The Bayesian Heresy

Friday, May 30, 2008

Long live the Choice Architects of the World

As all women who have ever shared a toilet with a man can attest, men can be especially spacey when it comes to their, er, aim. In the privacy of a home, that may be a mere annoyance. But, in a busy airport restroom used by throngs of travelers each day, the unpleasant effects of bad aim can add up rather quickly. Enter an ingenious economist who worked for Schiphol International Airport in Amsterdam. His idea was to etch an image of a black house fly onto the bowls of the airport’s urinals, just to the left of the drain. The result: Spillage declined 80 percent. It turns out that, if you give men a target, they can’t help but aim at it.

Russian businesses fighting poverty in UK

Guano is an undeniably strenuous enterprise from the perspective of the laborers who migrate to the islands to collect the dung each year. The laborers rise before dawn to scrape the hardened guano with shovels and pick-axes.

Many go barefoot, their feet and lower legs coated with guano by the time shifts end in the early afternoon.

The workers earn monthly salaries of about $600, more than three times what manual laborers earn in the impoverished highlands, where most of them are from

Guano in Peru sells for about $250 a ton while fetching $500 a ton when exported to France, Israel and the United States. Its status as an organic fertilizer has also increased demand, transforming it into a organic niche fertilizer sold around the world.

Richard Thaler on Nudge

Nudge: Improving Decisions About Health, Wealth, and Happiness

Related;
Dustin Hoffman’s mental accounting

Google goes against Burmese junta

Global Justice Center

Burma is a criminal cabal.

Bottom Billion - a myth?

The economics of Scrabble

An interesting profile of economist Jacques Polak;

During a lengthy recuperation from surgery in 1955, Jacques Polak whiled away the hours playing the popular board game Scrabble. It wasn't long before he subjected the word-building game to economic analysis—invoking such common concepts as the Keynesian multiplier and Marshallian profit maximization to divine a formula to maximize a player's total score.

The fundamental mistake inexperienced players make is trying to maximize their score in each turn, a strategy that, in the argot of economics, involves a cost: the "sacrifice of the score that might have been obtained with the same letter in another word," Polak opined in a 1955 article in the American Economic Review.

Polak developed a profit-maximizing formula of how best to make words using the 100 letter tiles in each game that have values running from 1 for common letters such as E to 10 for hard-to-use letters Q and Z. He propounds three rules:
• Letters with face values of 1 and 2 should, and those with a face value of 3 may, be used any time.
• Letters with face values of 4 and 5 should be used only if they score at least double, but a player should not hold onto them for a triple score.
• Letters with face values of 8 and 10 should almost always be kept for triple scores.

The derivation of the rules may be complicated, but they "can easily be followed in practice, even by beginners," he concluded. And apply them he did, Polak noted long after the article was published. Sadly, he was regularly bested by his wife, who cares nothing about the economics of Scrabble.

Clinton Ads

via The Caucus

“When Hillary was crying, and people said that was put on – I really don’t believe it was put on,” Mr. Pfleger said. “I really believe that she just always thought this is mine. I’m Bill’s wife, I’m white and this is mine. I just gotta get up and step into the plate. And then, out of nowhere, came ‘Hey, I’m Barack Obama.’ And she said, ‘Oh, damn. Where did you come from? I’m white. I’m entitled. There’s a black man stealing my show.”

Maths Pocast of the Day

Probability;

Heads or tails? It’s a simple question with a far from simple answer. One that takes us into the strange and complex world of probability.

Probability is the field of maths relating to random events and, although commonplace now, the idea that you can pluck a piece of maths from the tumbling of dice, the shuffling of cards or the odds in the local lottery is a relatively recent and powerful one. It may start with the toss of a coin but probability reaches into every area of the modern world, from the analysis of society to the decay of an atom.

