Tuesday, October 19, 2010

Labour markets, between heaven and hell



[...]heaven is where women and older people work like Swedes, the young work like the Dutch and the unemployed find jobs like the Danes. Hell is where workers get into unemployment like the Americans and out of it like the Italians.


Monday, October 11, 2010

Dale

Not that I want to brag or anything but... please check this out again and then go to the Nobel prize site to see who won this year's Prize in Economics (by the way, last year I predicted Hart, Holmstrom and Williamson, hence I also got there one of the awardees-- just in case you were wondering if I predict the same every single year).  

Anyway, while you can check out all the press release on the 2010 Econ Nobel prize directly from the source etc., some very brief and fast personal points on Dale Mortensen. I feel privileged to currently have Dale as my postdoctoral guide and host at Northwestern University (and to have known him over the years, particularly via the LMDG research group in Aarhus, but in fact already from my PhD years at the Tinbergen Institute Amsterdam--when probably in 2003 or so I took my first search and matching short course with him teaching it); I am also grateful to have taken part in several events organized by Beverly and Dale Mortensen in Chicago/Evanston; and, it so happened that I was having lunch with Dale and a couple of others here in Aarhus-- yep, you have to be in the right place, at the right time!-- some hours ago (and minutes before the actual Nobel prize announcement) when he received that phone call from Stockholm. That is pretty amazing, you know, to be part of this very moment... all that suspense and then the smiling confirmation... with Dale stating he is not supposed to acknowledge anything yet :-)... Thus we started John Abowd's invited seminar here at the Aarhus School of Business (of course Dale went on with attending undisturbed the seminar-- a scientist to the end!) with champagne and the live online Econ Prize announcement from Sweden.

Finally, at this very moment they do not seem to have put up a picture of Dale on the Nobel prize site yet (while they have found portraits of Peter Diamond and Chris Pissarides), so I'll just place up a photo with Dale and Beverly in their kitchen in Evanston, this summer, preparing to serve (some very lucky) us an absolutely delicious Mexican dish. Congratulations once again, Dale Mortensen!


PS. Pictures/videos from after the prize announcement might follow late...r on, depending when/if I have time to actually sort them out.

Sunday, October 10, 2010

My 2010 Nobel Econ Prediction

Some names are recurrent in the betting pools, but-- as usually-- it does not appear that anybody has a very clear favourite for this year's Economics Nobel, and that seems true even in terms of the Econ area(s) to be currently rewarded. Thomson Reuters' predictions are sampled from a pretty varied set topic-wise. Harvard , Chicago and Northwestern / Kellogg  seem all to be somewhat home biased for the leading pick, though with very heterogeneous faculty preferences in the rest. And when the experts disagree to this extent, you will rightly ask yourselves if there is any point in attempting a forecast.

But, as you came here anxious to get my prediction for tomorrow: I think it is high time search theory was recognized for its significant contributions to a great many Econ subdisciplines (inter alia, search is responsible for crucial modelling advances in Labour Economics, Consumer Theory, Monetary Theory, and way beyond) -- with Peter Diamond, Dale Mortensen and Chris Pissarides as its very deserving pioneers. This was my favourite option also last year, but I assign it a much higher probability of success now. That being said, I hope Dale would not change the dinner plans tomorrow evening  if he does get the phone call :-).

Tuesday, October 05, 2010

Econlinks: Kamelåså et al


  • Before I come up with my Econ Nobel forecast -- a week to go, stay tuned-- let us take a look to the 2010 Nobel Ig prizes related to Economics. The Economics Ig Nobel itself is perhaps not very unexpected this year--though not very creative either (I wonder whether Oliver Stone is behind this too; his latest movie gets pretty mediocre reviews-- IMDb, RottenTomatoes-- despite all the hype). The "Management" Nobel Ig reads much better (but I still need to check out that paper): "Alessandro Pluchino, Andrea Rapisarda, and Cesare Garofalo of the University of Catania, Italy, for demonstrating mathematically that organizations would become more efficient if they promoted people at random. REFERENCE: “The Peter Principle Revisited: A Computational Study,” Alessandro Pluchino, Andrea Rapisarda, and Cesare Garofalo, Physica A, vol. 389, no. 3, February 2010, pp. 467-72."

  • Mankiw's excellent advice for all new college freshmen. Do learn some Economics, Statistics, and Finance, (ok, even Psychology, though this is second order) for your own sake... Couldn't have phrased it better.







Sunday, September 05, 2010

Transylvania, Scania, Jutland

I have just arrived in Kolding (remember Kolding in winter time? It is even more beautiful now) for a workshop tomorrow, after a short wedding detour to Helsingborg, which looks and feels way more exciting than seen from Hamlet's side of the Øresund (or Öresund, if you fancy Swedish more than Danish). This, in turn, followed some busy days in Cluj --Transylvanian citadel unable to compete landscape-wise with Scandinavian harbours & fjords, but managing instead several decent cafés/wine bars/beer gardens that start to look capable of rewarding one's hard days' nights. At the cost of detail, I'll spare your waiting and tell you upfront that Café Bulgakov won the hard-fought contest, both in terms of atmosphere and food quality (dramatic improvement since a few years ago); where, obviously, '"I'm judge and jury and executioner too'"... If they worked on expanding the selection of Belgian beers--beyond the lovely, but lonely, Leffe--and considered polishing their wine list, I would see them as top contender for the Transylvanian café in Cluj.

PS. I know you are anxiously waiting for my Shanghai impressions. And for my Boston foodies recommendations. And for details of my half-hour NCN (=Napoca Cable Network) live interview in their "Cluj zi de zi" rubric, a couple of days ago. Soon.

