Conservatism: Cohort effects vs. Aging effects

Preliminary research based on interviews suggests that people don't really get more conservative as they age overall (HT:MR). It may look that way because older people today are more conservative than younger people. The research argues that what matters is when you become an adult. During the Depression and WWII, the social environment promoted a lot of values today's conservatives value, and the changed environment promotes different values. What happens within the person?

 Results, which are just starting to emerge, suggest that each belief follows its own complicated pattern. Seniors seem to have become more liberal about subordinate groups, for example, but more conservative about civil liberties. ... Late in life, [Pillemer of Cornell's] research shows, people often become more open, more tolerant, and more appreciative of compassion. Even if they started out conservative, they may become less extreme in their conservatism.

Economics in Unusual Places

1 - Using game theory at a buffet with limited food options to figure out what foods you should choose first (HT: MR). Basically, instead of just grabbing your favorites first, you should think about what other people will grab first (and as importantly, last). If your favorite food is hated by your fellow diners, leave it alone - it will still be there later - and pick up something else that might disappear if you don't grab it now. The article also has insights about the kinds of social norms that make everyone better off, how to pile the most on your plate, and some Wansinkian insights how much women's food choices are influenced by their neighbors.

2 - Some more game theory on why Iran has told the US just how it captured the Sentinal drone: by ensuring that it will only have one to sell, it makes other countries much more willing to pay for that one than they would be if they thought 2-3 more might appear in the next few years. Iran is sending a signal or using a commitment device about its future behavior to impact the actions of its fellow players today.

3 - I reported earlier on how G.I. Joe action figures are not classified as "action figures", but are "dolls" so they can get a lower tariff. The X-Men apparently are marketed by Toy Biz as not being human at all so they can avoid being tariffed at the doll rate altogether and instead get classified as "toys." Little did the X-Men realize their own marketing agents were plotting against their basic humanity, and all in the name of economics!

4 - Are we on our way to a Kuznets Gender Curve? Very poor countries and households can't afford to select children based on gender. As income rises (to the level of India and China, say) there is more and more discrimination favoring boys - medicine can tell families whether the fetus is a boy or a girl and they can react as they wish. However, new evidence is showing that upper-middle class Indian families ($3200/yr and up) are reversing the trend. The Economist praises bourgeouise values for saving the girls.

5 - Cowen pushes back hard on the idea that wealth is power, whether in politics, charity, or the market:

Second, the wealthy in groups do not always coordinate very effectively, to say the least.  ...  Third, many of the very wealthy choose to consume ego rents rather than effectiveness.  Fourth, “democracy” and “the market” control large chunks of modern life, and it is hard for outsiders to commandeer those processes.... the ability of the rich at the margin to control policy through intentional acts, either individually or in groups is much overrated.
Wealth does protect you from the depredations of others, such as being treated very badly by the police or legal system.  In this defensive sense wealth can give you a good deal of power.

LDS Aid

Two professors, one a Cornell-trained BYU professor of nutrition, have been working to improve the Atmit porridge that is often given out in LDS care packages. The hope is that it will be even better for small children with a better mix of micronutrients (particularly more iron) but without compromising on shelf-life. Another article describes its dissemination in poor areas of Peru.

A single serving provides 34 percent of the recommended daily allowance of protein, 43 percent of calcium, 99 percent of iron, and high percentages for a dozen vitamins and minerals for children under 5 years old. ... 
In 2010, 645,000 pounds of Atmit were shipped by LDS Charities to four countries. Depending upon the age and size of the children, that's enough to feed 100,000 to 130,000 children for one month. The cost? Less than $6 (USD) per child.

LDS efforts to help those suffering from the famine in the Horn of Africa:

In Ethiopia, projects to aid more than 100,000 refugees are under way, including water tanks, trucking services, sanitation supplies and hygiene training for 15 villages; supplementary food for 8,700 malnourished children; nutrition centers and sanitation facilities for Somali refugees in Dollo Ado; and 5,000 hygiene kits.
The Church also plans to provide water catchment and storage structures, as well as soap and washbasins to serve tens of thousands of other residents in the communities surrounding the Dollo Ado camps.

Other projects in Kenya, Uganda, and Somalia are also underway and briefly described at the link.



