January 2006 Archives

Wondering who's gonna win this year's Superbowl? Just ask eBay.

The company Mpire is plotting the price of team paraphenalia for the Seattle Seahawks and the Pittsburgh Steelers, in an attempt to see if the price might be a decent predictor of Superbowl victory. The intuition, I suspect, is that people will be buying the merchandise of the team they expect to win, in the hopes that it will increase in value once the win occurs. Aggregating the data into a single price is intended to look something like the confidence that the crowd has in a win by one team or the other.

From a story on the experiment:

The confounding success of the famous Super Bowl economic indicator, where the winning team's conference seems to correlate with the coming year's economy, is spilling over into other areas of voodoo economics. This time it's reversed as eBayers are predicting the outcome of America's time-honored obsession based upon the going price of each team's merchandise.

Right now, Seattle is around $150, while Pittsburgh hovers near $100. Since Pittsburgh is generally viewed as the favorite, I have to wonder if there aren't a lot of people spending rather small amounts of money on Seahawks trinkets just on the off chance that an upset happens. After all, depending on the consumer's belief in the increase of the value, the expected value of the Seahawk do-dad could be above that of the Steeler gee-gaw, no matter what team the consumer believes will win. (Hey, wait -- does that mean we should read this prediction in reverse? Since the crowd seems to favor Pittsburgh, we should expect Seattle-stuff to sell for more? Not sure. My guess at relevent parameters: 1) closeness of the line, since a wide spread might induce people to forget the long-shot bet and snap up the favored-team's stuff before everyone else does, and 2) the price of the item purchased, since a signed t-shirt might go for cheap now, but could increase several times over in value, whereas expensive items require a much greater level of certainty. Anyway...)

Both a virtue and a vice of eating at chain restaurants is the greater sense of certainty that at any single restaurant, the meal you havew will taste like it did the last time you had it, no matter where you happen to be. In the mind of the consumer, there is obviously some value to this, else we wouldn't see the vast number of fast food restaurants that we do. For the gourmand, however, the replication is usually a signal for poor quality. Perhaps its that there is an ease in making formulaic dishes that makes the connoisseur turn up their nose. Add to this the true foodie's attempt to constantly find new places. Why not return to a place that is reliable, and simply not order the same item until the menu has been exhausted? Perhaps there is some utility to be gained from the uncertainty in the quality of the meal; the consumer might enjoy the period of not knowing how the meal will taste.

Not terribly new or controversial, I would hazard to say. But it does raise questions in light of the new attempt to model the fermentation process in wine in order to achieve a greater uniformity in quality (flavor, in the general -- I'm sure wine lovers will have a huge number of variables against which they would prefer to optimize). Is there an interest on the part of the consumer to see that every bottle of wine is evened out to whatever degree science might allow? Obviously, for the seller there is some interest in being able to make broad claims about the wine (as well as avoiding spoilage). I wonder if this might not become a method employed mostly by large-scale wineries that attract casual shoppers, much like chain restaurants.

Partially related side note: For a successful restaurant, is there an optimal number of locations to open? Highly successful downtown restaurants often open suburban locations, to much success and little loss in reputation. But open scores of them, and suddenly the place is a "chain", with all the baggage that brings (for some consumers more than others, obviously).

In the context of the Google pile-on, James DeLong notes that many in the US have turned turned against Wal-Mart, but he fails to note whether many Chinese have done so...

That's not unusual, since most US coverage of Wal-Mart in China focuses on Wal-Mart sourcing goods there. But WM also has 45 stores in China, and it is this presence -- and the approval by the Chinese government that was needed to make it happen -- that Google critics seem not to have noticed.

For instance, Mr. Kessler writes:

Users in the West may not desert them, but a billion soon-to-be-online Chinese will forever associate Google with lame and censored search results - tools of the state. That just dumb. And totally uncool.

Uncool, yes. Uninspiring, yes. Unexpected, no.

