March 10, 2005

It's a Cookbook!

Posted by Henry

I’m about to jump on a plane to Europe, after jumping off a plane from Hawaii yesterday, but couldn’t resist blogging this aside from a recent Scott McLemee column.

At one point, they [‘Chairman Bob’ Avakian and his philosopher sidekick] note that the slogan “Serve the People,” made famous by the little red book, could be used — with very different intentions, of course — at a McDonald’s training institute. This is, on reflection, something like Hegel’s critique of the formalism of Kant’s ethics. Only, you know, different.

Chairman Bob is stealing a riff here from Damon Knight’s famous short story “To Serve Man,” which was made into an even more famous Twilight Zone episode. I imagine that Chairman Bob’s version is more laboured and less funny than the original: “Don’t get on the ship. The book, To Serve Man, IT’S A COOKBOOK!” has to rank as one of the best closing lines of all time.

October 21, 2004

How do Swear words get to be swear words?

Posted by Harry

In my Contemporary Moral Issues course I’ve recently been teaching about hate speech codes on campus. Well, it was contemporary a few years ago, and still interests me. So it was fair enough for one of my students to email me a question I can’t really answer:

Yesterday I found myself wondering why bad words are bad. I can’t seem to figure it out. I understand that some people find these words to be offensive but I don’t know why that is. Any comments?

I started an email rambling on about conventions, taboos, and common knowledge about certain uses (eg, various racist epithets enjoy their status as deeply offensive and hurtful words because we all now they are routinely used by racists for that purpose); and of course I realise that conventions depend on background practices and contexts (it is awfully difficult, in America, to come up with a hurtful and ‘racist’ term for English people, because, well, their just isn’t the social context or history to support such a term). But swearing doesn’t have exactly the same sort of route, and within each group of bad words there seem to be different paths. And, truth is, I feel that I’m just restating the existence of the phenomenon he’s wondering about. If you can answer his question I can either steal your answer and sound smart (and hope he doesn’t read the site) or just point him here.

September 08, 2004

McDonald's language quiz

Posted by Chris

This is fun: a quiz based on McDonald’s Happy Meal game instructions . Can you recognize the languages? (Via Des von Bladet ).

August 20, 2004

Gender-Neutral Pronouns

Posted by Brian

I had always thought there was a dialect of English where he could be used as a gender-neutral pronoun. That is, I always thought there was a dialect of English where one could say (1) without presupposing that the person we hire next will be male.

(1) The person we hire next will be able to teach whatever courses he wants.

Now I always (or at least as long as I can remember) thought it was a bad idea to speak such a dialect, because there was the obvious possibility for confusion between the gender-neutral pronoun and the gender-biased pronoun. And since the effects of such confusion could easily be to reinforce stereotypes and assumptions that shouldn’t be reinforced, I thought it was politically bad idea as well as being an inefficient means of communication. But as I said, I thought there was such a dialect.

Geoff Pullum has convinced me otherwise. There is no such dialect of English. If there was, there would be a dialct of English where the following sentences would be acceptable.

  • *Either the husband or the wife has perjured himself.
  • *Was it your father or your mother who broke his leg on a ski trip?

And clearly neither of these is acceptable in any dialect of English. So I now think that using ‘he’ as a purportedly gender-neutral pronoun doesn’t involve speaking a dialect I’d rather wasn’t used, it is just a mistake. As Geoff points out, English has a perfectly adequate gender-neutral pronoun - they - and it should be used instead of he in these contexts.

August 14, 2004

Language in the Blogosphere

Posted by Henry

Wandering around the blogosphere, I came across this rather interesting page. It seems to be a little outdated, but it provides an approximate count of the relative importance of different languages in the blogosphere. English comes first, unsurprisingly, then French. Portuguese is third, and Farsi fourth. This may seem a little surprising to those who aren’t familiar with the proliferation of Portuguese and Farsi blogs - both linguistic communities have also made substantial inroads into social network services like Orkut.com too. This leads to an interesting sociological question - why these communities and not other linguistic communities of similar size - have reached takeoff in the blogosphere. Equally interesting is the lack of any Arab language blogs on the list. This may be a result of how the authors have seeded their survey or parsed their results - but it may also quite possibly reflect reality. As far as I know, there are less than 70 Iraqi blogs (many of which are in English). I’m not aware of any substantial blogging communities in other Arabic-speaking countries - but I’m happy to be enlightened if I’m wrong. The root causes may perhaps include cultural factors - but I would bet that restrictions on Internet access and poor technological infrastructures also play a very important role.

August 12, 2004

Spelling

Posted by Chris

Whilst English speakers doughtily plough on with our archaic and tough spellings, and have to acquire a tolerance for the inconsistencies between British English and American English (to name but two), the German authorities have fought to implement a thorough spelling reform. But it seems that implementation faces a major hiccough as some of the major German newspapers have had second thoughts. Scott Martens gives a rough but excellent account of developments and rationales over at Fistful of Euros. (In other news, I shall be travelling to Loughborough this weekend.)

July 30, 2004

The Stalinist delusion

Posted by John Quiggin
Tyler Cowen says
If I could have the answers to five questions in political science/sociology, the appeal of Stalinism to intellectuals would be one of them.
I don’t think this is as difficult a question as is often supposed.