At the most recent General Conference, Church President Thomas S. Monson reminded members about the General Temple Patron Fund. Donations from members around the world are used to help members who live far from a temple travel there. A recent article highlighted some of the saints in southeastern Africa who have been blessed by the Fund:

Corruption: keeping it relative

Basu, Cornell prof on loan to the Indian government as chief economic advisor, argues that we can lower corruption by making the interests of bribe-payer and bribe-receiver diverge. Specifically, if a person is asked to pay a bribe to receive something they ought to anyway, don’t prosecute them – only the person receiving the bribe. That gives the bribe-payer an incentive to turn in the bribe-receiver after the transaction both by removing the disincentive of prosecution and promising restoration of the bribe money. Knowing this, officials should ask for fewer bribes.

The latest corruption report in graphical form (hat tip: PNB). Click to see it in glorious detail.

On keeping corruption relative for non-relativists:

To think that there is a low income country with zero corruption to which the United States can provide aid is foolish; it doesn’t exist at the high end of the income scale either. … The question is whether the MCC is investing in countries with relatively better records of controlling corruption. … Seventeen of the 21 MCC countries currently score better on control of corruption than their comparators, and 14 of the 21 countries have had better corruption scores than their comparators for the past six years.

Relatedly (to me, but not to him), Barder takes apart the idea of aid fungibility, specifically how difficult it is to get the right counterfactual:

A USAID assessment of Mozambique alleges that, “more than $100 million of donor funds were used in 2001 to bail out the failed privatization of the Commercial Bank of Mozambique (BCM)”. … This assertion seems to require us to speculate that if the donors had not given aid to the government, the government would not have bailed out BCM. But is there any reason for thinking that if there had been no aid at all, the government would have felt obliged to spend its own resources on health and education first, instead of the bank bail out? … And if all the donors had run health and education projects themselves, instead of giving aid to the government, what would the government have done with its budget savings in these areas? Would it not have used the money for the bank bail out?

… The bank bail out would probably have happened anyway: in which case the effect of aid was that there was more provision of health and education services than there would otherwise have been. If so, then in ordinary language we would say that donor funds were used for heath and education (not for the bail out) because that’s the difference the aid made.

Furthermore, in this particular case, the fact that the donors were mainly giving budget support almost certainly resulted in higher spending on social services than if they had been giving only project aid. The donors giving budget support had robust discussion with the government of Mozambique about its plans to bail out the banks, and thereby perhaps limited the resources used for the bail out. If the donors had been giving all their aid through projects, they probably would have not been able to have that conversation at all. If budget support gives the government less room to reallocate its spending because donors have more influence, this suggests that aid provided through the budget is less ‘fungible’ than aid provided as projects.

Whether or not you agree with these judgments about what might have happened in Mozambique, the example shows that our talk about ‘fungibility’ is somewhere between meaningless and irrelevant.

Cornell Seminar: Wansink on food interventions

Wansink gave a seminar to the nutrition department this week which I tweeted about while it was ongoing. He discussed two somewhat related strands of research, one with the military trying to get people to eat more and one with schools trying to get students to eat less and better. The military's main solution has been to try to get the food to taste better; schools (naturally) rely on education. Neither has been overly effective and he went in to find out a)why and b) what to do about it. Here are my notes from his talk:

It’s not nutrition until somebody eats it. Reasons for poor nutrition are simple, but only after we figure it out. 

In the army, the primary thing massive undernutrition affected was shooting accuracy. Army food scored 7.5/9 for taste, better than TGI Fridays. Observations: if it’s opened, it’s eaten; weird smells reduce appetite; no comfort areas; and they don’t drink enough.

#1 – Solution #1: TV dinner packaging. If their vegetables fall out when they open other foods, they eat them.

#2 – Packing material infused with smells of good food.

#3 – Familiar branding was comforting. They suggested: try M&Ms. The army tried peanut butter M&Ms which wouldn't melt, but that attracts sniper fire because of its bright orange packaging. Now army won’t try it again.

#4 – couldn’t solve.

Daily school salad bar sales increased 200-300% in days by moving the salad bar to the center of the room. People buy first thing 11% more often, so they moved broccoli to first ... and sales dropped 40%. Entrees worked as expected.

