Saturday, August 30, 2014

What dilemma?

Philosophers are fond of hypothetical moral dilemmas, whereby you test your moral theory or code against some nasty decision. A famous one is the so-called trolley problem. Ingrid Robeyns offers up another one, tailor-made for economists, because of the element of uncertainty...
Case A: Rescuing the miners:  
Imagine 100 miners who are stuck in a mine. They are divided in two groups. You can either rescue 50 (with certainty), but then the other 50 will be lost (this is strategy 1). Or you can try a different rescue strategy, which may potentially save all of them, but only at a 50% probability; there’s another 50% chance that all will die (strategy 2). Which strategy would you choose? 
The people around the table had conflicting views, and the reasons we believed to have for a certain view did not convince the others at all. My choice was for strategy 2, since that gives everyone an equal chance to be rescued, and thus treats the miners morally equally in a certain sense. But Robin said that miners themselves would choose strategy 1, since they have a strong collective ethos/identity which includes that you save whom you can save. He claimed that we can deduce this empirical claim from some accidents that happened with miners who were actually locked up in a mine. (this is my recollection of the discussion, but Robin is very welcome to correct me !) 
In the case of miners, we are dealing with adults and respecting their agency could plausibly be taken to overrule other reasons to choose for a certain strategy. But what if agency didn’t play a role? We could change the example, by turning the people-to-be-rescued into babies, who are too small to have anything resembling group-identity and agency: 
Case B: Rescuing the babies:  
Suppose 100 babies are stuck in a mega-crèche which is on fire. They are two floors with 50 babies on each floor. There are two rescuing strategies. Under strategy 1, you can rescue 50 babies for sure, but the other 50 will die. Alternatively you can try another strategy in which all 100 babies have a 50% chance of being rescued (strategy 2). 
Which strategy do you choose, and why? And if you choose differently in case A and case B, then why so?
It's most interesting as a dilemma if we assume that the two groups have been selected at random. That is, there is no known systematic difference between the ones who will die and the ones who will live under strategy #1. In that case, for a one-shot deal, risk aversion clearly favors #1. But what rule would you choose if you knew this kind of dilemma would arise repeatedly? Say, if you were choosing a rule from behind the "veil of ignorance"? Well, it seems to be a total toss-up. In the long-run, over many decisions, half the miners and half the babies will live, and half will die, either way. So flip a coin and don't look back...?

Still, because it's a wash for the unfortunate victims, the only factor that might tip the scales would seem to be the feelings of the decision makers and the witnesses to the decision. So, maybe, ask people to vote for the strategy that will make them feel less bad? Odd morality, that...

Thursday, August 28, 2014

Monday, August 25, 2014

Whiskey Tango Foxtrot

The NY Times book critic Dwight Garner suggested that David Shafer's Whiskey Tango Foxtrot might be the "novel of the summer." A well-written paranoid near-future thriller with a sense of humor? That sounds like my dream summer escape novel, and I'll confess, Shafer had me by the balls for the first 200 pages or so, which is about 50 pages longer than Donna Tartt did with her overpraised The Goldfinch. But somewhere right around page 212 Shafer jumps the shark, and the book kind of fizzles.

What went wrong? First, the book's appealingly flawed heroes are battling an evil conspiracy that amounts to thinly fictionalized versions of Google and the NSA working together to corner the information market. Sure, it's scary, but if you follow the headlines I'm afraid it's also a bit ho-hum. Second, Shafer does satire better than he does suspense or sci-fi. So when it comes time for the plot to really kick into gear, he has to tone down the funny, and his writing loses its edge. Third, there's what happens on page 212, when a certain woo-woo element is introduced to the plot. I won't give it away, but suffice to say that here's where attention to the hard sci-fi could have helped a lot. The Google conspiracy is highly believable because it is highly realistic. So to introduce something really weird is jarring unless you can convince the reader it has some minimal plausibility. No attempt is made. Maybe we will learn more in the sequel. And a sequel there must be, given the unsatisfying and inconclusive ending of this novel. Harrumph.

