tag:blogger.com,1999:blog-60484252024-03-13T16:40:25.500+00:00Bluematter.Unknownnoreply@blogger.comBlogger715125tag:blogger.com,1999:blog-6048425.post-38221839232491503732012-07-21T12:37:00.001+00:002012-07-21T12:37:18.977+00:00Why model?<div dir="ltr" style="text-align: left;" trbidi="on">
<br />
<div class="column">
<blockquote class="tr_bq">
<span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">The first question that arises frequently--sometimes innocently and sometimes not--is
simply, "Why model?" Imagining a rhetorical (non-innocent) inquisitor, my favorite
retort is, "You </span><span style="font-family: 'TimesNewRomanPS'; font-size: 12.000000pt; font-style: italic;">are </span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">a modeler." Anyone who ventures a projection, or imagines how a
social dynamic--an epidemic, war, or migration--would unfold is running </span><span style="font-family: 'TimesNewRomanPS'; font-size: 12.000000pt; font-style: italic;">some </span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">model.</span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;"><br /></span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">But typically, it is an </span><span style="font-family: 'TimesNewRomanPS'; font-size: 12.000000pt; font-style: italic;">implicit </span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">model in which the assumptions are hidden, their internal
consistency is untested, their logical consequences are unknown, and their relation to data
is unknown. But, when you close your eyes and imagine an epidemic spreading, or any
other social dynamic, you are running </span><span style="font-family: 'TimesNewRomanPS'; font-size: 12.000000pt; font-style: italic;">some </span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">model or other. It is just an implicit model
that you haven't written down.<br />
</span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;"><br /></span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">This being the case, I am always amused when these same people challenge me with the
question, "Can you validate your model?" The appropriate retort, of course, is, "Can you
validate yours?" </span> </blockquote>
<blockquote class="tr_bq">
<span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">The choice is not whether to build models; it's whether to build </span><span style="font-family: 'TimesNewRomanPS'; font-size: 12.000000pt; font-style: italic;">explicit </span><span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">ones. </span></blockquote>
<span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;"><br /></span><br />
<span style="font-family: 'TimesNewRomanPSMT'; font-size: 12.000000pt;">Here's more <a href="http://www.santafe.edu/media/workingpapers/08-09-040.pdf">Joshua Epstein on modelling</a>.</span><br />
</div>
</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-51874771944067865832012-07-01T14:59:00.000+00:002013-12-30T11:13:07.934+00:00Lady tasting tea - The adventures of R.A. Fisher in statistical science<div dir="ltr" style="text-align: left;" trbidi="on">
<blockquote class="tr_bq">
<blockquote class="tr_bq">
Already, quite soon after he had come to Rothamstead, his presence had transformed one commonplace tea time to an historic event. It happened one afternoon when he drew a cup of tea from the urn and offered it to the lady beside him, Dr. B. Muriel Bristol, an algologist. She declined it, stating that she preferred a cup into which the milk had been poured first. “Nonsense,” returned Fisher, smiling, “Surely it makes no difference.” But she maintained, with emphasis, that of course it did. From just behind, a voice suggested, “Let’s test her.”</blockquote>
</blockquote>
<br />
<a href="http://www.dean.usma.edu/math/people/sturdivant/images/MA376/dater/ladytea.pdf">Fascinating anecdote</a> from the life of R.A. Fisher. The link has more on Fisher's exact test and on whether the lady was indeed able to tell the difference between cups.</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-11304864243978458042012-03-31T16:39:00.002+00:002012-03-31T16:39:30.908+00:00Shopping in North Korea<iframe width="560" height="315" src="http://www.youtube.com/embed/Qh_TLMxlWpk" frameborder="0" allowfullscreen></iframe>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6048425.post-64900948060636484032012-02-16T13:43:00.000+00:002012-02-16T13:43:18.826+00:00The politics of hate, Greece editionThe moral condemnation directed towards the Greeks is the saddest aspect of this financial crisis, and it says a lot more about the givers than the receivers. Just like the smell of burning books, the demonisation of entire populations and a 'we good, they bad' mentality is an unmistakeable manifestation of pathology. Lacking the intelligence or the interest to understand what the hell is going on, the morally outraged resort to silly stories and juvenile good/evil dichotomies to make sense of the world.<br />
