1. Ahmad Jamal Trio at the Newport Jazz Festival 1959. I love every version I’ve ever heard of Poinciana.
2. Newton’s letter describing his theory of light, diagrams from his optics book..and much more amazing stuff.
3. Lego version of Matrix scene
One of the least enjoyable tasks of a journal editor is to nag referees to send reports. Many things have been tried to induce timeliness and responsiveness. We give deadlines. We allow referees to specify their own deadlines. We use automated nag-mails. We even allow referees to opt-in to automated nag-mails (they do and then still ignore them.)
When time has dragged on and a referee is not responding it is typical to send a message saying something like “please let me know if you still plan to provide a report, otherwise i will try to do without it.” These are usually ignored.
A few years ago I tried something new and every time since then it has gotten an almost immediate response, even from referees who have ignored multiple previous nudges. I have suggested it to other editors I know and it works for them too. I have an intuition for why it works (and that’s why I tried it in the first place) but I can’t quite articulate it, perhaps you have ideas. Here is the clinching message:
Dear X
I would like to respond soon to the authors but it would help me a lot if I could have your report. I realize that you are very busy, so if you think you will be able to send me a report within the next week, then please let me know. If you don’t think you will be able to send a report, then there is no need to respond to this message.
I listen to Pandora whenever I am in my office. It does a pretty good job of finding music that matches my taste, sometimes a really good job. In the past few weeks I’ve found some stuff that was completely new to me that I really liked. I created a station based on these tunes:
- Beep! Marty’s Mishap. I have never heard of this trio and as far as I can tell google has not either. The rhythm is an instrument if that makes any sense. This is exactly the kind of music I like.
- Nels Cline, Alstromeria. I don’t know how to classify this music. The guitar playing is virtuosity without showing off. The composition is academic without feeling pretentious.
- Tomasz Stanko Quartet, Kattorna. I first learned of this quartet in a roundabout way. The rhythm section has a few albums as a trio (The Marcin Waslez-somethingPolish-ski Trio) that I found on Pandora and really like. Then I learned that their main gig is this quartet led by trumpeter Tomasz Stanko. The quartet may be even better. Listen to what the piano is doing during the trumpet solos.
- Erik Friedlander, Quake. He plays cello. Lots of other people play lots of other instruments. Sometimes all at once. The music ranges from controlled chaos to the beautifully melodic.
- Rolf Lislevand, Toccata. Nuove Musiche with a modern sensibility. Beautiful.
- Moraz & Bruford, Living Space. Piano and drums, that’s it. But the pianist thinks he is playing the drums and the drummer thinks he is playing the piano.
All week this will be my music to read job-market files to. Join me.
Ahh, Evans Hall… (this is old yes, but still funny.)
I am very, very interested in studying one particular one: 18,000 bottles from the cellar of La Tour d’Argent are being auctioned off. It’s their first auction since the restaurant started in 1582. They are going through some tough times but:
Adversity is nothing new to La Tour d’Argent, which was pillaged in 1789 during the French Revolution. In the late 1980s, the wine cellar was flooded by the Seine River. And it was plundered in World War II, when the Nazis occupied the city.
The top wine is
a bottle of Corton, a red Burgundy, vintage 1895, its label blurred with mold and its price estimated at 1,000 ($1,488) to 1,200 euros ($1,786) .
The whole list is here. No “star” wines are being sold buy maybe that means there are bargains. It’s better to focus on wines that under the radar. If you still get excited and overbid, at least you can drink away your sorrow.
Tongue-in-cheek relationship advice from evolutionary psychology (via Mindhacks.)
Some Darwinists might say your optimal strategy would be to pair-bond with the older male but surreptitiously allow the younger, sexy male to fertilise you. But be careful, most men consider being cuckolded the greatest of betrayals.
And how about this?
You should have your husband medically assessed. It may be that some form of genetic disorder underlies his erratic behaviour, in which case he will need counselling and support. But you will also need to inform your daughters so that, if they are carriers, they do not themselves mate with men suffering from the same condition.
