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The Unusual Suspects: A Good Cryptographer Is Hard to Find

Earlier this year, the structure of an enzyme in an HIV-related monkey virus was solved in three weeks by internet gamers. It was a feel-good victory of human intelligence over disease, and a reminder of the awesome power of the internet.

The New York Times published a similar article a few days ago. In a slightly controversial move, British spy agency Government Communications Headquarters posted a puzzle online and directed people who solved it to apply for a job at GCHQ. It’s reminiscent of the Bruce Willis movie Mercury Rising and seems like an elegant solution to a hiring problem – the GCHQ can’t offer as much money to their cryptographers as private firms. Also, code breaking skills can’t be that easy to find. The Times reports on what happens after you break the code:

“So you did it,” says the congratulatory message. “Now this is where it gets interesting. Could you use your skills and ingenuity to combat terrorism and cyberthreats? As one of our experts, you’ll help protect our nation’s security and the lives of thousands.” Those interested are then invited to submit a formal job application, leading to interviews for a total of 35 jobs next spring.

12/12/11

Roland Fryer Identifies Five Habits of Successful Charter Schools

Harvard economist (and Freakonomics friend) Roland Fryer has a new paper out (full version here) that takes a look at the specific successful habits of charter schools. Along with co-author Will Dobbie, Fryer collected “unparalleled data” on 35 elementary and middle charter schools in New York City by conducting extensive interviews and videotaping classrooms.

Their results are fairly counter-intuitive. They showed that traditional solutions like class size, per-pupil expenditure, and the number of teachers with advanced degrees are not correlated with effectiveness, and in fact, “resource-based solutions” actually lowered school effectiveness.

Instead, they found five qualities that made up about 50 percent of a charter school’s effectiveness. These are:

1. Frequent teacher feedback
2. Data driven instruction
3. High-dosage tutoring
4. Increased instructional time
5. Relentless focus on academic achievement.

12/6/11

The Violent Legacy of Africa's Arbitrary Borders

Even if they haven’t heard the term Scramble for Africa, most people know that something went wrong when the continent was divided into nation states by European colonial powers.

Some economists, however, have taken the time to quantify the destructive nature of Africa’s national borders. Authors Stelios Michalopoulos and Elias Papaioannou have released a new working paper showing how arbitrary border decisions have affected war and civil unrest in Africa, particularly among split ethnic groups and their neighbors. Not surprisingly, the length of a conflict and its casualty rate is 25 percent higher in areas where an ethnicity is divided by a national border as opposed to areas where ethnicities have a united homeland. Examples of divided (and conflicted) groups are the Maasai of Kenya and Tanzania, and the Anyi of Ghana and the Ivory Coast. The conflict rate is also higher for people living in areas close to ethnic-partitioned hot-spots.

12/1/11

Changing Youth Migration Patterns: So Long New York, Hello… Portland?

A new blog post from William H. Frey, senior fellow at the Brookings Institution, takes a look at the migration patterns of American youth, and the cities that attract the “cool” crowd. In the last few years, the rough economy has put the brakes on mobility, which has declined to its lowest levels since World War II. Young adults in particular have stopped moving around. Still, like always, there are those 20 and 30 somethings who remain mobile. But, in recent years their list of destinations has begun to change. Frey writes:

While young people are moving less than before, it is interesting to see where those who did move went. Heading the list are Denver, Houston, Dallas, Seattle, Austin, Washington D.C., and Portland. The top three areas and our nation’s capital, arguably, fared relatively well economically during the recession. But all seven are places where young people can feel connected and have attachments to colleges or universities among highly educated residents.

11/3/11

Should Mexican Drug Cartels Be Labeled as Insurgents?

A few weeks ago, Freakonomics received an email from a man in Mexico City describing the effects of Mexican drug cartel violence on daily life and asking for our solutions to his country’s seemingly endless crime problems. This week, The New York Times ran a piece on Mexican drug cartels and growing American infiltration of criminal organizations. Now, a new report from RAND on drug-trafficking violence in Mexico analyzes the situation in the context of an insurgency, bringing to bear research on defense-sector reform.

What’s clear is that the drug-fueled violence in Mexico has diversified over the last decade into several other underworld activities: human trafficking, weapon trafficking, and assassinations, just to name a few. In other words, the cartels are no longer just cartels — they are something larger.