Regulation and pollution havens

One concern about environmental regulation is that "dirty" industries will simply move to less-regulated countries (so-called pollution havens). For example, metal smelting could move from the United States to China. If so, the United States would be cleaning up at the expense of China getting dirtier. Now if China were willing to put up with the pollution for faster economic growth, we might view the situation as win-win... assuming the Chinese decision-makers represent the interests of their people, more or less. But even under that rosy scenario, it's not necessarily win-win if some of the pollution has global impacts, such as greenhouse gas emissions. Then the United States still suffers from China's emissions.

If the pollution haven effect is empirically important, it should be the case that much of the reduction in pollution in, say, the United States, is the consequence of a shift in the composition of U.S. output away from dirty industries toward clean ones, with the dirty products now being produced abroad and imported. Contrary to this hypothesis, however, the evidence suggests that the lion's share of pollution reduction in the United States has occurred within industries, through changes in technique, as is shown quite elegantly in a new paper by Arik Levinson. (Access to the paper is by subscription, but you can view the abstract here.) As Levinson writes in his conclusion:
This simple exercise demonstrates a remarkable change over the past two decades. Air pollution emitted by US manufacturers has fallen by two-thirds, and that cleanup has almost entirely come from reductions in emissions intensity of each of the more than 400 industries that comprise the manufacturing sector rather than from shifts in the shares of those industries in overall manufacturing output – from technique rather than composition...
... the finding runs counter to perceptions about the effects of environmental cleanup in US manufacturing. While I don’t assess the cause of that cleanup here, one natural speculation would be that it has resulted from environmental regulations. If so, those regulations have not worked by reducing the share of polluting industries in the US manufacturing sector – driving those industries overseas or reducing consumption of those industries’ products. Instead, they have worked by reducing the emissions intensities on an industry-by-industry basis. That finding should be welcomed by anybody concerned that US regulations might appear to be succeeding, but only by reducing the menu of products available to American consumers or by shifting pollution from the US to other countries. The results here directly refute that concern.
In other words, while there are good reasons to be deeply concerned about pollution in China (and elsewhere), for the sake of both the Chinese and ourselves, concern that domestic environmental regulation is being nullified by global trade is probably misplaced. Which is good news.

Sunday, August 24, 2014

Can Music Be Perfect? Vol. 44

There are so many things I love about this song. The obvious things: Gladys is a great singer; the Pips and their moves; it's a fantastically simple but hooky love song. The less obvious things: not only is it a great pop song, but it also captures a particular personal decision at a particular moment in historical time... the Great Migration and the subsequent reverse migration by some; the conventional pattern of call and response, in which we expect the Pips to echo, accentuate, or comment on Gladys's lyric, is often reversed, with the Pips moving the story along by anticipating Gladys's next line: "He kept dreaming (Dreaming); Ooh, that some day he'd be a star (A superstar, but he didn't get far); But he sure found out the hard way that dreams don't always come true, oh no, uh uh." Yessir, this one is perfect.

In my imagination...

... I am hitting my backhand exactly the way Stan the Man does. A thing of beauty. But even in my fantasy world, mine does not quite average his 76 mph...

Friday, August 22, 2014

Satsuki and Mei


Health coverage news

The California Department of Managed Health Care has ruled that my university must offer insurance coverage for any abortion legal under California law. This is welcome news to many at Santa Clara U.... perhaps even to our President, in his guarded moments... he faced another tough year with the faculty if he had been allowed to follow through with his decision to limit coverage starting in 2015-16. On the other hand, there is always the possibility that abortion opponents in the Church, emboldened by Hobby Lobby, will push for a court challenge on the grounds that the State of California has violated "our" First Amendment rights, whatever the California Constitution provides. Now there's an interesting federalist showdown, albeit one I hope not to witness...

Monday, August 18, 2014

The Fragrant [your occupation here]

China has its Fragrant Concubine, it seems... I don't suppose I would want to be known as the Fragrant Professor, but perhaps that's better than the Fragrant Wastewater Engineer, or the Fragrant Mink Rancher. Or the Fragrant Software Engineer, for that matter.

P.S. To be clear, I am not approving of concubine as a profession.

As a frequent data janitor myself...

... I feel their pain.
Data scientists, according to interviews and expert estimates, spend from 50 percent to 80 percent of their time mired in this more mundane labor of collecting and preparing unruly digital data, before it can be explored for useful nuggets.
The worst is when you get it all cleaned up and there are no useful nuggets to be found...

Thursday, August 14, 2014

No taste for discrimination?