Wal-Mart never had Google's street cred among the Western elite, and I have no idea about its image in China. But I think that it's still important to ask, does Wal-Mart China stock and sell books by Chinese dissidents? Books about the occupation of Tibet? The nature of Falun Gong? Do you think you can find a book with this photo in it? Maybe, -- I don't know since I have never been in a WM China store -- though I highly doubt it, and I will assume that Wal-Mart is engaging in censorship (by just not supplying specific goods) at the behest of the Chinese government.

This leads ot a more important question: since Wal-Mart China is already censoring information available in its stores, do the Chinese people consider Wal-Mart a tool of the Chinese state? Or is it just a decent place to work and shop? I don't know the answer to these questions, but I would insist that the Chinese people are not stupid or inconsistent: why should Google be judged harsher than Wal-mart for acting in the same exact way?

Note: I am making ASSUMPTIONS here, and will gladly rewrite this post in light of hard evidence.

Purging Spam

Due to my complete inattention, T&B publshed approximately 3,000 spam comments In the last two months. That's actually a pretty low number considering I was using a dumb filter and was suffering from a strange hardware configuration that wouldn't let me alter software parameters.

T&B receives a spam comment every ten minutes -- roughly 6 an hour, or about 150 per day -- 9,000 over the past two months. So the filter caught ~66% of these, without me doing anything, while subjecting honest commenters to a 1-2% false positive probability.

I've culled the spam, and reconstituted the filter, hoping to up the catch rate to 98% with a less than 1% false positive rate.

Thanks for your patience.

Evolving Institutions

What insight might be gained from considering institutions as an evolving system in the same way we might view an ecosystem? That's the question posed over at the Complexity Blog.

One major focus in political science is the role of institutions, particularly for social choice problems. I was thinking about the relation of individual policy decisions and the institutional framework within which they are made and it occurred to me that the relationship has some analogies to the relationship of species evolution and ecological change. Specifically, analogies exist with regard to the i) time scales, the ii) forces exerted on each other, iii) endogenous stability, and iv) susceptibility to exogenous perturbations.

A thoughtful post, and if you're at all interested in the topics of complexity or agent-based modeling, the site is worth a regular read.

Do Kids Have Too Much Choice?

Normally I'd hold in special suspicion those who suggest that there is too much choice in the world. That the alternative means I would be required to trust another person to make that decision about when there is "too much" entirely negates the argument. Abundant choice is the result of the lack of such a figure. The alternative is day-long queues for the One Kind of Toilet Paper.

But does this hold when it's children making the choice? A recent study suggests requiring girls to take math and science courses might produce more women computer scientists.

For the purists among you: yes, I agree that in theory it might be better to have all education pivately funded and thus avoid the stifling question of what the state is requiring our children to learn. But you tell me when a serious coalition in Congress (here or whatever you might have abroad) is about to vote to end public schooling and I'll jump on the phones to help drum up support. Any takers? No? Ok then...

I'm not sure strapping kids into science classes is a great way to proceed, but this does provide some evidence (to my mind) against the seemingly widespread belief that some children just don't have to take certain classes if it's not their "preference". (Personally, I was allowed out of math classes in my sophomore year of high school because I finished the lowest requirements and evinced an aptitude for other areas. I'm paying dearly for that now.) If this is even partially accurate, it's a damning picture of schools as well as the general state of pedagogy for public education. Dismissing a certain canon of subjects for softer material and trying to make school only about "critical thinking" skills obviously results in some poor consequences:

Instead, it seems that restricting the choices available to adolescents, and making it mandatory for all pupils to study maths and science subjects throughout their secondary education, correlates with a higher proportion of women going on to study computer science at university.

"The principle of being free to pursue your preferences is compatible and coexists quite comfortably with a belief in essential gender differences. This essentialist notion, which helps to create what it seeks to explain, affects girls’ views of what they're good at and can shape what they like," said Charles.

She goes on to say that the implications for policy are clear: rather that letting kids discard subjects too soon, governments should insist on more maths and science for everyone, for longer.

"As other research has repeatedly shown, choices made during adolescence are more likely to be made on the basis of gender stereotypes, so we should push off choice until later," she concludes.