The RAND paper reiterates many points that have become familiar to us about the situation in Mexico: corruption is rife, policing is weak. It also looks at how high unemployment and a “youth bulge” have helped fuel Violent Drug Trafficking Organizations (VDTO). For many young unemployed people, joining a crime syndicate is often the best job option. But the most jarring part of the paper is the discussion and comparison of Mexican drug violence to other insurgency trends around the world. Rather than a war on crime, what if the battle with cartels is really a battle with different insurgent groups?

10/27/11

Horizontal vs. Vertical: An International Comparison of Teaching Methods

A new study released by NBER from authors Yann Algan, Pierre Cahuc and Andrei Shleifer takes a look at how teaching practices affect social capital. It’s long and detailed, so we’ll only give you the highlights: in a nutshell, there are major differences between societies that teach vertically (like a teacher lecturing) and societies that teach horizontally (with students working together in groups.)

And because everyone loves international comparisons, the difference between horizontal and vertical countries breaks down as follows:

Students work in groups more in Nordic countries (Denmark, Norway, Sweden) and Anglo-Saxon countries (Australia, United States and to a lesser extent Great Britain). This teaching practice is less common in East European countries and the Mediterranean (Greece, Cyprus, Portugal and, to a lesser extent, Italy). In contrast, in East European and Mediterranean countries, teachers spend more timing lecturing.

10/25/11

Why Does the Likelihood of Terrorism Increase After Natural Disasters?

In a new RAND working paper, authors Claude Berrebi and Jordan Ostwald use international data to argue that countries which experience a major natural disaster are more likely to have an increase in terrorism activity afterward. In the abstract they write:

…Using a structured methodology and detailed data on terrorism, disasters, and other relevant controls for 167 countries between 1970 and 2007, we find a strong positive impact of disaster-related deaths on subsequent terrorism deaths and incidence. We find that, on average, an increase in deaths from natural disasters of 25,000 leads to an increase in the following year of approximately 33 percent in the number of deaths from terrorism, an increase of approximately 22 percent in the number of terrorist attacks, and an increase of approximately 16 percent in the number wounded in terrorist attacks, holding all other factors constant.

10/24/11

Did Risk of Divorce Drive Boomer Women to Increase Their Education?

A new working paper from authors Raquel Fernandez and Joyce Cheng Wong highlights the stark differences in the lives of two generations of American women: those born in 1935 and those born just 20 years later in 1955. The authors found that education, wage structure and divorce were the main causes to changes in labor force participation.

From the abstract:

Women born in 1935 went to college significantly less than their male counterparts and married women’s labor force participation (LFP) averaged 40% between the ages of thirty and forty. The cohort born twenty years later behaved very differently. The education gender gap was eliminated and married women’s LFP averaged 70% over the same ages… We find that the higher probability of divorce and the changes in wage structure faced by the 1955 cohort are each able to explain, in isolation, a large proportion (about 60%) of the observed changes in female LFP.

10/18/11

Call It a Comeback: Why Performance Increases When We're Losing

If you were a New York Knicks fan in the mid 1990’s, you surely remember a certain 1995 playoff game in which Reggie Miller scored 8 points in under 9 seconds (two back-to-back three pointers, and two foul shots) to rally the Indiana Pacers to a last-second win over the stunned Knicks. It was a truly sad moment for New Yorkers, made all the worse when the Knicks lost the series in seven games. For whatever reason, some players seem to play better from behind. Reggie Miller certainly did.

A recent study by Jonah Berger of Wharton and Devin Pope of the University of Chicago highlights how being slightly behind is often an advantage. The authors devote a large part of their research to studying 18,000 NBA and 45,000 college basketball games. They also conducted an experiment in which people played competitive games and were given feedback halfway through.

10/17/11

Does Fingerprinting Food Stamp Recipients Save Money?

What do New York City and Arizona have in common? No, this is not a trick question; there is one thing: currently, they are the only jurisdictions in the country that require food stamp recipients to register their fingerprints in an electronic database. California and Texas recently lifted their fingerprinting requirements.