Most of the intellectuals who professed support for Communism during the rule of Stalin (and Lenin) were primarily victims of (self-)deception. They supported the stated aims of the Communist Party (peace, democracy, brotherhood), opposed the things the Communists denounced (fascism, racism, exploitation) and did not inquire too closely into whether the actual practice of the Soviet Union and the parties it controlled was consistent with these stated beliefs. I developed this point, and the contrast with the relatively small group of intellectuals who supported the Nazis, in a review of1 Mark Lilla’s book The Reckless Mind: Intellectuals in Politics

Two very different types of people have ended up as Communists. First, there are those for whom the central appeal was the cartharsis of a revolutionary smashing of the existing order. This was essentially the same appeal offered by the Nazis, and many of this type changed sides when the mandate of Heaven appeared to shift from one totalitarian party to the other.

On the other hand, there were large numbers of liberals and social democrats who were dissatisfied with the obvious failings of their own countries and accepted, at face value, the claims of the Soviet Union to be a peace-loving, democratic and socially just alternative society. Beatrice and Sydney Webb are prime examples of this sort of ‘fellow-traveler’.

The fellow-travelers may fairly be accused of gullibility and wishful thinking in their assessment of the Soviet Union, but this does not imply that their own ideas contained the seeds of totalitarianism. In fact, unlike the Nazi sympathisers discussed by Lilla, the vast majority of fellow-travelers, including those who took the formal step of joining the Communist Party, ultimately realised they had been deceived. Some repudiated their previous views entirely and became, in the American parlance, neoconservatives. Others simply accepted they had made a mistaken judgement, and adopted a more skeptical view of life, while retaining their old ideals.

There is nothing similar among those attracted to fascism and Nazism. Although Nazi propaganda was mendacious in every detail, it never concealed the fundamentally brutal nature of Nazism. The closest parallel to the ‘fellow traveler’ on the right is supplied by the many decent Catholics who supported Franco as a ‘soldier for Christ’.
After writing this, I recalled something Orwell had to say in response to an early Cold War description of the typical Communist as a fanatical ideologue, subordinating all personal values to the global struggle against capitalism and democracy. As he said (I’m paraphrasing from memory here), “this all sounds convincing, until you try to apply it the Communists you actually know. With the exception of a couple of hundred hardcore members, they are nothing like this. Most drift in, become disillusioned after a while, and drift out again”.

1 And also of a couple of books by Christopher Hitchens

July 27, 2004

The end of the line

Posted by John Quiggin

Ever since I learned to read, there’s been nothing better than to find a new author with a shelf full of books that I haven’t read1. Inevitably, though the day arrives when she (or he) becomes an old favourite with a shelf full of books I have read. The first I can remember was Rosemary Sutcliffe; the most recent has been Patrick O’Brian. I’ve just reached the end of the Aubrey-Maturin series, though there are still a couple I’ve missed. I’ve always found finishing a series an ambiguous experience, and the following exchange from my blog has finally clarified the mixture of feelings.

‘Ambiguous’ for all love! Your future yawns darkly, meaninglessly and emptily before you, man! Isn’t that why you left Two Of The Canon unbroached? C’mon admit it, Quiggers. There are those among us who would understand.
Posted by Rob Schaap at July 25, 2004 07:16 PM
Admittedly, my future yawns darkly, meaninglessly and emptily before me (apart from the Nutmeg of Consolation).

OTOH, I avoid the even greater risk of entering eternity with the series unfinished.

Hence, an ambiguous feeling.
Posted by John Quiggin at July 26, 2004 10:39 PM
Ah, I smoke it now.
Posted by Rob Schaap at July 26, 2004 11:22 PM

1 Since we’re now grading our tastes, I’ll use Orwell’s scheme and class myself as lower-upper-middlebrow. Give me 20 volumes of good respectable reads ahead of one work of tortured genius (not counting Ulysses), any time.

July 24, 2004

Big government is good for economic freedom

Posted by John Quiggin

Over at Marginal Revolution, Alex Tabarrok recently presented a graph showing a positive correlation between UN measures of gender development and the Fraser Institute’s Economic Freedom Index. Of course, Alex presented the usual caveats about causation and correlation, but he concluded “at a minimum the graph indicates that capitalism and gender development are compatible contrary to many radicals”

This prompted me to check out how the Economic Freedom index was calculated. The relevant data is all in a spreadsheet, and shows that the index is computed from about 20 components, all rated as scores out of 10, the first of which is general government consumption spending as a percentage of total consumption. Since the Fraser Institute assumes that government consumption is bad for economic freedom, the score out of 10 is negatively correlated with the raw data.

Looking back at Alex’s post, I thought it likely that high levels of government expenditure would be positively rather than negatively correlated with gender development, which raised the obvious question of the correlation between government consumption expenditure and economic freedom (as defined by the Fraser Institute index). Computing correlations, I found that, although it enters the index negatively, government consumption expenditure has a strong positive correlation (0.42) with economic freedom as estimated by the Fraser Institute. Conversely, the GCE component of the index is negatively correlated (0.43) with the index as a whole. By contrast, items like the absence of labour market controls were weakly correlated with the aggregate index.

It immediately struck me that this could be the basis of some snarky pointscoring. But on reflection, I thought that it would be more useful to look seriously at the issues raised by this result.

First, it’s necessary to explain the results. A large slab of the index consists of things like the absence of military interference in the rule of law. There’s also an entire section of the index devoted to sound money (low and stable inflation). These are both features characteristically provided by strong democratic governments, and not by weak ones, regardless of whether they are interventionist or laissez-faire. It seems pretty clear that a principal components analysis would show a dominant component associated with the characteristics of developed mixed economies, characteristics that include high levels of public expenditure, combined with relatively light-handed forms of government intervention in the private sector, compared to those characteristic of weak governments in less developed countries.