For a simultaneously hilarious and tragic view of what the permissiveness in education has done to technical skills, try this.

Just as interesting as the results of the study, however, is the point about early-age decisions being made along gender-stereotype lines. Does this mean that all those people learning about how to teach kids to learn how to learn and who refuse to "box anyone in" are actually producing grown-ups with stronger, not weaker, stereotypes about gender roles? Would it be these people that we should put in charge of the variety of cereal?

New Pull Prizes On the Way

Pull prizes like the Ansari X-Prize have some intuitive appeal to me. I like the idea of private fundraising for work that's been historically ceded to the government. I was glad to hear that more prize competitions are on their way.

I was of the opinion that peaceful boycotts don't ever work, because 1) not enough consumers believe in the principles underlying the boycott, meaning 2) only a threat of violence against customers can actually bring a full stop to a trade of specific goods.

Well, I was wrong; to have a successful boycott, you don't need consumers to boycott products at all! You just need to get into the newspaper.

Donna Abu-Nasr of the AP informs us that one economic boycott, by enraged Muslims against Danish products as punishment for the drawings of Muhammed printed in Jyllands-Posten (and reprinted in Norway’s Magazinet), is being adhered to.

In fact, the foodstuffs firm Arla Foods notes that ALL of its orders to the Middle East have been cancelled:

The boycott of Danish products in the Middle East is now almost total. All Arla’s customers in the region have cancelled their orders and sales have come to a standstill in almost all markets.

Well, is there a near universal belief in the Middle East that the Danish government should censor and censure the news, and that other Danish (or historically Danish) firms should pay for a newpaper's insolence? Maybe. Or is there a threat of violence being waged against supermarkets and consumers? Not really.

What has happened is scandal-loving and selective reporting by most major media. The decisions of the managers of hypermarkets (who serve the middle and upper classes in the major Middle-Eastern cities) have been taken as evidence of decisions of widespread individual dissatisfaction culminating in a boycott. Saudi Arabia recalling its Ambassador to Denmark is not an expression of public opinion.

In reality, this is not a consumer boycott at all, but a middle-man boycott. Danish goods are not available in many stores of the most Western-looking stores (e.g. in the UAE), but are readily available in others! Roger Harrison and Maha Akeel of the Arab News are on the scene in Riyadh, and give quite a different impression than the other news outlets:

Meanwhile, supermarkets are pulling out Danish products from their shelves...

The manager of a flagship supermarket in Jeddah said imported Danish dairy products accounted for about five percent of their sales in product volume but more in terms of income. He confirmed that no decision had been taken to reintroduce Danish products on the shelves. “As the situation stands, they are off for the foreseeable future.”

His supermarket took the initiative when the news became common knowledge. “We have had very positive feedback from our customers to our decision,” he said.

However, the manager of a major supermarket in the north of Jeddah said that there had been almost no reaction at all to date. “We have had one person bring back a purchase asking for a refund. Given the circumstances, we respected his wish at once.”

So which is it: widespread dissatisfaction or a vocal minority imposing their ideology upon the rest of the citizenry?

Well, unless the goods are sitting on the shelves for people to buy, the everyday Saudi shopper has no choice and no voice in deciding whether or not to boycott Danish products; that decision is made for him by the religious, political, and economic elite of his country.

You want proof? Just look at the words of Abdullah Al-Othaim, executive president of Al-Othaim Holding Company. His company is not buying Danish products anymore. Why? Well...

Al-Othaim said that just as Denmark has freedom of the press, Muslims have freedom to buy or not to buy.... Al-Othaim’s decision, which he says includes a boycott of any supplier that includes Danish products, may help to impact SR1.3 billion worth of exports to Saudi Arabia.
In other words, Muslims are free to buy Danish products, just not at his stores! That's fine in a freer market, especially since supermarkets are now an extremely competitive business in Riyadh. And his supermarkets do not dominate Riyadh, so he alone could not stop residents of Riyadh from having a choice... But market leader Panda supermarkets also pulled Danish products too....