My 3rd-grade daughter had some interesting social science homework this week. Classify each of the following statements as either a fact or an opinion. (The first two are easy warm-ups.)
- As footwear, moccasins are better than sneakers.
- There are Iroquois living in New York State today.
- Many Native Americans were expert craftsmen.
- The Native American diet was more nutritious than our own.
- Europeans had no right to settle in North America.
- Native Americans should be treated with great respect.
The answers are after the jump. This is a public school. Still, be careful with your expectations about political correctness (and reverse political correctness.)
A simple implication of sexual selection is that there should be a correlation between features that attract us sexually and characteristics that make our offspring more fit. Here is an article that studies the link between physical attraction and success in sport.
The better an American football player, the more attractive he is, concludes a team led by Justin Park at the University of Bristol, UK. Park’s team had women rate the attractiveness of National Football League (NFL) quarterbacks: all were elite players, but the best were rated as more desirable.
Meanwhile, a survey of more than a thousand New Scientist Twitter followers reveals a similar trend for professional men’s tennis players.
Neither Park nor New Scientist argue that good looks promote good play. Rather, the same genetic variations could influence both traits.
“Athletic prowess may be a sexually selected trait that signals genetic quality,” Park says. So the same genetic factors that contribute to a handsome mug may also offer a slight competitive advantage to professional athletes.
Studies like this are prone to endogeneity problems because success also feeds back on physical attraction. At the extreme, we know who Roger Federer is and that gets in the way of judging his attractiveness directly. More subtly, if you show me pictures of two anonymous athletes, the one who is more successful has probably also trained better, eaten better, been raised differently and these are all endogenous characteristics that affect attractiveness directly. Knowing that they correlate with success doesn’t tell us whether “success genes” have physically attractive manifestations.
One way to improve the study would be to look at adopted children. Show subjects pictures of the athletes’ biological parents and ask the subjects to rate the attractiveness of the parents. Then correlate the responses with the performance of the children. If these children were raised by randomly selected parents (obviously that is not exactly the case) then we would be picking up the effect of exogenous sources of physical attractiveness passed on only through the genes of the parents.
And why stop with success in sport. Physical attractiveness should be correlated with intelligence, social mobility, etc.
Why is blackmail illegal? Sure it’s mean and all but what makes it a crime? This article raises some questions about the legal scholarship behind blackmail. (The background is the Letterman case.)
Whether or not this is how Hollywood really works, Shargel does have a point of logic. The reasoning that makes blackmail illegal–and a great many other similar business activities not illegal — is something that’s never been satisfactorily explained by legal scholars. It remains a paradox of the law. That said, Halderman and Shargel shouldn’t hold their breath until January, when a judge will rule on their motion to dismiss. Even if it makes no sense, blackmail remains a serious crime.
What about the economics of blackmail? There is one obvious economic rationale for making blackmail a crime: rent-seeking. Seeking out and producing incriminating evidence for the express purpose of ultimately keeping it secret is a waste of labor resources and should be discouraged. And this idea explains an otherwise puzzling asymmetry. That is, presumably I can legally accept payment in return for publicizing good information about you. That is tantamount to threatening not to publicize it if you don’t pay me. Whether I threaten withold good information about you or actively publicize bad information about you I am arguably doing the same thing: threatening to lower your reputation relative to what it would otherwise be.
The economic difference is that allowing blackmail leads to unproductive rent-seeking whereas allowing me to charge you for good publicity incentivizes productive information-gathering.
In rare cases blackmail is efficient. If I want you to dig up the dirt on me (perhaps to keep it out of more dangerous hands) we have an incentive problem. I can’t pay you up front because then you have no incentive to do the search. You will come back claiming that my record is so clean that despite all your efforts you came up empty-handed. Instead I would like to pay you ex post in return for the documents. But once you’ve already sunk the cost of searching, I will hold you up and try to renegotiate the fee. The information is not worth anything to you since blackmail is illegal. We would both prefer to allow you to blackmail me ex post. That way I am effectively commited to pay you for your service and you will work hard.