This is scarcely surprising. State capacity tends to rise with income, so in wealthy countries the state can achieve more, with less obtrusive use of power, than in poor countries. It is strong and not weak states that produce economic freedom.

The same principles that lead to support for separation of powers within the state with clearly defined roles for the judiciary, legislature and executive (including the military!), also yield support for a mixed economy against the alternatives of comprehensive central planning and unfettered corporate power. The mixed economy produces more economic freedom for the average person than does the minimal state. Despite its own presumption to the contrary, the Fraser Institute’s analysis supports this conclusion.

July 23, 2004

Why does the efficient markets hypothesis matter ?

Posted by John Quiggin

Reading the discussion of earlier posts about the efficient markets hypothesis, it seems that the significance of the issue is still under-appreciated. In this post, Daniel pointed out the importance of EMH as a source of pressure on less-developed countries to liberalise capital flows, which contributed to a series of crises from the mid-1990s onwards, with huge human costs. This is also an issue for developed countries, as I’ll observe, though the consequences are nowhere near as severe. The discussion also raised the California energy farce, which, as I’ll argue is also largely attributable to excessive faith in EMH. Finally, and coming a bit closer to the stock market, I’ll look at the equity premium puzzle and its implications for the mixed economy.

To recap, the efficient markets hypothesis says that the prices generated by capital markets represent the best possible estimate of the values of the underlying assets. So, for example, the price of a share in Microsoft is the best possible estimate of the present value of Microsoft’s future earnings, appropriately discounted for time and risk.

The EMH comes in three forms. The weak version (which stands up pretty well, though not perfectly, to empirical testing) says that it’s impossible to predict future movements in asset prices on the basis of past movements, in the manner supposedly done by sharemarket chartists, Elliot wave theorists and so forth. The strong version, which almost no-one believes says that asset prices represent the best possible estimate taking account of all information both public and private. For policy purposes, the important issue is the “semi-strong” version which says that asset prices are at least as good as any estimate that can be made on the basis of publicly available information. There’s a heap of evidence to show that the semi-strong EMH is false, but the most dramatic, as I pointed out recently, is that of the dotcom boom, when obviously hopeless businesses like Pets.com were valued at billions of dollars. I’ve discussed this a bit more here

An apparent, but not real, moderation of the semi-strong EMH is the formulation offered by James Surowiecki that “whether or not markets are perfectly efficient, they’re better than any other capital allocation method that you can think of.” It’s clear that, if capital markets are always the best possible way of allocating capital then they must produce the best possible estimates of asset values, given available information, and this is just a restatement of semi-strong EMH.

A much more defensible position is that, even if capital markets are not perfect, neither is any alternative, and it is therefore an empirical question whether unregulated capital markets or some alternative, such as regulation or public investment, will yield better outcomes in any particular case. This formulation leads straight to the basic economic framework of social democracy, the mixed economy, leaving, of course, plenty of room to argue about the optimal mix.

Now let’s look at some specific cases where the EMH gives a simple and misleading answer, and where a more careful analysis leads to mixed-economy conclusions.

First, there’s the question of foreign exchange markets. As Daniel observed, the EMH implies that the optimal policy is to allow exchange rates to be determined by unregulated capital markets, in what is called a ‘clean float’. The experience of the Asian crises, and also of Chile and China, suggests that developing countries may do better with controls that limit short-term capital flows. But even among developed countries, belief in the desirability of a clean float has faded. The volatility of exchange rates since the collapse of the fixed exchange rate regime in the mid-1970s has been much greater than expected, and much more than can be explained by any sensible model of rational markets. Most central banks have come to adopt a policy of ‘leaning against the wind’, that is, buying their own currency when the exchange rate is well below the long-run average (sometimes called Purchasing Power Parity, though this isnt quite accurate) and selling when it is well-above. On average, this has been a profitable long-term strategy. A lot of economists, starting with the late James Tobin, would go further and tax foreign exchange transactions in the hope of reducing volatility. The lesson here is that neither rigidly fixed exchange rates nor a perfectly free float is likely to be optimal. You can read some more on this here

Second, there’s energy, and particularly electricity. Until the 1990s, electricity was supplied either by public enterprises (most places except the US) or regulated monopolies. These did not do a perfect job in making investment decisions. Roughly speaking, when engineers were in charge, there was “gold-plating”, notably in the form of excessive reserve capacity. By contrast when accountants or Treasury departments were in charge, capital was rationed tightly, and investment decisions were determined largely on the basis of attempts to get around the resulting artificial constraints.

The EMH implied that private capital markets would do a far better job. This in turn led to the creation of spot markets for electricity which otherwise made little sense, since, in the absence of highly sophisticated metering, most users could not respond to market signals in the required fashion (the big consumers, who could respond, typically had contracts specifying if and how much their supply could be cut in the event of a shortage). In practice, this produced huge reallocations of wealth while failing to produce either sensible signals to consumers or rational investment. Instead, the pattern in investment was one of boom and bust. As a result, there’s been a steady movement away from spot markets and towards the reassertion of more co-ordination and planning of investment. I’ve had a bit more to say about this here

Finally, there’s the equity premium puzzle, that is, the fact that average returns to equity are far higher than can be accounted for by any sensible model incorporating both reasonable risk attitudes and the efficient markets hypothesis. If you reject the efficient markets hypothesis, it’s natural to conclude that the true social cost of capital is close to the real bond rate. This in turn allows us to evaluate privatisation by comparing the profits forgone with the interest saving that arises when sale proceeds are used to repay debt. For Australia and the UK, such an analysis produces the conclusion that most privatisations have reduced welfare. Some of the evidence is in this paper (PDF file), and there’s a more rigorous analysis here (PDF). Responding to this argument, Brad DeLong observes, with customary acuteness that my argument implies that “the natural solution to all this is the S-Word:Socialism:public ownership of the means of production”.

