Comparing the Census to alternative data or information: What is the right counterfactual?

You might think that on a post about counterfactuals, we’d have a picture of sliding doors together with two contrasting pictures of Gwyneth Paltrow. But you’d be wrong. We’re full of surprises here at Lateral Economics.

By Matt Balmford; Gene Tunny; and Nicholas Gruen

Our inaugural blog post for the Valuing the Census project provided an overview of our strategy for estimating the benefits of the Census to the Australian community.

From here, we’ll be blogging about various issues that we’re grappling with in making this assessment.

To assess the value of the Census, we need to assess the additional value it generates over alternatives in its absence.

These alternatives are counterfactual scenarios to assess the benefits of the Census against.

So, that value is of the extra precision or insight for a given use, compared with the next best alternatives.

(In later blog posts we’ll get into what Census-related data or information means, as well as what the impacts of this extra precision or insight might be.)

But what are the alternatives to the Census? Continue reading

Posted in Economics and public policy | 3 Comments

If your problem is darkness, it’s better to light one quarter of a candle than to light any more of a candle (apparently)

Here’s Phil Lowe reporting on the RBA’s failure to meet its performance targets and refusal to do anything about it:

This decision [to cut rates by 0.25%] was not in response to a deterioration in the economic outlook since the previous update was published in early May. Rather, it reflected a judgement that we could do better than the path we looked to be on.

If anyone can fill me in on what that means, I’d be grateful.

Monetary policy is one way of helping get us onto to a better path. The decision earlier this month will assist here. It will support the economy through its effect on the exchange rate, lowering the cost of finance and boosting disposable incomes. In turn, this will support employment growth and inflation consistent with the target.

It would, however, be unrealistic to expect that lowering interest rates by ¼ of a percentage point will materially shift the path we look to be on. The most recent data – including the GDP and labour market data – do not suggest we are making any inroads into the economy’s spare capacity.

Steady as she goes.  

Posted in Economics and public policy | 2 Comments

Blogging another inquiry: Valuing the Australian Census

Lateral Economics has been commissioned by the Australian Bureau of Statistics (ABS) to estimate the value of the Australian Census to the Australian community. As part of that exercise we’ve got the go-ahead from ABS to do something that, it seems to me, all public inquiries, and most independent public agencies, should do as a matter of course. Run a blog a little like the blog we ran when I chaired the Government 2.0 Taskforce.

Ten years on from the Taskforce, it’s amazing how slow the practice has been to catch on. It seems to me the kind of thing that the Productivity Commission should do, and the Reserve Bank. Anyway, as far as I know, there’s no such blog on offer there or anywhere else much. One exception is the Bank of England which runs a lively blog in which staff explore all manner of questions relating to their research. It greatly enhances both its work and their staff’s morale and willingness for some of the best to stay at the Bank rather than moving off into academia or consultant land.

Anyway, this exercise gives us an opportunity to trial it again. Accordingly we will post from time to time outlining the progress of our investigations, particularly highlighting issues we are trying to understand to improve the quality of our review.

Comment will be post-moderated with a back-up plan to provide pre-moderation in the unlikely event of commentary which is judged to lack bona fides in a disruptive way. We’ll be consulting ABS with draft blog posts before posting them to give the ABS an opportunity to provide input. We nevertheless remain responsible for the exercise, and for the content of each post, not the ABS.

Finally, if you do have anything to offer, please do so to show how productive this kind of exercise can be. I know myself how productive it is from my own experiences blogging myself not least as part of the Government 2.0 Taskforce, but as I’ve grown older it’s struck me how much adoption relies on, well, adoption. If no-one’s doing it, no one does it. Then a few people do it and the obviousness of doing it seems to become accessible to others, even as they keep their in-tray reasonably cleared.

Valuing the Australian Census

Gene Tunny, Nicholas Gruen, and Matt Balmford, Lateral Economics

The five-yearly Australian Census provides a wealth of data on Australian households. Those data are used extensively by all levels of governments, industry, and non-profits in decision making and planning. The Census provides important information on household composition, journey-to-work flows, Indigenous status, and languages spoken at home, among other data. It is also used extensively to ‘ground-truth’ and so assess and improve the representativeness of a wide variety of data sets. The ABS understands that all this information is of substantial value, but no careful estimate of its total value has yet been made. The ABS has engaged Lateral Economics to provide such an estimate. Continue reading

Posted in Economics and public policy, IT and Internet, Metablogging, Public and Private Goods, Web and Government 2.0 | 23 Comments

The Last Days of Nigel (the Darwin Shooter’s second victim)

Yesterday I was chatting online about Wednesday evening’s dreadful shooting massacre in Darwin (like many shocked people here). I posted a comment listing the various murder scenes, saying: “A fourth was murdered at 18 Gardens Hill Crescent (or Gardens Rd, not sure which).”

A fellow Darwin tweep (son of an old colleague) with whom I talk quite often, replied: “Crescent. His name was Nigel.” Actually we were talking about the second victim in time, a person so far only identified as a 75 year old man. M_ obviously knew something, so I sent him a Direct Message.

KP: Hi M_. I guess from your comment that you were close to Nigel. I’m so sorry. All this stuff is so close, it reminds you that Darwin really is still just a small town.

M_ : Cheers Ken. Wasn’t close but he is my neighbour. I was first on the scene and tried to perform first aid but it was a mess and he lost too much blood. Ambo didn’t arrive for an hour. Police were at a road block 100m down the road at the time but just stayed where they were. Ben drove straight past them after unloading at 2 apartments. Bit upset about that to be honest.* They even id’d the right ute to me after I ran down the road. Appreciate your story though. We also know the Hoffman’s but have to say I didn’t recognise him as I watched him exit. Bloody small town mate. Bloody being the operative word today.