You can trust me to pay you for the information but now the problem is that I can’t trust you. You will show me only half of what you found and blackmail me to keep that a secret. Once you have your money you will show me the other half and blackmail me again. Forseeing this I won’t pay you the first time.
Once you think of this its hard to see how blackmail works at all and why we need to even make it illegal. The blackmailer has to somehow prove that he is not hiding any additional information. That is probably impossible because any incriminating evidence can be copied.
Maybe the problem can be solved with a reciprocal arrangement. You dig up some dirt on me and yourself. Then you offer me the following deal. I pay you the hush money and you hand over the information about you. I will pay you because in return I get a threat against you which deters you from blackmailing me again.
In 2006, the pharma company Cephalon faced entry by generic drug producers. It’s blockbuster drug Provigil was coming to the end of its patent protection. The solution – buy off the competitors for an extra six year window:
Cephalon negotiated separate deals with four generic drug makers — Teva Pharmaceuticals, Ranbaxy Laboratories, Mylan Pharmaceuticals and Barr Laboratories — seeking to develop generic versions of Provigil.
Under those settlement agreements, Cephalon granted the generic drug makers non-exclusive, royalty-bearing rights to market and sell a generic version of Provigil starting in October 2011, or April 2012 if Cephalon obtains a pediatric extension for the drug. Cephalon maintains it has valid patents for Provigil until that time frame.
In documents filed with the Securities and Exchange Commission, Cephalon disclosed it received licenses to certain modafinil-related intellectual property developed by the generic-drug companies. In exchange for the licenses, Cephalon agreed to make payments to Barr, Ranbaxy and Teva “collectively totaling up to $136.00 million over the next several years.”
And this is legal apparently.
(Hat tip: Zachary Roth at Talking Points Memo)
From an entertaining article in the Financial Times that develops the analogy between the interconnectedness of financial instruments and biological ecosystems.
“From an individual firm’s perspective, these strategies looked like sensible attempts to purge risk through diversification: more eggs are being placed in the basket,” says Mr Haldane. “Viewed across the system as a whole, however, it is clear now that these strategies generated the opposite result: the greater the number of eggs, the greater the fragility of the basket – and the greater the probability of bad eggs.”
That is what a mathematical ecologist would have predicted if he or she had known what was going on in the world of finance. The tropical rainforest, for example, has so many interdependent species that it is more vulnerable to an external shock than the simpler ecological diversity of savannahs and grasslands.
I wonder what prescription naturally arises from this perspective? Total laissez-faire so that the financial system can suffer enough crashes, extinctions, and re-organizations to find a configuration that is stable for the long run? Would we someday see Business schools sending missions out to shuttering financial institutions clamoring for intervention in the name of preserving derivative-diversity. What is the analog of sexual reproduction and random genetic mixing?
Straight from the horse’s mouth….well, Dubner and Levitt’s, as interviewed by Jorn-Steffen Pischke of LSE.
You have to scroll down to Nov 9, 2009 to find the video. Lots of other interesting videos there…..Sen, Krugman, Bueno de Mesquita.
This article from New Scientist asks whether sleep walkers can be held morally responsible for acts committed while unconscious. A different question is what effect a sleepwalker exception would have on crime. Would it encourage sleepwalkers to commit more crimes, or on the extensive margin would it encourage more to people to take up sleepwalking?
I have no personal experience, but if sleepwalkers believe they are awake, then they would not be motivated by an exemption for sleepwalkers. Of course at any moment in time all of us may be sleepwalking and assuming we all account for that small probability, a sleepwalker exemption would encourage more crime across the board. This could be easily compensated by a small, uniform increase in penalties.
We shold worry that non-sleepwalkers will make use of the additional defense at trial (the “jammie defense?”)