People want what they can see, so instead of removing ice cream, just cover the glass door with paper. Sales down 28%. Saying “Do you want salad with that?” doubled salad sales. She held on to the plate with their pizza until they answered, increasing likelihood even more.

Most changes are among people who only occasionally consume fruits and vegetables. Kids who never eat them aren’t affected and kids who eat them regularly aren’t much changed. So it’s marginal users.

Big Bag

Problems in Ethiopian governance:

The problem with foreign aid in Ethiopia is that both the Ethiopian government and its donors see the people of this country not as individuals with distinct needs, talents, and rights but as an undifferentiated mass, to be mobilized, decentralized, vaccinated, given primary education and pit latrines, and freed from the legacy of feudalism, imperialism, and backwardness. It is this rigid focus on the “backward masses,” rather than the unique human person, that typically justifies appalling cruelty in the name of social progress.

 A moving account titled "Springtime in Kigali", hat tip: Texas in Africa.

When I think of the spectacular growth around Kigali, or those miles of trenches laid with fiber-optic cable across the country, or the latest signs of a growing crackdown against the opposition, they all seem to be different ways to answer the question – for better or for worse – of how to deal with the legacy of 1994.

Yglesias' vision for the world - celebrating idleness, fan fiction, school, retirement, and open source software as transcendent escape from capitalist masters:

So that’s the agenda I have to offer. For rich countries—productivity growth, social insurance, and efforts to improve public health all aiming at allowing people to live more and more of their time outside the bonds of commercial work. For poor countries—capitalism, to get the process of prosperity and social betterment rolling. At the interface between the two—a generous and humane approach to migration issues so that people can have the freedom to escape bad situations, and a trade regime that aims at facilitating the exchange of goods rather than coercing poor countries into adopting the preferred policies of rich world companies. And for all of us, an overhaul of energy systems so the world doesn’t boil and we all get to keep enjoying our prosperity.

Cornell researchers find that SOME jurors are statistically more likely to find unattractive people guilty and give them harsher penalties.

LDS in Haiti

“Immediate help was sent by the Church to members and nonmembers and was distributed under the direction of the local priesthood and Relief Society leaders,” said Elder Francisco Viñas, the Church area president based in Santo Domingo. “They not only received medical aid, food, water and other basic supplies, but they also received counsel, guidance and comfort from their local leaders.” ...
 “The nine chapels in and around Port-au-Prince were mostly undamaged—another remarkable miracle,” said Elder Wilford W. Andersen at the recently-concluded 180th Annual General Conference of the Church. “During the weeks that followed the earthquake, they became shelters for over 5,000 Haitians and bases from which food, water, and medical attention were distributed. Basic needs were met, and order began to emerge out of chaos.”...

In the case of Haiti, local Church leaders worked to complete a head count of members of their own congregations and formulated an assessment of their needs.

Despite the devastation in their homeland, order quickly returned to Mormon congregations in Haiti. Patrick Reese, manager of planning and administration in the Humanitarian Services Department of the Church, said “The (Church) leaders knew the principles of welfare, of communication and self-reliance long before the catastrophic event occurred and they knew how to implement these principles for the benefit of their members.”...

Since the earthquake, the Church has sent 1.4 million pounds of aid to Haiti and the Dominican Republic in addition to teams of doctors who treated patients in Mormon meetinghouses after the quake. 

Labor Redundancy: Health Care Survey

I go in to the Cornell health facility most every week to get an allergy shot. They have made some changes recently to streamline the process for me: I can now check myself in using my staff ID card and today I was even invited to make my own appointments online. Why would they do this? Economics, my dear Watson! It reduces their labor costs and gets the less-routine patients to a receptionist faster.

I sauntered over to one of the receptionists during a lull: they've known me for years now and everyone thinks Econotoddler is cute as can be when I bring him with me, so I'm on good relations with the staff. I introduced the subject to her and then said, "Y'see, I'm an economist so I wonder about these kinds of questions: are you worried about your job becoming redundant?" On seeing the surprise on her face - she probably doesn't get that question every day - I realized I might just as well have said, "I'm an economist so I have no social skills" but then I'd be worried about reverse causality (I may be an economist because I have no social skills). Of course, having observed me pacing the reception area reading various papers and books, she probably knew that already.

