Things we won’t say about race

Until yesterday I had never heard of Trevor Phillips. He is a former chairman of the UK’s Equality and Human Rights Commission (EHRC), which means he was in charge of enforcing British anti-discrimination laws in the Blair years. The documentary below is one of the more interesting I’ve seen, not least because of Phillips’ introspection.

Almost his concluding sentences: “Preventing anyone from saying what’s on their minds won’t ever remove it from their hearts. People need to feel free to say what they want to without fear of being accused of racism or bigotry. It means that we’re all going to have to become more ready to offend each other.”

Posted in Democracy, Immigration and refugees, Politics - international, Race and indigenous, Social Policy | 4 Comments

Multipliers over 1: SHOCK!!

The Effect of Cash Injections: Evidence from the 1980s Farm Debt Crisis by Nittai K. Bergman, Rajkamal Iyer, Richard T. Thakor


What is the effect of cash injections during financial crises?
Exploiting county-level variation arising from random weather shocks during the 1980s Farm Debt Crisis, we analyze and measure the effect of local cash flow shocks on the real and financial sector. We show that such cash flow shocks have significant impact on a host of economic outcomes, including land values, loan delinquency rates, the probability of bank failure, employment, and wages. Estimates of the effect of local cash flow shocks on county income levels during the financial crisis yield a multiplier of 1.63.

Posted in Economics and public policy | Leave a comment

Biased Promotions and Persistence of False Belief

Beetles: Biased Promotions and Persistence of False Belief by George Akerlof, Pascal Michaillat – #23523 (LS PR)


This paper develops a theory of promotion based on evaluations by the
already promoted. The already promoted show some favoritism toward
candidates for promotion with similar beliefs, just as beetles are
more prone to eat the eggs of other species. With such egg-eating
bias, false beliefs may not be eliminated by the promotion system.
Our main application is to scientific revolutions: when tenured
scientists show favoritism toward candidates for tenure with similar
beliefs, science may not converge to the true paradigm. We extend
the statistical concept of power to science: the power of the tenure
test is the probability (absent any bias) of denying tenure to a
scientist who adheres to the false paradigm, just as the power of any
statistical test is the probability of rejecting a false null
hypothesis. The power of the tenure test depends on the norms
regarding the appropriate criteria to use in promotion and the
empirical evidence available to apply these criteria. We find that
the scientific fields at risk of being captured by false paradigms
are those with low power. Another application is to hierarchical
organizations: egg-eating bias can result in the capture of the top
of organizations by the wrong-minded.

Posted in Economics and public policy, Science | 5 Comments

Genetic diversity is good for the economy!

High School Genetic Diversity and Later-life Student Outcomes: Micro-level Evidence from the Wisconsin Longitudinal Study
by C. Justin Cook, Jason M. Fletcher – #23520 (EFG LS)


A novel hypothesis posits that levels of genetic diversity in a population may partially explain variation in the development and success of countries. Our paper extends evidence on this novel question by subjecting the hypothesis to an alternative context that eliminates many alternative hypotheses by aggregating representative data to the high school level from a single state (Wisconsin) in 1957, when the population was composed nearly entirely of individuals of European ancestry. Using this sample of high school aggregations, we too find a strong effect of genetic diversity on socioeconomic outcomes. Additionally, we check an existing mechanism and propose a new potential mechanism of the results for innovation: personality traits associated with creativity and divergent thinking.

Posted in Uncategorized | 3 Comments

Right-to-Carry Laws and Violent Crime

Right-to-Carry Laws and Violent Crime: A Comprehensive
Assessment Using Panel Data and a State-Level Synthetic Controls
Analysis by John J. Donohue, Abhay Aneja, Kyle D. Weber – #23510 (LE)


The 2004 report of the National Research Council (NRC) on Firearms
and Violence recognized that violent crime was higher in the
post-passage period (relative to national crime patterns) for states
adopting right-to-carry (RTC) concealed handgun laws, but because of
model dependence the panel was unable to identify the true causal
effect of these laws from the then-existing panel data evidence.
This study uses 14 additional years of panel data (through 2014)
capturing an additional 11 RTC adoptions and new statistical
techniques to see if more convincing and robust conclusions can