More Readings;
F. N. David, Games, Gods and Gambling (Griffin, 1962)

T. M. Porter, The Rise of Statistical Thinking, 1820-1900 (Princeton University Press, 1986)

S. M. Stigler, The History of Statistics (Harvard University Press, 1986)

J. Von Plato, Creating Modern Probability (Cambridge University Press, 1994)

John Haigh, Taking Chances: Winning with Probability (Oxford University Press; New Ed edition (8 May 2003)

Gerd Gigerenzer, Reckoning with Risk: Learning to Live with Uncertainty (Penguin Books Ltd; New Ed edition (24 April 2003)

Frederick Mosteller, Fifty Challenging Problems in Probability With Solutions (Dover Publications Inc.; New Ed edition (1 Feb 1988)

Ian Stewart, Taming the Infinite: The Story of Mathematics (Quercus, July 2008)

Teacher package: Statistics and probability theory

The Drukard's Walk

A great talk from Authors@Google;
The Drunkard's Walk: How Randomness Rules Our Lives
by Leonard Mlodinow

Related;
Numbers Guy Interview: Leonard Mlodinow;

WSJ: If you can pick an index-outperforming stock 51% of the time, how many picks do you need to make to have better than a 99% chance of outperforming the index? (We’ll assume your picks are uncorrelated and that the magnitude of any outperformance or underperformance is the same.)

Mr. Mlodinow: Consider a stock analyst versus an index fund in a kind of stock-picking World Series. The law of large numbers says if you play a best-of-X series you can be confident that the best team will win — if X is large enough. But for small X, say, a best-of-seven series, there is a surprisingly large chance that the lesser team will win. So in sports just because one team is superior doesn’t mean it will win the series.

The same uncertainty applies to the market. For example, suppose the stock picker has a 51/49 edge over the index fund, meaning he or she will outperform it, in the long run, in 51% of the years in which they compete. How long is the long run in this case? The mathematics shows that in order to justify 99% confidence that the stock picker will outperform the index fund more often than it underperforms it, the contest would have to go on for about 13,700 years...

WSJ: After a particular drug is on the market, it will cause a particularly serious adverse effect to happen to one of every 3,000 patients in an epidemiological, i. e., post-hoc analysis. In retrospect, how many patients must be tested in the randomized, double-blinded, placebo-controlled, clinical trial to achieve 95% confidence that the side effect will show up?

Mr. Mlodinow: You need roughly 14,000 patients. Here is how you get that: The process is governed by the binomial distribution, which can be approximated by the normal distribution. The chance of an adverse reaction in any one patient is one in 3,000. Since you want a 95% confidence interval for one (or more) reactions, you want enough patients so that 1.00 is 1.64 standard deviations (or more) below the mean. With 14,000 patients the mean number of adverse reactions will be about 4.6 and the standard deviation is about 2.2, which gives you what you require. (I have rounded my answer to the nearest 1,000).

Correction: To achieve 95% confidence that the side effect will show up, you need 8,985 patients receiving the drug. This blog post misstated the number as 14,000. See the comments of this post for more details.

WSJ: Might we need to proceed irrationally in our lives to succeed? In other words, if we really believed that so much of success was the result of luck, wouldn’t a lot of us just give up trying?

Mr. Mlodinow: Some theorize that this is the evolutionary reason that we like to assume we are in control, even when we clearly aren’t. That may be so, but I don’t mourn the role of luck, I celebrate it. All else equal, it is a lot more fun not knowing how your book will do, or how your life will turn out, than it would be if everything could be determined by a logical calculation. Moreover, the fact that luck matters means you can help yourself by being persistent. A failure doesn’t mean you are unworthy, nor does it preclude success on the next try. As Thomas J. Watson, the highly successful IBM pioneer, said, “If you want to succeed, double your failure rate.”

Try the following spelling bee words

eidetic: marked by or involving extraordinarily accurate and vivid recall, especially of visual images.

hemotrophe: the nutritive substance supplied to embryos of some animals.

homeostasis: a relatively stable state of equilibrium or a tendency toward such a state between the different but interdependent elements or groups of elements of an organism, population or group.

laryngitis: inflammation of the larynx, the upper part of the air- breathing tube in humans, most other mammals, and some amphibians and reptiles.

luftmensch: an impractical contemplative person having no definite business or income.

opalescence: reflecting an iridescent light.