I'm still not certain how much this really matters, since in Riyadh, supermarkets account for only 35% of food sold. So what about the other 65%? Do they even carry Danish products?

This is about politics, power, and influence. Look at the attempts to bring this issue in front of the UN. Hamid Karzai appears to be the only leader who understands what the phrase "free press" means:

“The press is free here as we now have it in Afghanistan. There are things that the political system cannot control.”
Astonishing good sense!

You can see some Palestinians in Gaza burning the Danish flag, and empty store shelves in Kuwait. But these images tell me nothing about what the people of the Middle East believe. Nothing.

An aside: Competition from smaller dairies is hitting Arla hard in Denmark.

Have I Mentioned I Don't Like Putnam?

Really, I don't. One of the silliest non-fiction books I've read in years simply must be Bowling Alone. Oceans of data are marshalled and then misused to claim that people are opting out of community involvement.

Maybe, just maybe, people don't like to bowl anymore because there are ever more numerous ways to be engaged with others. But never mind that! People are going on fewer picnics! Don't you understand how dangerous this is? Nevermind that kids are signed up for a far wider range of extra-curricular activities nowadays. Karate, chess camp, soccer, little league...none of that is important when the rolls of the Boy Scouts aren't increasing as fast as they once were.

Feh. I can only keep that up for so long.

Add to this argument, however, this new paper, "The Strength of Internet Ties." (Via the Complexity and Social Networks Blog.)

Disputing concerns that heavy use of the internet might diminish people’s social relations, the report shows that the internet fits seamlessly with Americans’ in-person and phone encounters. With the help of the internet, people are able to maintain active contact with sizable social networks, even though many of the people in those networks do not live close to them. The report highlights how email supplements, rather than replaces, the communication people have with others in their network.

Meanwhile, the reception for Better Together was appropriately lukewarm. Perhaps that was because it's an anecdote-drivin little work that still seems to miss the point. It mentions Craigslist, but focuses on things like town art shows and interpretive dance.

Hmmmm. Ever wonder about those noisy little objects all the students seem to be carrying around? Ever wonder why people have to demand that they be shut off or put on silent? Here's a suggestion: about taking a look at the size and breadth of the cell phone market to get even a small insight on just how much people contact each other.

Get Better at eBay

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From Knowledge@Wharton, an article on bidding behavior in online auctions:

Would you like to go on an Internet auction site and know how much to bid for a certain item -- and also know that you didn't overpay for that item? How about when you sell an item in an online auction: Would you like to know what price to set that ensures you don't leave money on the online table?

Wharton marketing and statistics professor Eric T. Bradlow can't provide specific answers. But he does offer guidance on the behavior of potential buyers in a new study entitled, "An Integrated Model for Bidding Behavior in Internet Auctions: Whether, Who, When, and How Much," recently published in the Journal of Marketing Research. Bradlow, who is also academic director of the Wharton Small Business Development Center, co-authored the study with Cornell marketing professor Young-Hoon Park. "To the best of our knowledge, this is the first attempt to model formally the behavioral aspects of bidding behavior for the entire sequence of bids in Internet auctions," the authors write.

Here's a a draft of the paper.


Cover your wallet when you cough...

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Scientists exploring the way disease spreads among humans have found a treasure trove of data from the site Where's George. From the introductory note at Nature:

Analysis of the trajectories of over half a million dollar bills shows that human dispersal is described by a 'two-parameter continuous-time random walk' model: our travel habits conform to a type of random proliferation known as 'superdiffusion'. And with that much established, it should soon be possible to develop a new class of models to account for the spread of human disease.