Actually, however, while this aspect of the argument, taken in isolation, would imply that public ownership always outperforms private, there are plenty of factors going in the other direction, such as the principal-agent problems associated with the absence of an owner-manager or a threat of takeover. So, the correct conclusion, as foreshadowed above, is that the optimal arrangement will be a mixed economy.

Determining the optimal mix is a difficult task, requiring lots of case-by-case analysis, but I’ll offer the view that the optimal public share of production and consumption is unlikely to be below 25 per cent, and is typically close to 50 per cent. For a contrasting view, I’ll point to my distinguished predecessor at the University of Queensland, Colin Clark, who thought 25 per cent was an upper bound. I’ll need another big post to spell out my claims here, and this will take some work. In the meantime, feel free to pitch in with your own views.

July 22, 2004

Scandal

Posted by John Quiggin

As far as I can see, the Right seems to be winning the scandal wars just at the moment. I didn’t follow the Plame-Wilson scandal the first time around, so I can’t really tell how damaging or otherwise the latest claims from US and British intelligence may be to Wilson’s credibility. Similarly, although it seems clear that Sandy Berger has made a fool of himself , I have no idea what this means for anything that might possibly matter. Finally, it appears that last Thanksgiving in Iraq, Bush posed not with a fake turkey, but with a display turkey, never intended for carving but to adorn the buffet line. I’m glad that’s been cleared up.

All this confirms me in the view that the kind of “smoking gun” or “what did X know and when did s/he know it” scandal that has dominated politics since Watergate is a waste of everybody’s time. The real scandals are those that are, for the most part, on the public record.

Looking specifically at Iraq, I’m amazed at the continuing focus on intelligence reports about WMDs. It seems to me as if people on both sides of the debate have excised from their memories everything that happened between December 2002 and the outbreak of the war, with the exception of some speeches given by Bush, Blair and Powell. In particular, it seems as if judgements about the threat posed by Saddam’s regime depended primarily on intelligence reports from places like Niger.

To remind anyone who might have forgotten, from December 2002 onwards, anyone who watched the news could acquire all the evidence they needed to conclude that Saddam did not have nuclear weapons and was not close to getting them, and that he probably didn’t have a germ warfare program either. This is because UN inspectors had (with trivial exceptions) unhindered access to any site that US or British intelligence reports indicated might be suspicious. In particular, they were able to visit old nuclear sites like Tuweitha where both Blair and Bush claimed that suspicious rebuilding activity had gone on. They found nothing, for the very good reason that nothing was happening. A more thorough search would have been needed to rule out the possibility of a stockpile of poison gas, but we now know it would have come to the same conclusion.

Of course, this was not enough to convince those who were bent on war in any case. But even for these people, the intelligence reports should have been irrelevant once the inspections commenced. At this point it became clear that whatever was in the intelligence reports, it was not information that could be given to the inspectors to say go and look at place X, take up the floor and you’ll find the evidence you need. I saw various more or less desperate explanations of why this might be the case during the leadup to the war, but I find it hard to believe that anyone actually relied on intelligence reports, as opposed to longheld beliefs, in concluding that Saddam must have WMDs.

Either way, it doesn’t matter much whether and how the intelligence reports were cooked, over-egged, sexed up or whatever. The main question is how, with the world having agreed on a UN resolution that required either inspections or war, we ended up with both1.

1 I can’t stop people posting absurd legal quibbles about the meaning of “active compliance” and so on, but I won’t respond to them.

July 20, 2004

The virus of error

Posted by John Quiggin
In the most recent London Review of Books, Hugh Pennington has a generally excellent article on measles and erroneous (to put it charitably) research linking the combined MMR vaccine to autism. It's a pity therefore that, on a peripheral issue, he perpetuates an equally glaring error, saying
'Most people have an intuitive appreciation that the best vaccine programme, from an individual's point of view, is one where almost everyone else is vaccinated while they are not, so that they are indirectly protected without incurring any of the risks or inconvenience associated with direct protection.' If too many people act in this way, the infection becomes commoner in the population as a whole, and returns as a real and significant threat to the unimmunised. This is a modern version of the 'Tragedy of the Commons' described by Garrett Hardin in his influential 1968 essay: 16th-century English peasants had free grazing on commons; their need to supplement food supplies and income was very great; the resulting overgrazing wrecked the commons for everyone.
As I've pointed out previously Hardin's story was, in historical terms, a load of tripe. It's interesting to note that, in repeating Hardin's story, Pennington adds the spurious specificity of "16th century England", whereas Hardin's account was not specific regarding dates and places, and therefore harder to refute. This is characteristic of the way in which factoids are propagated.

July 19, 2004

Rational manias

Posted by John Quiggin

There’s a cottage industry within economics involving the production of historical arguments giving rational1 explanations of seemingly irrational historical episodes, of which the most famous is probably the Dutch tulip boom/mania. This Slate article refers to the most recent example, a complex argument regarding changes in contract rules which seems plausible, but directly contradicts other explanations I’ve seen.

