When data looks too good to be true, it’s often not telling the entire story. An example of how to spot science that smacks of advocacy.
David Pennock is one of the smartest guys I know. As a scientist at Yahoo! Research, he’s on the bleeding edge of computer scientists working at the interface with economics. His latest project, called Predictalot, is an amazing new prediction market which allows people to trade on the millions of possible outcomes of the Sweet Sixteen. It’s a brilliant example of just why economists are going to have to get cozy with computer scientists. And David has generously agreed to provide a guest post describing what he’s up to. (And if you want more, he writes the always-interesting Oddhead Blog).
The marginal cost of accessing an academic journal article is pretty much zero. The research has been written, the type has been set, and the salaries have already been paid. So the socially optimal price is: free.
Today, I’m off at the spring meeting of the Brookings Panel on Economic Activity. And for any serious student of the economy, it’s a great line-up of papers. (Full disclosure: David Romer and I are the editors. We commissioned the papers, so of course we love ‘em.) Rather than write about the papers, I figured it might make more sense . . .
I sat down last week for a good chat with the smart folks who run the Planet Money podcast. The topic: Money and happiness.
Four years ago, 75% of Americans said that they had confidence in financial institutions or banks. Following the financial crisis, that number has fallen dramatically, to 45%. This well-earned public mistrust may be yet one more factor retarding the recovery of the financial sector, and possibly the broader economy. Survey data also show that trust in government is also currently . . .
I’ve been watching developments in the Middle East and Northern Africa closely. It can be hard to keep track of it all. Fortunately, the prediction markets at InTrade provide a useful barometer.
I can’t tell whether I’m writing this as a very proud significant-other, a jealous co-author, or a pleased colleague, but whatever it is, I can’t resist passing on some good news: Betsey Stevenson recently learned that the Labor and Employment Relations Association is awarding her the John Dunlop Scholar Award, typically awarded to a labor economist in the first decade of their careers. The award is “to recognize outstanding academic contributions to research by recent entrants to the field.” It’s a very flattering acknowledgment, and she’s following in the footsteps of Jon Guryan, Alex Mas, Nick Bloom, David Lee, Marianne Bertrand, Armin Falk and David Autor, among other labor luminaries.
I’ve written here before about my research with Betsey Stevenson showing that economic development is associated with rising life satisfaction. Some people find this result surprising, but it’s the cleanest interpretation of the available data. Yet over the past few days, I’ve received calls from several journalists asking whether Richard Easterlin had somehow debunked these findings. He tried. But he failed.
One of the exceptional things about the U.S. is how mobile our workers are. It means that worker shortages in North Dakota won’t last long, as workers will move there from jobless Nevada. There’s been a lot of concern that the housing crisis has halted this important adjustment mechanism. According to the Census Bureau, the number of people moving across state lines has plummeted in recent years. Problem is: It’s just not true.
When I stated on this blog that I was hoping to run the NY marathon in under four hours, I was hoping that my public commitment would spur me on. And it did. Sort of. I ran under four hours – 3:54:59 to be precise – which I’m thrilled by. So score one for Ian Ayres and the value of public commitments.
I was at the Legg Mason Thought Leader Forum last week, talking about my research over recent years on prediction markets. It was good fun, but the real novelty was that as I was speaking – literally, in real time – there was a cartoonist next to the stage, cartooning my talk on a five-foot-wide poster. I’ve never seen this before, but it was a real hit.
Ha! That headline probably got you thinking this was a post about Governor Cuomo. It’s not. It’s about an economist trying to keep fit despite the rising demands of work, parenthood, and the shrinking supply of energy that comes in your mid- to late thirties.
Is the Tea Party responsible for yesterday’s election results? Probably. But perhaps not in the way you were thinking.
Journalists have written thousands of pages describing the anger, fury or excitement of the Tea Party. But this isn’t how an economist would approach the question. Perhaps the single deepest idea in economics is the opportunity cost principle. And so it is worth asking: What is the opportunity cost of an active Tea Party movement? To figure this out, you need to ask, “or what?”
A few weeks back, I revealed myself to be the humorless, politically-correct parent that I am, complaining about the gender roles represented by Lego’s new line of Minifigures. My complaint: Of the sixteen Minifigures, the only two that were women were a Cheerleader and a Nurse. Ever the earnest parent, I hope my daughter can imagine herself creating a life beyond these stereotypical roles.
An interesting observation about the potential policy impact of “happiness economics” in this weekend’s Financial Times from the always-astute Tim Harford…
Over at FiveThirtyEight.com, Nate Silver has a post attempting to debunk the idea that there is momentum in political campaigns. But I think he’s wrong. And his post provides a fun opportunity for a simple statistics lesson on the difficulty of discovering momentum.
You’ve probably heard the latest marriage narrative: With the recession upon us, young lovers can’t afford to marry. As appealing as this story is, it has one problem: It’s not true.
We’ve all done it. You’ve been introduced to someone, but forget his or her name. And so you spend the rest of the conversation studiously avoiding needing to refer to your new friend by name. Well, as far as I can gather, the same thing happened on Wednesday to Treasury Secretary Tim Geithner. He gave a talk at Brookings that was all about China, but if you didn’t know better, you could be forgiven for thinking he had forgotten her name.
While speculation is rising about just who will win this year’s Nobel Prize in Economics (to be announced on Monday), it’s probably worth pointing out that the far more important Ig Nobel Prizes for the year have already been announced.
The Brookings Panel on Economic Activity is pretty much my favorite conference each year. (It better be! I took over running the Panel with David Romer in early ’09.) I’ve found that the best way to keep growing as an economist is to embrace any opportunity to be the dopiest guy in a very smart room, and this latest meeting was no disappointment. I’ve been meaning to write about it for a couple of weeks, but time kept getting away from me. So I decided to try something different-I popped into the video studio to chat about some of the new findings presented at the Panel. Here are the highlights.
Fran Blau is one of my favorite labor economists in the world: She’s smart, savvy, tackles important problems, and also incredibly generous in helping younger scholars and colleagues with their own research. She is now also the winner of this year’s IZA Prize in Labor Economics.
Heartbreaking facts: “2.7 million children have a parent behind bars-1 in every 28 children (3.6 percent) has a parent incarcerated, up from 1 in 125 just 25 years ago. Two-thirds of these children’s parents were incarcerated for non-violent offenses.”
A few weeks back, I sat down with the Richmond Fed’s Aaron Steelman for a most enjoyable hour or two talking about my recent research projects and perspectives on economics generally. If you’re interested in learning more, click here for the full interview. Regular readers of this blog may even recognize a few themes that I’ve been hammering away at here on these pages. At the risk of quoting myself, here are a few favorite parts.
There’s a lot of talk about race these days. But high-frequency chatter can obscure some of the more important longer-term trends shaping the lives of African-Americans. Which is why Betsey Stevenson and I turn to the data, in a new paper, “Subjective and Objective Indicators of Racial Happiness.”
There’s a particular kind of story one reads occasionally, making fun of the worst excesses of political correctness. But this entry is about the other extreme-a toy manufacturer so far in the dark ages that even Don Draper might snicker.
But not the heart you’re thinking of.
Economists aren’t cited very often in scholarly journals.
What role should the rich play in solving our fiscal woes?
Sunday’s New York Times reported on attempts by the Texas Board of Education to rewrite the high school curriculum in accordance with its conservative values. So I find the raw ideological force exerted by these “educators” to be both striking and dispiriting.
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