The only nit I can think to pick here is to question whether there is a difference in travel patterns between the average person and those 1)more likely to use a good deal of cash and 2) are likely to enter their dollar bill serial numbers into a website. This may, of course, be addressed in the article, to which I do not have access other than the first graf:

The dynamic spatial redistribution of individuals is a key driving force of various spatiotemporal phenomena on geographical scales. It can synchronize populations of interacting species, stabilize them, and diversify gene pools1, 2, 3. Human travel, for example, is responsible for the geographical spread of human infectious disease4, 5, 6, 7, 8, 9. In the light of increasing international trade, intensified human mobility and the imminent threat of an influenza A epidemic10, the knowledge of dynamical and statistical properties of human travel is of fundamental importance. Despite its crucial role, a quantitative assessment of these properties on geographical scales remains elusive, and the assumption that humans disperse diffusively still prevails in models. Here we report on a solid and quantitative assessment of human travelling statistics by analysing the circulation of bank notes in the United States. Using a comprehensive data set of over a million individual displacements, we find that dispersal is anomalous in two ways. First, the distribution of travelling distances decays as a power law, indicating that trajectories of bank notes are reminiscent of scale-free random walks known as Lévy flights. Second, the probability of remaining in a small, spatially confined region for a time T is dominated by algebraically long tails that attenuate the superdiffusive spread. We show that human travelling behaviour can be described mathematically on many spatiotemporal scales by a two-parameter continuous-time random walk model to a surprising accuracy, and conclude that human travel on geographical scales is an ambivalent and effectively superdiffusive process.

Hey -- did they say "decays as a power law"? Chris Anderson, please call your office. Someone would like to talk to you about the long tail of disease. (Easy to identify: the specialization of docs and drugs to ease the million small ailments that plague everyday life. Harder to assess: Since we don't truly face the costs of our own care in the developed world, it's a redistributive requirement that these ailments get treated, since they are more prominent as people age. And as social investment goes, old folks are nice, but see little to no return as compared to getting kids healthy and educated. If the money is spent -- distorted by the odd employer-based insurance program and the public funding system we have -- primarily on old age problems, then its in those specialties where the doctors will concentrate. Advancement in geriatric care at the expense of early preventative care. Are we still happy with the long tail when it's communal?)


NB: Nod to the FRIAM group's discussion list for the pointer.

The Number of Magazines Rises!

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We reported two years ago that the number of magazines was on a steep decline, except for the specialty areas below that had their best year ever in 2003:

Survival & Weapons*
Baking*
Laundry, Cleaning & Dyeing*
Bride*
Produce*
Health*
Guns & Firearms*

Since then, the number of magazines plunged from 23,990 in 2003 to 21,266 in 2004, but rose to 22,054 in 2005.

num_mags_2005.gif

The categories with the best years ever (along with a long track record) are different from previous years, though not unexpected, I guess:


Sanitation
Purchasing
Industrial Relations/HR
Funeral Service

Deaf

Paint
Track & Field
Dogs
Horses
Golf
Military & Naval
Interior Design & Decoration

I see some connection to the boom in home remodeling, and military and naval to our war situation, but dog and horse magazines?

The Start of VMT

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In video game circles, the acronym "RMT" stands for "real money trade". This is the long standing practice of people paying real money for virtual goods. Well -- and it was inevitable -- it looks like the direction has been reversed. Via Mashable I saw an article noting that people are starting to sell real-world goods for virtual-world currency.

This may not be the very first instance of the activity, but it has now moved to being a whole business model. There really is nothing surprising about this -- at least if you already don't see anything odd about being able to buy computer hardware for "money" you earned playing a video game.

My question: what's the average amount of time it takes to make, say, 100 Linden dollars? With that information in hand, it should be a quick path to figuring out a few things about the time value of leisure for Second Life players. I think it would be fascinating to compare how long it takes to make the equal amount of buying power in Second Life as in the real world. How many hours would an average player need to work to buy, say, this monitor in Second Life versus her first (real) life? (Running at about $399 at TigerDirect, and 140,000 Linden dollars.)

What I'd expect to find: it takes quite a bit longer in Second Life. But the money would be spent on upgrades and various small computer items that are mprovements on the gaming experience, since I think this would be treated simply as a fun by-product of playing Second Life. That said, I'd also expect to see people under-estimate how long it takes as compared to real world work, possibly implying over-valution of their leisure time. (That is, they think it's pretty fast, and so spend more time playing in the belief that the value of playing the game is higher than it really might be -- though that requires some squishy comparisons in leisure activities, I suppose.)