Our preferred panel data regression specification (the “DAW model”)
and the Brennan Center (BC) model, as well as other statistical
models by Lott and Mustard (LM) and Moody and Marvell (MM) that had
previously been offered as evidence of crime-reducing RTC laws, now
consistently generate estimates showing RTC laws increase overall
violent crime and/or murder when run on the most complete data.
We then use the synthetic control approach of Alberto Abadie and
Javier Gardeazabal (2003) to generate state-specific estimates of the
impact of RTC laws on crime. Our major finding is that under all
four specifications (DAW, BC, LM, and MM), RTC laws are associated
with higher aggregate violent crime rates, and the size of the
deleterious effects that are associated with the passage of RTC laws
climbs over time. We estimate that the adoption of RTC laws
substantially elevates violent crime rates, but seems to have no
impact on property crime and murder rates. Ten years after the
adoption of RTC laws, violent crime is estimated to be 13-15% percent
higher than it would have been without the RTC law. Unlike the panel
data setting, these results are not sensitive to the covariates
included as predictors. The magnitude of the estimated increase in
violent crime from RTC laws is substantial in that, using a consensus
estimate for the elasticity of crime with respect to incarceration of
.15, the average RTC state would have to double its prison population
to counteract the RTC-induced increase in violent crime.

Posted in Democracy, Law | 1 Comment

Dinner Party in Melbourne on the 22nd June: #WAINS?

My 60th Birthday party was a blast. So as not to wait another decade till the next one, I thought I’d do it annually. But to disguise the naked egotism of it I decided to raise money for a Good Cause. And the cause is Urban Refugees founded by Sonia Ben Ali who flew in at the right time for my 60th. (Can’t celebrate a milestone without a social innovator flying in from Paris.)

Anyhow, the thing is, Sonia is back in Australia next week. We were thinking of holding a genteel dinner with billionaires wives and their blue rinse to get them all to pitch in a few thousand, and have charity lunches, but then we realised that neither Sonia nor I knew any billionaires or their wives.

So I just thought, “what the heck, let’s get this baby off the ground”. So on Thursday 22nd June, you’re invited to a fantastic party in Melbourne with a whole lot of fantastically interesting people I know. (Seriously, there are some fascinating people there I promise! There even other Troppodillians there!)

It will mostly be dinner and party, but you’ll hear a little about the cause from me, from Sonia and from Nemat Ahmadi,a newly arrived Afghan refugee who has made his way to Melbourne from Urban Refugees’ base in Malaysia!

We’re inviting you to pay your way with $50 for the dinner with drinks purchased at the bar. So Book Now on this link.

I’m also hoping you can donate and will match every dollar of yours over $100 up to a total liability of $5,000 for me. (Ross Gittins has already decided to play hard-ball and try to bankrupt me so this matching pool is now down to $4,100! Bring it on I say! We can always mortgage the yacht.)

One final thing, if you’d like to donate, we’re in the process of getting tax deductibility and so if that matters to you, the best way of donating is make a comment below (or if you want to hide your generosity under a bushel), email me on ngruen AT gmail and I’ll make sure Urban Refugees gets back to you when we can issue a tax deductible receipt. I’d hope we can do it before the end of the financial year.

Looking forward to seeing yous all there!

And please pass this around.

Posted in Blegs | 7 Comments

Trump and the new world (dis)order

What are the effects of having a US president who is diminished in stature and yet not facing imminent job loss? I try to think this through in my latest column for The CEO Magazine.

One likely result: less stability in US foreign policy, as Trump spends more time on it. Foreign policy is what presidents do when they become less important, because that’s where Congress plays the smallest role and a president has greatest freedom.

This will mean more departure from past patterns and from the US State Department’s preferred policies. Mainstream western understanding of the international order is based to a large extent on shared values, acknowledged rules and mutually beneficial long-term alliances. Trump is not by instinct a long-term alliance guy. He’s transactional. He asks the question “what have you done for me lately?”. He is also impetuous and uninclined to develop a shared leadership position before speaking or tweeting.

All of this is now pretty widely accepted. It was evident in Trump’s delay in backing Article 5 of the NATO treaty.

Perhaps Trump’s strangest foreign policy excursion so far is happening in the tiny, gas-rich Persian Gulf state of Qatar. If there was some sort of diplomatic award for mixed messages, the US would have it in the bag already.
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Posted in Politics - international | Leave a comment