Saturday, December 20, 2014

The gift-giving of Robert Barro

“The Deadweight Loss of Christmas” is the sort of academic paper that makes ordinary people think economists are kind of crazy.

"I find that holiday gift giving destroys between one-third and one-tenth of the value of gifts,” proclaimed Joel Waldfogel, then an economics professor at Yale, in the 1993 paper. He estimated that ill-chosen gifts caused between $4 billion and $13 billion a year in economic waste; for comparison, he cited an estimate that put economic costs of the income tax at $50 billion. ...

But one thing I learned from growing up around economists is they do not always live up to their provocations. For example, my economist father, who taught me as a young child that voting is irrational because your odds of affecting the electoral outcome are infinitesimal, votes. And Mr. Waldfogel, who went on to write a book called “Scroogenomics: Why You Shouldn’t Buy Presents for the Holidays,” actually does buy presents at the holidays, at least for some people. ...

Since it’s almost Christmas, I called up the economist I know best to get his perspective on gift giving: My father, an economics professor at Harvard. My dad says his approach to gifts is to try to buy something that the recipient didn’t know he or she wanted. And the Robert Barro record on this is instructive, because it is mixed.

Sometimes there are big hits: This Christmas he found a book of John Wesley sermons published in 1825, a perfect gift for his wife, Rachel, who is deeply interested in the history of Methodism, but most likely would not have found the item herself.

On the other hand, let’s evaluate the box of fancy chocolates he and Rachel sent me for Christmas this year.

There are three ways to evaluate this gift. The first level of analysis is that I’m on a diet and certainly would not have bought the chocolate myself, which suggests this was an example of what Mr. Waldfogel warned us about: gift mismatch leading to deadweight loss.

The second level of analysis is that I’ve already eaten half the box, which demonstrates my revealed preference for chocolate, and shows my father achieved exactly what he set out to do: He identified an item I would not have bought for myself but apparently wanted.

The third level of analysis considers the fact that I now feel I should not have eaten the chocolates, or at least not so many of them in two days. ...

My father, who is not a behavioral economist, would surely reject this last analysis and say if I ate the chocolates, that must have been the rational thing for me to do; therefore, the chocolates were a great gift. ...

It’s true that Americans have taken to gift cards...

But not all economists agree that this is a valuable technological advance.

“It seems clear to me that a gift certificate is inferior to money,” says my dad. Which means there is more chocolate in my future.
--Josh Barro, The Upshot, on revealed preferences of economist fathers

Thursday, December 11, 2014

Left-handed people make less money

Lefties score lower on cognitive tests and are 50 percent more likely to have behavioral problems and learning disabilities (such as dyslexia). Also, people suffering from schizophrenia are more likely to be left-handed than are people without the condition. ...

In the Fall 2014 issue of the Journal of Economic Perspectives, Joshua Goodman, an assistant professor at Harvard's Kennedy School, has a paper that aligns the research with the documented obstacles that left-handed people face. In the paper, “The Wages of Sinistrality: Handedness, Brain Structure, and Human Capital Accumulation,” Goodman identifies statistical shortcomings in previous studies of left-handedness and introduces other figures for analytical poking and prodding. He analyzed five longitudinal data sets (three from the U.S. and two from the U.K.) that have been tracking the lives of babies for decades.

His conclusion? Left-handed people earn significantly less than right-handed people.

Lefties’ median earnings are about 10 percent lower than those of righties, which is the same magnitude as the salary hit that comes with spending one fewer year in school. (Speaking of education, left-handed people are also less likely to complete college.) ...

What could explain this discrepancy? It would seem that lefties might earn less because they’re at a physical disadvantage when faced with objects made for righties. But that doesn’t seem quite right, as Goodman found that lefties are more likely to work in manual jobs. Instead, it’s probably because of the cognitive problems that, statistically speaking, are more likely to affect lefties than righties.

Determining why those disadvantages arise is more difficult—there doesn’t seem to be one clear cause of left-handedness. It would appear that the trait is at least partially genetic. A child is 50 percent more likely to be left-handed if his or her mother is, and the trait might be derived from the structure of a baby’s brain. But there are other, non-genetic explanations that account for these facts: Children with left-handed mothers might just be more likely to imitate them, and a stressful prenatal environment might force some left-hemisphere functions to migrate to the right side of the brain in utero. Either way—nature or nurture—handedness is a trait that, from the time of birth, appears to have long-term effects on personal economic well-being.
--Joe Pinsker, The Atlantic, on the right-handed world

NFL defensive players should lateral more

American football as we know it today is a derivative of rugby, a game which still has no room for Aaron Rodgers, Tom Brady and the forward pass. And in today’s NFL, there no longer seems to be room for the backwards pass. ...