Once opened, questions like this are rarely closed. Still, articles of this kind seem a lot less interesting in 2004 than they did in, say, 1994. In 1994, the efficient markets hypothesis (the belief that asset markets invariably produce the best possible estimate of asset value based on all available information) was an open question, and the standard account of the Dutch tulip mania was evidence against it. In 2004, the falsity of the efficient markets hypothesis is clear to anyone open to being convinced by empirical evidence.

We have seen billion-dollar valuations placed on companies that proposed to home-deliver dogfood at prices lower than those charged in discount stores. We’ve seen unimportant subdivisions of profitable companies valued at more than the companies themselves. We’ve seen a dozen different companies simultaneously priced at levels that made sense only if they were each going to monopolise the industry in which they were competing. And don’t even get me started on the US dollar bubble (now burst) or the bond bubble (still inflating).

In summary, is contradicted by our own recent experience far more thoroughly than by anything that might or might not have happened in Amsterdam in the 1630s. Everybody who cared to look at the numbers coming out of markets in the late 1990s knew they were crazy, but it didn’t matter. Those who bet on an early return to sanity (George Soros for example) lost their money. The only sensible course was to withdraw to the sidelines and wait the madness out.

It’s true that dramatic episodes like the dotcom mania don’t happen all the time. But even one such episode, occurring in a well-developed and sophisticated financial market like that of the US in the late 1990s is sufficient to undermine the assumption that asset markets ever yield the best possible estimate of asset values, except by chance.

1 That is, explanations consistent with individual rationality as defined by economists

July 16, 2004

The new Iraq

Posted by John Quiggin

Although there’s plenty of news coverage of inquiries into the “intelligence” that justified the Iraq war, coverage of events in Iraq itself seems to have declined sharply since the formal handover of sovereignty and the shutdown of the Coalition Provisional Administration. There seems to be a general media consensus that things have gone quiet, with the result that, when the usual news of bombings, kidnappings and assassinations is reported, it’s always prefaced with something like Suicide Blast Shatters a Calm (NYT 15 July) or after a week of relative calm (Seattle Times 7 July).

Regardless of the calmness or otherwise of the situation, the installation of Allawi as PM has certainly produced a new dynamic. Allawi has moved quickly to establish himself as a strongman, resolving by default the questions left unanswered in the “handover”. His announcements of emergency powers and the establishment of a security service/secret police have been criticised, but they amount to little more than the assumption of powers previously exercised by the CPA with no legal basis of any kind. The big question before the handover was whether any new military operations would be under the control of the interim government or of the American military. Allawi has moved pretty quickly to ensure that he will give the orders here, putting the onus on the American military to come to his aid if his forces run into serious resistance.

Allawi has also moved to split the insurgency, distinguishing between “legitimate” resistance forces (essentially those whose attacks were directed at the occupying forces) and terrorists (Zarqawi’s Al Qaeda offshoot, and the remaining supporters of Saddam). The big beneficiary of this is Moktada al-Sadr whom Bremer tried to suppress in his last weeks, but who is now more popular and powerful than ever1. In a fairly standard move in situations of this kind, Sadr has switched from overt resistance activities to vigilante work, directed both at the Al Qaeda, Wahhabist and Saddamist insurgents and at “prostitutes, pimps, pornography sellers, gamblers - and those who sell alcohol.”2 Naturally enough, other Shiite leaders are alarmed at this and are trying to find a way to isolate al-Sadr (as always, Juan Cole has the story covered). But, having fought the Americans and lived to tell the tale, al-Sadr is pretty much untouchable now.

At this stage, there are three plausible outcomes for Iraq over the next year or so. The first is that Allawi will succeed in crushing the insurgency where Bremer failed, and will also manage to divide and rule the Shiite majority. The likely outcome in this case is a strongman government, comparable to the Mubarak regime in Egypt, and broadly sympathetic to the US. The second is that elections will produce a Shi-ite majority government, including al_Sadr. Such a government would be overtly hostile to the US, and would almost certainly demand early withdrawal of the occupying forces. The third is that the insurgents will succeed in reducing the country to chaos. My money is on the second. It seems clear now that it would have been far better to have held elections in 2003, when the dominant Shiite voice was the relatively quietist Sistani and before disasters like those in Fallujah and Najaf.

Update Commenting on the version of this piece at my blog, reader Jack Strocchi points to this Sydney Morning Herald piece, which includes allegations that Iraqi PM Allawi personally executed prisoners at a Baghdad police station. The killings supposedly took place a week or so before the handover of sovereignty. Allawi has denied the allegations , and, although the SMH has statements from purported eyewitnesses, it seems implausible that Allawi would take such a risk for no reason, especially with the handover only a week away.

The more important point that comes out of the article is that the spread of such rumours is, on the whole, good for Allawi’s popularity in Iraq. I compared him to Mubarak, but, as Jack (channeling Steve Sailer) points out, Putin provides a better analogy in many ways. It’s not hard to imagine a situation where, with even partial success against the insurgency, Allawi could get control of most of the levers of power and secure majority support/acquiescence through some sort of plebiscite.

1 Amazingly, the US military is touting the campaign against al-Sadr as a textbook success in counterinsurgency

2 Very similar things are being done in Sunni “no-go zones” like Fallujah. The days of “Democracy, Whiskey, Sexy” are a long way behind us now.