Recovering, however, she was happy to defend her noble profession. It's one thing to streamline the routine care for patients who come in every week and know what to expect. College students, she explained, are a naive group who generally don't understand the difference between urgent and routine care, how long wait times are off campus, they haven't been making their own health care decisions, and some even think that acne is something you need to see the doctor about. Part of her job is educating the undergrads about the health care system, what constitutes urgent care, and how grateful they should be that Cornell gets to their complaints with the promptness it does. And Gannett is quite prompt.

I thanked her sincerely for helping me understand the system a little better.

Yes, the facts of that information could be provided by a computer screen, but people wouldn't read it. It is more effectively and efficiently communicated one on one as individual health care issues develop. But now I'm imagining self-check-in kiosks at my doctors' offices where education is not a primary function, and a slightly sophisticated online program that screens available appointments based on urgency..... I think this would be a beautiful thing at our allergist's office where the receptionists do not take kindly to the Econotoddler and a sad thing at our GP's where the doctor is too streamlined and doesn't remember us from one visit to the next. It's nice to have a friendly face to chat with.

Cornell and the NCAA

Our coach just sent me, personally, (and every other Cornellian, personally) an email, praising our fine spirit for the reason we got to the Sweet Sixteen.

I know we were called the underdog, the Cinderella, the long shot, the feel-good story of the Sweet Sixteen. Well, we may have been all those things. But first and foremost, we were, and of course still are, Cornellians. And that is what made us great on and off the court--it was that Big Red spirit and work ethic that got us to the Sweet Sixteen.

While wearing my mischievous Puck hat, I whisper to whoever is sitting near me in the back of the auditorium if it is that same Big Red spirit that keeps us out the Sweet Sixteen every other year?

The Onion, meanwhile, ascribes our success to our standing and just calls us names. Hurtful names like:

mid-major semi-upper-lower-middle-mid teams
minor mid-sub-major Cornell
high-scoring para-mid-semi-diminished-sub-mid-major Cornell

"Kentucky is a major-major-major-major basketball school, no two ways about it," Cornell senior Jon Jaques wrote on his blog Wednesday. "We may be a low-mid-upper-mid-downer-middle-mid-micro-submacro school from upstate New York, but we've never let it hold us back. When the Big Dance is over, I wouldn't be surprised to see people calling Cornell a mid-upper-parallel-medial, or even a para-demi-duo-double major. I think we've proved something to the world."

The better Onion post, however, explains why we won mathematically:

Cornell's basketball team had on Wednesday squandered most of its underdog goodwill by using every opportunity to explain that, given a finite set of possible outcomes and a sufficient period of time, the sheer quantity of opportunities available to accomplish an improbable outcome makes its achievement likely if not almost certain. "It'd be foolish to ascribe any of the properties of a pan-dimensional function space to the NCAA Tournament," said Cornell center Jeff Foote, who has averaged 14 points per game in the first two rounds. ...

Path dependence and the sugar tax

John Cawley, one of Cornell's many economists, doesn't think NY State's proposed tax on sugared soda will amount to much. At 1 penny per ounce, he says it won't change prices enough to change behavior significantly, it won't raise enough money relative to the state's budget deficit, and it won't cause unemployment because "consumers that stop drinking soft drinks tend to switch to diet drinks, juices and even water often bottled by the same company." In econ-speak, even if the change is statistically significant, he argues it isn't economically significant: 1) a small drop in a big ocean; 2) the demand for sugared sodas is extremely price inelastic.

I tend to doubt #2. So I can buy a 20 ounce Real Coke for $1.95 or a 20 ounce Diet Coke for $1.75 that's sitting right there next to it with their price tags right next to each other. Is Diet Coke such a poor substitute for Real Coke that the sugar is worth more than 10 percent price premium? Even he admits that customers switch to products by the same company, and price is one of those factors that moves people.

But if #2 is true, that means it generates more revenue and undermines his other point. New Yorkers drink a lot of sugared soda. A couple million here, a couple million there, pretty soon you're talking about real money.

Even granting that both arguments could exist simultaneously, there is an institutional reason for going for this. Policy tends to be pathway dependent. Taxes in the door may go up, they may go down, but they rarely leave the building. I doubt that 1 penny per ounce is going to suddenly stop the spread of obesity. But it's a much easier sell to go for 1 penny per ounce now (it's so little) and then 2 pennies and then 5 or 10 or whatever the socially optimal value (t*) is than to go from 0 to t*.