<br />
Richard Parker, the Harvard economist, has an <a href="http://www.ft.com/intl/cms/s/0/48b55f8a-57d3-11e1-b089-00144feabdc0.html#axzz1mY1RomyZ">interesting article in the FT</a>:<br />
<blockquote>Greece desperately needs reforms. Mr Papandreou knew this well before the crisis, as did most Greeks. But the larger problem was the panic that swept over Europe and the easy moralising that financial crises evoke. Greeks were cast as tax-evaders, lazy and anti-business, their government as over-indebted, bloated and corrupt – a situation that required castor oil and humiliation.<br />
<br />
But almost none of the moralising clichés were true. Greek taxes were more than a third of gross domestic product, near the European average. And if Greeks were anti-business, why then were there more small entrepreneurs per capita than anywhere else in Europe? Government was not bloated in terms of employees – at a fifth of the labour force, it was about the European average. Corruption was clearly a problem, but our data showed it was concentrated – incomprehensibly to non-Greeks – in the health sector, where minor “gifts” to doctors secured early scheduling of surgeries.</blockquote><br />
Two more facts to add here. One, Greeks work amongst the highest number of hours of all OECD countries. Two, while there is a lot of tax evasion in Greece (together with high tax rates so that overall tax take is comparable to elsewhere), this has to do with the fact Greece has a relatively large number of small, family businesses. The Germans have as much inherent propensity to tax evade as the Greeks.Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6048425.post-77481223817757740182012-02-10T07:00:00.001+00:002012-02-10T07:00:12.291+00:00Friday Special edition unknown, now back on Friday!<a href="http://cheaptalk.org/2009/12/08/sniping-and-squatting/">How to bid on eBay</a>. No, you don't just enter your valuation and relax.<br />
<br />
<a href="http://www.portfolio.com/views/blogs/odd-numbers/2007/11/29/why-men-are-better-mathematicians-and-engineers">Why men are better</a> at mathematics and engineering.<br />
<br />
Eugene Fama: <a href="http://www.dimensional.com/famafrench/2010/03/my-life-in-finance.html">My life in finance</a>.<br />
<br />
Open <a href="http://oyc.yale.edu/">Yale courses</a>.<br />
<br />
Interviews of <a href="http://korora.econ.yale.edu/et/interview/">great econometricians</a>.<br />
<br />
Mad, <a href="http://marginalrevolution.com/marginalrevolution/2008/03/mad-men.html">mad men</a>.<br />
<br />
<a href="http://www.thejapaneseshop.co.uk/categories/Japanese-Kokeshi-Dolls/Kokeshi-Dolls/?sort=priceasc&gclid=CMeL2oSF0qwCFQMPfAodqnfy6g">Beautiful Kokeshi dolls</a>.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-33799352762328770892012-02-08T07:00:00.001+00:002012-02-08T07:00:04.313+00:00Stats and Bayesian econometrics resources<a href="http://www.ling.uni-potsdam.de/~vasishth/book.html">The Foundations of Statistics</a>: A Simulation-based Approach. Nice intro to R too.<br />
<br />
A course in <a href="http://personal.strath.ac.uk/gary.koop/bayes.html">Bayesian Econometrics</a>, by Gary Koop.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-64460470850075574922012-02-05T22:20:00.000+00:002012-02-05T22:20:40.695+00:00Friday special special, now on a Monday!Gary Becker, 2008: <a href="http://online.wsj.com/article/SB122333679431409639.html">We're not headed for a depression</a>. <i>'World economic growth will recover once we are over the present severe financial difficulties.'</i><br />
<br />
<a href="http://www.nytimes.com/2009/02/10/health/10real.html?_r=1&em">Don't blow your nose</a> when you have a cold. <br />
<br />
Very interesting <a href="http://www.portfolio.com/views/blogs/odd-numbers/2007/11/18/youre-not-attractive">research on dating</a>.<br />
<br />
<a href="http://medicalhypotheses.blogspot.com/2009/02/why-are-modern-scientists-so-dull.html">Why are modern scientists so dull?</a> <br />
<br />
Did people who knew about <a href="http://www.slate.com/articles/business/the_dismal_science/2008/10/they_made_a_killing.html">secret CIA coups game the market</a>?Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-9922020518027491892012-02-02T00:22:00.000+00:002013-12-30T11:14:34.323+00:00In the beginning, a crash in appetite for risk<div dir="ltr" style="text-align: left;" trbidi="on">