July 14, 2004

The beauty of the English language

Posted by Daniel
Given the number of irregular verbs in the English language, it’s nice to know that one commonly used phrase is at least well-behaved:

Some might argue that the modern meaning of the phrase “accept responsibility” is irksome in that it has only illocutionary significance; without the announcement that X has “accepted responsibility”, one would have the very devil of a job working out that it had happened. Might I suggest that what we ought to do is to coin a generalised version of Douglas Adams’ useful neologism “dogdyke” from his excellen book, “The Meaning of Liff”:

DOGDYKE (vb.)
Of dog-owners, to adopt the absurd pretence that the animal shitting in the gutter is nothing to do with them.

Onward to hell we all go …

Is economics an empirical science ?

Posted by John Quiggin

Tyler Cowen1 lists a number of economic propositions which he formerly believed, but has abandoned in the light of contrary evidence. Most of these propositions were elements of the economic orthodoxy of the 1980s and 1990s, variously referred to as Thatcherism, neoliberalism, the Washington consensus and, in Australia, economic rationalism. They include the efficacy of monetary targeting, the beneficence of free capital movements and the desirability of rapid privatisation in transition economies.

Following in the same spirit, I thought I’d list a couple of propositions on which I’ve changed my mind in the face of empirical evidence. These are elements of the Keynesian orthodoxy of the 1950s and 1960s, on which I was trained. Following Cowen, I’ll list them as false claims I used to believe

  • There is a long-run trade-off between unemployment and inflation
  • Keynesian fiscal policy is a powerful and reliable instrument for stabilising aggregate demand

On both these issues, I’ve come to accept that Milton Friedman was largely right, and his Keynesian opponents largely wrong.

On the first, I think Friedman’s victory was total, although the supposed implication that there exists a “natural rate” of unemployment at which inflation remains stable has proved equally unreliable.

On the second, Friedman was absolutely right in talking about “long and variable lags” and rejecting the idea that it is possible to “fine-tune” the economy. This doesn’t mean that fiscal policy is of no value. In particular, the fact that budgets naturally go into deficit when the economy turns down provides a measure of automatic stabilisation. And when a deep recession lasts for more than, say, a year, there’s time to bring discretionary fiscal policy into play. The suggestion, by Nick Gruen and others, of some form of independent body to manage discretionary fiscal policy, analogous to that of the Reserve Bank in monetary policy, has a lot of appeal for me. Still, this is a long way from the kind of mechanical Keynesianism I was taught a few decades ago.

Combining my concessions and Tyler Cowen’s, it’s evident that there is some process of convergence in the beliefs of economists, though with a lot of oscillation. The breakdown of Keynesian economic management during the crisis of the 1970s, and the general ‘fiscal crisis of the state’ that occurred at the same time, validated many of the criticisms made by Friedman and others of the Keynesian and social-democratic orthodoxy of the postwar period. But it produced an overreaction, most notably in the extreme claims made by advocates of rational expectations macroeconomics, but also in overblown claims about the merits of privatisation and deregulation. These have gradually lost favour as their empirical weakness has been exposed by events.

1 Jason Soon has also noted this piece

July 12, 2004

The new consensus on minimum wages

Posted by John Quiggin

Coming in a bit late, I have the opportunity to survey a range of blogospheric discussion of the topic of minimum wages, which largely supports the view (not surprising to anyone but an economist) that minimum wages are good for low-income workers. The traditional view among economists was that minimum wages reduced employment and thereby harmed workers, but this view has been overturned, or heavily qualified, by empirical evidence, beginning with the work of Card and Krueger.

The debate kicked off with a piece by Stephen Landsburg in Slate, noting that recent US econometric studies had failed to find economically and statistically significant negative effects on employment resulting from higher minimum wages. This was surprising, in view of a range of earlier studies which found right-signed effects, but were statistically weak because of small samples. Landsburg argues that this might be an example of publication bias, in which studies with no statistically significant results tend to get discarded. He concludes
Now that we’ve re-evaluated the evidence with all this in mind, here’s what most labor economists believe: The minimum wage kills very few jobs, and the jobs it kills were lousy jobs anyway. It is almost impossible to maintain the old argument that minimum wages are bad for minimum-wage workers. In fact, the minimum wage is very good for unskilled workers. It transfers income to them
Landsburg then goes on to argue against the minimum wage on the curious ground that it’s a less transparent alternative to policies such as an Earned Income Tax Credit. Brad de Long responds, endorsing the EITC, but arguing that minimum wages are also an effective policy instrument for transferring income to the poor.

There are quite a few interesting responses. Steve Verdon develops Landsburg’s argument, pointing out that a minimum wage increase which raises the general cost of goods and services is like a consumption tax and has an associated deadweight loss. That’s true, but it’s also true of whatever tax may be used to finance the EITC. Robert Waldmann suggests changing the structure of payroll tax, but as he himself points out, his argument disregards the point that the budget is already in deficit. Tyler Cowen observes that increases in wages may be offset be reductions in working conditions. Interestingly, no-one seems to have defended the traditional view on empirical grounds.
An interesting and important question is whether these results can be transferred to other countries like Australia, where the minimum wage is higher relative to average weekly earnings. In the survey of the literature we did for the National Wage Case, Steve Dowrick and I concluded that, although there might be some reduction in employment and some leakage to low-wage workers in high-income households, the evidence showed that minimum wages help low-income workers . Our study is here (PDF file)

Overall, my view is close to that of Brad de Long. Minimum wages are a useful policy instrument, but by no means the only or most important one, to improve the position of low-income workers.