These poor fellas are victims of exquisitely bad timing, given events in Ferguson, MO. "Taste for discrimination," Gary Becker's locution, never sounded serious enough given the subject, but to translate, what Gary really meant was that people can be bigots, and act on their beliefs, and other people will suffer for it. But he also suggested that markets might undermine the effects of bigotry. I think the statistical evidence for "taste discrimination" is pretty solid, but there may be settings where its effects are minimal, perhaps even, as these authors suggest, fantasy football (that's English for soccer, you gringos).

Anyway, back here in the real world, unarmed youths get shot and killed, and it has something to do with race, and thank you, Captain Ron Johnson: treating people with respect, compassion, and dignity makes you a true hero in this strange country.

Sunday, August 10, 2014

I've been to Walmart twice in the last 2-3 weeks...

... and both times found exactly what I was looking for... good quality, good price. Am I a bad person? My reading of the evidence is that when Walmart comes to town, working folks' wages go down but the prices they pay for stuff go down enough to compensate. I love the rainbow of people I see and hear at my Mountain View store. I don't think Walmart competes with mom and pop in Mt. View... more likely Target and Kohl's. But if I'm going to continue to shop there, maybe it's about time I ponied up some money to UFCW's organizing efforts. Everyone deserves a living wage.

Can Music Be Perfect? Vol. 43

Benny Carter was so cool, and you have to dig those pants. 1977, man! That's the incomparable Niels-Henning Ørsted Pedersen with the swift little fingers, looking and sounding extremely snazzy. Ray Bryant and Jimmie Smith rounding out the quartet on piano and drums.

Saturday, August 9, 2014

Robert Solow...

... is coming up on his 90th birthday. Hat tip to Brad DeLong for bringing this excellent 2012 essay by Professor Solow to my attention. Is it politically incorrect of me to say that I hope when I am Bob Solow's age I can guide a spoon to my mouth, nevermind write insightful essays about 20th century political economy...?

The BIG picture

A Basic Income Guarantee is the natural policy for implementing an eg-lib (egalitarian-libertarian) political philosophy, if that appeals to you as it does to me. The idea is neither more nor less than what it sounds like: the government would guarantee each person a basic income, financed through taxation. BIG redistributes income no questions asked and lets you decide what to do with the money. Of course there are some details to work out: most importantly how much, and with what kind of taxation to fund it, but also whether the payment will go to individuals or families, etc.

Milton Friedman was famously an advocate for a version of BIG– which is known as the negative income tax (NIT) to economists– on sound libertarian grounds: if you must redistribute income, do so in a way that minimizes market distortions and paternalistic meddling.

Uncle Milty notwithstanding, BIG generally has received more support from the left than the right in the United States. Take a glance at the U.S. BIG network's advisory board and you find such lefty stalwarts as Fred Block, Nancy Folbre, and Frances Fox Piven (her first name misspelled!). But BIG has apparently made a comeback among some of the free-market crowd, as indicated by this recent CATO essay by Matt Zwolinski. Zwolinski sees BIG as a "pragmatic" replacement for most of the modern welfare state, one which could accomplish the redistributive goals of the welfare state at a much lower economic cost.

At an abstract level, Zwolinski's claim relates to an idea from economic theory known as the second fundamental theorem of welfare economics: the efficiency of the free market system can be consistent with income redistribution, so long as you redistribute resources "lump sum" and then leave prices and quantities free to adjust. This compatibility between leveling and the market led Amartya Sen to suggest that the second theorem "belongs to the revolutionists' handbook."

In the real world, the second theorem could never be fully operationalized, because any form of redistribution that pays attention to people's position in the income distribution is not "lump sum," and therefore creates inefficient incentives. In the real world, furthermore, the conditions for the market to achieve efficient outcomes are generally violated by a variety of market failures, such as externalities (e.g. pollution).

So, in the real world, we must decide between complex and imperfect alternative arrangements for redistribution and government regulation. Benefits and costs must be estimated and compared, and political feasibility and stability considered. Regarding the net benefits from replacing the welfare state with BIG, Mike Konczal has a pretty convincing take-down of Zwolinski's claims for BIG savings. Basically, the U.S. welfare state doesn't have all that much fat, so there's just not much to be gained. The EITC (earned income tax credit) is already a variant of the NIT, with a work requirement added on. Programs like EITC, Medicaid, and SNAP (food stamps) operate effectively with admirably low overhead. Disincentive effects are likely modest. Near-universal public social insurance programs such as Medicare and Social Security may, for reasons of scale and state compulsion, overcome some market imperfections that would likely afflict a fully privatized system of social insurance under BIG transfers. So we can't be confident that a BIG would make matters better rather than worse, even from a pure efficiency standpoint.