<a href="http://www.cato-unbound.org/2008/12/08/j-bradford-delong/liquidity-default-risk/">DeLong, December 2008</a>:<br />
<br />
<blockquote>
Think of it this way: two years ago we lived in a world in which the wealth of global owners of capital was some $80 trillion — that was the market value of all of their property rights to dividends and contract rights to interest, rent, royalties, options, and bonuses.<br />
<br />
In the past two years the wealth that is the global capital stock has fallen in value from $80 trillion to $60 trillion. Savings has not fallen through the floor. We have had little or no bad news about resource constraints, technological opportunities, or political arrangements. <br />
<br />
$17 trillion of [the fall] comes by [my] arithmetic from a rise in the risk discount. There has been a massive crash in the risk tolerance of the globe’s investors.<br />
<br />
Thus we have an impulse — a $2 trillion increase in the default discount from the problems in the mortgage market — but the thing deserving attention is the extraordinary financial accelerator that amplified $2 trillion in actual on-the-ground losses in terms of mortgage payments that will not be made into an extra $17 trillion of lost value because global investors now want to hold less risky portfolios than they wanted two years ago.<br />
<br />
Our models predict that in normal times, with the ability to diversify portfolios that exists today, the risk discount on assets like corporate equities should be around 1% per year. It is more like 5% per year in normal times — and more like 10% per year today. And our models for why the risk discount has taken such a huge upward leap in the past year and a half are little better than simple handwaving and just-so stories. Our current financial crisis remains largely a mystery: a $2 trillion impulse in lost value of securitized mortgages has set in motion a financial accelerator that we do not understand at any deep level but that has led to ten times the total losses in financial wealth of the impulse.</blockquote>
</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-62317197507953676452012-02-02T00:00:00.000+00:002012-02-02T00:00:41.338+00:00The wisdom of Chris Dillow<blockquote>The recession does not exist: individuals’ lived experience tells us little about macroeconomic phenomena such as booms and slumps. These are aggregate economic data, not direct sense data to any individuals. </blockquote><br />
An <a href="http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2008/11/the-recession-is-not-taking-place.html">excellent piece</a> by Chris Dillow on the inability of individuals to directly perceive macroeconomic phenomena. Yes - it's still clearing out my closet season, but hey - the recession's still here so I'll count this one as timely. <br />
<br />
In more recent blogging, I like how Chris has something interesting to say, even when commenting on <a href="http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2012/01/on-hesters-bonus.html">the most boring story in the world</a>:<br />
<br />
<blockquote>“Management“ functions rather like witchcraft. It’s a set of rituals which are wrongly supposed to have effects on the outside world.</blockquote>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-45226687246931429752012-01-23T08:00:00.003+00:002012-01-23T08:00:14.909+00:00Schools test often to teach inequality and hierarchy<blockquote>At school, our kids are rated and ranked far more often than most adults will tolerate, even though this actually slows their learning! It seems that modern schools function in part to help humans overcome their (genetically and culturally) inherited aversions to hierarchy and dominance. Modern workplaces require workers who are far more accepting than are foragers of being told what to do when, and of being explicitly ranked, and our schools prepare kids to accept this more primate-like environment.<br />
<br />
The evidence strongly suggests that students learn better when they are not graded and certainly not when they are graded on a curve.<br />
<br />
Subjects worked on different tasks and received performance-contingent payments that varied in amount from small to very large relative to their typical levels of pay. With some important exceptions, very high reward levels had a detrimental effect on performance.</blockquote><br />
