In trying to avoid financial crises, as in wars, generals tend to prepare for the last war. In Greg Ip’s retrospective "A Decade After Bear’s Collapse, the Seeds of Instability Are Germinating Again," Greg amplifies a 2014 warning by Hyun Song Shin to that effect by pointing out the wide variety of ultimately falsified ideas that have driven financial excesses and their ensuing crises: Crises surprise because they usually start with an assumption so sensible that everyone acts on it, planting the seeds of its own undoing: in 1982 that countries like Mexico don’t default; in 1997 that Asia’s fixed exchange rates wouldn’t break; in 2007 thatRead More »
Articles by Miles Kimball
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Carola Binder—Why You Should Get More Vitamin D: The Recommended Daily Allowance for Vitamin D Was Underestimated Due to Statistical Illiteracy4 days ago
Carola Binder, like me, is blogging about diet and health. In her post "D is for Devastating: A Statistical Error and the Vitamin D Saga" she discusses the important news that the recommended daily allowance for Vitamin D should be more than ten times as big as it is. The recommendation of researchers who know what they are doing is 7000 IU. For me, that means this: In addition my regular multivitamin, each day I need to take three of the tiny 2000 IU Vitamin D3 gel capsules I get from Costco. In general, it is better to get vitamins from natural sources when possible. But the most important natural source of vitamin D is sunshine. ShortRead More »
Even after a sharp correction earlier this year, the price of Bitcoin and other cryptocurrencies has remained unsustainably high, and techno-libertarians have continued to insist that blockchain technologies will revolutionize the way business is done. In fact, blockchain might just be the most over-hyped technology of all time.
NEW YORK – Predictions that Bitcoin and other cryptocurrencies will fail typically elicit a broader defense of the underlying blockchain technology. Yes, the argument goes, over half of all “initial coin offerings” to date have already failed, and most of the 1,500-plus cryptocurrencies also will fail, but “blockchain” will nonetheless revolutionize finance and human interactions generally.
The Year Ahead 2018Read More »
How does the military prepare for future unknown threats?Photo illustration by Natalie Matthews-Ramo. Photos by Thinkstock and Geoffroy Van Der Hasselt/AFP/Getty Images and Mass Communication Specialist 2nd Class Ridge Leoni/U.S. Navy via Getty Images.
Everyone knows the foreign threats our government deems urgent: cyberwar, a criminal North Korean regime, an aggressive Russia leader. (OK, not everyone in our government … ) But how does the military prepare for the threats which will eventually arise, but are not yet known? Peter W. Singer is a strategist and senior fellow at New America, and an expert on military technology and planning. And he spends his time studying what threats America is likely to face, and how the armed forces should prepareRead More »
Hat tip to Shawn Ruest for flagging this article. My inaugural lecture here at the University of Colorado Boulder, "Restoring American Growth," meditates on the issues raised by this graph.Read More »
We need Marvin Goodfriend on the Federal Reserve Board to help insure that we don’t suffer another Great Recession. I urge the Senate to confirm Marvin Goodfriend. Of anyone who has ever been nominated for the Federal Reserve Board or served as President of one of the regional Federal Reserve Banks, Marvin Goodfriend has the deepest understanding of negative interest rate policy and is the strongest advocate of negative interest rate policy.On how negative interest rates can stop a rerun of the Great Recession, seeRand Paul has misguided views on monetary policy, but he understands that the real issue in whether to confirm Marvin GoodfriendRead More »
AdvertisementDuring a speech in Iowa last week, in the middle of his red-meat calls for a border wall and tougher immigration enforcement, President Trump called for something decidedly less sanguinary: “a total rewrite of our immigration system into a merit-based system.”This is one of the few consistent positions the president has held while in office; he called for a similar reform in his State of the Union address, months before. The real surprise, though, is his source of inspiration: Canada.If it seems weird that Mr. Trump would propose Canada as a model for anything, that’s understandable. Americans, especially conservatives, love to mock their northern neighbor: for its accent, its apologetic manners, its food (oh, poutine) — and above all, for its supposedly softheaded, pinkoRead More »
The trouble with observational studies of diet and health that don’t include any intervention is the large number of omitted variables that are likely to be correlated with the variables that are directly studied. Still, it is worth knowing for which things one can say:Either this is bad, or there is something else correlated with it that is bad. When multivariate regression is used, one might be able to strengthen this toEither this is bad, or there is something else bad correlated with it that is not completely predictable from the other variables in the regression.This statistical point is directly relevant to the results of the Nurses’Read More »
I mentioned an upcoming Lael Brainard speech a week ago. She’s the Federal Reserve Governor to watch because when she gets onboard policy, it shows consensus. And this week she gave that speech, whose very title suggests a regime shift in US monetary policy. The full “Speech by Governor Brainard on navigating monetary policy as headwinds shift to tailwinds ” is on the Fed’s website. But I am going to give you a play by play here and tell you what it means for policy. The short answer is it means the Fed will be more aggressive in tightening going forward. The analysis follows below.