Nightcap Nod: Mindhacks.
For the operative who is confused about polite, Talibany behavior, the senior leadership has been kind enough to offer a code of conduct. It is written in a spartan and logical fashion, point by point, a bit like the work of Ludwig Wittgenstein.
Number 15 is their policy on torture:
If some one admits that he is spy because you forced or tortured him, that does not make this person a spy and you can’t punish him. lt is prohibited for a Mujahid to promise to someone that if he admits then he will not be killed, he will be let go, or will not be tortured. There are two kinds of promises: the first is forcing, like you are telling him if you admit then we will let you go or we are not going torture you or put you in jail. lf you use force to cause admission, this is not legitimate. Second, you do not use force but you tell him that if you admit we will give you money or a high ranking position. This method also is not legitimate.
They recognize the possibility of false confessions using stick-based incentives like torture. Interestingly, the humble Mujahid is not even allowed to use carrot-based incentives. There is a problem of generating false confessions from an informant who just wants to get a reward.
The Taliban also know a little elementary implementation theory. One method to determine if someone is a spy is if (point 14): “There are two witnesses
that testify such person is a spy” (my emphasis). We can improve incentives to tell the truth if we can cross-check what one person reports against what another reports. If only one person says someone is a spy, there is the possibility the informant is lying for some reason – personal animosity, theft of the purported spy’s possessions once he is killed or incarcerated etc. But if we require two informants to say the person in question is a spy, if the two contradict each other, the senior Taliban can at the very least investigate further. The simplest way to encourage truthtelling is to punish both informants if they contradict each other. The document does not elaborate on this and relies on ambiguity of outcome (fear of repercussions?) to suffice to give incentives. The contract is incomplete in other words….another issue that is a concern of mechanism design and contract theory.
I didn’t see any repeated games insights though. Maybe in the next version.
I am going to write an insurance contract with you. We agree that if an accident happens I will cover you unless you a type prone to accident or you don’t try hard enough to avoid an accident.
There are two ways we can implement these conditionals. We could investigate whether they hold at the time we sign the contract or we could wait until an accident happens. Since an accident is unlikely to happen, the second method often avoids unnecessary costs of investigation and makes it cheaper to enforce the contract. That means I can offer you a lower premium.
All of this assumes that the conditions that would nullify the contract are
- completely described either in the contract or in law,
- fully understood by the insured, and
- within the information set of the insured
Arguments against rescision can be based on any one of these three being violated. Certainly #1 is violated in practice if insurance companies are free to present any evidence suggestive of, for example, pre-existing conditions. Violations of #2 plagues all economic analysis of contracts, no doubt it is a problem here as well. And an argument against recision could be based on #3, even if we assume that contracts are complete and voluntary.
Indeed I believe that #3 is the basis for a response to the obvious “If allowing for recision is against the interests of the insured, why don’t insurers compete by offering no-rescision contracts.” These would have higher premiums for the reasons given above. Insurees would tend to reject these in favor of lower-premium rescision-permitting contracts when they are not aware of buried, jargon-laden, medical records that would nullify their coverage. In fact, the asymmetric access to this information superimposes an artificial asymmetric information problem on an insurance market that is already plagued by adverse selection.
Here’s a research problem: what does a competitive equilibrium look like in an insurance market where both types of contract can be offered? Assume that the insurer has superior information about documentation of pre-existing conditions, and conditions contract terms on its private information.
Is it an infinite number of monkeys, or is it infinitely-lived monkeys? If what you want is Shakespeare with probability 1 it matters. Because Hamlet is a fixed finite string of characters. That means the monkey has to stop typing when the string is complete. If we model the monkey as a process which every second taps a random key from the keyboard according to a fixed probability distribution, then to produce the Dithering Dane he must eventually repeat the space bar (or equivalently no key at all) until his terminal date.