We found 77 instances from 2002-2013 in which the defense lateraled after a turnover, and the vast majority were successful. For this study, we ignored offensive laterals because most occurred on swing passes, reverses, or flea flickers, which are all in the playbook, and the rest showed up in desperation razzle-dazzle attempts at the end of games. Each lateral play in our sample added an average of 15.6 yards of field position. Nine plays resulted in touchdowns for the defensive team, with the player who received the lateral running, on average, an additional 33 yards into the end zone.

Perhaps most notably, the lateraling team fumbled on seven plays and only lost the ball back to the offense on three of them. ...

Using a model developed by Brian Burke of Advanced Football Analytics that provides the number of points the average team could expect to score, given a unique down, distance, and field position, each lateral in our sample equated to an average gain of 0.92 expected points per play—and that’s including the three lost fumbles.
--Andrew Mooney, WSJ, on reviving a lost weapon

Monday, December 8, 2014

Creating mice with half-human brains

Mice have been created whose brains are half human. As a result, the animals are smarter than their siblings. ...

The altered mice still have mouse neurons – the "thinking" cells that make up around half of all their brain cells. But practically all the glial cells in their brains, the ones that support the neurons, are human. ...

[Steve] Goldman's team extracted immature glial cells from donated human fetuses. They injected them into mouse pups where they developed into astrocytes, a star-shaped type of glial cell. ...

Astrocytes are vital for conscious thought, because they help to strengthen the connections between neurons, called synapses. ...

A battery of standard tests for mouse memory and cognition showed that the mice with human astrocytes are much smarter than their mousy peers. ...

To explore further how the human astrocytes affect intelligence, memory and learning, Goldman is already grafting the cells into rats, which are more intelligent than mice. ...

...Goldman is quick to dismiss any idea that the added cells somehow make the mice more human. ...

However, the team decided not to try putting human cells into monkeys. "We briefly considered it but decided not to because of all the potential ethical issues," Goldman says.
--Andy Coghlan, New Scientist, on real-life rats of NIMH and Algernons. HT: Marginal Revolution

Sunday, November 30, 2014

How long is forever? 50 years

After Philippe de Montebello agreed at breakfast two decades ago to name the Metropolitan Museum of Art’s Roman Sculpture Court, in perpetuity, for the philanthropists and antiquities collectors Leon Levy and his wife, Shelby White, Mr. Levy predictably, but politely, posed an impertinent question. ...

Mr. Levy later recalled, “I asked him, How long is ‘in perpetuity’?”

“For you, 50 years,” Mr. de Montebello, the museum director, replied. ...

“Perpetuity is usually a matter of negotiation now,” said William D. Zabel, a lawyer representing the Fisher family, who had threatened to sue on their behalf 12 years ago when Lincoln Center considered changing the name at that time without its permission.

Tuesday, November 25, 2014

It's OK to drink a little alcohol while pregnant

National guidelines recommend abstaining from all alcohol exposure during pregnancy, but many women consume low to moderate amounts of alcohol, often before realizing they are pregnant. Researchers from the Yale’s Schools of Public Health and Medicine and Brown University investigated the effects of lower levels of alcohol consumption on 4,496 women and singleton infants. ...

About 30% of women in the study reported consuming alcohol— predominantly wine — during their first month of pregnancy. ... Overall alcohol exposure levels among women who reported drinking were relatively low, with a median level of approximately one drink per week in the first month of pregnancy.

The team found that for those women who drank low to moderate amounts of alcohol in early pregnancy, there was a reduced likelihood of low birth weight, short birth length, and small head circumference, which are all hallmarks of FAS. Drinking later in pregnancy during the third trimester was associated with lower risk for low birth weight and preterm delivery.

Sunday, November 23, 2014

Spin aside, Dept. of Energy loans are still losing money

The Department of Energy snookered the media last week with a report that seems to show that its clean energy lending programs are profitable. “Remember Solyndra? Those loans are making money,” went a typical headline. ...