The Headwinds Policy Regime of Janet Yellen
Let’s put post-crisis monetary policy in the US into five distinct phases. Each of these represent monetary policy regime shifts, like the one we are now seeing.
In the course of arguing against parental power as a justification for monarchy, John Locke gives a powerful statement of how law serves freedom in section 57 of his 2d Treatise on Government: “Of Civil Government” (Chapter VI. Of Paternal Power).First, John Locke argues that natural law is rational:The law, that was to govern Adam, was the same that was to govern all his posterity, the law of reason. But his offspring having another way of entrance into the world, different from him, by a natural birth, that produced them ignorant andRead More »
For a growing number of people, data analysis is a central part of their job. Increased data availability, more powerful computing, and an emphasis on analytics-driven decision in business has made it a heyday for data science. According to a report from IBM, in 2015 there were 2.35 million openings for data analytics jobs in the US. It estimates that number will rise to 2.72 million by 2020.
A significant share of people who crunch numbers for a living use Microsoft Excel or other spreadsheet programs like Google Sheets. Others use proprietary statistical software like SAS, Stata, or SPSS that they often first learned in school.
While Excel and SAS are powerful tools, they have serious limitations. Excel cannot handle datasets above a certain size, and does not easily allow for
Michael Mahoney: Publication Prejudices: An Experimental Study of Confirmatory Bias in the Peer Review System15 days ago
Publication Prejudices: An Experimental Study of Confirmatory Bias in the Peer Review System
Publication Prejudices: An Experimental Study of Confirmatory Bias in the Peer Review System
Michael J. Mahoney
Cognitive Therapy and Research, Vol. 1, No. 2, 1977, PP. 161-1 75
Confirmatory bias is the tendency to emphasize and believe experiences that support one’s views and to ignore or discredit those that do not. The effects of this tendency have been repeatedly documented in clinical research. However, its ramifications for the behavior of scientists have yet to be adequately explored. For example, although publication is a critical element in determining the contribution and impact of scientific findings, little research attention has been devoted to the variables operative in
Link to the article above
As I wrote in "QE or Not QE: Even Economists Need Lessons in Quantitative Easing, Bernanke Style," Martin Feldstein is a very important, influential and intelligent economist. So it is disappointing that he has no new ideas to offer in order to rein in the trajectory of the US national debt in his latest Wall Street Journal op-ed, "Reagan’s Cure for America’s Debt Disease."Martin Feldstein suggests that we can raise the retirement ages built into Social Security’s formula and increase premiums for Medicare for those with higher incomes.Read More »
Motivated System 2 Reasoning (MS2R): a Research Program
1. MS2R in general. “Motivated System 2 Reasoning” (MS2R) refers to the affinity between cultural cognition and conscious, effortful information processing.
In psychology, “dual process” theories distinguish betweeen two styles of reasoning. The first, often denoted as “System 1,” is rapid, intuitive, and emotion pervaded. The other—typically denoted as “System 2”—is deliberate, conscious, and analytical.
The core of an exceedingly successful research program, this conception of dual process reasoning has been shown to explain the prevelance of myriad reasoning biases. From hindsight bias to confirmation bias; from the gamblers fallacy to the sunk-cost fallacy; from probability neglect to
Link to the article above. Thanks to Andrew Baker for pointing me to this article on healthy lowfat diets versus healthy lowcarb diets.
IntroductionWhen I am at a restaurant, I often tell the waiter that I am eating lowcarb as a convenient way of explaining what I am going for. But that is not really true. What I am doing is following a low-insulin-index diet as a complement to the weight-loss power of time-restricted eating. I introduce these two key ideas in myRead More »
Erik Olsen: An Arcane American Law Makes Shipping Goods by Sea Among American Ports Prohibitively Expensive, with Terrible Consequences19 days ago
For many Americans, the experience of driving on a coastal highway like Interstate 5 in California can be a nightmare of dodging massive trucks hauling cargo between US cities. In Europe, not so much.
That’s because for decades, European nations have turned to the sea rather than the road to transport goods across the continent. In fact, over 40% of Europe’s domestic freight is shipped along so-called motorways of the sea. In the US, a measly 2% of domestic freight distributed among the lower forty-eight states travels by water, even though half the population lives near the coast.
