Feb 23 2012

Always ask why: Chesterton’s Gate

Peopl just love to think that they’re smarter than everyone else. They look at a problem they’re not familiar with for two minutes and then say, “Oh, but the answer’s obviously…” Matt will recognise this phenomenon from all the times he’s been told that macro forecasting is a waste of time and the people buying it must be idiots. Economists generally get it from physicists who think Brownian motion solves half the problems in economics. Economists themselves are terrible at it: they look at almost any policy debate and claim that if only X were properly priced then everything would be rosy.

If all these things are so obvious then the question is, why haven’t they been dealt with already? And, “because nobody else is smart enough to see the solution” is unlikely to be the correct answer. More often, the person with the ‘solution’ just doesn’t understand the complexity of the problem and the reasons why things are as they stand.

Now, that isn’t a new insight, but I’m sure I’m not the only one who’s been bothered by the lack of a snappy name for it. After all, it isn’t a real proposition until you can name it after someone. So I was very happy to come across this article by Megan McArdle discussing Chesterton’s Gate. I’m not sure if the name is widespread, but i’m already a fan. Apparently GK Chesterton gave a fairly eloquent description of the problem:

In the matter of reforming things, as distinct from deforming them, there is one plain and simple principle; a principle which will probably be called a paradox. There exists in such a case a certain institution or law; let us say, for the sake of simplicity, a fence or gate erected across a road. The more modern type of reformer goes gaily up to it and says, “I don’t see the use of this; let us clear it away.” To which the more intelligent type of reformer will do well to answer: “If you don’t see the use of it, I certainly won’t let you clear it away. Go away and think. Then, when you can come back and tell me that you do see the use of it, I may allow you to destroy it.”

This paradox rests on the most elementary common sense. The gate or fence did not grow there. It was not set up by somnambulists who built it in their sleep. It is highly improbable that it was put there by escaped lunatics who were for some reason loose in the street. Some person had some reason for thinking it would be a good thing for somebody. And until we know what the reason was, we really cannot judge whether the reason was reasonable. It is extremely probable that we have overlooked some whole aspect of the question, if something set up by human beings like ourselves seems to be entirely meaningless and mysterious. There are reformers who get over this difficulty by assuming that all their fathers were fools; but if that be so, we can only say that folly appears to be a hereditary disease. But the truth is that nobody has any business to destroy a social institution until he has really seen it as an historical institution. If he knows how it arose, and what purposes it was supposed to serve, he may really be able to say that they were bad purposes, that they have since become bad purposes, or that they are purposes which are no longer served. But if he simply stares at the thing as a senseless monstrosity that has somehow sprung up in his path, it is he and not the traditionalist who is suffering from an illusion.

Permanent link to this article: http://www.tvhe.co.nz/2012/02/23/always-ask-why-chestertons-gate/

Feb 22 2012

Stats NZ smackdown?

It may just be me, but this statement by Statistics New Zealand sounds like an (appropriate) smackdown of this speech from the RBNZ (which we discussed in terms of appropriateness here).

In his speech, the Governor had said that the Reserve Bank’s very rough analysis suggested that the measurement differences could mean our GDP was understated by up to 10 percent.

“Based on Statistics NZ’s detailed knowledge of measuring the economy, I am confident that any measured rise in GDP will be significantly less than that amount,” Mr Bascand said.

I have a word that describes that statement.  BOOM!

Permanent link to this article: http://www.tvhe.co.nz/2012/02/22/stats-nz-smackdown/

Feb 21 2012

Social smokers are the victims

According to the Dom Post there is new research out showing that banning smoking in places that people socialise will reduce social smoking:

New Zealand researchers believe fewer people would take up smoking socially if smoke-free rules extended to areas outside bars.

Alone, that sounds pretty innocuous. But how does it justify a headline like:

Study backs ban on smoking outside bars

As if the goal of healthcare policy should be to minimise gross harms, rather than maximise net benefits!

One interesting aspect of the article is that the social smokers themselves supported such a ban. Most reported smoking to fit in and be viewed as a part of the group, but said they would prefer it if none in the group smoked so they didn’t have to. The first reaction I had is that the social smokers are holding everythign else constant when they think about the benefits of a smoking ban: they’re assuming that the group will work the same way, just without the smoking. That’s a pretty big assumption to make, given that there are plenty of options open to the serious smokers.

Assuming that issue away, is this a co-ordination problem where people are stuck in an inferior, all-smoking equilibrium, or could everyone in the group be better off if the group didn’t smoke? Just as importantly, would the costs imposed on avowed smokers be greater than the benefits to social smokers who would prefer not to smoke? The most obvious solution is a mechanism that allows social smokers to precommit to not smoking, but that mechanism appears to elude people so far.

Permanent link to this article: http://www.tvhe.co.nz/2012/02/21/6723/

Feb 21 2012

Newsreading game of the day

From the Positive Economist:

Government, whatever it is, isn’t a grumpy gatekeeper protecting a bottomless barrel of stuff and saying “no, no, no”. We can disagree about what government should do, of course, but let’s not pretend that there aren’t constraints.

How many stories does this apply to in a daily newspaper?

Permanent link to this article: http://www.tvhe.co.nz/2012/02/21/newsreading-game-of-the-day/

Feb 20 2012

The profession in three minutes

Pareto optimality: when you can’t take someone’s shit without them giving a shit.

HT: Greg Mankiw

Update: Eric points to some good additions here. Particularly relevant to the libertarians among you.

Permanent link to this article: http://www.tvhe.co.nz/2012/02/20/the-profession-in-three-minutes/

Feb 20 2012

The internet makes music better

An interesting piece by Robert Waldfogel on VoxEU attempts to estimate the quality of music over the past half decade. He uses a few different measures of quality and asks whether the advent of music sharing online increased or reduced quality. The key chart is:
The Beatles are still the best
The spike in the 2000s is interesting, but in interpreting the measure one has to ask whether there’s anything other than quality that could be influencing it.

Essentially, he has used demand measures to proxy quality, so the most obvious bias seems to be demographics. Look for example, at the continued high demand for 60s music. That may be partly because The Beatles were great, but could it also be because that’s when the baby boomers were in their formative musical years, and so continue to demand that music from their youth? We know that there was a small echo from the baby boomers children in the ’80s and early ’90s, so could that be partially explaining the spike in demand for the 2000s music, too?

Of course, the demographic argument works both ways: maybe the large number of young people in the sixties and noughties also increased the supply of music, too. That may lead to a corresponding increase in the quantity of high-quality music, which would lead to it being disproportionately weighted in the index.

If anyone’s an expert in this field then let us know why you think Waldfogel’s results hold, or not. Alternatively, unfounded speculation is welcome.

Permanent link to this article: http://www.tvhe.co.nz/2012/02/20/the-internet-makes-music-better/

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