Unfortunately, that’s not true. Taxpayers are losing money on DOE lending. ...

DOE takes credit for the interest that companies pay on their loans, but it doesn’t subtract—or even report—the interest costs that taxpayers pay to finance those loans. ...

DOE’s report does not address this issue, except in a footnote in a table (cut and pasted above) revealing that its $810 million of “interest earned” was “calculated without respect to Treasury’s borrowing cost.” ...

The report does not allow us to say just how far behind. We do know, however, that DOE loans are typically made at small, sometimes zero, spreads above Treasury rates. So a large portion of DOE’s “interest earned” must have been offset by borrowing costs. That puts taxpayer losses in the hundreds of millions of dollars. ...

Indeed, the Obama administration still predicts that DOE’s loans will lose money over their lifetimes.

DOE’s lending programs should not be evaluated solely or even primarily based on their profitability or lack thereof. What matters is their overall social impact. ...

If DOE wants to play the profitability card, however, it should do so in an accurate and transparent way. Last week’s report falls woefully short.
--Donald Marron on profiting by ignoring costs

The problem with evaluating charities on overhead percentage

Like most NGOs, we bragged to our donors that we had low overhead, that their dollars and euros and kroner and francs went to “the cause” and not to our rent or our heating bills. And this was, at least on the Excel sheets, true. ...

The problem is, those overhead tasks don’t disappear just because you don’t spend money on them. Someone has to monitor the accounts, find new donors, calculate taxes, organize the holiday party. Centralizing these tasks in dedicated departments, hiring specialists, getting good at them, that would have looked like bureaucracy. So instead, we spun them out to the entire staff: We assigned researchers and project managers—anthropology majors mostly, some law school dropouts—to do our H.R., accounting, fund-raising, and project evaluations.

The outcome was as chaotic as it sounds. Want to hire someone? You’ll need to write your own job ad, find job boards to post it to, and, in some cases, update the standard employment contract yourself. Want to issue a press release about the results of the study you just performed? Write it yourself and start sending it to journalists. Hopefully you know a few. ...

Every staff meeting, one or two people announced they were leaving. “I wasn’t hired to spend my day fund-raising” were the most common eight words at farewell parties.

My experience wasn’t unique. Stern cites the example of the American Red Cross, which sent confused volunteers, clueless employees, and, bafflingly, perishable Danish pastries to the Gulf Coast after Hurricane Katrina because it hadn’t invested in training its U.S. staff in actual crisis response. A buddy of mine works at an NGO with 150 staff where the H.R. department is exactly one person, and she’s also the receptionist.
--Michael Hobbes, New Republic, on charitable response to incentives. HT: ACT

The premise of the problem of evil and suffering

In his short book [“True Paradox: How Christianity Makes Sense of Our Complex World,” UPenn law professor David] Skeel touches on a variety of eternal questions—from the mystery of human consciousness to the relationship between law and justice. He addresses the problem of evil in an especially compelling way—not by “solving” it in some philosophically air-tight way, but by questioning its premise.

The “problem,” of course, is that the presence of evil in human affairs seems to suggest that God, if he is there, is either malicious for causing it or powerless to stop it: In either case, he isn’t “God” in any traditional understanding. Mr. Skeel points out, however, that in order to make the argument, terms like “evil and “malicious” must be imported from a worldview that assumes God’s existence. ...

[Atheist Christopher] Hitchens hotly denied that his suffering had any moral significance but found it hard not to describe it in moral terms—writing of the cancer’s “malice” before catching himself: “There I go again.” At another point: “To the dumb question ‘Why me?’ the cosmos barely bothers to return the reply: Why not?” ...

The Christian God does not simply allow or disallow suffering—he himself suffered, in the person of Jesus Christ, and uses suffering to renew his children’s character.

The most captivating chapter in “True Paradox” deals with the afterlife. No one who achieves great things, Mr. Skeel argues, really believes those achievements are pointless, destined to fade into nothingness. In a similar way, he suggests, our work on earth will somehow find its fulfillment in heaven. Indeed, the afterlife of the Christian tradition has little to do, he contends, with the commonplace images of men and women playing harps in the clouds. The Bible strongly implies, rather, that the Christian’s life in eternity will extend his earthly life’s complexity, only without failure and rebellion against God. The Christian, then, if Mr. Skeel is right, is able to do his work believing what the materialist wants to believe but can’t, quite—that the significance of that work will not only last but last into eternity.
--Barton Swaim, WSJ, on Christianity and meaning

Friday, November 14, 2014

Surprise, you're the president of Yale!