And just FYI, as of yet, T&B cannot accept Linden Dollars as currency for tips. The regular large donations to Swedish Swiss bank accounts is still the preferred method. (NOTE: Donations will also be accepted in allotments of soda to stave off problems relating to low caffeine supplies for Ian.)

Dirty, until proven clean

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Much has been posted about the DOJ's demand for Google search data. (Which is why I won't bother to link to more than the story. The blog references are too numerous, and I would certainly leave out plenty that are more deserving of links than those I might include.)

I do want to add one thought to the mix. It's the end of this paragraph that confounds me most:

The government, which says its request will not result in identifying individual computer users, wants to use the information to resurrect an online pornography law shot down last year by the U.S. Supreme Court. It wants to search Google queries to see how often users inadvertently run across sexual material.

The DOJ says it has no interest in personal data, simply in those otherwise innocuous searches that result in links to adult sites. Pardon me, but isn't this starting from the wrong end of the problem?

The original law (the Child Online Protection Act) was shot down largely because in casting so wide a net, it would limit access to valuable information. Honestly, pick one biological word for a body part associated with sexual acts and see what happens on ANY search engine. It would need to be incredibly sophisticated filtering software that could distinguish well between, say, instructions on checking for breast or testicular cancer and the sites hawked by the flood of spam we all receive.

Wouldn't it make more sense to go the other direction? Why doesn't the DOJ set a few of its interns to listing and then searching for porn, and then track the non-porn sites that are part of the search results. I can imagine a number of search terms that might prompt hits on pages for sexual reassignment surgery. (Plus, this would give me great amusement at the thought that DOJ would have rooms of people surfing for XXX-rated websites. Let's face it: the government does far less productive things with our money on an hourly basis.)

Taking a step back from my abhorrence to any sort of filtering via fiat, if I have to accept that my tax dollars are going to rich congressmen and women who pretend to know the best way to raise your children, the least I would hope for is some attempt to make the blocking of adult material as unobtrusive as possible. The presumption in the current method (looking at searches and see what "nefarious" things turn up) is that all search terms are potentially dangerous things, resulting in a flood of porn, until they can be satisfactorily (according to whom?) listed as clean of "filth".

Of course, in terms of effort expended by the government, this kind of rediculous intrusion is far less expensive than finding ways of improving enforcement of already existing laws.

In a November 2005 working paper, Sound and Fury: McCloskey and Significance Testing in Economics, Kevin Hoover and Mark Siegler inform us that because Deidre McCloskey still hasn't done her homework right, she continues to misrepresent the median economist as a statistical dummy. Part of the abstract:

That statistical significance is not economic significance is a jejune and uncontroversial claim, and there is no convincing evidence that economists systematically mistake the two. Other elements of McCloskey’s analysis of statistical significance are shown to be ill-founded, and her criticisms of practices of economists are found to be based in inaccurate readings and tendentious interpretations of their work. Properly used, significance tests are a valuable tool for assessing signal strength, for assisting in model specification, and for determining causal structure.

Here's a more extensive earlier draft, and a list of the full-length AER papers McCloskey and Ziliak failed to include in previous analyses.

That's all in section 5.1, starting at page 31 (37) of the working paper. I was with H&S much of the way in that section-- especially about the subjectivity required to construct the evaluations, and the inconsistency across the two reviews -- until they conflate the refusal of M&Z to re-produce a representative sample of the now lost paper-to-dataset mappings with a refusal to "share" them. This serves to imply that the mappings are hidden in Ziliak's sock drawer, or thereabouts.... and the authors lose my respect with what I fear is not just poor word choice. Still, the paper is as interesting as it is fierce.

From page 34 (40):

Unfortunately, Ziliak has informed us that such records ["that indicate precisely which passages in the text warrant particular judgments with respect to each question."] do not exist. And McCloskey and Ziliak declined our requests to reconstruct these mappings retrospectively for a random selection of the articles (e-mail McCloskey to Hoover 11 February 2005). Absent such information, including any description of procedures for calibrating and maintaining consistency of scoring between the two surveys, we cannot assess the quality of the scoring or the comparability between the surveys.