Sioux: an American Indian people and their language.

sinecure: an office or position that requires little or no work and that usually provides an income.

-2 Hoosiers make finals of national spelling bee

Visions of the Future

Space elevator

More here and here

Most Stupid Quote of the Day- Sharon Stone

And then all this earthquake and all this stuff happened, and I thought, is that karma -- when you're not nice -- that the bad things happen to you?

Another Band Aid?

World Bank Launches $1.2 Billion Fast-Track Facility for Food Crisis

Related;
Trust the development experts – all 7bn of them By William Easterly;

The report of the World Bank Growth Commission, led by Nobel laureate Michael Spence, was published last week. After two years of work by the commission of 21 world leaders and experts, an 11- member working group, 300 academic experts, 12 workshops, 13 consultations, and a budget of $4m, the experts’ answer to the question of how to attain high growth was roughly: we do not know, but trust experts to figure it out.

This conclusion is fleshed out with statements such as: “It is hard to know how the economy will respond to a policy, and the right answer in the present moment may not apply in the future.” Growth should be directed by markets, except when it should be directed by governments.

My students at New York University would have been happy to supply statements like these to the World Bank for a lot less than $4m.

Why should we care about the debacle of a World Bank report? Because this report represents the final collapse of the “development expert” paradigm that has governed the west’s approach to poor countries since the second world war. All this time, we have hoped a small group of elite thinkers can figure out how to raise the growth rate of a whole economy. If there was something for “development experts” to say about attaining high growth, this talented group would have said it.

Science that can blow your mind

Class One Impossibility =Hollywood

Our most advanced computers are currently like retarded cockroaches

Michio Kaku on Science you thought never possible- a fascinating interview

War over Arctic- Can it Happen?

Affirmative Action Programs gone wrong

Wednesday, May 28, 2008

Photo of the Day- Unrest in China

A day after parents staged an impromptu rally in Mianzhu on Saturday, the Communist Party's top local official, Jiang Guohua, came to plead with the protesters to not carry out their plan to march to Chengdu, the provincial capital, where they sought to prevail on higher-level authorities. Mr. Jiang, on his knees, failed to deter the parents, who shouted in his face and continued their march.

The Secrets of Growth success

Zambia Economist has more on the Growth Commission report

Related;
Growth Economics (book Review)by Asaf Razin

The end of race as we know it?

John H. McWhorter and Glenn Loury debate on Blogging Heads

Related;
The Stupidity of Dignity- Steven Pinker

This spring, the President's Council on Bioethics released a 555-page report, titled Human Dignity and Bioethics. The Council, created in 2001 by George W. Bush, is a panel of scholars charged with advising the president and exploring policy issues related to the ethics of biomedical innovation, including drugs that would enhance cognition, genetic manipulation of animals or humans, therapies that could extend the lifespan, and embryonic stem cells and so-called "therapeutic cloning" that could furnish replacements for diseased tissue and organs. Advances like these, if translated into freely undertaken treatments, could make millions of people better off and no one worse off. So what's not to like? The advances do not raise the traditional concerns of bioethics, which focuses on potential harm and coercion of patients or research subjects. What, then, are the ethical concerns that call for a presidential council?...

The sickness in theocon bioethics goes beyond imposing a Catholic agenda on a secular democracy and using "dignity" to condemn anything that gives someone the creeps. Ever since the cloning of Dolly the sheep a decade ago, the panic sown by conservative bioethicists, amplified by a sensationalist press, has turned the public discussion of bioethics into a miasma of scientific illiteracy. Brave New World, a work of fiction, is treated as inerrant prophesy. Cloning is confused with resurrecting the dead or mass-producing babies. Longevity becomes "immortality," improvement becomes "perfection," the screening for disease genes becomes "designer babies" or even "reshaping the species." The reality is that biomedical research is a Sisyphean struggle to eke small increments in health from a staggeringly complex, entropy-beset human body. It is not, and probably never will be, a runaway train.