This is Robin Hanson of <a href="http://www.overcomingbias.com/2010/05/why-schools-test-often.html">Overcoming Bias</a> making a plausible point, though I would not view this at all as a recent phenomenon. If anything, accepting hierarchy and dominance is probably less important today than it used to be at any point since pre-history. <br />
<br />
Do click through, there's more interesting stuff there.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-49866149130187131702012-01-22T17:13:00.000+00:002012-01-22T17:13:41.401+00:00Gelman galore<div dir="ltr" style="text-align: left;" trbidi="on">Clearing Out My Closet season continues, this time with a number of interesting posts from Andrew Gelman:<br />
<br />
<a href="http://andrewgelman.com/2005/11/uh_um/">Uh.. Um..</a><br />
<blockquote>I [Mark Liberman] took a quick look at demographic variation in the frequency of the filled pauses conventionally written as “uh” and “um”.</blockquote><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhhznc3bxNf2r-Dy62zWm3_ZWWLSFGEJ_dCHWiC-30Gwp8VbNkWeS1RwbvxtBap8qzL72t_ZDufqBS-Uj4oTUoONYwIvrSresKwUqAxWUdylsxapEvXfRO9748pgHFbxDUisWYl/s1600/AgeSexFluency3.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhhznc3bxNf2r-Dy62zWm3_ZWWLSFGEJ_dCHWiC-30Gwp8VbNkWeS1RwbvxtBap8qzL72t_ZDufqBS-Uj4oTUoONYwIvrSresKwUqAxWUdylsxapEvXfRO9748pgHFbxDUisWYl/s320/AgeSexFluency3.png" width="320" /></a></div><br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS-kw0ybkq-_3CwOXAp0o-yVhpVrc0ZoU7gAX2TvseeQ2S6EBnUbJnrdOs-M8JRSpb2-GIqGOauWEmVnjnpOGeNJLHmHXeRPC7H31RHLDJ7YqqeW9ciPFMpSHMiRG6q50EqKGH/s1600/AgeSexFluency1.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjS-kw0ybkq-_3CwOXAp0o-yVhpVrc0ZoU7gAX2TvseeQ2S6EBnUbJnrdOs-M8JRSpb2-GIqGOauWEmVnjnpOGeNJLHmHXeRPC7H31RHLDJ7YqqeW9ciPFMpSHMiRG6q50EqKGH/s320/AgeSexFluency1.png" style="cursor: move;" width="320" /></a></div><br />
<a href="http://andrewgelman.com/2006/05/marginal_and_ma/">Marginal vs marginal</a><br />
<blockquote>To me, the most interesting bit of terminological confusion is that the word “marginal” has opposite meanings in statistics and economics. In statistics, the margin (as in “marginal distribution”) is the average or, in mathematical terms, the integral. In economics, the margin (as in “marginal cost”) is the change or, in mathematical terms, the derivative.</blockquote><br />
<a href="http://andrewgelman.com/2008/09/mellow_liberals/">If you are jumpy, you are less likely to be liberal</a><br />
<blockquote>In a group of 46 adult participants with strong political beliefs, individuals with measurably lower physical sensitivities to sudden noises and threatening visual images were more likely to support foreign aid, liberal immigration policies, pacifism, and gun control, whereas individuals displaying measurably higher physiological reactions to those same stimuli were more likely to favor defense spending, capital punishment, patriotism, and the Iraq War.</blockquote><br />
<a href="http://andrewgelman.com/2008/08/friday_the_13th_1/">Friday the 13th, unlucky?</a><br />
<blockquote>A study published on Thursday by the Dutch Centre for Insurance Statistics (CVS) showed that fewer accidents and reports of fire and theft occur when the 13th of the month falls on a Friday than on other Fridays. . . . In the last two years, Dutch insurers received reports of an average 7,800 traffic accidents each Friday, the CVS study said. But the average figure when the 13th fell on a Friday was just 7,500. <br />
<i><br />
Datacharmer recently made a good comment on this:</i><br />
<br />
Apart from avoiding risky behaviour on Friday the 13th because it is deemed unlucky (which might well be happening), you should also consider that Friday the 13th – unlike other Fridays – CAN’T be Christmas or New Year’s (where people get drunk and drive), and it will also be associated with a lower (or higher) probability of falling before a bank holiday weekend (or I guess in the States Independence day, etc).<br />
<br />
I guess all I’m saying that it could well be other factors driving this result other than a change in people’s behaviour because Friday the 13th is ‘unlucky’.<br />
<br />
How about accidents on Friday the 12th of Friday the 14th? The article only compares Friday the 13th with an average Friday – in fact, it doesn’t even reveal whether the 13th is least accident prone Friday in the book… </blockquote><br />