Not surprisingly, this has touched off a debate over social utility and costs in New York. Proponents say that the resulting fingerprint database saves the city millions of dollars a year in duplicate fraud. Last year, the Human Resources Administration said it found 1,900 cases of duplicate applications for 2010, with savings of nearly $5.3 million.

Detractors claim this estimate is unproven and that fingerprinting keeps a certain amount of needy people out of the system through intimidation.

10/13/11

Incentivizing the School Commute

We’ve written about bribing kids to get better grades. But what about bribing them to walk or ride their bike to school?
A new working paper examines a program in Boulder, Colorado that attempted to incentivize kids to bike or walk to school over a span of several years. The program began with a $10 cash prize for the first two years, but then switched over to a $10 bike store coupon thereafter. One lucky student who rode and walked to school every day during a “prize period” won the coupon.
Even considering the small, non-cash winnings, biking and walking to school increased 16 percent during the prize period. Here’s the abstract:

10/12/11

Why Gun Traffickers Should Live in Arizona

A new study by Brian Knight, an economist at Brown, explores the flow of the illegal firearm market in America and compares the source of guns used in crimes to gun laws in and around that state.
How big is the market for illegal firearms? Pretty big. Knight writes: “ATF investigations into tracking between July 1996 and December 1998 identify over 84,000 firearms that were diverted into this secondary market (ATF, 2000).” Meanwhile, each state in America legislates its own gun laws, resulting in cross-state externalities. For example, Knight cites anecdotal evidence showing that a gun purchased legally in Virginia for $150 – $200 typically resells in New York City for $500 – $600. This is the sort of thing that keeps Michael Bloomberg up at night.
Here’s the abstract:

10/6/11

Explaining the Black-White Wage Gap

As of 2010, black men in America earned 74.5 percent of a typical white man’s wage; black women earned 69.6 percent. A new paper from Harvard’s Roland Fryer (certified genius), Princeton’s Devah Pager and Jorg L. Spenkuch of the University of Chicago examines some of the factors driving the black-white wage gap.
Using data from unemployed workers in New Jersey who sought employment for up to 12 weeks, the authors show that racial discrimination accounts for one-third of the wage difference. They also estimate that blacks have a 7 percent lower reservation wage than their white counterparts at a comparable job that demands a comparable skill level. Fryer and his colleagues control for skill level by measuring the job applicants’ wage at their previous job against the wage they were seeking.
Here’s the abstract:

10/6/11

Immigration, Elasticity and Why Americans Won't Pick Onions (Yet)

A study released this week by NBER measures the elasticity of substitution between American workers and their immigrant counterparts — in non-economic speak, the study asks whether immigrants are good substitutes for equally skilled native workers. While some comparisons remain murky, it appears that non-native workers are actually “perfect substitutes” for equally skilled native workers. The authors write:

In terms of the elasticity of substitution between equally skilled immigrants and natives, we conclude that the OP data, correctly analyzed, imply that the two groups are perfect substitutes. In fact, by using a statistically valid set of regression weights and by defining the earnings of a skill group as the mean log wage of the group (rather than the unconventional log mean wage used by OP), we find that the OP data reveal an effectively infinite substitution elasticity. The evidence thus implies that native workers are exposed to adverse effects from immigration-induced increases in labor supply.

The study sheds some light on the thinking behind (and backlash against) Alabama’s court-upheld crackdown on illegal immigrants.

10/6/11

Nation of Texters: A Third of People Prefer a Text to Talking

A new poll from the Pew Research Center asked Americans about how they use their phone, and in particular, their phone’s non-voice features. They got predictable but still staggering results about sending and receiving text messages, especially from the younger demographic. The summary states:

Some 83% of American adults own cell phones and three-quarters of them (73%) send and receive text messages. The Pew Research Center’s Internet & American Life Project asked those texters in a survey how they prefer to be contacted on their cell phone and 31% said they preferred texts to talking on the phone, while 53% said they preferred a voice call to a text message. Another 14% said the contact method they prefer depends on the situation.