McCloskey’s reason for not sharing the mappings appears to be, first, that they are utterly transparent and, second, that the relevant information is contained in the scores themselves:

Think of astronomers disagreeing. We have supplied you with the photographic plates with which we arrived at our conclusions [i.e., the question-by-question scores for the 1990 survey]. . . The stars [i.e., the articles in the American Economic Review] are still there, too, for you to observe independently. [e-mail McCloskey to Hoover 19 February 2005]
[Emphasis added]

UPDATE 1/25: After reading Dr. Ziliak's comment, and carefully reading the sections of their paper dealing with M&Z's AER work, I must say that I'm disappointed in H&S. I don't think H&S have much new to say other than the problem is not as bad as M&Z claim. However, this is an empirical question, that in my mind, H&S fail to address thoroughly -- in fact, not even in a cursory fashion.

H&S caught my attention by insisting their data were better than the original. So I figured they would try to reproduce results -- which granted, is pretty hard and thankless work! What I really wanted to know from their paper were the results of a sensitivity analysis that should have been performed: given a) the expanded and more comprehensive dataset (allegedly 20% larger over the original), and b) a revised protocol (they didn't seem to like the multi-faceted M&Z questionnaire), how often do the M&Z results still hold? How frequently do published papers focus on measuring and sizing up economic impact? H&S didn't answer these questions. Hence, I found the paper of Hoover and Siegler pointless from the standpoint of my interests. And their selective detailed review of several papers in section 5 demonstrates nothing to me.

In Size Matters, M&Z found that the percent of full-length AER papers that didn't distinguish economic from statistical significance grew from 70% in the 1980's to 82% in the 1990's.

But H&S claim to have found new data: 15 papers in the 80's and 56 papers in the 90's that M&Z failed to include in their previous analyses. Since H&S don't perform one, let me create my own sensitivity analysis, measuring the potential impact of new data (though not the impact of a revised questionnaire).

First, the original M&Z data, percent of papers not distinguishing economic from statistical significance:

1980's: 127/182=70%
1990's: 112/137=82%

Second, I'm looking to make a lower bound: assume previous identifications of M&Z are correct, but that every single paper H&S have discovered does measure oomph:

1980's: 127/197=64%
1990's: 112/193=58%

In other words, under the extremely unlikely scenario that every single paper H&S have identified distinguishes economic from statistical significance, a majority of top AER papers STILL don't! And that 6% drop over the period, by itself, is not important to the profession.

For a more likely (though not most likely), mid-range estimate, assume half of all newly discovered papers measure oomph:

1980's: 135/197=69%
1990's: 140/193=73%

And finally, what if none of the new papers measure oomph:

1980's: 142/197=72%
1990's: 168/193=87%

In interval form, the new estimates for the share of papers not distinguishing economic from statistical significance range from 64%-72% for the 1980's and 58%-87% for the 1990's.

In sum: A majority of papers in the AER in the 1980's and 1990's did not distinguish economic and statistical significance, although trends in the share are not yet determinable.

(Of course, what is really called for is another observer to categorize the raw data using a different protocol, but that will have to wait for somebody without a blog).

Piecework in Goss' Garage

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How much is a good starting wage for a newly trained Volvo mechanic who lacks any experience? Pat Goss has a reality check for those who don't see the link between pay and productivity:

Washington, D.C.: Dear Pat,

My brother is 19. In February he will have completed a year of training at UTI (where he finished top of his class) and four months of specialized training at Volvo in Chicago (where he is also top of his class). Though Volvo guarantees placement somewhere after graduation, over Thanksgiving he met with a few Volvo dealerships in the area to see about securing a job before he is done with school. I was shocked to see that he was offered jobs that paid only $14 an hour. Do you feel he was low-balled by these dealerships? Is there room for negotiations? I know nothing about cars or garages ... just a big sister trying to get a little more info. Thoughts?