</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-4652476259451343682012-01-21T23:17:00.001+00:002012-01-21T23:20:27.789+00:00If you can prioritise well you are probably not very creative<blockquote>In a 2003 study at Harvard, Dr. Carson and other researchers tested students’ ability to tune out irrelevant information when exposed to a barrage of stimuli. The more creative the students were thought to be, determined by a questionnaire on past achievements, the more trouble they had ignoring the unwanted data. A reduced ability to filter and set priorities, the scientists concluded, could contribute to original thinking.</blockquote><br />
The <a href="http://www.nytimes.com/2008/05/20/health/research/20brai.html?em&ex=1211601600&en=be28283a8d61a2ab&ei=5087">NY Times</a> has more.<br />
<br />
I'm clearing out my inbox of its 400+ emails, and many of these relate to stuff I wanted to post here - so expect a regular stream of content. Even if a couple years old, good links always stay fresh!Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-71906280899791877392012-01-17T19:51:00.002+00:002012-01-17T19:54:28.207+00:00ASCII 3D<div dir="ltr" style="text-align: left;" trbidi="on">OK, this is geeky - but love it. <br />
<br />
<a href="http://www.stata.com/support/faqs/stat/mlogit.html">Source</a>. <br />
<br />
<br />
<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigE5rGpsHCMTz4kGqueNYWTCC9W8ffVpYGAG3r5yVFWYAv7nk61JS_GDyaINc23coMEteg9OHNrmN4UNSY0yIIZN1C_YF6SmnsRlDv9seNLCIOLEsJpwh29xToGH_qbq_9B72F/s1600/Screen+shot+2012-01-17+at+19.52.56.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="382" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEigE5rGpsHCMTz4kGqueNYWTCC9W8ffVpYGAG3r5yVFWYAv7nk61JS_GDyaINc23coMEteg9OHNrmN4UNSY0yIIZN1C_YF6SmnsRlDv9seNLCIOLEsJpwh29xToGH_qbq_9B72F/s640/Screen+shot+2012-01-17+at+19.52.56.png" width="640" /></a></div><br />
</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-38264547176899983732011-12-29T12:16:00.000+00:002011-12-29T12:16:55.054+00:00A Mosque (1986)<div dir="ltr" style="text-align: left;" trbidi="on"><blockquote class="tr_bq">A mosque is where Muslim people learn, read and pray.Where I go with my little brothers we have to pay 2 pounds each week for learning everyday.We learn the Koran and how to pray.We have to go to everyday,if we don't we are punished.We must take an excuse note to say why we didn't come.I go in a van to the mosque Then I go to a big room to learn how to pray.We stay for one hour.Each week there is a test if you pass you go to another group for lessons.After the test you go to your own class where the register is taken.Then you must read to your teacher for one hour,if you make one mistake you are punished.The punishment is a beating with a bamboo stick.When we are finished we are taken home by van.<br />
<br />
Shelina Akther(11)</blockquote><br />
From the BBC's <a href="http://www.bbc.co.uk/history/domesday/dblock/GB-536000-180000/page/9">Domesday Reloaded</a> project, a remarkable - if somewhat misguided - attempt to document life in modern Britain circa 1986. Cool stuff.<br />
<blockquote class="tr_bq"><br />
In 1986, 900 years after William the Conqueror’s original Domesday Book, the BBC published the Domesday Project. The project was probably the most ambitious attempt ever to capture the essence of life in the United Kingdom. Over a million people contributed to this digital snapshot of the country. <br />
<br />
The whole of the UK – including the Channel Islands and Isle of Man – was divided into 23,000 4x3km areas called Domesday Squares or “D-Blocks”. <br />
<br />
Schools and community groups surveyed over 108,000 square km of the UK and submitted more than 147,819 pages of text articles and 23,225 amateur photos, cataloguing what it was like to live, work and play in their community. <br />
<br />
This was about documenting everyday life - the ordinary rather than the extraordinary.<br />
<br />
The project used the cutting edge technology of the day, and the data was eventually presented on a special type of Laser-Disc, read by a BBC master computer and navigated using an innovative tracker-ball pointing system.<br />
<br />
But the technology didn’t catch on and the computers became very expensive for schools and libraries to buy. Very few people ever got to see the fruits of all of their hard work. </blockquote></div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-41063902401944757862011-12-25T01:22:00.000+00:002011-12-25T01:22:27.047+00:00I heart Nixie tubes<div dir="ltr" style="text-align: left;" trbidi="on">I'm looking to buy myself a nixie tube clock for (late) Christmas and ran into these <a href="http://kosbo.com/index.php?option=com_imagebrowser&view=gallery&Itemid=70">awesome designs</a>.<br />
<br />
