Hi friends. Welcome to the first edition of my hopefully-weekly email/blog!
As you know, learning new things and discussing with friends has always been very important to me. In recent years, that process has been mediated by Facebook and Twitter (and Point, although few of you made that leap) to an enormous extent. But I’ve grown dissatisfied with sharing and discussing on social media. There are a bunch of reasons: norms discourage long posts; I feel guilty for occupying too much of people’s feeds; people’s responses are constrained by the need to project a public image; and I don’t get practice writing real sentences. (And, of course, I end up spending too much time on there.) So I’m experimenting with this format. This will be a place to share interesting things I’ve read and heard in the previous week. The topics will probably revolve around social science, politics, and technology. Reply whenever you’d like; unsubscribe if you must. And since I’ll be spending less time on social media, you might need to send me the most interesting things you find directly. Thank you for reading!
p.s. if Google Reader still existed and/or people still used RSS feeds, as they should, this wouldn’t need to exist as an email/blog. But sometimes technology marches unmistakably backward.
1. On The Weeds podcast, there was an interesting discussion of what I would call socially appropriate biases toward positivity and negativity. They were talking about economic journalism and the perennial question of “whether the economy is doing well.” As a liberal journalist, Ezra Klein is socially expected to be skeptical of positive economic statistics, both because his role involves uncovering how the poor get screwed and because he is personally affluent, so it would look bad to cheerlead the economy when many people are worse-off. But this dynamic encourages some blinkered thinking when the unemployment rate has dropped to 4.9%! Alternatively, it’s socially acceptable for Republicans to celebrate a booming economy–just not when Obama is the president. Ezra and Matt point out that if Mitt Romney were president with 4.9% unemployment, after promising 6% during the campaign, he would be hailed as a major savior. Liberals are tempted to cheerlead the Obama Boom–but if you do, you’re a corporate shill.
2. A book that I’d like to make time to read: The Half-Life of Policy Rationales: How New Technology Affects Old Policy Issues. Via Tyler Cowen, this book argues that the appropriateness of some policies depends on the technology in existence at the time, and as technology changes, some policy becomes outdated. That seems intuitively obviously true, but (a) barely ever discussed and (b) totally absent from how politicians and political analysts talk about policy. I think most of all I’m interested in the tricky issue of “solving for the equilibrium” of how technology and policy change iteratively in response to one another. I’d love to read case studies about that iterative process.
3. I’m interested in Brand New Congress and will probably write about them again. Short description: staffers from the Bernie campaign are trying to create a movement to draft candidates for every open Congressional seat in 2018. The candidates will be regular people, “leaders in their communities,” with no political background. Brand New Congress will operate a national fundraising and campaign management infrastructure so the candidates don’t need to deal with the massive fundraising obstacles that keep any sane person from running for Congress. My initial reaction is that this, as I’ve described it, is an incredible idea. The problem is the part I haven’t described: all candidates will adhere (roughly) to a policy litmus test equivalent to the Bernie platform, especially re: income inequality, trade, climate change, and criminal justice reform. Of course I think this is a pretty good platform. But I also think it will brand the whole effort as Democratic and partisan, and will dilute some of the appeal of the pure idea: political outsiders with no special interest obligations. On the other hand, Josh rebuts me that very few people (donors or voters) will get as excited as I am about pure institutional reform; people want a platform. What do you think?
4. NYT story about how family-owned restaurants in Palo Alto are closing because the tech giants are hiring away their staff for in-house cafeterias (aaand because rent in Palo Alto is insane). Seriously, I suspect the anomalous real estate market in P.A. is more than half the story here. But putting that aside, this made me think about Enrico Moretti’s book The New Geography of Jobs. Moretti shows how high-wage jobs have a multiplier effect, creating other service sector jobs in the same region. He estimates that tech jobs, in particular, come with a 5x multiplier: two new professional jobs (doctors, lawyers) and three new low-skill service jobs (retail, food). This article is consistent with that story, with one big difference: the new service jobs are being created inside the tech firms rather than independently. I guess there are a lot of transaction costs to buying your own food during a busy day, so this outcome seems consistent with the Coase/Williamson approach. If this phenomenon turns out to be more broadly applicable than the weird Palo Alto real estate situation, it would pretty significantly change the view I took away from Moretti, which is that high-wage firms are very good for local economies.
5. Occasionally I read articles about social science on edge.org. I even have a book compiled by edge’s founder, John Brockman. But this week the sociologist Michele Lamont, visiting our department, revealed the sinister truth that edge is a front for the hegemonic takeover of the social sciences by cognitive psychology and behavioral economics. Why that would be a bad thing, I’ll have to explain some other time. But come to think of it, it’s true that most of their material fits into those disciplines. And what’s more, Lamont explained that Brockman is a literary agent for many of the authors who appear on edge. So it’s more of an advertising machine than I realized. My verdict on whether to keep reading edge is not yet out.
6. On the EconTalk podcast, guest Scott Sumner discussed a very important economic fallacy: “reasoning from a price change.” One example they gave: you own your house, and you notice a bunch of new houses being built in your neighborhood. Should you be worried about the value of your own home? A lot of people who’ve taken some microeconomics would say yes, supply is going up, so price is going to go down. But this is to “confuse a shift along a demand curve with a shift in the curve itself.” In other words, what you should probably infer from the new construction is that demand in your neighborhood has increased, which is going to push up both supply and price. More generally, it’s essential to know why a price is changing, not just which direction it changed. The point of this discussion, by the way, was to show why the question “Why is there so little investment if interest rates are so low?” (posed by Robert Shiller, no less) is fallacious. In Roberts and Sumner’s view, interest rates are low because the investment schedule has contracted inward.