Tuesday, August 31, 2010

Econlinks: Of Maths, Efficiency, and Language

  • Last but not least: two ok obituaries for Tony Judt, one in The Economist and one in the NYRB.

Saturday, August 14, 2010

Up in the air

It is great, truly great. In fact IMDb and RottenTomatoes do not give it sufficient credit. I was told I would love it, by people who know me, but I didn't just love it: I adored it. One of my favourite scenes is also one of the most brilliant dialogues/pick-up strategies, on screen and beyond. It is a shame the movie did not win any Oscars, given the six (only!) nominations it received. "Superlative" is not doing enough justice to the acting performances of George Clooney, Vera Farmiga or Anna Kendrick, with the film also an example of perfect direction and screenplay by Jason Reitman & co. It belongs right there, in my top 5 all-time favourites.

To top it all, I've seen "Up in the air" just the proper way, up in the air-- during my Chicago-Amsterdam trip yesterday. And, obviously, I write this post from Schiphol's KLM lounge, soon to be up in the air again, this time to Shanghai. "Bingo. Asians."

Sunday, August 08, 2010

The Manski Critique

Chuck Manski's recent NBER working paper, "Policy Analysis with Incredible Certitude" (non-gated version) ought to be a must-read for anyone doing or interested in policy analysis.

The study is written in an accessible way, such that it can be in principle followed without explicit academic training in Economics/Econometrics (there are plenty of further references for the technical details), and essentially sums up some of Manski's conclusions from his well known research agenda on empirical methods in social sciences such as partial identification, and using decision theory with credible assumptions, for policy inference-- see for instance his books on these topics (which any applied econometrician should have on his/her shelf; though I confess, my copies are currently still in Aarhus, awaiting my shipping/bringing them to Chicago), Identification Problems in the Social Sciences (1995), Partial Identification of Probability Distributions (2003), Social Choice with Partial Knowledge of Treatment Response (2005), and Identification for Prediction and Decision (2007).

Manski catalogues the 'incredible analytical practices' and provides examples for each category. His set consists of "conventional certitudes", "dueling certitudes", "conflating science and advocacy" and "wishful extrapolation". I find particularly compelling the sections on the conventional and respectively the dueling certitudes, which are preceded by a concise introduction on the incentives for certitude (wherein, as usually, USA presidents' alleged statements always come in handy). Similarly, Manski pins down very well the "wishful extrapolation" practice, when often very strong, unwarranted, invariance assumptions are made (see his example on the selective incapacitation studies performed by RAND researchers in the early 80s, which gave rise to some hot political debates).

The one section that I find less thorough than the others in Manski's paper is the one on "conflating science and advocacy". Acknowledging that impartiality in social science (in fact, with some contextual caveats, this point is relevant for science in general) is the ideal, and that often research falls far from this ideal, I think Manski's pointing out that conflating science and advocacy is one of the main reasons for incredible policy analysis is absolutely correct. His illustration with excerpts from Milton Friedman's arguments for educational vouchers is also fine; indeed some of the crucial empirical evidence necessary for Friedman's stated policy implications in that context was (and still is, as Manski also states) missing, such as whether there are significant neighborhood (or peer) externalities involved (however, for making that point stronger, plenty of better, and/or more recent examples could have been used...). What I did not particularly fancy is the between-the-lines allusion that Friedman used to do this (i.e., conflating science and advocacy) on a frequent basis or, perhaps, all/most of the time. For instance, Manski states on page 20, "Milton Friedman [...] had a seductive ability to conflate science and advocacy" [...]. See Krugman (2007) for a broader portrait of Friedman as scientist and advocate". That particular NYRB article of Paul Krugman that Manski cites (presumably for other depictions of Friedman seductively conflating science with advocacy, and related-- line which is otherwise not followed up or further substantiated in Manski's paper) has however a considerable number of inaccuracies and misunderstandings, which others very well pointed out in subsequent articles, see for instance Nelson and Schwartz's reply to Krugman's; in fact, many would easily think that Krugman is himself guilty of conflating science and advocacy here (and elsewhere; some do actually substitute 'conflating science and advocacy' with 'ignoring science for advocacy' as practice in many of Krugman's NYT pieces- 1st bullet point...). And yes, ok: I wrote myself a post about that Krugman portrayal of Friedman, shortly after his article appeared. All in all, however, this minor point does not in any way diminish the essence of Manski's thesis; it's only that if it is about impartiality and professionalism in scientific practice (which Chuck Manski is one of the champions of, no doubt), we should make sure that is also the (only) between-the-lines message.

Thursday, August 05, 2010

Eterna è la strada che va

I've been a fan of "Banco del Mutuo Soccorso" (wiki, official) for an indefinite number of years now. I hold for instance the view that their first three early '70s albums -- which I listen to frequently, on my iPod, e.g. while travelling from Chicago to Evanston and back--, Banco del Mutuo Soccorso, Darwin!, and respectively Io sono nato libero, are composed almost entirely of genius works, surprisingly underrated and little known outside intelligentsia circles (even in Italy). It is pretty hard to pin B.M.S.'s style down, or relate it to any other band's, since they combine uniquely various musical genres, rock, jazz, classical, all that plus the so Italian cantautore sort, in masterpieces that ought to rival in status and fame Pink Floyd's brightest creations.

Anyway, here is my number 1 choice: enjoy the superlative Il giardino del mago (very decent quality YouTube clip), from their first album-- with today's runner-up being Canto nomade per un prigionero politico, the major piece from Io sono nato libero.


Check out also my earlier blog incursions into the territory of Italian good music, here, here, and here. More will follow.