<div class="separator" style="clear: both; text-align: center;"><a href="http://1.bp.blogspot.com/-HVFJEOdqm_c/TvZ6t6_oeyI/AAAAAAAAApA/FnEIsqvKMwg/s1600/Image00003.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="240" src="http://1.bp.blogspot.com/-HVFJEOdqm_c/TvZ6t6_oeyI/AAAAAAAAApA/FnEIsqvKMwg/s320/Image00003.jpg" width="320" /></a></div><br />
</div>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-76701294845271376482011-11-04T01:47:00.001+00:002014-03-13T10:48:41.335+00:00The economic consequences of the referendum that wasn't<div dir="ltr" style="text-align: left;" trbidi="on">
The referendum may not be happening, but yesterday's events will have a deep impact on Greek and European affairs.<br />
<br />
As I speculated <a href="http://bluematter.blogspot.com/2011/11/why-greek-referendum-is-exactly-right.html">yesterday</a>, Prime Minister Papandreou explicitly said today that his main rationale for calling a referendum was to putt a stop to speculation that Greece is considering exiting the Eurozone. The chain of events that led to the referendum being called off demonstrated beyond doubt that the political classes will be keeping Greece in the Euro at all costs.<br />
<br />
The fact there is now a credible commitment is very important. It means that some of the funds that have exited the country will find their way back to its banks and its economy, it means that bond investors need not fear Greece inflating its debt away or engaging in unilateral funny business, and it means that a great source of uncertainty has been dealt with.<br />
<br />
This is not to say that staying the Euro is the right course of action for Greece. But since this seems to be what a majority of the Greek people want, making a binding commitment is the right way to go. There will be more investment, lower spreads, and an increased willingness of the rest of the EU to engage constructively. <br />
<br />
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Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-24835943302779405852010-12-08T01:46:00.001+00:002013-12-30T11:16:33.135+00:00Forget sovereign debt, think sovereign equity<div dir="ltr" style="text-align: left;" trbidi="on">
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Why don't countries issue part of their debt with equity-like characteristics to increase stability in crises, just like corporations do? You could have treasuries that pay a fixed percentage of tax revenue, GDP, or even GDP growth to the bearer, rather than a predefined interest rate.
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Yes, it's a bit too late for Europe now, but moving forward this could be a useful bit of financial innovation.</div>
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Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-6048425.post-84480897709911100832010-12-08T01:06:00.001+00:002010-12-08T01:06:01.084+00:00Sacrifice trade union to save the EuroGreece and Ireland need to depreciate their currencies, but exiting the Euro is unworkable for either of them. Extraordinary times call for extraordinary measures, so they could both temporarily introduce import tariffs for EU products, as well as potentially recycle some of the money generated to export tariffs. <br /><br />Imports go down, exports go up, GDP increases, deficit goes down. Of course this doesn't work in the long-run the way depreciation would, but it would work a treat as a short-run stimulus and deficit-reducing measure.<br /><br /><br />Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-18607529147292841692010-12-03T00:19:00.000+00:002010-12-03T00:19:22.968+00:00Stata is bloggingStata now has an <a href="http://blog.stata.com/">official blog</a>, Not Elsewhere Classified. And here's a list of a few <a href="http://www.stata.com/links/blogs.html">unofficial ones</a>.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-91263989630193647242010-11-15T01:46:00.001+00:002010-11-15T23:38:34.708+00:00Development is mostly not about aid<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjejbnCbHxF8t0roKlrznq1qFHUKlNV218_Hxz1fiop1fyZ9fB9jGjFFJ5ifYZqnYwIsFBBmDb16AGNRNb2sRKmotRP_Y6L8B-C5eYdEI9TLLGArLwaxfaaMLqQI5dPwZzoPgyc/s1600/Screen+shot+2010-11-15+at+01.18.52.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjejbnCbHxF8t0roKlrznq1qFHUKlNV218_Hxz1fiop1fyZ9fB9jGjFFJ5ifYZqnYwIsFBBmDb16AGNRNb2sRKmotRP_Y6L8B-C5eYdEI9TLLGArLwaxfaaMLqQI5dPwZzoPgyc/s320/Screen+shot+2010-11-15+at+01.18.52.png" width="252" /></a></div><br />