If that terminal date is infinity, i.e. the monkey is given infinite time, then this event has probability zero. On the other hand, an infinite number of monkeys who each live long enough, but not infinitely long, will Exuent with probability 1 as desired.
(If your criterion is simply that the text of Hamlet appear somewhere in the output string, then a) you are sorely lacking in ambition and b) it no longer matters which version of infinity you have.)
Mortarboard Missive: Marginal Revolution.
From an excellent blog, Neuroskeptic, here is a survey of some data on mental illness incidence and suicide rates across countries. The correlation is surprisingly low:
So what’s the story? Take a look –
In short, there’s no correlation. The Pearson correlation (unweighted) r = 0.102, which is extremely low. As you can see, both mental illness and suicide rates vary greatly around the world, but there’s no relationship. Japan has the second highest suicide rate, but one of the lowest rates of mental illnesses. The USA has the highest rate of mental illness, but a fairly low suicide rate. Brazil has the second highest level of mental illness but the second lowest occurrence of suicide.
Perhaps I am reacting too much to the examples in the excerpt, but one possible explanation comes from noting that there is a difference between incidence of mental illness and detection. In countries where mental illness is readily diagnosed you will see more reports of it and also (assuming it does any good) less suicide. The US must be the prime example. And as I understand it, mental illness is highly stigmatized in Japan so the effect there is exactly what the data would suggest. I don’t know about Brazil.
A basic tenet of micro theory: a firm should shut down if the price for its output is so low that it cannot even cover variable costs. Alligator skins are fetching “prices far lower than in the past and lower even than the price of raising an alligator.” Budding alligators farmers should turn their firms into zoos not Jimmy Choos.
At least inputs into alligator bags, shoes and watch straps are very cheap and competition between producers should make Choos and Blahniks cheaper, offering one possible resolution to the annual Xmas shopping conundrum for many confused men. Typically but not in this case:
“Every time I go to Neiman Marcus and say every year the price is going up, they fight me tooth and nail,” said George D. Malkemus III, the president of Manolo Blahnik. “They say, ‘I’m not going to spend $4,000 for an alligator shoe.’ ”
One popular theory: Hermes is fast becoming the dominant player in the supply chain from Florida to Paris. The firm has scarfed up many tanneries and has the market power to set the price to farmers low and the price to Blahniks high. The middleman reaps the rents.
I don’t think they are any men’s Choos and anyway I’m quite happy in my Merrell’s. But the Xmas shopping issue awaits….
“You’re a cad if you break up around Christmas. And then there’s New Year’s — and you can’t dump somebody right around New Year’s. After that, if you don’t jump on it, is Valentine’s Day,” Savage says. “God forbid if their birthday should fall somewhere between November and February — then you’re really stuck.
“Thanksgiving is really when you have to pull the trigger if you’re not willing to tough it out through February.”
That’s from a story I heard on NPR about turkey dropping: the spike in break-ups at Thanksgiving followed by a steady period (for the surviving pairs) through the Winter months. If there is a social stigma against cutting it off between Thanksgiving and Valentine’s Day, then there may be value in that. Often social rules emerge arbitrarily but persist only if they serve a purpose, even if that purpose is unrelated to the spirit of the social norm. The post-turkey taboo plays the role of a temporary commitment that can strengthen those relationships that are still worth maintaining.
The value of a relationship fluctuates over time. Not just the total value of the partnership relative to autarky but also the value to the individual of remaining committed. The strength of a relationship is precisely measured by the maximum temptation each partner is willing to forego to keep it alive. The moment a jucier temptation appears, the relationship is doomed.
Unless there is commitment. Commitment is a way of pooling incentive constraints. A relationship becomes stronger if each partner can somehow commit in advance to resist all temptations that will arise over the length of the commitment. This transforms your obligation. Now the strength of the relationship is equal to the expected temptation rather than the most severe temptation actually realized. A social stigma against ending the relationship over certain intervals of time aids such a commitment.
