I presented a videoseminar today, presenting a new argument against discounting the utility of future (more precisely later-born) generations, and I thought I’d report on both medium and message.
It was a bit of a bleeding edge experience, though it worked OK in the end. The big problem was presenting slides at the same time as video of me talking. ANU was expecting a hardware solution (dual video) while UQ was expecting a software solution (NetMeeting or Bridgit). Fortunately, I had sent the presentation ahead of time, so someone at the ANU end was able to run it for me. But I’ll have to develop a standard procedure for this.
I’ve attached the presentation (in PDF format)here
Some comments from the other side:
– I guess it is harder for people in that format to raise questions during the talk, (could have been the topic but doubt it) I would next time make sure in the beginning to encourage questions and tell them that they should raise their hand as you see them and/or say John and you would take that as rude but finish you thought and take the question
– Your voice was fading in and out a bit. When you said a louder word the speakers tuned down (to not have a feedback I suppose) and our ears had to adjust constantly – not sure if that problem could be solved
– Again the end is a bit weird not much one can do I suppose. I guess theoretically a subgroup of people could come close to the camera and continue the Q&A. Sorry about that though.
Overall, it’s pretty clear that both the technical and the social/conventional aspects of the process need refinement.
On the tech side, while the video of me presenting appeared to be OK, the video of the audience I got, with the same bandwidth, was naturally lower-res. I guess this will improve with time.
Also, Joshua Gans has suggested that it’s silly to confine the audience to people who can get to ANU (or wherever). I’m looking into streaming video over the Internet: it appears this is possible, but not trivial.
With all the problems noted above, it took me two hours and no travel to present a seminar that would normally have taken an entire day, four taxi trips and two plane trips, at a minimum, with an overnight stay if I wanted to avoid an absolutely exhausting experience. Videoseminar is definitely the way of the future.
{ 17 comments }
Chris Bertram 04.29.08 at 8:24 am
Of course the downside (or upside, depending on the case) is that you don’t get taken out for drinks and dinner afterwards. I guess they could send you vouchers for a take-out….
John Quiggin 04.29.08 at 8:42 am
Since I don’t discount future utility, and trust my ANU colleagues, the promise of a drink on my next physical visit is adequate payment.
notsneaky 04.29.08 at 8:57 am
Ok. Is there a transcript available, since I’m more interested in the argument rather than technical issues with the presentation? I mean, how can you NOT discount the utility of future generations, even from a social perspective? A little bit, at least? Otherwise, given positive interest rates and all, shouldn’t we immediately institute saving rates of 90% of income or so – whatever it would take to keep us at bare subsistence and reproduction – since then, our pain will be temporary but the future generation’s glory be forever?
(and I’m assuming that you’re talking about the pure rate of time preference, not stuff due to risk or the expected growth of income)
(and I also understand the argument that it may be better to assume very very very low discount rates, just in case we’re overestimating something somewhere, but that’s an argument for zero discount rates CONDITIONAL on the fact that we may be overestimating something somewhere, not an argument that we REALLY should not discount future generation’s utility.)
All that may be in there, so that’s why I ask for details.
notsneaky 04.29.08 at 9:03 am
More precisely a non pdf transcript.
Laura 04.29.08 at 9:05 am
John I spent two years teaching English at La Trobe’s Mildura campus by commuting there (from Melbourne) one day a week; it’s 660km so it was a 70 minute flight each way with four taxis for the home/airport/campus transfers. Video linkups were not good enough at the time (04-06) to be seriously considered, but they’ve improved a great deal since, and hopefully they will still get better.
I never use powerpoint or any other visual aid in a videoconference situation as it’s too easy for the whole thing to fall to bits. If visuals are absolutely needed I email them to the other end in advance.
The urgent problems are, as you say, the technical one that the wide angle shot of the room full of listeners is such low definition that they all look like blurry smudges, and the lack of mutually understood social conventions for conducting a mutually satisfactory discussion.
Charles S 04.29.08 at 10:32 am
It strikes me that the audience members in the distant location should use flashlights to signal their desire to ask a question. The sudden flash of light in the wide angle shot of the darkened room would be very visible, but less intrusive than simply standing up and shouting out a question. It would also work in conjunction with turning off the sound except during questions, which can be useful since the murmur of the distant room is somehow much louder and more intrusive than the murmur of the local room.
John Quiggin 04.29.08 at 10:59 am
Notsneaky, the positive interest rates to which you refer will only arise if there is exogenous* technical progress, in which case consumption will rise over time in such a way as to equate the rate of discount derived from declining marginal utility with the exogenous rate of technical progress. If that doesn’t make perfect sense, can I observe that Ramsey derived his saving rule back in 1928 with zero pure time preference, and he obviously didn’t get the result you suggest.
There will be a paper soon and i’ll post it here, but the PDF has the basics.
* Or you could have endogenous progress derived from increasing returns to scale in information doing much the same thing.
Jason 04.29.08 at 11:41 am
I know notsneaky’s asked for detail on the content, so sorry if this is turning into a lot of work, but I’m curious about the challenges of the process. You had two institutional ITS teams (I assume – ?) expecting two different solutions, and it appears one team just sorted it out – what was the communication like between you and the institutional tech people? Would you have been able to handle the production side (integrating video and visuals) without their involvement?
Steven 04.29.08 at 3:09 pm
There appears to be a typo in the pdf slides. On slide 9 in the statement of A.4, the subscripts and the superscripts should be swapped. (Alternatively, they could be swapped in the definition of preferences in slide 8).
Or I’ve misunderstood what you’re trying to say.
Steven 04.29.08 at 3:24 pm
Another apparent typo. In slide 12, “At t=1” should be “At t=2”.