In fact, it's arguments like Cawley's that will help get it passed: it's so small, what harm could it do? So those of us in favor of it (like Adam Smith) should ... probably stop criticizing his argument.

Yes, the effect will be small. Very small. Miniscule. You won't even notice.


[Edit: I since spoke with Cawley and asked him for his more nuanced views than news will provide. Yes, he understands all these points very well. He has yet other concerns that the news didn't even touch.]

Five Second ... White Man's Burden

It is easy for people to misread Easterly's views. I'm not certain why, other than that people don't read him carefully. In White Man's Burden [the Click to Look Inside link on the picture doesn't work, so click the title here to look inside], he opens by introducing that there are two problems: one is the suffering of the poor, the other is the historic inability of the West to solve the problems. In particular, despite spending $2,300,000,000,000 on foreign aid over the last 50 years, that we are still unable to get twelve cent medicines to the people who need them most. His work focuses on the second problem.

He does not in the entire book argue that we should spend less trying to help the poor. He argues that we are trying to help in ways that are largely ineffective. "I ... keep trying, not to abandon aid to the poor, but to make sure it reaches them." "Western assistance ... can still play some role in alleviating the sufferings of the poor."

He does not argue that aid can never be effective. He argues that the way we have gone about it has often been ineffective and proposes some ways to help it be more effective. He cites Botswana as an example of aid "supporting reform and good government," though detailing how abysmally it has failed to do the same elsewhere; he cites pages and pages of World Bank, WHO, and IMF programs that were successful.

He does not claim that we should give up trying to help people. He pleads that we change the question from How can I use foreign aid to solve every problem in the world to "What can foreign aid do for poor people" and then do it. "Aid agencies cannot end world poverty, but they can do many useful things to meet the desparate needs of the poor and give them new opportunities."

He does not provide a blueprint for how to solve every problem with aid. He does suggest several dimensions where significant progress could be made by experimentation in making aid more effective. They include:

Accountability and Specialization "The utopian agenda has led to collective responsibility for multiple goals for each agency, one of the worst incentive systems invented since mankind started walking upright.... Have individual accountability for individual tasks. Let aid agencies sepcialize in the sectors and countries they are best at helping. Then hold aid agencies accountable for their results by having truly independent evaluation of their efforts." "Not overall sweeping evaluations of a whole nationwide development program, but specific and continuous evaluation of particular interventions."

Feedback and Meaningful Participation from Recipients. "The needs of the rich get met because the rich give feedback to political and economic Searchers, and they can hold the Searchers accountable for following through with specific actions. The needs of the poor don't get met because the poor have little money or political power with which to make their needs known and they cannot hold anyone accountable to meet those needs." The jargon is already there, but he takes down Poverty Reduction Strategy Papers as one set of planners talking to another set of planners, often written by the recipient government at the dictation of the donors, sometimes even undermining democratic processes and selections. "Visibility gives more power to Searchers while invisibility shifts power to Planners. The problem with aid is that the poor are mostly invisible." "Participation should mean more buying and voting power in the hands of the poor in aid."

Fund Maintenance. "Aid donors should just bite the bullet and permanently fund road maintenance, textbooks, drugs for clinics, and other operating costs of development projects. Politically dysfunctional governments that don't do maintenance can concentrate on other things. ... The return on spending on instructional materials in education is up to fourteen times higher than the return on spending on physical facilities." p. 190

On Peacekeeping: "Peacekeeping could be good, but just who is willing to be accountable for its success or failure. ... Interventionism suffers from the patronizing assumption that only the West can keep the locals from killing eah other. ... Peace usually succeeds war because of a decisive victory by one side, not because of negotiated settlements by outsiders. ... UN interventions produced a stable peace only a quarter of the time. With no intervention, a stable peace resulted nearly half the time." He is overall quite negative on military interventionism.

