apex predator, Central European News reports.
Visitors are forking over their cash to be caged inside the back of a truck as it makes its way through the animal park. Just to make sure they get the attention of the beasts, huge chunks of raw meat are tied to the bars to lure them as close as possible.
“We wanted to give our visitors the thrill of being stalked and attacked by the big cats but with, of course, none of the risks,” said zoo spokeswoman Chan Liang. “The guests are warned to keep their fingers and hands inside the cage at all times because a hungry tiger wouldn’t know the difference between them and breakfast.”
The chilling, once-in-a-lifetime experience has been a hit with visitors — the trips have been sold out for the next three months, according to CEN.
The link is here, via NinjaEconomics. Elsewhere, in New York they are banning the tiger selfie, with or without huge chunks of raw meat. Yet also in New York, Tough Mudder has added tear gas to some of its obstacle routines, via Hugo Lindgren.
Martin Ford’s *The Rise of the Robots*
Of all the moderns who have written on automation and rising joblessness, Martin Ford is the original. His Rise of the Robots: Technology and the Threat of a Jobless Future is due out this May, you can pre-order here. Self-recommending.
Here is my earlier post Will you lose your job to a robot?
January 6, 2015
Martin Anderson has passed away at 78 years old
There is one account here. Excerpt:
Martin Anderson, the Keith and Jan Hurlbut Fellow at the Hoover Institution, passed away on January 3, 2015. An engineer by training and an esteemed academic, Anderson’s early work spanned urban renewal, welfare reform, and the military draft. His work on the draft included promoting an all-volunteer force as director of research for Richard Nixon’s presidential campaign; he is often credited as a significant factor in ending conscription in the United States. After receiving his PhD in industrial management from the Massachusetts Institute of Technology in 1962, he became a professor of finance at the Graduate School of Business at Columbia University, becoming one of the youngest professors to receive tenure there. After joining the Hoover Institution in 1971, Anderson continued to intersperse his academic career with public service and political campaign advising, serving presidents and candidates Nixon, Ford, Reagan, George H. W. Bush, Wilson, and Dole.
I read Anderson’s work on urban renewal very early in my career and was definitely influenced by it.
Tuesday assorted links
1. “Ekki staðalbúnaður í smalamennsku!” With video, of course, and implying the advantages of water transport.
3. Steven Landsburg makes some good points, but Summers may be able to invoke threshold effects.
4. Harvard faculty actually seem to hate the best parts of Obamacare. Bravo to this article. And quick summaries of evidence-based medicine.
5. “I’m the poster child of evil [art] speculation…” An excellent piece, also NYT.
6. How big is the sexism problem in economics? Kimball and anon.
7. Sorkin covers the Lucian Bebchuk fracas.
Modal markets in everything
Accrington Stanley, who would have faced Manchester United in the FA Cup third round had they beaten Yeovil in the previous round, are selling commemorative tickets for the game that will never happen for £20.
The article does not specify which means of payment they will accept.
The pointer is from Simon Koppel.
January 5, 2015
Do sinking ships put women and children first?
There is a new paper on this topic, not by Bruno Frey, rather by Mikael Elinder, the abstract is this:
Since the sinking of the Titanic, there has been a widespread belief that the social norm of “women and children first” (WCF) gives women a survival advantage over men in maritime disasters, and that captains and crew members give priority to passengers. We analyze a database of 18 maritime disasters spanning three centuries, covering the fate of over 15,000 individuals of more than 30 nationalities. Our results provide a unique picture of maritime disasters. Women have a distinct survival disadvantage compared with men. Captains and crew survive at a significantly higher rate than passengers. We also find that: the captain has the power to enforce normative behavior; there seems to be no association between duration of a disaster and the impact of social norms; women fare no better when they constitute a small share of the ship’s complement; the length of the voyage before the disaster appears to have no impact on women’s relative survival rate; the sex gap in survival rates has declined since World War I; and women have a larger disadvantage in British shipwrecks. Taken together, our findings show that human behavior in life-and-death situations is best captured by the expression “every man for himself.”
The pointer is from Ben Southwood.
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