Update Jacob Levy asks, reasonably enough
If, as Landsburg claims, the published studies are “all in agreement” about the direction of the effect, then the underlying distribution of studies can’t be as he describes it, can it? Publication bias in favor of significant findings, superimposed on an actually-neutral relationship ought to generate equal numbers of ostensibly-significant findings in each direction.
Actually, the Card and Krueger study found weak positive impacts of minimum wages on employment using a data set where most of the obvious sources of bias had been removed. There may have been earlier studies with similar results, but they would almost certainly have been discarded, on reasonable grounds of weak statistical significance or omitted variable bias. By contrast, studies with similar weaknesses, but with the expected sign would have been published.

July 08, 2004

I guess he thought he could have gone faster

Posted by John Quiggin

Talking of transatlantic language differences, I was quite surprised to see this headline in the Washington Post. And I thought Australians took sport too seriously.

April 26, 2004

Making learning languages fun

Posted by Chris

I’ve been going to evening classes to try to get my German up to speed for a few weeks now and I feel I’m making a bit of progress. If I watch the Deutsche Welle news I can more or less work out that Schroeder is unbelievably pissed-off with Blair over the Euro referendum but can’t say so for diplomatic reasons. I’ve also been renting German movies such as Lola Rennt (terrific but not so useful for language) and Was tun, wenn’s brennt? (Funny, though comedies about terrorists making bombs out of fertilizer have a decidedly retro feel these days.) Anyway, after reading Learning French through Blaxploitation over at Ishbaddle, I may have the learning-by-casual-osmosis strategy the wrong way round. Watch DVDs in English and turn the German subtitles on? Anyway, I’m interested in hearing about language-learning strategies that are fun at the same time (and if anyone can throw in German movie recommedations too, that would be a plus).

March 22, 2004

Varieties of English

Posted by Brian

Here’s a semantic construction I hadn’t heard before. (This was on SportsCenter, or some sports show, on the weekend.)

(1) Nevada upset Gonzaga by 19 points on Saturday.

That isn’t, or at least wasn’t, a sentence in my dialect.

I could say each of the following.

(2) Nevada beat Gonzaga by 19 points on Saturday.
(3) Nevada upset Gonzaga on Saturday.

But transitive ‘upset’ couldn’t be modified by a margin of victory. Maybe I just had a quirk in my dialect and I should remove it, but (1) still sounds odd to me. I might try using the dialect in which ‘upset’ can be modified this way and see if it starts sounding more natural with use. With the way the NCAA tournament is going, I should have plenty of opportunities to try.

I have no theory whatsoever as to why in my native dialect this modification is (was) impermissible. One would think that the beating would be a constituent of the upsetting, and hence that any permissible modifier of ‘beat’ could latch on to that constituent. But apparently not, at least not in the language I spoke until a few days ago.

February 14, 2004

Decoding Anaphors

Posted by Brian

Context can be so crucial in figuring out what a sentence means, even in subconscious processing. When I first scanned this I thought Ed Gillespie shouldn’t be so candid in front of reporters.

In prepared remarks, Gillespie attacked Kerry and other Democrats, saying they are readying “the dirtiest campaign in modern presidential politics.” (From CNN)

I bet our Republican readers did not read it that way!

February 12, 2004

Gender-Neutrality

Posted by Brian

I hadn’t noticed this before, but Mark Kleiman has on his website a fun collection of aphorisms he co-collated with David Chu-wen Hsia. I normally stay away from aphorisms because they remind me of Wittgenstein and anything that reminds me of Wittgenstein makes me irritated, but there’s some good stuff here. What I really wanted to comment on though was the following.

Masculine pronouns, and “man” for “human being,” occur throughout. English needs neuter personal pronouns, but currently lacks them. We can’t do much about that now without great loss of force. (Those who doubt this sad fact are urged to try their hands at gender-neutralizing “Greater love hath no man than this: that he lay down his life for his friends.”) Our apologies to those offended.

That’s not the hardest challenge I’ve seen today. This isn’t a perfect translation into gender-neutral language, but it’s pretty close.

No person has greater love than to lay down their life for their friends.

People who think ‘they’ is invariably a plural pronoun won’t like this, but they’re wrong for both etymological and ordinary language reasons.

January 30, 2004

He Wanna Be Adored

Posted by Brian

This is a fairly rambling post on the syntax and semantics of ‘want to’ and ‘wanna’, so it’s almost all going below the fold. I would be interested to hear back if people agree or not with some of my judgments about the various cases.

Europa Malynicz sent me the following case, which it turns out we have different intuitions about.

Brian is running for election on the Monster Raving Loony Party ticket. He did not want to win when he entered, because he’s just smart enough to know that Monster Raving Loonies are bad for government. But, being a bit of a Monster Raving Loony himself, he’s now forgotten that he’s in the contest. While watching nightly news he sees himself dressed up as a Teletubby disguised as a teacup campaigning for votes. Not recognising who he is, but being very impressed with the hat he’s wearing, he forms the desire that that guy wins the election. In this context, which of (1) and (2) are true?
(1) Brian wants Brian to win the election.
(2) Brian wants to win the election.

I think that (1) is probably true, although it might be misleading. But I think (2) is false. (Europa thinks it is also true but misleading, which is where the difference arises.) So the first reason I’m posting this is to check what your intuitions are. Could (2) really be true in this context? Could (1)?