One thing that I have admired about Easterly is that he is willing to admit that he was wrong. He does so at least twice in the book, once discussing market reform "shock therapy" and once in discussing structural adjustment. I asked him at his blog whether some of his own work fell under a criticism he had just made, and he admitted that one of the papers I mentioned fell into the same category. He promised a bit more of a response which I'm still waiting for, but there's something comforting in talking with someone you know is willing to say "I was wrong." In the book he opined that the military would be the least responsive to criticism, but on his blog has noted with surprise that the military responded the most cordially and promisingly of any group he has criticized.

One of my few criticisms is that he simultaneously calls for more observability while deriding current aid projects for overly focusing on observability without differentiating what should be observable. That is, he wants to trim down the number of goals any agency is responsible for, so it is more observable who does what, but he laments incentives that support building facilities or roads because they are more visible than textbooks or maintenance.

After presenting a fairly convincing case that Planning really doesn't work, I also noted with some irony that there was a heavy element of planning involved in the homegrown development cases he lauds at the end of the book. He acknowledges some of this, that "the success stories follow a variety of formulas," but prefers to call South Korea and Japan's actions intervening in economies rather than planning and to note that China and Singapore are "quite far from a laissez-faire model." "What we do know ... is that the West played small part in them." This leaves open a door for domestic planning to be good and foreign planning to be bad, a door I think he could do a much better job turning into a window or a peephole.

"Success attracts paternity claims." So every theory of development claims success for the various successes. When Sachs visited Cornell, for instance, he laughed at Easterly's assertion that aid hasn't done much and cited the total figure of aid given to China and India. Easterly notes that those large sums only amount to $0.001 per day for each Chinese person and $0.005 for each Indian person. Compare that to the much larger sums spent in Africa (which Sachs calls a mere $0.50 per person) and you wonder how so little could do so much while so much does so little.

Some very good 'side note' sections: The importance of social networks (p. 82-87), property rights (p. 90-99), the difficulties of making democracy work and its evolution (p. 116-129), comparing the cost effectiveness of health initiaives (HIV prevention, AIDS treatment, and others; p. 249-258). He also has some excellent snapshots of World Bank publications from the 1950s or 1980s to today, all saying the exact same thing: things are bad, but there are promising signs out there. I learned that it is much easier for me to be sanguine when reading about the colonial disasters of England, France, and Portugal than to read about the (usually CIA-backed) disasters the US sponsored (270-338).

Notable Quotables after the break:

What is Applied Economics?

Ron Mittelhammer, new president of the AAEA - now the Agricultural and Applied Economics Association, formerly the American Agricultural Economics Association - attempts to define just what applied economics is and finds it a much more challenging job than it at first appeared.

Is it, as per Wikipedia, the intersection of economic theory, econometrics, and real world problems? Or can we leave out the econometrics? Keynes and several contemporaries asked, "Well, what do you apply if not theory?" So to them applied economics takes economic theory and uses it in a particular setting, making applied economics just part of economic theory. If the application of economics is supposed to contribute something to the theory also, though, there has to be some of its application that goes outside of accepted theory.

After reviewing this bit of conflicting literature, Mittelhammer examines 1500+ journal articles to see if he can descriptively identify what applied economics is from a revealed preference standpoint. Out of 20 top general interest journals, he finds that 25% of the articles are pure theory, 15% are largely theory with a minor application, and the remaining 60% are applied.

Without saying it in as many words, Mittelhammer is saying that applied economics is anything which is not pure theory. 24% of the works he identifies as being applied make use of an explicit theory (such as writing down a utility function and some first-order conditions before running the regressions). By contrast, 80% of the papers used econometrics. In his final Venn diagram, he shows applied economics as being the intersection of "methods of analysis" and "history, institutions, and judgment" which also shares some intersection with "economic theory." I'm trying to figure out what the intersection of theory and methods is that is not applied. Econometric theory, perhaps?

The society's recent name change was also interestingly supported: 90% of the articles in agricultural journals are applied, with only 1% pure theory.

The difference between this definition and my schooling interests me. At the Cornell Economics Department (left), the courses with "applied" in the title description simply implied only that the theory was at a less-abstract level. I even attended a course labeled "empirical" that was a collection of pretty rarefied theory. The exception to the rule were the labor economists whose seminars consist of strings of regressions. I'm very thankful I spent time with them during my first years here to pick up a lot of useful skills. Little wonder I had to go outside the department to do some empirical/applied work!