I’ll hold off on substantive comments until I see the paper. The sketch of the proof of the main result in the slides is too brief for me to figure out what’s going on.
John Quiggin 04.29.08 at 8:26 pm
I picked up the second typo as I was going, but I haven’t fixed it yet. I’ll check on the second, thanks.
notsneaky 04.30.08 at 3:04 am
Yes, but Ramsey assumed that there was a “bliss point” in terms of utility that each generation could achieve. This is effectively sneaking in time preference through the back door.
The result that it’s “okay” to sacrifice the present generation (actually any finite number of them) for the sake of the future is quite general.
See for example this discussion of the Koopmans axiomatization of inter temporal social welfare:
http://cepa.newschool.edu/het/essays/growth/optimal/koopaxiom.htm
Quote:
“Koopmans’s analysis suggests that if we attempt to derive a social welfare function without time preference, then we are implicitly violating sensitivity somehow. This makes sense. Without time preference, the utilities achieved by any finite number of generations can be “ignored” as the remaining infinity overwhelms them completely. Indeed, in continuous time, such negligibility is automatic.
But it is the ethical implications of this that are interesting. What Koopmans has highlighted with his exercise is the interlinkage between sensitivity with time preference. On the one hand, discounting is unethical because, say, it could be used to justify current environmentally-destructive activities whose effects would only be felt millions of years in the future. On the other hand, discounting is ethical because without it, the infinite future overwhelms the finite present. More acutely, without discounting, we could justify savagely destroying one generation now if it yielded a series of minuscule gains (no matter how small) that would accrue forever after. An ethical balance must be struck: either we count every generation equally (in which case, no single generation counts at all), or we allow discounting (in which case every generation counts, but some less than others). Which is more ethical? See Kenneth Arrow (1979) for some reflections on this.”
John Quiggin 05.01.08 at 10:55 am
#8 Sorry to be slow responding. The problem was fixed at the other end, and I had no real communication with them. They may have just set up a computer and projector with my presentation in the usual way.
#12 I don’t think Ramsey assumed a bliss point. And the problem of infinity is easily resolved as in Stern. Include a small probability that we either blow ourselves up or, more generally, make changes so radical that our current calculations are irrelevant. Then you get convergence nice and easily.
Joshua W. Burton 05.02.08 at 6:03 am
It seems to me that technological progress is a red herring: stipulate, if you like, that the ethical discount rate is increased by the likelihood that my descendants will be richer than I am. Still, even in a static economy, where this effect can be neglected, aren’t later generations intrinsically less valuable, simply because we hold the temporal high ground?
My grandchild, at a time when we’re both alive, acts without obvious coercion on the belief that a dollar when he’s 65 is worth substantially less than a dollar when I’m 65. I share this belief. Who stands outside time to gainsay us? Later lives are less important than earlier lives, by the revealed free preference of those who live them.
If we deplete half of an irreplaceable resource every 50 years on the exponential plan (a low 1.5% per annum liquidity preference, in a notional zero-growth economy), every generation will be able to tell the next that, at constant date, they were offered the same future value at the same age as everyone else as of that date. So no one can fairly say that her generation was shortchanged, except by the chance of birthdate and the observed time value of money set by her generation’s own lifestyle preferences. Since no one chooses her birthdate, this is the unique “fair” solution, but it does imply as a corollary that, at least with respect to irreplaceable resources, “that age is best which is the first.” Our far descendants have nothing to offer today but deeply time-discounted future labor (“what have they ever done for us?”), which is less valuable than our present labor; why should we accept their anticipatory whims at par?
In fact, this revealed-preference argument should perhaps be justly applied beyond the economic and into the political realm! Resolved, that in the interest of intergenerational fairness the sovereign franchise should be exponentially age-weighted against the young.
Imagine a one-time sudden windfall (Fred Hoyle’s gold meteorite) that needs to be divided. Equal votes gives everyone alive when it falls an equal slice. Equal worth gives everyone an equal inheritance at an equal age, so we carve off $1000 worth of meteorite for the pensioner right now, and put away $400 worth of meteorite in a money market account for the college kid’s retirement. His life is objectively cheaper: it takes a smaller slice of meteorite to give him $1000 at retirement. Yet if he has a “fair” vote, it’s hard to see why he wouldn’t want a full-sized slice right now.
Now imagine the meteorite is a big one, and we live on it.
Joshua W. Burton 05.02.08 at 1:00 pm
It’s worth asking what sets the magnitude of the liquidity preference in the absence of technological progress, population growth, and idiosyncratic risk, by the way. My guess is that the residual 1% or 2% is suspiciously close to the actuarial risk. The reason $0.99 today is as good as $1 next year is because I might be dead.
(Shortsightedness and alienation can be viewed here as a kind of artificial mortality: a wayward teenager with a high liquidity preference may not actually expect to be dead in 20 years, but he expects to be someone he doesn’t much care about, which is roughly the same thing.)
The real injustice in using the safe money market rate to devalue future generations (as I modestly proposed above, #14) is that the first generation of immortals will wind up owning everything.
Joshua W. Burton 05.02.08 at 1:05 pm
And therefore, lasting institutions which don’t expect to be dead (anything with “trust” or “stewardship” in its name or its charter preamble, for example) should behave like our hypothetical immortal with a long memory. A redwood tree for the enjoyment of a tourist in the 22nd century should be worth the same as in the 21st, to the park service or the Sierra Club, even though it’s worth less than that to mortal humans, of any given generation.
bob 05.02.08 at 9:39 pm
A question about the presentation itself: what software and template were used to create this? This is the second time this week I’ve seen an academic presentation using this exact style (e.g., same blue bar along the bottom with name/affiliation, title, date and page number). I like it, it makes for a clean looking slide deck, but I can’t seem to figure out what it is.
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