One big reason why is an obscure law, enacted right after World War 1, called the Jones Act, which preserves a monopoly for US-built, owned and operated ships to transport goods between US ports. The
Davide Cantoni, Jeremiah Dittmar and Noam Yuchtman: How the Protestant Reformation Shifted Human and Physical Capital Accumulation Toward Secular Ends20 days ago
Louis Johnston flagged this very interesting NBER Working Paper in a tweet. Unfortunately, the paper itself is gated, but I think you will find the abstract fascinating. In case it is hard to read above, here it is:Using novel microdata, we document an unintended, first-order consequence of the Protestant Reformation: a massive reallocation of resources from religious to secular purposes. To understand this process, we propose a conceptual framework in which the introduction of religious competition shifts political markets where religious authorities provide legitimacy to rulers in exchange for control over resources. Consistent with ourRead More »
There’s enough advice on happiness floating around out there to make your head spin. Yet, this is understandable, as everyone is different. What makes one person happy might make another miserable.
In the face of so much contradictory, and often subjective, advice, what are you supposed to do if you want to live a happier life? Just forget about all that subjective advice and focus your energy and attention on science-proven facts.
“Happiness is not something ready made. It comes from your own actions.” – Dalai Lama
UCLA neuroscience researcher Alex Korb has spent a great deal of time studying the effects of different happiness strategies on the brain. His findings have a lot to teach us about what actually works when it comes to boosting happiness.
Korb’s researchRead More »
I was delighted see that the Economist noticed my paper with Susanto Basu and John Fernald: "Are Technology Improvements Contractionary?" This is the paper for which the first sentence in the abstract is simply "Yes." Even better, the Economist interpreted it correctly: the historical pattern of technology improvements being contractionary is an indictment of the historical monetary policy response to technology shocks. Standard optimal monetary policy theory suggests that monetary policy should come close to stabilizing the price level around a steady trend. The failure of monetary policy to do this in response to technology shocks can beRead More »
The story is all in the graph above. Note that because household spending is graphed, only direct payments for health insurance and out-of-pocket health care costs are counted.Read More »
Besides frozen cherries with half and half and homemade nutbars, one of my healthy treats is a few squares of intense dark chocolate each day that I am eating anything. (On the benefits of fasting, see my posts "Obesity Is Always and Everywhere an Insulin Phenomenon" and "Stop Counting Calories; It’s the Clock that Counts.") Although the sugar in most chocolate is a problem, I think of the cocoa in chocolate as being good for my health. In this, I am not alone. As Richard Shiffman writes in his interesting Valentine’s Day Wall Street Journal article "Is Chocolate a Healthy Choice for Valentine’s Day? That Depends on Which Kind":U.S. salesRead More »
Image courtesy of A&ETV Beyond Scared Straight. Learn more about the effectiveness of Scared Straight.Lots of government and charity programmes aim to improve education, health, unemployment and so on. How many of these efforts work? The vast majority of social programs and services have not yet been rigorously evaluated, and…of those that have been rigorously evaluated, most (perhaps 75% or more), including those backed by expert opinion and less-rigorous studies, turn out to produce small or no effects, and, in some cases negative effects.This estimate was made by David Anderson in 2008 on GiveWell’s blog. At that time, he was Assistant Director of the Coalition for Evidence-Based Policy.This has become a widely-quoted estimate, especially in the effective altruism community, and oftenRead More »
Because people are so obviously unequal in so many ways, it is tricky saying what one means by saying everyone is "equal before the law." Putting a high value on freedom makes that easier, because then "equality before the law" means that everyone gets to do whatever they want in as long as they respect other people’s right to do whatever they want. I discuss some of the complexities in this in "The Complexity of Liberty: How Equality Enters into a Good Definition of Liberty," but the basic idea has become intuitive in our society, whichRead More »
7/They’re not going to listen because ethnic divisions (a polite euphemism for "racism") have made Republicans care much less about repairing roads and bridges, funding science, providing quality education, helping the poor, and tons of other stuff that makes a nation work.Read More »
This is an interesting panel discussion. In addition to useful background explanation, the discussion had three specific bits I found revealing. Let me transcribe those parts. Then I will expand on what Michele Mazzocco says. Lindsey Jones: … there is a beautiful study by Aaron Maloney and Sian Beilock showing that when parents have math anxiety and they do homework with their children, then their children end up being even more math anxious and performing even worse in school. Lindsey Jones: But there are things we can do as well. So there is research showing that suggests that for example if you engage students in what is called "expressive writing" exercises, before they take, for example, a high-stakes math exam—they simply write down how they feel about the upcoming test, how theyRead More »
Boulder Creek (image source here)
In addition to the Economics Department here at the University of Colorado Boulder, where I am a professor, I have been hanging out at the Institute for Behavioral Genetics, which is on the other end of campus, a beautiful hike past the football stadium and then along the Boulder Creek Path. One of the impressive people I have met at the Institute for Behavior Genetics is David Brazel, currently a Predoctoral Trainee of the Institute for Behavioral Genetics and of Molecular Cellular and Developmental Biology.Read More »