As a stand-alone substitute for the welfare state, BIG suffers from other criticisms that can be leveled against libertarianism. Some people are simply not capable of making good decisions for themselves: young children, addicts, people with severe emotional or developmental disabilities. Libertarians love to level the charge of paternalism against liberals, but nearly everyone agrees that (gender-neutral) paternalism may be called for in some cases. And not all children or dependents are blessed with a qualified or benevolent "pater" or "mater" to spend their BIG for them; who else is there, if not the state?

Political feasibility and stability are further concerns. Political support for Medicare and Social Security spring in considerable part from the view that people pay into the systems and are entitled to take benefits out. The sense of entitlement that follows from payroll contributions is a feature of Social Security by design, according to a well-known quote attributed to FDR:
“We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program. Those taxes aren’t a matter of economics, they’re straight politics.”
BIG, transparent dole that it is, may be politically vulnerable in the long run. (A partial exception would be a BIG based on shares of a commonly held resource, such as dividends on the Alaska Permanent Fund, directly linking the payment to property rights.)

Having acknowledged all these drawbacks of the BIG idea, I still can't help thinking it deserves a bigger place in our political landscape. Politically, it represents a potential source of common ground between the liberal left and libertarianism. Is that enough to reconfigure our heavily polarized political space? By itself, no... but throw in immigration reform, personal and civil liberties, and anti-militarism, and who knows?

Economically, I have read enough sci-fi and witnessed enough advances in computing and robotics to agree with those who are seriously concerned about a future in which capital, with its highly concentrated ownership, displaces much of the demand for labor. No, not technological unemployment... just technological immiseration. Making BIG part of the mainstream political agenda now is a way politically and institutionally to set the stage for decoupling income and private property. Friedman meets Marx... why not?

New Air

Henry Threadgill and Cassandra Wilson should hang out together more often. That's Fred Hopkins and Pheeroan akLaff on bass and drums.

Thursday, August 7, 2014

If I were a religious person...

... I could at least have some hope that Bush and Cheney will burn in hell for their sins. But I'm not, and I don't...
Now, the Kurds have been battling a group of militants from ISIS who are using powerful American weapons they took from the battlefield, left by the Iraqi Army.
“They are literally outgunned by an ISIS that is fighting with hundreds of millions of dollars of U.S. military equipment seized from the Iraqi Army who abandoned it,” Mr. Khedery said.
"Jihadists Rout Kurds in North and Seize Strategic Iraqi Dam"

Tuesday, August 5, 2014

Guardians of the Galaxy

I average one of these summer comic-book blockbusters a year. I enjoyed this one more than most. Too much noise and mayhem, but that comes with the territory. The dialogue, such as it is, is generally witty; the pop soundtrack is programmed to appeal to the baby boomers (e.g., me) in the audience, presumably attending with their grandchildren; and the visuals are often arresting: my advice when you get bored with the action sequences is to treat it as an art film, ignore the plot, and let the colors and geometries wash over you.

Good: Chris Pratt, the only person who is acting here... cute, relaxed, and charming; Groot, the tree guy played (supposedly) by Vin Diesel... nice to know that he can be propagated from a cutting.

Bad: The wise-ass talking raccoon; Glenn Close's hair; lame and uninteresting villains.

Ugly: Preview for the latest Dumb and Dumber sequel. We have the drones... why can't we take out Jim Carrey?

Saturday, August 2, 2014

Climate myths

Nice of Bob Frank to "shatter" six myths that he claims are holding back action on climate change, but frankly (ha ha), they've been shattered countless times before. No amount of scientific consensus or reality checking is going to move the Republicans on this issue, so any progress at the national level will continue to consist of executive action, which of course is vulnerable to presidential elections and Supreme Court constraints. The best hope is that state and local governments, and idiosyncratic entrepreneurs like Elon Musk, continue to push the envelope on policy and technology solutions. Slim hope, to be sure.