Its good that commitments are temporary, but you want their beginning and end dates to be arbitrary, or at least independent of the arrival process of temptations. The total value of the relationship also fluctuates and you want the freedom to end the relationship when it begins to lag the value of being single. This is especially true in the early stages when there is still a lot to learn about the match. Over time when the value of the relationship has clarified, the length of commitment intervals should increase.
Commitments can also solve an unraveling problem. If you know that your partner will succumb to a juciy temptation and you know that its just a matter of time before a juicy temptation arrives, you become willing to give over to a just-a-little-juicy temptation. Knowing this, she is poised to give it up for just about anything. The commitment short-circuits this at the first step.
Mind Your Decisions looks at the game theory of the classic Thanksgiving showdown between Lucy and Charlie Brown.
Time after time, Lucy would bring her football to the park and entice Charlie Brown to practice some place kicks. Lucy would hold the ball, Charlie Brown would run full-steam to kick it only to have Lucy snatch the ball away at the last minute sending Charlie Brown flying, yelling ARRRRGGGHHH and landing in a heap. What a blockhead. Sure you can understand his willingness to trust her the first time, maybe even the first two times, but after that it’s pretty clear what Lucy’s objective is.
You may try to make excuses for Charlie Brown by arguing that subgame-perfection requires a great deal of strategic sophistication. But you don’t need to invoke any refinements here. The unique Nash equilibrium action for Charlie Brown is to say no. Even worse, not yanking the ball is a weakly dominated strategy for Lucy and after that strategy is eliminated, Charlie Brown has a strongly dominant strategy to walk away.
So it is not surprising that in It’s The Great Pumpkin Charlie Brown, he has finally figured this out and flatly refuses to play Lucy’s game. That’s when she goes contract theory on him.
Now we are reaching higher-order blockheadness. First of all, whether or not the contract is valid, its terms are not verifiable to a court. And Charlie Brown should be able to figure out there is something fishy about this contract. Lucy would only offer a contract if she preferred the outcome (run, don’t yank) to the outcome (walk away). But even though Lucy has never directly revealed any preference between these two outcomes, there is pretty good evidence that the worst possible outcome for Lucy would be to see Charlie Brown successfully kick.
Indeed, Lucy knew from the beginning that Charlie Brown would eventually figure out her intention to yank the ball. After that, she knows Charlie Brown will refuse to play. So if Lucy really preferred (run, don’t yank) to (walk away) then she would prevent this evaporation of trust by allowing Charlie Brown to kick the ball at least a few times, but she never did.
The only way to rationalize Lucy’s steadfast insistence on sending him flying is to assume either that (run, don’t yank) is her least-preferred outcome, or that she thinks that Charlie Brown is indeed a blockhead and unable to deduce her intentions. In either case, Charlie Brown should have viewed Lucy’s contract with deep suspicion.
1. Leaked documents reporting British commanders’ “special relationship” with US commanders and much more. The summary of the documents is here.
2. Social networking 1950s style.
3. NYT Guide to mid-level Chicago restaurants (Big Star Taqueria, Xoco, and Great Lake menus)
Happy Thanksgiving.
Jackson, NH
Here’s my measure of creativity. Try it before reading on. Time yourself. Let’s say 30 seconds. You are going to think of 5 words. Your goal is to come up with 5 words that are as unrelated to one another as possible. Go.
Via Jonah Lehrer, I found this article that would give some backstory to my test. I will paraphrase, but it’s worth reading the article. First of all, our memory is understood to work by passive association (as opposed to conscious recollection.) You have a thought or an experience, and memory conjures up a bunch of potentially relevant stuff. Then, subconsciously, a filter is applied which sorts through these passive recollections and finds the ones that are most relevant and allows only these to bubble up into conscious processing.
Now, there are patients with damage to areas of their brain that effectively shuts off this filter. When you ask these patients a question, they will respond with information that is no more likely to be true as it is to be completely fabricated from related memories, or even previously imagined scenarios. These people are called confabulators.