A major sin of theocon bioethics is exactly the one that it sees in biomedical research: overweening hubris. In every age, prophets foresee dystopias that never materialize, while failing to anticipate the real revolutions. Had there been a President's Council on Cyberethics in the 1960s, no doubt it would have decried the threat of the Internet, since it would inexorably lead to 1984, or to computers "taking over" like HAL in 2001. Conservative bioethicists presume to soothsay the outcome of the quintessentially unpredictable endeavor called scientific research. And they would stage-manage the kinds of social change that, in a free society, only emerge as hundreds of millions of people weigh the costs and benefits of new developments for themselves, adjusting their mores and dealing with specific harms as they arise, as they did with in vitro fertilization and the Internet.

Worst of all, theocon bioethics flaunts a callousness toward the billions of non-geriatric people, born and unborn, whose lives or health could be saved by biomedical advances. Even if progress were delayed a mere decade by moratoria, red tape, and funding taboos (to say nothing of the threat of criminal prosecution), millions of people with degenerative diseases and failing organs would needlessly suffer and die. And that would be the biggest affront to human dignity of all.

The prize Hillary isn't owed;

Women, we are told by some people who say they know them, are not amused. Women, or at least those whose consciousnesses have been properly raised, supposedly think that the impatience being expressed about the protracted futility of Hillary Clinton's campaign is disrespectful. They say that if the roles were reversed — if Barack Obama's delegate arithmetic were as hopeless as hers — people would not be so insensitive as to try to hurry a man off the stage.

But they would. And some people, claiming to speak for African Americans, would be explaining that African Americans find it all disrespectful. In identity politics, ritualized indignation about imagined affronts is highly choreographed and hence predictable.

In America, however, nothing ages as fast as novelty, and efforts to encourage Clinton to pack it in are heartening evidence that the novelty has worn off: The female candidate is like all other candidates. This is what equality looks like — life as an equal-opportunity dispenser of disappointments.

Tuesday, May 27, 2008

Sean Mills, President of The Onion

Our Dumb World: The Onion's Atlas of the Planet Earth, 73rd Edition
by The Onion

Related;
Obama Practices Looking-Off-Into-Future Pose

McCain Vows To Replace Secret Service With His Own Bare Fists

Illicit Mexico

Mexico: On the Road to a Failed State?

The Gangs of Central America

A Hellish Sunrise

A Dangerous Sunrise on Gliese 876d

Indonesia- A Budding Democracy

Vice-president thinks the country is 'too free'?

Latin-American Shadow Financial Regulatory Committee??

Latin-American Shadow Financial Regulatory Committee;

Some of the members; Ricardo Hausmann / Alberto Carrasquilla / Gullermo Calvo /PEDRO CARVALHO de MELLO / Ernesto Talvi

Here's latest press release

Blogging at the World Bank

Pierre Guillaume Wielezynski, who works on blogs and social media for the World Bank, said: "Dani (Kaufmann) has the profile of a good blogger: open, conversational, opinionated and, most important of all, passionate. He understands that blogging, and social media in general is a powerful new form of expression. With Shanta (Shantayan Devarajan), the CommGap team (Communication for Governance and Accountability Program), and Dani, I am excited to see the Bank embrace social media."

The Governance Blog joins the other recently launched blogs that are helping to break ground on the social media front: CommGap's Public Sphere, East Asia & Pacific on the Rise, and Devarajan's End Poverty in South Asia. "The PublicSphere blog has been going since January," said Sina Odugbemi, program manager in CommGap, who recently joined the Bank from DfID. "We've had thousands of readers so far, most of them from outside the Bank. It's a way for us to engage with a global community on a whole range of issues related to the interactions among public opinion, the public sphere, and governance," Odugbemi said....

Kaufmann, whose trademark, even in his research, is being a straight shooter, says about his newest medium: “I like the language of blogging—the straightforwardness is very salutary. I like it when you don’t have to write in ‘Bank-ese.’”

