faulker020

One advantage of writing down models in math, even if you can't test them, is that you make the ideas concrete. For example, take a recent exchange between Ryan Avent and Paul Krugman. Avent is trying to explain robots could be taking jobs even while productivity is slowing down. Lots of people have said made some variant of the argument: "If robots are taking our jobs, how come productivity growth is so slow?" Here's Avent's theory : The digital revolution has created an enormous rise in the amount of effective labour available to firms. It has created an abundance of labour...  How does automation contribute to this abundance of labour?...[T]here’s a...straightforward and important way in which automation adds to abundance now. When a machine displaces a person, the person doesn’t immediately cease to be in the labour force...  In some cases workers can transition easily from the job from which they’ve been displaced into another. But often that isn’t possible....

Anne Case and Angus Deaton have a new paper on white mortality rates . This one is getting attacked a lot more than the 2015 one, though the findings and methods are basically the same -- increased death rates for U.S. whites, especially for the uneducated. Andrew Gelman is still on the case (we'll get to his critique later), but a number of other pundits have now joined in . Thanks in part to these critiques, it's rapidly becoming conventional-wisdom in some circles that the Case-Deaton result is bunk - one person even called the paper a "bogus report" and criticized me for "falling for" it. But most of the critics have overstated their case pretty severely here. The Case-Deaton result is not bunk - it's a real and striking finding. Harris and Geronimus' Critique First, let's talk about the most popular critique - Malcolm Harris' post in the Pacific Standard . Josh Zumbrun of the Wall St. Journal had a good counter-takedown  of this one on...

With the casting controversies over the live-action Ghost in the Shell movie  and the Marvel Netflix series Iron Fist , the outcry over "whitewashing" of Asian characters in American entertainment has reached a fever pitch. So I thought I'd write a post about that. Why care about whitewashing? Why do I, who am not Asian, care about whitewashing? Well, there's a not-so-important reason and a very important reason. The not-so-important reason is that I have a lot of Asian-American friends, and it pisses me off to see movies depicting an America in which they don't seem to exist. But that's very unimportant compared to the real issue, which is racial integration.  Most of America's immigration now comes from Asia , meaning that the nation's future will be greatly affected by how well we integrate Asian-Americans into American culture and society. Keeping Asian-Americans invisible will cause non-Asian Americans to keep seeing them as perpetual foreigners ...

There's a new website out called EconoFact , and while I respect the people involved and I get what they're trying to do, I think they're currently going about it wrong. The site needs some major changes. In the age of Trump, "alternative facts", and "fake news", there's an understandable desire to bring truth back to a post-truth world. The new website describes its mission thus : EconoFact is a non-partisan publication designed to bring key facts and incisive analysis to the national debate on economic and social policies. It is written by leading academic economists from across the country who belong to the EconoFact Network...  Our mission at EconoFact is to provide data, analysis and historical experience in a dispassionate manner...Our guiding ethos is a belief that well meaning people emphasizing different values can arrive at different policy conclusions. However, if in the debate we as a society can’t agree on the relevant facts, then the na...

Will Wilkinson, one of the greatest essayists working today, has a wonderful article in the Washington Post about two competing visions of America - one cosmopolitan and polyracial, the other exclusive and insular. Here are some great excerpts: [Trump] connected with these voters by tracing their economic decline and their fading cultural cachet to the same cause: traitorous “coastal elites” who sold their jobs to the Chinese while allowing America’s cities to become dystopian Babels, rife with dark-skinned danger — Mexican rapists, Muslim terrorists, “inner cities” plagued by black violence. He intimated that the chaos would spread to their exurbs and hamlets if he wasn’t elected to stop it...  To advance his administration’s agenda, with its protectionism and cultural nationalism, Trump needs to spread the notion that the polyglot metropolis is a dangerous failure...  When Trump connects immigration to Mexican cartel crime, he’s putting a menacing foreign face on white anxie...

The idea of "thinking like an economist" is, in principle, a good one. It often helps to think of the world in terms of incentive compatibility, constrained optimization, supply and demand, competition vs. barriers to entry, strategic interactions, present value, marginal vs. average effects, externalities, etc. These are all things that economists think about. And there are empirical techniques that mostly aren't specific to econ, but which empirical economists use a lot, that are also good to think about - endogeneity, omitted variables, conditional vs. unconditional probabilities, signal extraction, and so on. And it's generally cool and useful to be able to think like an applied mathematician in general - to be able to construct formal, quantitative models to represent ideas you have about the way the world works. So there are many ways that it can be useful, fun, and mind-expanding to learn to think like an economist.  And there really are some books out there th...

Tyler Cowen has a new post in the ongoing blog discussion about the value of empirical economics. Most of Tyler's post is about the potential misuse of empirical economics. He writes: The political process does not select for humble versions of empiricism.  Those end up with virtually no political influence, whereas some of the more dogmatic form of empiricism may find some traction. Absolutely true. Ideologues just pick and choose results that support them. If 100 studies show the impact of immigration on labor markets is small, and one George Borjas study says it's large, the anti-immigrant people will wave around the Borjas study. (And then the anti-empiricists will say "See? No one can really know who's right!") Tyler: A lot of the bias in empirical methods comes simply from which questions are asked/answered. Post Trump and De Vos, I see plenty of commentators and researchers reporting “vouchers don’t raise test scores” and virtually no “vouchers increase ...

If you spend any time at all talking to rightist immigration restrictionist types on Twitter or elsewhere, you'll notice that they've taken to calling themselves "nationalists." They contrast this with "globalism", which they associate with rootless cosmopolitans pushing open-borders policies on countries to which they have no allegiance. Lots of people on the left take these folks at their word - after all, weren't the Nazis nationalists? Didn't nationalism cause WW2? Etc. But I've always been suspicious of the "nationalist" label. American rightists have always seemed to me like part of an international, borderless white supremacist movement - a sort of global white-ist Ummah . They always seem to have much more allegiance to their co-racialists in other countries than they do to their own non-white countrymen.  Josh Barro notices this in a recent post : For members of a movement that purports to focus on putting American interests f...

I finally got around to reading Akerlof and Shiller's latest book,  Phishing for Phools . In fact, I saw Akerlof give a talk by that name at an INET conference back in 2011. The book was basically a longer version of that talk. Phishing for Phools has one big important idea. The idea is that deception is fundamental to market economies - that it's not just the result of certain models or certain situations, but that it's always present to some degree. The reason is that companies are always looking for new ways to trick people out of their money - to find new information asymmetries, bounded rationality, suboptimal behavior patterns, and legal loopholes to exploit. Given that companies are always looking for these, their will always be some degree of trickery and mistakes in any market. This is just an obvious result of costly monitoring (though I'm not sure Akerlof & Shiller actually mention that explicitly). They call this a "phishing equilibrium". I wi...

"Faith is the substance of things hoped for, the evidence of things not seen." - Hebrews 11:1 Empirical economics is taking over the profession . It's very hard to make it in the field these days without doing a hefty amount of empirical work. Lots of job market papers are still theory papers (cough! signaling! cough!), but the number of economists who can make it as pure theorists is shrinking to a rarefied, brilliant sliver. I see that as a very good thing. That's what natural science looks like - a small number of theory papers, supported by a very large base of applied theory and empirical work. It's the sign of a mature field. I also think it's going to be very important in helping the economics profession recapture some of the public respect that it's lost over the last decade. When people start to see economists as fact-driven scientists grounded in observable reality, rather than mathematical philosophers dispensing Olympian received wisdom, the ...