On Feb. 10, 1950, A. Whitney Griswold ’29 GRD ’33 and his wife, Mary, headed to New York for an evening of theater and fine dining. After seeing “Caesar and Cleopatra,” Whitney — a young Yale history professor — and Mary decided to stay over in New York and have lunch the next day with Roswell Ham, then-President of Mount Holyoke College. After hearing all about Ham’s life as a college president, Whitney remarked to Mary, “Thank God we’re not in that racket.”

He needn’t have worried. Though Yale’s president, Charles Seymour 1908 GRD 1911, had just announced his retirement, Griswold was a highly unlikely choice for the job. He had never been interviewed for the position. He was too young, just 43. He was something of a nonconformist, at least by Yale standards: a solid Democrat on a faculty full of Republicans. And though Griswold had sterling credentials — a bachelors and doctorate from Yale (the country’s first ever Ph.D. in American Studies) and nearly two decades of celebrated teaching — he genuinely did not want the job.

Yet, when he returned to the Elm City later that evening, Griswold learned that the Yale Corporation, the University’s highest governing body, had chosen him to run the nation’s third-oldest university. “When the Corporation announced its choice,” Yale’s late, great historian Brooks Mather Kelley ’53 wrote in “Yale: A History,” “many observers could not have been more surprised if Yale had chosen God.” ...

On April 4, 1959, the Yale Corporation gathered to decide the names of Yale’s 11th and 12th residential colleges, at that point still two years away. Eventually, of course, they settled on Morse and Ezra Stiles. But unlike today — when there is no shortage of debate over the new colleges’ names — Griswold named Morse and Stiles largely on his own, Sterling Professor Emeritus of English and former Stiles Master Traugott Lawler told me.
--Scott Stern, Yale Daily News, on the old way of doing things

Not my job: Nuclear missiles edition

The Pentagon will have to spend billions of dollars over the next five years to make emergency fixes to its nuclear weapons infrastructure, Defense Secretary Chuck Hagel will announce on Friday, after two separate Pentagon studies concluded that there are “systemic problems across the nuclear enterprise,” according to senior defense officials. ...

For example, while inspectors obsessed over whether every checklist and review of individual medical records was completed, they ignored huge problems, including aging blast doors over 60-year-old silos that would not seal shut and, in one case, the discovery that the crews that maintain the nation’s 450 intercontinental ballistic missiles had only a single wrench that could attach the nuclear warheads.

“They started FedExing the one tool” to three bases spread across the country, one official familiar with the contents of the reports said Thursday. No one had checked in years “to see if new tools were being made,” the official said. This was one of many maintenance problems that had “been around so long that no one reported them anymore.”
--David Sanger and William Broad, NYT, on military competence

Monday, November 10, 2014

How the police help themselves to your belongings

[Las Cruces, New Mexico city attorney Harry] Connelly was talking about a practice known as civil asset forfeiture, which allows the government, without ever securing a conviction or even filing a criminal charge, to seize property suspected of having ties to crime. The practice, expanded during the war on drugs in the 1980s, has become a staple of law enforcement agencies because it helps finance their work. It is difficult to tell how much has been seized by state and local law enforcement, but under a Justice Department program, the value of assets seized has ballooned to $4.3 billion in the 2012 fiscal year from $407 million in 2001. Much of that money is shared with local police forces.

The practice of civil forfeiture has come under fire in recent months, amid a spate of negative press reports and growing outrage among civil rights advocates, libertarians and members of Congress who have raised serious questions about the fairness of the practice, which critics say runs roughshod over due process rights. In one oft-cited case, a Philadelphia couple’s home was seized after their son made $40 worth of drug sales on the porch. Despite that opposition, many cities and states are moving to expand civil seizures of cars and other assets. ...

In the Georgia session, the prosecutor leading the talk boasted that he had helped roll back a Republican-led effort to reform civil forfeiture in Georgia, where seized money has been used by the authorities, according to news reports, to pay for sports tickets, office parties, a home security system and a $90,000 sports car. ...