Nigel was always whinging about the trees. He liked to cut down trees and had a win with the council over a tree last week. He was pretty happy about that. He was a good sort and I reckon he was shot through the door coz he liked to keep an eye on the comings and goings. His uneaten dinner was still on the kitchen counter in his flat.

*M_’s reaction here is more than understandable, but I don’t necessarily agree. Assuming the police staffing the Gardens Hill Crescent road block were just general duties uniformed officers, if they had set off solo in pursuit of the gunman they would almost certainly have caught up with him at the Buffs Club at the top of the hill only a minute or so later. Would they have captured the shooter alone and unaided?  It’s more likely that one or both of them would also have been slaughtered, just adding to the horrific death toll.

It’s essential that all relevant issues are explored, to ensure as far as possible that the best possible procedures are in place and followed in such events.  But we shouldn’t start with a presumption that it was anyone’s fault other than the Shooter himself.  There were four separate murder scenes and all four murders occurred within the space of only a few minutes. In the absence of NT Police acquiring extraordinary clairvoyant powers, it looks to me that they did as good a job as one could reasonably expect in such an extraordinary and confused situation.

Posted in Life, Personal | Leave a comment

Guest Post by Simon Molloy: Reducing political bias at the national broadcaster

An interesting graphic which the SMH thought was better presented in a form in which you can’t read whatever was near the right hand margin. NG (ed)

Claims of a left-wing bias at the ABC are seldom absent from public discussion. These claims quickly lead to suggestions that the ABC should privatised.

Of course, bias and impartiality are notoriously elastic and subjective concepts. The only arbiter that can make sense of this tangle of subjectivity is the Australian public. The ABC’s impartiality can only be judged by its perceived alignment with the views of the Australian public as judged by the Australian public.

But how are we going to determine what the Australian public thinks is biased or impartial?

Why not just ask them?

Why not conduct regular ABC impartiality polls? Why not create a statistically accurate reading of what the stakeholders that fund the ABC think of its performance? Continue reading

Posted in Democracy, Media | 7 Comments

Australia should remain in alliance with the bully

There is a widespread consensus in Australian policy circles that Australia should follow the US in almost any foreign adventure, though preferably on the cheap. The shining example of this was John Howard’s decision to publicly support the US in its war in Iraq in 2003, and yet send only a 1,000 special forces or so. Maximum alliance points, minimal actual risks and costs. Well done, John Howard.

Sure, the US and its Murdoch media empire heavily lobby and cajole Australian politicians and public opinion. Yes, joining the Americans makes one a bit of a target. And yes, of course there is a large element of corruption and laziness to the alliance.

Still, we’d be nuts to break up with the Americans. The best arguments come, ironically, from those who criticise the Americans loudly and convincingly.

The biggest reason to be with the Americans is that they are bullies. Yes, you read it correctly: the fact that they misbehave on the international stage is a very important reason to be with the Americans as all those who have opposed them have found out the last 70 years. Look at American decisions the last 5 years around the Golan, Jerusalem, Khassoggi, Venezuela, Iraq, Egypt, Iran, Cuba and Libya. The more we cry ‘injustices’, the more we should want to keep the Americans as friends.

All the ‘left-wing intellectuals’ who write about how many wars the Americans have started and how they have supported dictators and other *ssholes thus provide the strongest reasons for Australia to stay in the US alliance: the Americans get very nasty to those they see as enemies, particularly those who were former friends (think of Panama, Iran, or Venezuela). Why make ourselves the net target?

Sure, supporting the bully comes at a loss to others in the world, but not to us unless the other side really gets more powerful, in which case we can always switch. A new bully would recognise we are just the runt that follows the biggest bully, so it’s up to the new bully to show he is worthy of our allegiance. Till then, we stick with the one we know. That IS smart politics.

Can’t we do a New Zealand and simply be independent, I hear you ask? You see this written a lot, but New Zealand doesn’t have large American bases on its soil. Australia has huge American bases on its soil, which do not merely provide business for prostitutes but also gives the Americans a reason to become very nasty to whomever asks them to leave. Continue reading

Posted in Cultural Critique, History, Libertarian Musings, Politics - international, Politics - national | 21 Comments

Forecasting and competition policy

Top B2B Technology Companies for AI in Sales ForecastingValues are observed in actions and choices, and rather less so in words. Competition policy has been applied with great relish to the labour market – at least at the bottom end. (Subject to our relatively generous basic and award wage arrangements). So restrictive practices of warfies and workers in manufacturing plants have been ended, and where they haven’t compromised worker safety or other valuable things, I expect this is a very good thing.

But back the top end of town, rigid demarcations remain, between doctors and nurses, baristas and solicitors (ok – barristers and solicitors, but you get my meaning). You might think this is because of the raw power of powerful professions in our society. And you’d be right. 1 But the thing is that economists’ and policy makers’ imagination seems to align with the power. The desirability of reforming professional licensing was always in the Chicago School catechism. Continue reading

  1. To be as generous as possible, let’s say “largely right”. One can concede that restrictive practices in law and medicine do have some consumer protection and integrity functions, though these could be easily dealt with if we were serious about achieving anything here.
Posted in Competitions, Cultural Critique, Economics and public policy, Innovation, Politics - national | 3 Comments