A Tale of Two Houses
The Biggest Problem Facing Science
New York Times article on publication bias:
Fears that this is resulting in some questionable findings began to emerge in 2005, when Dr. John P. A. Ioannidis, a kind of meta-scientist who researches research, wrote a paper pointedly titled “Why Most Published Research Findings Are False.”
That's the theory. Here's some data:
... C. Glenn Begley, who is chief scientific officer at TetraLogic Pharmaceuticals, described an experience he had while at Amgen, another drug company. He and his colleagues could not replicate 47 of 53 landmark papers about cancer. Some of the results could not be reproduced even with the help of the original scientists working in their own labs.
Now is that an artifact of publication bias too? Who knows?!
I feel that a big leap forward in science right now would be a category of journals that only commissions studies replicating important findings (or asking important new questions) and will publish the results, regardless of the answer. That will beat publication bias. Determine what you want to study ex-ante and publish the results regardless of how it turns out. Only then can we really know what's going on.
Great article in the New York Times about gas subsidies in Venezuela. You can get a sense of the politics behind bad economic policy:
Venezuela has the world’s cheapest gasoline, about six cents a gallon, a price so low that drivers often fill their tanks for less than a dollar and tip the gas station attendant more than the cost of the fuel pumped into their cars.
Despite the socialist orientation of Venezuela’s government, the wealthy and middle class benefit greatly from the fuel subsidy because they are more likely to have a car, while the poor primarily benefit through the effect on mass transportation fares. Two researchers at the Harvard Kennedy School, José Ramón Morales and Douglas Barrios, calculated that the value of the gasoline subsidy for the top 10 percent of households in 2010 was about $3,755 a year, compared with $506 a year for the bottom 10 percent.
The clock is ticking on climate change, according to this New York Times article: U.N. Says Lag in Confronting Climate Woes Will Be Costly.
Nations have so dragged their feet in battling climate change that the situation has grown critical and the risk of severe economic disruption is rising, according to a draft United Nations report. Another 15 years of failure to limit carbon emissions could make the problem virtually impossible to solve with current technologies, experts found.
Climate change is a classic example of a public good--which means it can only be acquired through our governments. We can't just up and go to the store to buy it. (The last chapter of Economics covers public goods.) The right choice for society depends on our individual stances on the matter. So let's examine our personal stance on through a simple thought experiment.
Suppose there's a product on the market right now that will insure you and your descendants against the ill effects of climate change due to carbon emissions. It costs $5,000. Will you buy it? If yes, you should vote for policies aimed at curbing carbon emissions. If no, you should vote against it.
Me? I'd buy that product in a heartbeat--even if it costs a lot more than $5,000. Upsetting the ecosystem, overpopulation, and nuclear weapons in the wrong hands are the three potential catastrophes that keep me up at night (or would, if I wasn't such a good sleeper). If I can eliminate one of these threats with a measly $5,000--I'm all in. That's why I wish all governments could get together and agree to a carbon tax.
Good News From Tunisia
Tunisia is about to pass a fairly moderate constitution. It's a giant leap forward for the region.
The New York Times reports:
"Two years in the making and now in its third draft, the charter is a carefully worded blend of ideas that has won the support of both Ennahda, the Islamist party that leads the interim government, and the secular opposition. It is being hailed as one of the most liberal constitutions in an Arab nation."
The support from the Islamists didn't come easy though:
"It was partly the crisis in Egypt — including the overthrow last summer of the Islamist government of President Mohamed Morsi, Egypt’s first popularly elected leader — that prompted Ennahda to make important concessions and seek consensus on the new Tunisian Constitution. The assassination on July 25 of a left-wing politician, Mohamed Brahmi, in Tunis — the second political assassination in the country in six months — drew a sharp public reaction, weakening the Islamists."
Netflix CEO Reed Hastings' excellent thoughts on management, Netflix Culture: Freedom and Responsibility, went viral a few years ago. I just came across it for the first time via this Harvard Business Review article by Patty McCord, former Chief Talent Officer at Netflix. Both the slide and the article are worth reading.
Mankiw on How to Help the Poor
Greg Mankiw, in a New York Times op-ed about how to help the working poor, explains why direct redistribution works better than a minimum wage (a result I keep emphasizing in Economics).
Author of Economics: The Remarkable Story of How the Economy Works