Whether you believe aid is effective or not, it has always struck me that, as a quantitative matter, it is a drop in the ocean. I am not saying that we should abandon aid; I am convinced it mostly makes things better. What I am saying, however, is that given how little it is and how widespread poverty is, the effect on national-level indicators can only be very, very small.<br />
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While aid can realistically only ever be a small part of the solution, other policies pursued by rich countries can have very widespread effects, and have perhaps received less attention than is warranted. In other words, we may be giving x euros in aid, but how much are we taking back by pursuing a Common Agricultural Policy? How much aid would a country have to give to make up for the effect on the poor of tight immigration policies?<br />
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The excellent <a href="http://www.owen.org/blog/4138">Owen Barder</a> links to a worthwhile attempt to rank rich countries according to how well they perform on development along these dimensions:<br />
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<blockquote>Though the effects of aid on development are uncertain, there is a huge amount that industrialised countries can do – or not do – which affects how quickly countries develop. The policies of rich countries on trade, investment, migration, the environment, security and technology can make a huge impact on how quickly poor countries are able to develop. Yet we tend to judge industrialized countries too much according to how much aid they give, and too little to how they behave in all these other ways.<br />
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The Center for Global Development provides an essential service by <i>ranking the rich</i> each year so we can see how we are doing. They use a series of quantitative measures on all these dimensions to create a composite picture of how a country’s policies affect development. </blockquote><br />
The <a href="http://www.cgdev.org/section/initiatives/_active/cdi/">2010 results are now in</a>. An excellent effort; I hope the next step is an attempt to monetize the value of the different policies pursued. However arbitrary this exercise may be, it will be another step in going beyond a qualitative understanding of the effect of aid, trade policies, etc, allowing us to better focus our collective efforts.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-85909322734603969032010-11-09T03:04:00.000+00:002010-11-09T03:04:20.101+00:00Empathy is the opposite of UtopiaA beatiful presentation by Jeremy Rifkin: <br />
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<object width="640" height="385"><param name="movie" value="http://www.youtube.com/v/l7AWnfFRc7g?fs=1&hl=en_GB"></param><param name="allowFullScreen" value="true"></param><param name="allowscriptaccess" value="always"></param><embed src="http://www.youtube.com/v/l7AWnfFRc7g?fs=1&hl=en_GB" type="application/x-shockwave-flash" allowscriptaccess="always" allowfullscreen="true" width="640" height="385"></embed></object><br />
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Eat your heart out, Powerpoint.Unknownnoreply@blogger.com2tag:blogger.com,1999:blog-6048425.post-5425131449017831072010-11-05T01:44:00.002+00:002010-11-05T01:53:15.684+00:00Nicaragua invades Costa Rica due to Google error<blockquote>A Nicaraguan military commander recently invaded Costa Rican territory, and ordered troops to take down a Costa Rican flag and replace it with Nicaragua's. Was this the work of a brash commander, going rogue on his superiors? A new policy of Nicaraguan imperialism? Neither. The incident was caused by an error in Google Maps. [...] commander Eden Pastora blamed the incursion on a misleading border on Google Maps that was off by some 3000 meters.<br />
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La Nación points to a disparity between the borders on Bing and Google. We've highlighted the area in question:</blockquote><img src="http://lh3.ggpht.com/_eZ1iOBtFIgU/TNNh_GQ7ChI/AAAAAAAAAog/UgKrDJvw3Ww/%5BUNSET%5D.jpg?imgmax=800" style="max-width: 800px;" /><br />
Thanks <a href="http://www.fastcompany.com/1700270/google-maps-trumps-bing-causes-invasion-in-south-america?partner=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+fastcompany%2Fheadlines+%28Fast+Company+Headlines%29">Austin Carr.</a>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-6048425.post-14242140239519534632010-11-03T00:59:00.000+00:002010-11-03T00:59:47.829+00:00The night they burned government bonds<blockquote>As I've noted before, one thing I've learned from this recession is that it's not as easy to increase the money supply as I thought.</blockquote><br />