But in the video, [chief of the forfeiture unit in Mercer County, New Jersey Sean] McMurtry made it clear that forfeitures were highly contingent on the needs of law enforcement. In New Jersey, the police and prosecutors are allowed to use cars, cash and other seized goods; the rest must be sold at auction. Cellphones and jewelry, Mr. McMurtry said, are not worth the bother. Flat screen televisions, however, “are very popular with the police departments,” he said.

Prosecutors boasted in the sessions that seizure cases were rarely contested or appealed. But civil forfeiture places the burden on owners, who must pay court fees and legal costs to get their property back. Many seizures go uncontested because the property is not worth the expense. ...

Mr. McMurtry said his handling of a case is sometimes determined by department wish lists. “If you want the car, and you really want to put it in your fleet, let me know — I’ll fight for it,” Mr. McMurtry said, addressing law enforcement officials on the video. ...

Prosecutors estimated that between 50 to 80 percent of the cars seized were driven by someone other than the owner, which sometimes means a parent or grandparent loses their car. ...

“I can’t tell you how many people have come in and said, ‘Oh, my hijito would never do that,’ ” [a police officer] said, mimicking a female voice with a Spanish accent.

Extreme standardized testing

In Florida, which tests students more frequently than most other states, many schools this year will dedicate on average 60 to 80 days out of the 180-day school year to standardized testing. In a few districts, tests were scheduled to be given every day to at least some students. ...

But there is another requirement that has made testing more difficult in Florida. The state ordered all students, including those in elementary school, to take standardized tests on computers as of this year. But again, the state did not give districts extra money for computers or technology help.

Because schools do not have computers for every student, tests are staggered throughout the day, which translates to more hours spent administering tests and less time teaching. Students who are not taking tests often occupy their time watching movies. The staggered test times also mean computer labs are not available for other students.
--Lizette Alvarez, NYT, on going beyond teaching to the test

Saturday, November 8, 2014

The Denver Post's marijuana critic

[Jake] Browne, 31, held the bud up to his nose and inhaled. Then he opened his computer. “Faint lemony sweetness,” he typed, before loading the pot into a small glass pipe.

“I usually will take one, maybe two hits,” he said as he fired up the bowl. “I’m looking for how it burns, the taste, if it’s flushed well — meaning you don’t want to taste the fertilizers or chemicals.” He exhaled, waited and then turned to his computer again. “Head high. No initial body effect,” he wrote.

This is Mr. Browne’s job (or, at least, one of his jobs). The longtime resident of Colorado — where marijuana has been legal since January...

He is also the first pot critic for The Denver Post, Colorado’s oldest and largest daily newspaper. ... Yes, he is paid to smoke it — and then write about the high.

“The thing people say to me most often is, ‘Dude, you must have the best job ever,’ ” said Mr. Browne, sitting in his living room. ...

...Ricardo Baca, the newspaper’s newly appointed cannabis editor (and a longtime staff member) said it simply made journalistic sense. “We have a restaurant critic and wine reviewers,” he said. “We have an award-winning craft beer blog. From that logic you do need a pot critic — and maybe a few of them.” ...

The key to pot criticism, Mr. Browne said, is knowing your audience. While he tries to keep his language basic enough that a nonsmoker could understand it (“I think pot needs smart people to be ambassadors to the masses,” he said), he doesn’t want to be condescending to those who do. “I never want to be that pretentious pot critic,” he said.
--Jessica Bennett, NYT, on a critic for everything

Sunday, November 2, 2014

Quantity surcharges, not discounts, at supermarkets

When you shop at a supermarket—say for a bag of chips or a can of tuna—you naturally assume that buying a bigger package must be cheaper per unit and thus will save you money. As it turns out, you often would be wrong. The bigger package can cost you more per unit; there might be a "quantity surcharge." One survey found that 25 percent of brands that offered more than one size imposed some form of quantity surcharge. These surcharges are not errors. Consumer Reports has called them a "sneaky consumer product trick." The trick works best on consumers who don't pay much attention to prices, who just assume the bigger package will be the better deal. (How often have you done this?) One study examined which supermarkets practice this "trick" and found just what our discussion so far would have predicted: supermarkets in low-income neighborhoods are the least likely to have quantity surcharges. It is harder to trick someone into paying more when she is careful to squeeze the most out of every dollar spent.
--Sendhil Mullainathan and Eldar Shafir, Scarcity: Why Having Too Little Means So Much, on exploiting inattention

Saturday, October 25, 2014

Justice Roberts on diversity on the Supreme Court

Chief Justice John G. Roberts Jr., who has two Harvard degrees, was once asked whether it is healthy for the Supreme Court to consist of only justices with degrees from elite institutions.