The article discusses how especially creative people with perfectly healthy brains achieve their heights of creativity by reducing activity in that area of the brain associated with the filter. The suggestion is that creativity is the result of allowing into consciousness those ideas that less creative people would inhibit on the grounds of irrelevance. And this makes sense when you realize that thought does not “create” anything that wasn’t already buried in there somewhere. Observationally, what distinguishes a creative person from the rest of us is that the creative person says and does the unexpected, “outside the box,” “out of left-field” etc.
It reinforces the view that creative work doesn’t come from active “research.” At best you can facilitate its arrival.
Apparently, financial firms seem to believe that this is the case:
An increasing number of hedge funds and brokerages are scrutinizing professional poker to find talent and analytical tools, according to financial recruiters including Options Group, a New York-based executive-search company. Susquehanna International Group LLP, the Bala Cynwyd, Pennsylvania-based options and equity trading company, uses poker to teach strategic thinking.
“Someone who has made a successful living as a poker player for a few years would more likely be a good trader than someone who hasn’t,” said Aaron Brown, a 53-year-old former poker pro who is now a risk manager at AQR Capital Management LLC in Greenwich, Connecticut, which oversees $23 billion. “They know to push when they have the edge and they know how not to bust, and that’s a tough combination to find.”
Catch me on the public radio program Marketplace this evening. I will be talking about pinball.
I sat here in Northwestern’s high-tech studio and talked into that thing to Kai Ryssdal.
- More than modern equipment, what the studio needs is a few candles and some incense. Also someone to look at me and pretend that everything I am saying is really interesting. A person instantly gains about 10 IQ points whenever he believes somebody is into what they are talking about.
- I don’t think I did a very good job but that’s ok. Things like this tend to feel like impending doom to me. I congratulated myself that for the first time in my life I would try to be detached and take note of what impending doom feels like.
- Like standing in front of a big class for the first time, or the first job-market seminar, or a first date the overwhelming feeling is that it’s bizarre that anyone would actually care what I am talking about. My advice when you feel that way is to embrace it as an absurd commentary on life and use that thought to help yourself smile your way through it.
Cute video from Tim Harford on the information economics of office politics.
(My theory is that in fact the managers will get stuck with cleaning coffee pots. The wage-earners are already held to reservation utility while the managers are likely earning rents. And, as illustrated in the video’s epilogue, there is no fully separating equilibrium in the “threaten to resign” game.)
I just attended an interesting NBER conference on organizational economics. I discussed a very nice paper by Giacomo Calzolari of the University of Bologna, Italy’s best public university. Bologna is in Emilia Romagna which has given the world Parma ham, Parmesan cheese, mortadella, prosciutto and, of course, tortellini. Food generates much happiness for consumers and high income for producers. It even greases the wheels of the finance:
The vaults of the regional bank Credito Emiliano hold a pungent gold prized by gourmands around the world — 17,000 tons of parmesan cheese. The bank accepts parmesan as collateral for loans, helping it to keep financing cheese makers in northern Italy even during the worst recession since World War II. Credito Emiliano’s two climate-controlled warehouses hold about 440,000 wheels worth €132 million, or $187.5 million.
Alas, like gold, Parmesan attracts thieves:
Thieves tunneled into one warehouse in February and made off with 570 pieces before they were apprehended by the police. “Thank heavens we caught the robbers before they grated it,” said William Bizzarri, who manages the warehouses.
Little wonder then that food is a local obsession. Giacomo told me that he himself organized a tortellini tasting competition. He and his friends purchased tortellini from around thirty shops that sell handmade pasta in Bologna. Just imagine living in a city where there are that many places specializing in one artisanal culinary product!