Pat Goss: Low-balled? What does he bring to the table? He has no real experience. He has no real training. In the outside world that would be a reasonably good starting point. Yeah I know the schools tell tales of enormous salaries but that does not usually happen unless the person has experience. Besides the hourly rate is not nearly as important as his ability to produce work. Most shops pay on hours completed which is then converted to an adjusted hourly wage. If he's good he can easily convert the $14 an hour into $35 or more simply by producing more work relative to book allowed hours.

[Emphasis added]

Clarification

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I am not related to Lillo Brancato, and have absolutely no inside information about his arraignment for the murder of an NYPD officer.

Prediction Markets in Everything

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Here's an interesting new online market: S M A R K E T S :: Product Trading Market. You can buy and sell shares in products that are being sold on Amazon, much like you can trade shares on the future of innumerable things at TradeSports.

It's probably not all that interesting to suggest that the iPod Nano is going to be a stong seller. But if I were a book publisher I'd be keeping regular tabs on this page.

Of course, the lack of real money trading throws in some difficulties, but I think the experiment is fascinating. Since more people trading in these things always help make the experiment a little more robust, why not head over and make a few bets on the next big Amazon product sales.

(Side questions: does it make sense to allow users to write in product reviews before a product is even released? And if you're a seller, or an interested party (an author), would you want to allow or restrict reviews prior to official release? What signal do you send if you don't allow prior review?)

De Viti in Ten Minutes

In what's left my spare time, I've been reading Antonio De Viti De Marco's First Principles of Public Finance, translated from the Italian in 1936 -- though his ideas were already welded together by 1900. He's trying to integrate public finance into economics, while setting out just what PF is. So in the first 50 pages, he's outlining a methodology, and setting up polar theories of how individuals relate to the state: meaning that either the producers of the public goods are identical with the consumers, as we have in a participatory democracy, or they're not, as we have with despotism. And rather fortunately, De Viti didn't have to deal with the current public goods requirements of rivalry and exclusion; instead, for him, public goods are basically what the government produces, but "collective needs" are those goods and services useful for supporting social interaction. It's messy, but at least he's trying to separate the actual economic product of the government from what we find it efficient for the goverment to prduce.

My ten minutes are up.

Writing in the Bulletin of the History of Economics Society Volume 1, Issue 1 (Winter 1979), David Levy noted in "Computerized Text Processing for the Historian of Economic Thought", that the typing technology of the day worked fine for business applications, but that academics needed to become familiar with the really good programs used to create computer documentation. You know, the ones that contained the latest technology:

recent developments.jpg

I'm probably the last generation in the U.S. to have used an old-fashioned manual typewriter for typing up reports; I did so until we purchased word processing software and (what turned out to be an incredibly durable) Epson dot-matrix printer for our Commodore 64 some time in the mid to late1980's.

Senegal Forbids Cheap Cars

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Have you ever wanted to race from the UK to Africa in a beat-up old car costing less than $200? Then the Plymouth-Dakar Challenge is the race for you! But watch out when you get to Senegal:

Senegal is now upholding laws that prohibit the import of cars more than 5 years old. This is a bit difficult for us as we need to cross Senegal to gain entry to The Gambia. Last year we made attempts to get official approval from Senegal to allow the PDC to pass through. It would be difficult to claim that those attempts were entirely successful, but with the persistence of Sad Steve and Andy Pag on the ground in Senegal all Groups were allowed to pass through... allbeit under the watchful eyes of the Senegalese Customs who insisted that the drivers paid an official to join them in the convoy to make sure no-one sold any cars! We are hoping to gain further assistance from the Senegal Natonal Olympic Committee this year to try to make the crossing of Senegal a little easier. If you ARE able to buy a car under 5 years old for £100, then you'll find Senegal much easier. If you cannot manage this, then you just need to be aware that Senegal is not going to be all that welcoming, but you should (eventually) be allowed through. There are NO GUARANTEES, however, and you might find yourself driving back home!

You'd better watch out when you get to The Gambia too, as they authorities there forbid right-hand drive cars.

Hat tip to Autoblog, and make sure you check your route map.

By the way, this journal by one set of participants is a riot.

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