-We Continue to Innovate: From Surveys to Blogging

Congratulations to Governance Matters Blog and to Mr. Daniel Kaufmann who has been instrumental in creating a Bank blog focussed on governance issues. Still it seems Bank's work are too much in silos and there isn't much talk on cross themes.

The following post was on East Asia blog;
Number 1 essential to fighting corruption: political will

I would have liked to see a reaction from the those at Governance Blog. With all the focus on Africa why isn't there a blog focused on Africa? IMF has taken lead in creating a blog on public financial management.

Who do you think at World Bank should be blogging? Robert Zoellick, Danny Leipziger, Anwar Shah, Charles Kenny, etc.,

Book recommendation for Mankiw

Guesstimation: Solving the World's Problems on the Back of a Cocktail Napkin
Lawrence Weinstein & John A. Adam

Related;
Chapter 1: How to Solve Problems

Archived Weekly Problems and Solutions

John A. Adam on Flick

Terminally ill bloggers

Baldy's Blog;

Adrian Sudbury has been a reporter for both the Huddersfield Express and Chronicle Series and the Huddersfield Examiner. In November 2006 the 25-year-old was promoted to digital journalist, effectively editing the new-look Examiner website. Just two days into his new role he became seriously ill and called in sick. A week later he drove himself to A&E and was eventually diagnosed with leukaemia. It was then identified that he actually has two distinct types of the disease running at the same time. According to the medical literature he is the only person in the world to have this condition. As such, it has not been possible to offer Adrian a prognosis. Here he shares his experiences of the disease and his treatment.

We wish all the best to Adrain- you're a very courageous man.

Monday, May 26, 2008

Philosopher and musician David Rothenberg jamming with whales

Tyler Cowen recommends David Rothenberg

David Rothenberg jamming with whales

Podcasts

The Black Death;

In October 1347, a Genoese trading ship arrived at the busy port of Messina in Sicily. Readying to dock, it would have nosed in among many similar ships doing similar things. But this ship was special because this ship had rats and the rats had fleas and the fleas had plague. Within four years, over a third of the population of Europe lay dead. This was the Black Death and its terrible progress was captured by the Florentine writer Giovanni Boccaccio who declared “in those years a dead man was then of no more account than a dead goat”.

The Black Death devastated Europe, changed its economics and broke up its society, but did the disease also bring subtler transformations in its art, its religion and its intellectual outlook?

Hanson on Signalling

an online marketing research organization . We help companies that want to hear your opinion find you, listen to you, and compensate you for the time you spend helping them improve. Our members earn $300 to $550 per week by taking on-line surveys, participating in virtual focus group discussions, and testing new products, websites and services

Advice;

NO! Do not join these sites. They are a scam. To take a survey you have to pay and give your email address to them. They will them send your email address to thousands of spammers. I had to shut down an email account I had because the spam was so bad. Not to mention I lost my money.

These survey sites are a scam. Please don't give them your money or email address or any information for that matter

In one of the more pointed exchanges, Representative Maxine Waters, Democrat of California, seized on the record $40.6 billion profit of Exxon Mobil in 2007. She pounded on the company’s senior vice president, J. Stephen Simon, demanding to know if gas prices would be lower if the company earned a few billion dollars less.

At another point, Ms. Waters brazenly suggested that perhaps the American oil industry should be nationalized, acknowledging that it was an “extreme step” but one that might be necessary if outsize profits and exorbitant gasoline prices continued.

“Thank you for being here today,” Ms. Waters told the executives. “If you feel a little bit beaten up on, we all feel beaten up on, so just share the pain. We get our behinds kicked every day in our districts about what is going on.”

Economic Gangsters Corruption, Violence, and the Poverty of Nations

* Chapter 1: Fighting For Economic Development
* Chapter 2: Suharto, Inc.
* Chapter 3: The Smuggling Gap
* Chapter 4: Nature or Nurture? Understanding the Culture of Corruption
* Chapter 5: No Water, No Peace
* Chapter 6: Death by a Thousand Small Cuts
* Chapter 7: The Road Back From War
* Chapter 8: Learning to Fight Economic Gangsters

Related;
The link between Corruption and Dating Economics