This is <a href="http://economistsview.typepad.com/economistsview/2010/10/friedman-was-all-wrong-about-japan-and-the-great-depression.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+EconomistsView+%28Economist%27s+View+%28EconomistsView%29%29">Mark Thoma</a>. But how about a big bond bonfire? (call it a bondfire if you must) How about <a href="http://bluematter.blogspot.com/2010/10/crazy-post-midnight-thoughts-on-fiscal.html">direct financing</a> of government debt?<br />
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I never got why Japan's lost decade was accompanied with such an explosion of government debt. The way I see it, below target inflation (let alone deflation) is a license to print money, and if the banks will do nothing with it, then the government should.<br />
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We seem to have forgotten the oldest trick in the book.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-33818583910028499742010-10-17T22:32:00.000+00:002010-10-17T22:32:17.877+00:00The Star Wars alphabet<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgdVgRYTR7UY2IlN-T2isHDHMH7clJNJhfDboHfOXc27IXyLDpQpq6j3M9WEv_2gDLUoGFDOmzS2J8cmJTFDYehSnog16YIoPqnEPKRVFTkHT1MMrZN1kZ0SxULIlSDkKTO83ce/s1600/1287159459_2135_detail.jpeg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgdVgRYTR7UY2IlN-T2isHDHMH7clJNJhfDboHfOXc27IXyLDpQpq6j3M9WEv_2gDLUoGFDOmzS2J8cmJTFDYehSnog16YIoPqnEPKRVFTkHT1MMrZN1kZ0SxULIlSDkKTO83ce/s320/1287159459_2135_detail.jpeg" width="320" /></a></div><br />
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<a href="http://joewight.deviantart.com/">Joe Wight</a> has created the Kawaii Star Wars alphabet, with a different character for each letter of the alphabet. D, of course, is for that mean-looking fella above.<br />
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HT (and a full list of the letters in alphabetical order) <a href="http://designerscouch.org/view-log/The-Kawaii-Star-Wars-Alphabet-by-Joe-Wight-1644">Designers Couch</a>.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-6048425.post-89725208160544710942010-10-15T00:30:00.000+00:002010-10-15T00:30:51.696+00:00Quitting smokingI quit smoking four days ago. I am (was?) a very keen smoker, but after ten happy years of inhaling burnt tobacco I felt that the risk of cancer was starting to outweigh the pleasure of smoking.<br />
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Well, I said I quit, but I need to qualify that. I have not decided to quit <i>for ever</i>; I have only decided to quit for three weeks, and I will then evaluate whether I want to continue abstaining from smoking. This helps for two reasons:<br />
<ol><li>Quitting for three weeks is easier than quitting for ever. The former is a project I was willing to undertake; the latter sounded (and still sounds) too daunting to attempt.</li>
<li>My nicotine addiction has already subsided somewhat, and will have subsided a lot more by the end of week three. So when at the end of week three I pose the question of what I want to do next, I'm more likely to opt for the 'quit' than the 'restart' option compared to making that decision at the height of my addiction.</li>
</ol>A second, related, trick is this. I've promised myself that I will allow me to have one more cigarette, and one more cigarette only. Well, I've been feeling like having a cigarette about every 20 seconds, but given that I really want to enjoy and savour my one cigarette I keep postponing it for <i>tomorrow. </i>You can think of it as an inverse application of the Akerlof procrastrination observation. I realised this could work when last week I realised it's actually been six months in which I've had a bottle of expensive champagne in my fridge, always meaning to drink it <i>tomorrow. </i>Well, I'll hopefully be popping that cork to celebrate six months as a non-smoker.<br />
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Trick number three, I've started telling people - I find it hard, and painful, to break commitments and go back on my word, and even though I'm not really making any explicit commitments or promising anything to anyone, announcing that I'm undertaking this project creates expectations and I do not want to disappoint. Trick number four, I'm buying myself an iPad for Christmas, but if and only if I am still a non-smoker in two months' time. <br />
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The self-deception is, of course, crystal clear. But so far it's working.Unknownnoreply@blogger.com4