9/28/11

Enlisting in the Military Increases Earnings, But Only If You Stick Around

A new RAND research report prepared for the U.S. Army explores the effect of military enlistment on individual earnings and the labor market. The authors used data from applicants to “active-component enlisted service” from 1989 through 2003, and followed them for up to 18 years. From the report:

The authors find that military enlistment increases earnings in both the short and long-term: The percentage increase in earnings attributable to enlistment is about 40 percent in the first few years following application and diminishes to about 11 percent 14–18 years following application. Enlistment significantly delays college education in the short run. In the longer run, enlistment slightly increases the likelihood of attaining a two-year college degree, but it also decreases the likelihood of attaining a four-year college degree, especially among higher-aptitude youth.

9/27/11

College and the Widening Wealth Gap

If a picture is worth a thousand words, then a few Economic Policy Institute snapshots might be the Great Novel of our time. A few weeks ago, Heidi Shierholz at EPI brought us yet another harrowing tale from the front lines of the recession generation. In an “Economic Snapshot,” she writes:

As college students head back to the classroom this semester, a harsh reality confronts them — the rewards for the time, energy, and money that young people put into college are less than they were a decade ago. Since 2000, America’s young college graduates have seen wages, adjusted for inflation, deteriorate. This lack of wage growth may be particularly surprising to those used to reading about the vast unfilled need for college graduates, which if true would lead to increases in their earnings.

But how is this happening? Maybe it has something to do with a more recent snapshot from Lawrence Mishel at EPI on the growing wealth gap in America. He writes:

9/27/11

Deforestation, and the Incentivized Eco-Crime of Indonesia

There are books that governments keep officially, and then there are the other books – accounts of what people are actually doing and profiting from that are never mentioned in any legal context. A team of researchers from MIT, the University of Maryland, the London School of Economics and the World Bank cleverly used MODIS satellite imagery to uncover this kind of discrepancy as they investigated deforestation in Indonesia.
The satellite pictures allowed for comparison of legal and illegal logging operations. What they found (and write about in a new paper for NBER) shows how an increasingly decentralized government, coupled with very real monetary incentives for local officials, leads to eco-crime.
Indonesia contains one of the largest pieces of tropical forest in the world, rivaled only by Brazil and the Democratic Republic of the Congo. It’s also the third largest producer of greenhouse gases behind the U.S. and China, due largely to its “forest extraction” practices. The paper examines three main forces that affect the decision-making and corruption of bureaucrats and government officials in charge of the logging-heavy jurisdictions of Indonesia.

9/22/11

Pay to Play: Should Registered Organ Donors Get Priority as Recipients?

The organ donor waiting list in America is a long one. There’s far too much demand for a very limited supply. In 2010, 89,316 people were on the kidney transplant waiting list, while the number of living donors was only 6,282, and the number of deceased donor transplants was 10,622. Freakonomics is no stranger to the repugnant discussion of the organ market. America’s particular organ donation policies, however, aren’t practiced everywhere. Singapore and Israel give priority to potential recipients who were already registered donors. A new working paper written by Judd B. Kessler of Wharton, and Alvin E. Roth from Harvard further tests this idea of priority-to-participants in an incentivized game. Here’s the abstract:

8/23/11

Will Rahm Emanuel's Merit-pay System Work Where Others Haven't?

Last week, Chicago mayor Rahm Emanuel announced that he’s rolling out a merit pay program specifically for school principals, using $5 million in donated funds. The plan is particularly bold considering its announcement comes on the heels of quite a bit of evidence, from research to scandals, showing the faults of merit pay.

In March, we wrote about Harvard economist Roland Fryer‘s study on New York City’s failed merit pay experiment, the Schoolwide Performance Bonus Program, which was shutdown last month. A subsequent RAND report echoes much of Fryer’s findings:

…the theory underlying school-based pay-for-performance programs may be flawed. Motivation alone might not be sufficient. Even if the bonus here had inspired teachers to improve, they might have lacked the capacity or resources — such as school leadership, expertise, instructional materials, or time — to bring about improvement.

8/22/11

The Economic Value of (Very) Personal Data

Graphic designer Nicholas Felton keeps track of how many miles he walks each day. He also records how many book pages he reads, how many work e-mails he sends, and what songs he listens to. Felton’s become somewhat famous for his obsessive self-tracking, and the slick info-graphics he produces on himself each year. Both the Wall Street Journal and Slate have made videos about him, here and here.
Felton began tracking his daily habits and compiling a Personal Annual Report in 2005, available at his website.

7/27/11

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