“First of all, I disagree with your premise,” he responded. “Not all of the justices went to elite institutions. Some went to Yale.”
--Adam Liptak, NYT, on Justice Roberts's quick wit

Friday, October 24, 2014

Taking a selfie when you've been shot

Late one night in August, Mishay Simpson shot Andrew Noll after he walked into her Davis Islands home unannounced. Simpson, the wife of semiprofessional golfer Rhett Simpson, later told investigators that Noll was a former friend who had been stalking her and threatening to hurt her family.

When the home's alarm went off and she heard someone coming up the stairs, she grabbed a 9mm Ruger. When the door opened, she fired.

A bullet sliced through Noll's chest and exited his back, piercing a painting on the wall behind him.

Noll, 23, survived the shooting. But there was much more to the story than what Simpson, 28, told police.

Among the things she omitted: She and Noll had an affair. ...

A few weeks before the shooting, Simpson tried to break things off. ...

In the hours before the shooting, he texted her again. She said her husband was out of town and she was going to bed. Noll later told police that he interpreted that to mean it was okay to come over. He tried entering the alarm code, but it didn't work.

The alarm sounded as he headed upstairs. When she fired, he could smell the gunpowder.

As he lay bleeding, Noll raised the phone and snapped a selfie.
--Dan Sullivan, Tampa Bay Times, on our "selfie for every occasion" era

Sunday, October 19, 2014

When air pollution is so bad it makes your skin dirty

Even by the city's standards, Beijing was very polluted on Sunday. The PM2.5 scale, which measures the number of micrograms of "particulate matter" per cubic meter, came up to a whopping 344. (To put that figure in perspective, the World Health Organization considers 25 micrograms to be healthy). ...

To say the least, these weren't ideal conditions for a marathon. But that race is precisely what took place on Sunday, as tens of thousands of runners braved the conditions to complete the 34th annual Beijing International Marathon.

Event organizers were aware that the air wouldn't be good on Sunday, but determined it was too late to postpone the race, which had attracted participants from throughout China and around the world. To help runners clean detritus from their skin, organizers supplied over 140,000 sponges placed at stations throughout the course.
--Matt Schiavenza, The Atlantic, on taking air pollution to the next level

What happened to Samuel L. Jackson's character after Pulp Fiction

At the end of Pulp Fiction, [Samuel L.] Jackson’s Jules says to Vincent that, after their brush with death in the diner, he’s just going to “walk the earth.” When Vincent asks him to expand, he says, “You know, walk the earth, meet people… get into adventures. Like Caine from Kung Fu.” In Kill Bill: Vol. 2, Jackson makes a cameo at The Bride’s wedding as a piano-playing drifter who goes by the name of “Rufus.”
--Marlow Stern, Daily Beast, on a beloved character making good on a vow. HT: AS

Wednesday, October 15, 2014

Time spent in meetings is growing exponentially

Time spent in meetings has been rising by 8% to 10% annually since 2000, and is likely to continue increasing, says Michael Mankins, a partner in San Francisco with the management-consulting firm Bain & Co. Senior executives are spending an average 28 hours in meetings each week, and middle managers spend 21 hours, says Mr. Mankins, lead author of a recent 17-company time-management study with analytics provider VoloMetrix. ...

Conference-room shortages fuel genuine anxiety in employees who must meet with others to get work done. When Seattle-based Moz, a maker of marketing-analytics software, outgrew its office space last year, employees began booking conference rooms in advance just in case they needed them, says Mark Schliemann, vice president, technical operations, for the company. “If there’s a shortage of food, people want to hoard it. Conference rooms are the same way,” Mr. Schliemann says. “If people see conference space as valuable and they need it, they do whatever it takes to get it.”

Such logjams leave 40% of employees wasting up to 30 minutes a day looking for meeting space, according to customer surveys by Steelcase Inc.