As all economists would know, to truly study which store makes the best products, you have to control all other variables apart from the store-induced variation. As far as I understood from Giacomo, they did this by buying the same kind of classic tortellini from all the stores. The story is that a chef from Bologna peeked through a keyhole to see the naked Venus but all he could glimpse was her navel. His view is immortalized in the shape of the tortellini. There is only one way to improve on Venus – by adding a lot of components of the noble pig: the filling is pork loin, mortadella, parma ham and of course parmesan cheese in just the right proportions. The recipe is registered by the Chamber of Commerce in Bologna. (Even a baconatarian (i.e vegetarian except for cured pork products) might be put off by the meatiness but I’m willing to give it a shot.) To control for any bias of the people sampling the tortellini, Giacomo had a blind tasting.
The winner: Boutique de Tortellini.
They did not publish the results but word-of-mouth alone helped to increase sales at the Boutique.
Of course, there are many great food regions in Italy. Giacomo himself actually prefers Sicilian cuisine because of its great variety and incorporation of ingredients from all across the Mediterranean.
Mayonnaise by hand is pretty easy and a big improvement over stuff in a jar. A great workout too. Recipes usually seem too cautious, guarding against disaster when the emulsion doesn’t work. Mine always came together without a hitch until recently I have had two occasions when it “broke” as they say. (I guess I was getting a little lax.)
In a recipe book called Vegetarian Cooking for Everyone by (whatshername who was the Chef at Greens in San Francisco) there is given a method to bring a failed mayonnaise back from the dead. Tonight (making Tuna Burgers with Harissa Mayonnaise out of Fish Without a Doubt [great book!] was the occasion of my second failure and, remembering the tip, I gave it a try.
Pour 1-2 tablespoons of boiling water into the goopy mess (it really looks ugly when it goes wrong) and whisk. Viola, mayonnaise reborn. Simple as that.
Kids love harissa mayonnaise.
- The right time to shoplift.
- Fact: there was a Mr. Ely on the Mayflower. Fiction: everything written here.
You are playing in you local club golf tournament, getting ready to tee off and there is last-minute addition to the field… Tiger Woods. Will you play better or worse?
The theory of tournaments is an application of game theory used to study how workers respond when you make them compete with one another. Professional sports are ideal natural laboratories where tournament theory can be tested. An intuitive idea is that if two contestants are unequal in ability but the tournament treats them equally, then both contestants should perform poorly (relative to the case when each is competing with a similarly-abled opponent.) The stronger player is very likely to win so the weaker player conserves his effort which in turn enables the stronger player to conserve his effort and still win.
There is a paper by Kellogg professor Jennifer Brown that examines this effect in professional golf tournaments. She compares how the average competitor performs when Tiger Woods is in the tournament relative to when he is not. Controlling for a variety of factors, Tiger Woods’ presence increases (i.e. worsens, remember this is golf) the score of the average golfer, even in the first round of the tournament.
There are actually two reasons why this should be true. First is the direct incentive effect mentioned above. The other is that lesser golfers should take more risks when they are facing tougher competition. Surprisingly, this is not evident in the data. (I take this to be bad news for the theory, but the paper doesn’t draw this conclusion.)
Also, since golf is a competition among many players and there are prizes for second, third etc., the theory does not necessarily imply a Tiger Woods effect. For example, consider the second-best player. For her, what matters is the drop-off in rewards as a player falls from first to second relative to second to third. If the latter is the steeper fall, then Tiger Woods’ presence makes her work harder. Since the paper looks at the average player, then what should matter is something like concavity vs. convexity of the prize schedule.
Also, remember the hypothesis is that both players phone it in. Unfortunately we don’t have a good control for this because we can’t make Tiger Woods play against himself. Perhaps the implied empirical hypothesis says something about the relative variance in the level of play. When Tiger Woods is having a bad season, competition is tighter and that makes him work harder, blunting the effect of the downturn. When he is having a good season, he slacks off again blunting the effect of the boom. By contrast, for the weaker player the incentive effects make his effort pro-cyclical, amplifying temporal variations in ability.
Jonah Lehrer (to whom my fedora is flipped) prefers a psychological explanation.
Cheap Talk 