This is a cute case, and it suggests a couple of wild hypotheses.

De Se Hypothesis
(2) is only true if Brian has a de se desire, a desire that is essentially self-directed. It’s false in the case described because he has a de re desire that that guy wins, a desire that is directed at the guy on TV, which just happens to be him.

PRO Hypothesis
It’s really hard to explain the difference between (1) and (2), i.e. that one of them is true and the other false, if there is a hidden pronoun PRO between ‘wants’ and ‘to’ in (2). So here’s some evidence that there isn’t one. (I make no claims to originality here - debates about hidden pronouns are very well worked over so I suspect someone has made this point before.)

Thinking about PRO makes me think about wanna, but thinking about wanna just makes me confused. Here’s roughly why. How grammatical do each of the following seem to you?

(3) a. I want to be adored
      b. I wanna be adored
(4) a. You want to be adored
      b. You wanna be adored
(5) a. He wants to be adored
      b. He wanna be adored
(6) a. She wants to be adored
      b. She wanna be adored
(7) a. They want to be adored
      b. They wanna be adored

My intuitive judgments are that all the a sentences are OK, while 5b and 6b are very bad, and 7b is pretty bad. It turns out Google agrees that 5b and 6b are much worse than 3b and 4b, but it also thinks 7b is just as bad as 5b and 6b. Still, all the forms are used widely enough that they seem kinda acceptable at least to some. Here are the counts for searching for pronoun followed by “want to” or “wanna”.

want to
wanna
Ratio
I
10,600,000
2,390,000
4.4
You
16,400,000
1,510,000
10.9
He
1,760,000
11,800
149.2
She
816,000
16,500
49.5
They
4,030,000
79,400
50.8

79,400 is many more hits than I expected for a phrasing I regard as marginal, an 28,300 between ‘he’ and ‘she’ is way more than I expected for a phrasing I regard as clearly bad. At least the ratios were way down than from ‘I’ and ‘You’.

December 30, 2003

Quite

Posted by Chris

I’ve had to check myself several times when writing on CT recently. I’ve been tempted to use the word “quite” as a modifier of words like “good”. The trouble with this is that Americans (and perhaps all other English users outside the UK?) use the word as a modifier also but in a different sense from the way I would naturally do. If an English person is asked what they thought of a film or a play or a restaurant and they reply that it was “quite good”, they are likely to mean that it was good only to a moderate degree. Americans will intend and understand by the same phrase that something was absolutely, wholly or certainly good. If you tell me that my work is “quite good”, I’m likely to understand that as damning with faint praise. But If you are an American you probably meant to compliment me. Just to confuse matters, a British person who says they are “quite sure” does indeed mean that they are absolutely sure. I hope we’ve quite cleared up that misunderstanding.

December 16, 2003

Update your stylebooks

Posted by Ted

Greg Beato identifies yet another irregular verb:

  • We engage in refreshing, hilariously politically incorrect humor
  • You (pl.) push the boundaries of good taste
  • They wallow in profanity and ethnic slurs

December 07, 2003

Wirtiglugs

Posted by Henry

David Langford’s indispensable Ansible tells us about wirtiglugs, hwinis, and (my favourite) breekbridders.

As a Christmas treat, Greer Gilman offers seasonal words of Shetland dialect. [EG] wirtiglugs, brose made with wirt. sukkaleg, a stocking without a foot, or with a very ragged foot. warbak, an insect that breeds under the skin in cattle. hwini, a hermaphrodite sheep. hwirkabus, water in the throat; a disease of sheep. hwamp, a quirk; the hollow of the inside of the human foot. hustak, a big fat woman. brimfuster, sea-froth. brimskud, the vapoury, smoke-like haze which rises from the shore-bretsh. barfljug, to separate ears of corn from their stalks without crushing the corn. kilpik, a little basket made of dokkens. kist, a word used to scare a cat. pirl, a single particle of sheep’s dung. pirr, a light breath of wind, such as will make a cat’s paw on the water. sae, a tub with two lugs. sig, a hardened part of the skin of the hand caused by pressure of a tool in working. sangster, a bruni made of sillik livers and bere bursten [if you stuff that in a cod’s liver, it’s hakkamuggi, the local form of haggis]. sanveelter, a disease of horses caused by their eating sand along with their food. krug, to crook or crouch in taking shelter fromn the weather under some high or overhanging thing. krugset, to beset in a corner. manket, worn out with work. norraleg, a needle with a broken eye. feevi, snow falling in large flakes. snud, the twisting movement of the head of a refractory cow. limmer, a bad woman. limmerik, the bog asphodel. pilli, the penis. tairm, a string made of sheep’s gut, used for fiddle-strings. tamtier, to cause delay by frivolous pretenses. breekbridder, when two men court the same woman, each is breekbridder to the other. brennik, a parhelion, a mock sun. essi, defiled with ess. faan upon, beginning to show signs of decay, as fish or flesh. jap, a short, choppy sea. kirkasukken, the buried dead as distinguished from those who have a watery grave. ogarhunsh, any frightful or loathsome creature.

September 23, 2003

Language Log

Posted by Brian

Via Kai von Fintel, I see there’s a new blog Language Log being run by four very talented linguists. I was very pleased to see that Geoff Pullum, author of my favourite academic book, agrees with me about the learned/said controversy that erupted here soon after CT opened.